Thursday, March 8, 2012

                    Urban-Rural Exodus and Community Tourism Development

Urban-rural exodus or counter urbanization is a phenomenon where city dwellers move from city centres to the country side.  Urban-rural movement is believed to have been prominent since 1950 in more economically developed countries sparked by an increase in car ownership, the creation of new business hubs in remote areas, the zeal for a peaceful retirement and small scale farm ownership. This phenomenon generated from an individual perspective has been gaining wider attention in some countries gradually transforming ideal resources in country sides to tourism development oriented resources.
The approach to tourism development differs from country to country but the Asian approach seem to be making great strides renovating the once abandoned country sides to  peaceful havens for city dwellers and visitors.  Inconveniences and uncertainties in urban areas  is changing the attitude of city dwellers making rural settlement a new battle ground not just for retirees and the old but also to young stars who want to adopt a different form of lifestyle. If this present trend of movement continues around the world, then the United Nations prediction of 60% of the world’s population to live in urban environments by 2030 needs to be elucidated further.
The South Korea government recently announced that it will speed up the construction of thousands of houses in rural communities following report that the number of city dwellers making new homes in the country sides has been on the increase cutting across the ages of 30, 40 and 50 years. The government encouraged high schools in rural areas after it selected 82 schools as public boarding schools with available funds. It encourage the teaching of “after school English” in rural areas in a bit to improve the quality of education. South Korea offers tourism farms which are developed by groups of farm households in rural areas. Home stay villages are common here and it has encouraged women to be more involve in rural tourism than ever before. This has greatly promoted national tourism where nationals take advantage of their holidays to spend time with family in such areas that still preserves the identity of nature.  In most of the accommodations, visitors are given the opportunity to cook foods of their own taste.  Such visits also help children to appreciate handicrafts and historic buildings that may be scarce to find in big cities.

 A traditional farmhouse use for home stays in South Korea (source: Food and Fertilizer Technology Center for the Asia Pacific Region)


Japan is noted for its farm tourism commonly known as “farm inn”. Varieties of meals are offered to visitors which makes them feel different from the daily urban lifestyle. Recent studies reveal that most Japanese prefer spending part of their time in rural communities because of the inconveniences of urban rhythm. Abandoned villages and farms are given facelift to meet up the growing number of daily visitors.





A traditional farmhouse in Japan use for farm stays (source: Food and Fertilizer Technology Center for the Asia Pacific Region)

In Malaysia, the government provides agro-tourism centres in a bit to foster education and recreation in rural communities. Agrotourism is defined as a form of tourism which focuses on rural culture or cultural landscape as a means of attraction to tourist. These centres help to protect rare animal and plant species which has become sites of major attraction to visitors. The government also encourages camping and caravans on the farms which is attracting a wide range of national and foreign visitors.





Rural tourism in Malaysia (source: Food and Fertilizer Technology Center for the Asia Pacific Region)


The benefits that can be generated by communities engage in rural tourism are boundless.  Communities that are still emerging in such practices have the task to be educated on management skills, marketing, and should be well informed about visitor’s needs and wants.  Good planning and strategic location is primordial for success in rural tourism and lack of infrastructures will limit all endeavours to progress. Above all, local people should be in favour of tourism development for they are custodians of the land and reliable agents to build a strong partnership. With all the necessary resources put together, other forms of tourism such as health tourism, ethno tourism, project tourism, historical tourism, cultural tourism or adventure tourism will be developed and it will tap a lot of knowledge from those who have experienced life in big cities and willing to transform rural communities to engines of development and source of income that promotes regional community integration.
Nfor Canicius Ndi


Monday, March 5, 2012

REGIONAL ECONOMIC BLOCS AND DIPLOMATIC RELATIONS IN AFRICA; A CASE STUDY OF THE ECONOMIC AND MONETARY COMMUNITY OF CENTRAL AFRICA (CEMAC)

A. General introduction
The establishment of regional trade regimes became very prominent after the Second World War. Development was at the forefront of many nations after the war and economic development was given much attention with the creation of regional economic blocs. Regional economic blocs had ambitions to create less restrictive trade between members and standardize trade with non -members. The severe economic crisis faced by many states made them to open new avenues of cooperation and regional economic blocs was identified as a major break through to develop common policies in the social, political and economic fields that will lead to economic of large scale production. The United States for long had symbolic power and she championed the course of multilateral trade negotiations. By 1980, the United States had a change of policy which favored free trade and this gradually changed the phase and structure of international economy with the growth of regional economic blocs. It is estimated that by the year 2000, three main trading blocs, the European Union, NAFTA[1] and APEC[2] had a significant influence of 87% in World trade. A report from the World Trade organization indicates that the 134 members of the organization have signatories to regional trade agreements with other countries. Regional trade agreements by 1999 were estimated to about 184 where 109 had outstanding reputations.
This paper focuses on the diplomatic and economic relations that characterize the Economic Community of Central African States (CEMAC). Regional economic blocs from its origin recorded significant successes that changed the dimension of world trade. Regional economic integration is necessary for weak African states although state sovereignty seem to be weakened by this attribute. I will argue in this paper that CEMAC can make benefits as a regional body if the rules of the game are respected by member states.
To have an insight of regional economic blocs and diplomacy, it’s important to take a look at some definitions.
In his writing on trade blocs Jones (2001) defines a trade bloc as a preferential trade agreement that brings together subset of countries with the mission of reducing trade barriers within the member states. A trade bloc that has geographic characteristics within member countries is known as regional trade (integration) agreement. Regionalism also refers to the integration of countries into trade blocs irrespective of their geographical characteristics. Jones identifies two principal characteristics of trade blocs; He first looks at it as a process that eliminates barriers to trade and secondly as discriminatory because it applies only to member countries of the trade bloc.
Regional integration agreement is considered one of the major developments in international relations in recent years. Although they have different structures they have a common objective of reducing barriers to trade between member countries which leads to liberalization to trade and investment. The acceleration of globalization with advancement in new technology has increased trade volumes and large investment flows.
Diplomacy as defined in Britannica Encyclopedia is the art of conducting relationships that results to positive outcome without conflict. Countries use diplomacy to accomplish their foreign policies through secret negotiations that falls in line with international agreements and laws. The states interest is the first objective of diplomacy which deploys history, geography and economics. Diplomacy seeks to secure freedom of action for the state that ensures the states independence, security and integrity. Three kinds of diplomacy have been identified by writers;
-The European style which lays emphasis on diplomacy as an instrument
-The American style which looks at diplomacy as revolutionary
-The Third World style which gives more emphasis to the morality of recognizing and dealing with other states.
No matter what kind of diplomacy is applied within regions or between states, they all have as primary goal to conduct relations and cooperation that eliminates conflicts. To clearly explain the development and stakes of regional economic blocs the following theories will be applied; the theory of internationalization, theory of liberalism, realists and Marxists theories.
The research questions are:
-What are the causes of failure of CEMAC as a regional economic bloc?
-What measures can be put in place to strengthen the activities of CEMAC?

                                              B. History of CEMAC
Regional and sub-regional integration in Africa can be traced back from the post colonial period which was considered an extension of the liberalization movement where geographic location was viable for economic and political strength. This also reflected the European exemplary model of free trade with enormous opportunities. The Brazzaville treaty in 1966 established UDEAC to promote free trade between member states and a common tariff for import from other countries. The process of sub-regional integration was later strengthened when member states agreed to form the monetary union pegged to the Central Africa CFA francs as a common currency. In 1999, CEMAC became an official organization representing Cameroon, Chad, Central African Republic, Republic of Congo, Equatorial Guinea and Gabon as an economic union following agreements reached in 1994. CEMAC was created to fulfill the following needs of the sub-region;
-To promote trade within member states
-To achieve collective autonomy within member states
-To raise the standard of living of its population and maintain economic stability through harmonious cooperation
-To enforce solidarity towards under privileged countries
-To strengthen institutions and build common markets to fight external competition
-To develop physical, economic monetary integration
-To develop a culture of human integration
Four community institutions are identified following treaties that created CEMAC
-UEAC[3]
-UMAC[4]
-The parliamentary Community
-The Community Court of Justice

To attain the objectives of CEMAC, they created the following four organs;
- The conference of Heads of States and Governments. This is the supreme body of the community. Policies are determined by this organ and they direct the actions and decisions put in place by CEMAC. This is accomplished using supplementary acts
- The Council of Ministers. It directs the Economic Union of Central Africa. It is compose of ministers in charge of finance and economic affairs of member states. Each national delegation has not more than three members.
-The Ministerial Committee. This committee is responsible of giving directions to the monetary union of Central Africa. It is made up of two ministers per member state. The presidency of the ministerial committee is rotated annually among the member states in alphabetical order. The role of the ministerial committee is to examine the economic trends within the member states and to ensure coherence with common monetary policy.
-The Executive Secretariat. It is headed by an executive secretary who acts as the principal executive officer of the economic union of Central African states.

Member states of CEMAC have agreed to certain treaties and protocols to foster integration in the region. Such treaties include;
-Protocol which establish the network of parliamentarian
-Protocol relating to the creation of COPAX[5]
-Protocol on non-trade barriers
-Protocol on freedom of movement and rights of nationals of member states
-Protocol of cooperation on tourism
The most important of these protocols is the adoption of a pact of non-aggression following a United Nations consultative committee on security in Central Africa held in Yaoundé-Cameroon on September nine 1994.

C. Challenges of CEMAC
Almost eleven years after the creation of CEMAC as a regional economic bloc in Central Africa, the road to success has been slow and cumbersome to member states. CEMAC is plagued with political, economic and socio-cultural challenges. The theory of internationalization according to the works of Wiedersheim et al (1975, 1977, 1979, 1990), internationalization is a slow process from country to country. This theory relies on a slow and progressive process of internationalization during which organizational learning takes place. Researchers in this field recommend exportation to be a valuable means of diffusion and expansion. It is estimated that trade within the CEMAC region amounts to only 2% of total imports and 1% of total exports. Victor Essien (2006) makes a remark that “Ironically trade between CEMAC and Nigeria is higher than trade among CEMAC countries.

a) Political challenges of CEMAC
The free movement of people within the Central African region was agreed by member states in a treaty to promote integration. Since this agreement was made little has been achieved because of nationalistic and egoistic attitude from member states. Until 2008, the impact of this policy is still to be felt in the region. Countries like Gabon and Equatorial Guinea with small population strongly oppose this policy. For example, Cameroonians have been victims of xenophobia in Equatorial Guinea and this strained relation between the two countries. Some member states consider integration as exploitative and a threat to sovereignty. President Paul Biya of Cameroon during the 2008 CEMAC summit in Yaoundé-Cameroon condemned the uncompromising attitude of some leaders and he called for more commitment if integration should succeed. Regional integration according to some political pundits is good politics because it meets political needs like security and it equally enhances bargaining power. Walter Hallstein of the European Union explained the balance between economic and political objectives saying “We are not in business at all, we are in politics”.  Integration cannot be efficient and effective if within member states there is suspicion of who gains what from whom. Article five of the convention regulating the CEMAC court of justice stipulates the courts authority over issues that concern the region. The convention further confirms that the court of justice is an independent body from states, organs and other institutions with full authority that cannot be put into question. This implies that member states are obliged to follow the rulings of the court. Some member states are defiant to the orders of this court to protect the interest of their states.
The official inauguration of the CEMAC parliament took place in April 2010 in Malabo. It began as an inter-parliamentary commission in 2008 and the convention to create it was signed in Yaoundé-Cameroon in 2008. This parliament functions as a watchdog over the activities of the CEMAC commission and it examines the budget of the commission presented and defended before the CEMAC parliament. This institution has been praised as one that will test the strength of democracy in the sub region because it controls the functioning of community activities especially the democratic control of the institutions and organs that participate in the decision process of the community. Some critics convincingly argue that national parliaments will lose their power of elaboration and adoption. Moye (2009) argues that,
 “If national law is in contradiction to a community law, the former has to be revised, or else it becomes null and void. As such authorities of the member states are not total masters of their national legislation”.
Stiff political barriers are identified in the Central African sub region. It is one of the regions in the world that has leaders who have stayed in power for so long representing shadows of democracy than genuine political and economic growth and prosperity in the region. This system of governance has encouraged laissez-faire and abuse of public office that has generated corruption in almost all sectors of national life. It is no exaggeration when Koep (2010) mentioned that, most CEMAC governments are run by elites that position themselves in a democratic window-dressing than in genuine political and economic liberalization. This style of governance laid ideal framework for abuse of public office. He goes further in the article “new opportunities, same risk in Central Africa”, and looks at the effects of political interference in the private sector throughout the Central African sub-region where most large business projects are initiated as joint ventures with state controlled companies at the mercy of ruling elites. This has often prompted fraudulent payments to secure contracts or licenses out of the official tender process. Following a United States Senate report released in February 2010, the son of long saving Equatorial Guinean president in a money laundry case is alleged to have hired U.S lawyers, bankers and real estate agents to move more than $110 billion from 2004-2008 for personal purchase. Such examples are glaring in the region where government officials are behind bars for embezzlement and long serving presidents rule their countries like personal assets grooming their sons or relatives to hold strategic positions in government.
To Marxists, all forms of government are ugly reflections because of class antagonism. He advocates for a form of democracy called “dictatorship of the proletariat” as the first step towards socialism. Political realism looks at power as the bases of political action at the domestic or international scene. Politicians at the domestic level work to maximize power meanwhile on the international scene; states are seen as the primary agents that maximize power. Political realism defines power as deeply associated to interest but it goes further to state its objectivity in the law of politics and believes in the possibility of developing a rational theory that distinguishes politics between truth and opinion. It is affirmed that it is political realism than enhanced the European Union to position itself as an independent and autonomous “civilian power in international affairs”. This has gone a long way to defend the classical principle of balance in international relations as well as multilateral global governance. No matter what forms of political strategies are initiated by states the bottom line should be that which understand the laws by which society evolves while formulating rational outline which eliminates or reduces impartiality.

b) The legal sector:
To increase the banks lending to the private sector, the legal sector must be strengthened. When the legal sector of a state cannot ensure appropriate accounting and bookkeeping practices, settle legal disputes the registration of collateral and fair democratic institutions, the states economic progress is at risk. The separation of power is a far fetch dream within member states of the sub region. The constitutional framework of most member states gives extra powers to the head of state as the supreme commander of the military, the judiciary and the legislative. In Cameroon for example, the Head of state has powers to appoint and dismiss judicial officials. With such a legal system investors are scared to put their resources where there is no guarantee incase of legal proceedings. Despite electoral institutions put in place, elections are often marred with fraud to keep regimes in power and this has reduced voter apathy.

c) Economic challenges of CEMAC
There is lack of an enabling environment for investment. It is estimated that growth rate in 2008 in the region stood at 8% that is far below expectation. Many factors accounted for this low growth rate amongst them the cumbersome procedure to create a business in the respective countries. In Cameroon for example, to create a business, one need to go through thirteen procedures which takes about thirty seven days. In Congo Brazzaville the formalities require ten segments with thirty seven days to complete the process. In Gabon, it is nine formalities in fifty eight days. In Chad, nineteen procedures are needed to create a business in seven five days. Ten formalities are needed in the Central African Republic which takes just fourteen days. The most cumbersome procedure is in Equatorial Guinea where twenty procedures are needed to create a business organization in two hundred and thirty three days. (The post online 2008)
This is a clear indication that the business environment in the region is not yet favorable for investment where much is still in the hands of the privilege few. This has killed small business initiatives in the region where a reasonable proportion of the population in the region fall under this category. Some nationals of the sub region with heavy investments are moving their investment projects to other regions of the continent where investment procedures are short and less time consuming. Foreign Investors are scared from such a business climate because it signifies a lot of uncertainty.
d) Banking sector
The banking sector in CEMAC dominates the financial system but its impact is not significant as compared to banking systems in other sub-Saharan African countries. According to IMF report (2005), the non-bank financial system like the microfinance institutions has recently gained grounds but has not gained macro economic significance. The absence of deep and liquid inter-bank markets also prevents member countries from having full benefits of their monetary union. When the banking sector was restructured in 1990, thirty three banks were identified in the region which is insignificant as compared to other regions. This implies that financial services are available only to a small segment of the population and it is estimated that only about 3% of the population of CEMAC on average has an account with commercial banks. Most banks in the region do not have flexible interest rates and are not credible enough. Political manipulation sometimes by state machinery has crippled and led to bankruptcy of some banks. It is also unfortunate that foreign banks dominate the banking system where three quarter of all the banks have foreign ownership with about 20% of foreign control and 20% of state ownership.
Coupled with the banking problems, foreign direct investment in Central Africa is very low compared with other sub-Saharan countries. Following a feasibility study published in 2008 by the Pan African Stock Exchange, most countries of Central Africa have low foreign direct investment which implies few manufacturing industries operate in the region. These countries rely more on natural resources and much money is spent on buying imported goods than producing them domestically. Lack of sufficient infrastructure, political instability and government policies also accounts for low direct investment in the region.

e) Stock exchange in Central Africa
The stock exchange markets in Africa are still to gain momentum as compared to other regions of the world. By 1989, there were eight stock exchange markets across the continent with three in North Africa and five in sub-Saharan Africa. The number has recently increased to twenty three but are characterized by low market capitalization, few listed companies, low liquidity, few stocks, disclosure and deficiency. To promote regional cooperation ASEAC[6] was created in 1993. Out of the nineteen stock exchanges of the association belonging to twenty six countries, no country from Central Africa is among these countries. The Douala stock exchange since its creation in 2001 celebrated its first entry in 2006 and since then only three companies have been listed. Although with this slow growth rate, it mobilizes larger savings than the Libreville stock exchange which is the headquarters of the regional stock exchange of Central African states. The president of COSUMAF [7]in 2005 said it will be more profitable for the Douala and Libreville stock exchanges to be merged together to strengthen regional integration. This fusion according to him will stimulate a profitable financial market in the CEMAC region. Critics put forth arguments that the low market capitalization and low liquidity are the main reasons why global emerging market funds are ignoring Africa. Listed securities and stock exchange must have $50billion in market capitalization and $10 billion in value traded to attract any interest from global emerging market funds (World Bank 2006)

f) High dependence on natural resources.
  Most countries of the sub-region depend on offshore oil extraction and timber exportation. For example, ninety percent of Congo’s export is made of oil while wood accounts for eight percent. Equatorial Guinea and Gabon export oil, Chad exports oil and cotton, the Central African Republic exports diamond and Cameroon exports oil, cotton and timber. Some of the resources are non renewable and the regeneration of timber takes a very long time. Over dependence on these resources indicates that there is economic uncertainty in the region. During the 2009 financial crisis for example, the Central African region was affected because they do not have diversified market products. Maria A (2008) says, most CEMAC countries share similar structural characteristics and undiversified production structures which results from poor infrastructures, weak banking system and non transparent trade policies.

g) High tariff and non tariff barriers
  Differences in trade policies have been identified as obstacles of trade within CEMAC and neighboring countries. High tariff and non tariff barriers play a leading role in making CEMAC markets uncompetitive. Maria A (2008) identifies CEMACs tariff structures which impose high taxes on infant industries like wood products, farm products and items for which average tariff rates exceed twenty three percent. She identifies the weakness of the CEMAC code that does not regulate export taxation because exports of member states are subject to a number of duties and taxes that are intended to enhance government revenue. In effect these measures weaken export competitiveness and enhance government revenue collection. Hinkle et al (1797) says this is further compounded by political and administrative obstacles with poor transport and communication facilities that have led to market segmentation that hinders regional trade integration. He goes further to say that CEMACs trade structure resembles a,
 “Hub and spoke arrangement in which France is the hub and the CEMAC economies are spokes with weak intra-regional[8] linkages”.
 The influence of France as a colonial power still looms in this region where trade policies are designed to benefit European markets. Paul Baron in dependency theory condemns the benefits of foreign capital to indigenous social forces when he argues that foreign capital leads to the expropriation of surpluses from under developed areas back to advanced countries living third world countries at the same stage with little progress.

h) Factor mobility
The impact of a CEMAC passport in the sub-region is still to be felt. Since this project was executed little has changed about the free movement of people within the sub-region. The procedure to enter a different country is demanding and time consuming. Unemployment levels are high and this has limited worker mobility in the region. Despite the fact that the region has a common currency and a regional institutional framework like BEAC[9] and COBAC[10], financial integration is still very low. Road networks within the region are poor thus limits the movement of agricultural produce from one country to another, an activity that survives about 60% of the population of the region.

i) Project Cooperation
Countries create opportunities when they cooperate and share resources like fishing grounds, rivers, hydro -electric power and rail connections amongst others. Through cooperation, countries can easily identify and solve their common problems. Areas of cooperation within the sub region on the contrary have created a lot of division within member states. The Lake Chad basin which uses to be a source of livelihood for thousands of people has shrieked today beyond reasonable levels. Member states sometimes fail to respect their financial engagement coupled with administrative delays. Some countries are unwilling to cooperate because of national pride, political tension and lack of trust, high cost of coordination as well as the distribution cost and benefit. Most countries of the Central African sub-region are endowed with hydroelectric power potentials but power failure is constant and this greatly disrupts business ventures and economic growth in the region. A good example of conflict within regional integration is the agreement of the East African common market between Kenya, Uganda and Tanzania where income transfer created by the common external tariff  and compensation became a bone of contention when Uganda and Tanzania suspected that Kenya was going to have an upper hand over them. This finally led to the collapse of the Union.

j) Socio-cultural challenges
African countries are characterized by different cultures and languages with hundreds of mother tongues. Colonial influence also contributed to the establishment of national languages. It is evident that when people or communities share a common language, this can encourage integration while on the other hand it can also be a dividing factor. Tribal and ethnic conflicts are common within countries of Central Africa often triggered by land rights, dominance of tribes or ethnic groups over others and politically motivated conflicts. Cameroon for example, has two official languages, English and French and there is a great division between Francophone’s and Anglophones in terms of attitude and equal distribution of resources. Cameroonians have been victims of xenophobia in Equatorial Guinea and Gabon and this strained relation between the two countries. Because of these differences operating small or medium size businesses within countries of the region is sometimes a night mare. According to regulation no .17/99/CEMAC-020 CM -03, relating to the CEMAC investment charter, item six spells out that all countries shall ensure a uniform and equitable respect of the rules of the game in the system. They shall ensure the development and good maintenance of basic economic and social infrastructure in the areas of health, education, the environment and urban development. Most CEMAC member states fail to respect clauses that they unanimously agreed could be of interest to the region.

D. The way forward for CEMAC
a) Free movement of people within the sub region
If CEMAC is looking forward to strengthen regional cooperation, there is need for member countries to open their borders to citizens within the sub region. Carpe Libertatem (2007) in an article entitled “The case of open borders” brings out the argument by cultural conservatives persuasion that open borders are bad because immigrants will take advantage of the welfare system of another country and the state system will become destroyed. They also argue that cultures will be destroyed by too many foreigners who may decide to live where ever they go. Although this also raises security concerns within the sub region, it is the obligation of member states to keep their security on the alert. The initiative of a CEMAC passport is a step in the right direction but member states need more education on the practical application of this measure.

b) The need for patriotism
The Central African sub region has some of the longest serving leaders across the world with regimes that continuously manipulate the constitution to stay in power. These leaders do not pay allegiance to citizens who voted them in power and to their ancestral land as they by-pass the law of natural selection. According to Charles Darwin (1871),
“A tribe including many members who, from possessing in a high degree the spirit of patriotism, obedience, fidelity, courage, and sympathy were always ready to aid one another and sacrifice for themselves”.
 Some of these leaders rule their countries on family lines and accumulate massive wealth for their families that is often invested in foreign banks. This has greatly hindered foreign direct investment in the sub region. The separation of power is absent; laws and institutions are weak to protect investors. A new breed of leaders and institutions are needed that will initiate laws that are convincing enough to encourage investment. This will also stamp out corruption that has crippled some major state cooperation
c) ` Project cooperation
It is evident that much benefit accrues when countries cooperate and share resources together like fishing grounds, rivers, hydroelectric power, and rail connections amongst others. It is also easy to overcome problems when nations cooperate. The liberalist argument of David Ricardo is better explained in such cooperation. He uses the comparative cost advantage to demonstrate how countries can benefit from each other if they specialize in trade or things they can best produce. All countries in the Central African sub region are dependent on natural resources of different kinds. It will therefore be advantageous for these countries to specialize in the sector that they have enormous resources and cooperate with other countries of the region which will go a long way to promote regional trade. This can only be achieved if member countries keep aside national pride, build trust and encourage high level coordination. For example, regional cooperation and exchange was crucial in achieving project cooperation in the South African Development Cooperation in the Southern African pool. The Southern African pool provides regional exchanges of electricity. The gains over the period of 1995-2010 are estimated at $785 million and a 20% saving. Milward (1984), Whally (1996), says, what motivated the formation of European Economic Community in 1957 was the desire to increase bargaining power relative to the United States. If the Central African sub region can emulate this example with its enormous natural potentials, this will promote economic development in the region.
d) Strengthen the financial sector and markets.
The financial sector is indispensible to economic growth and poverty reduction. It is revealed that the banking sector dominates the financial system in the sub region but this remains insignificant compared to the banking systems in other sub-Saharan countries. Estimates show that three quarters of the banking system in the sub region is dominated by foreign banks and almost all the banks have 20% of foreign participation while only 3% of the CEMAC population on average has an account in commercial banks. The banking difficulties can be solved if the regional banking commission (COBAC) harmonizes rules that regulate banking activities in the region where nationals are given equal opportunities to own and manage banks. To encourage savings from the population, interest rates should be made flexible where medium and small size enterprises can obtain loans at reasonable rates.
Concerning the market problems, regional central banks of Central Africa rely on direct non-market based monetary instruments such as reserve requirements, interest rate controls and discretional liquidity operations which is said to be preventing the emergence of market-based transactions. To solve the market problems, the region need to be oriented towards a market based monetary instrument that will support financial integration in the sub region. The introduction of treasury or central bank bills would promote regional inter-bank markets activities. (IMF country report 2005). Liberalists believe in freely functioning markets based on division of labor which leads to maximization, efficiency and prosperity. Adam Smith argues in favor of free trade and limited government intervention. This can only be achieved if respective governments first recognize the role of small and medium size enterprises in their economy. Liberal economic theory assumes that the individual is the basis of society who acts rationally in seeking to maximize their own economic welfare. The primary aim of liberal economic policy is economic efficiency and the welfare of individuals.
e) The Stock Exchange
The stock exchange market in Central Africa is still very weak. The African securities exchange association was establish in 1993 for an efficient framework of cooperation, exchange of information and raw materials. Out of the nineteen member countries, no country from the Central African region is among. Some critics believe that the Central African economy is still very young to have two exchange markets in Douala-Cameroon and Libreville-Gabon, hence they advice that the stock exchange markets should be merged to serve the whole region. Such integration will improve the general business climate and the financial markets may lead to a better mobilization of resources which are available within and outside the continent thus promoting a stronger level of investment and economic growth. If countries of Central Africa join the African securities exchange association, they will gain more practical experiences that will guide them restructure their exchange markets. The Pan African stock exchange report of 2008 indicates that stock exchange have a reputation for encouraging greater economic dynamism and producing higher levels of wealth by providing investors with the opportunity to share the risk and profits of enterprises. Stock exchanges also improve market mechanisms that raise and allocate scarce financial resources, mobilize capital, attract foreign direct investment and allocate resources to projects that will create benefits to the economy.
The stock exchange stands as a reliable alternative that secures capital at a relative low cost as compared with loans in banks. The government and the private sector can use this to mobilize capital which can finance a wide range of infrastructure leading to job creation, provision of social needs and economic growth. Stock markets are regarded as appropriate tools that can promote the availability of finance and stimulate the development of private savings which supports the non monetary funding of the economy and the fight against inflation.
It is evident that regions that are economically highly integrated may tend to have less internal conflicts. Policies that promote trade within a region increase intra-regional security and this equally paves the way for full political integration which reduces or limits the risk of internal conflicts. The structures of regional agreements may be different but they all share certain things in common, the objective of reducing barriers to trade and extend liberalization to trade investment. Through this, countries are willing to be involved in the construction of shared executive, judiciary and legislative institutions. Patrick (1987) sites the work of Gilpin, indicating that the possibility of cooperation on a global level is more likely to happen through an interconnected network of regional regimes than through global cooperation. Neoliberals such as Keohane (1984), argues that cooperation is possible and likely even without an acting hegemony. Illustrating with the “Prisoner’s dilemma[11]”, he argues that countries have the incentive to cooperate due to the absolute gains that can be obtained.

f) Cultural diversity
The socio-cultural diversity that exist in Central Africa should be considered a uniting factor rather than a source for division. Societies and communities have blossom around the world because they accept and integrate with other cultures. Culture is considered more of a learning exercise acquired from the communities where people grow and identify themselves. Edward Taylor (1976) defines culture as “ A complex whole which includes knowledge, belief, arts, law, morals, custom and any other capacities and habits acquired by man as a member of society” Taylor distinguish three layers of culture:
-The body of cultural traditions that is distinct and specific on the bases of belief and language that make it different from others
-Subculture: When people migrate or move from one place to another due to natural or human causes they still remain attached to their original culture and traditional values. This makes them to be identified as a subculture in that society with different traits and characteristics. We can identify for example African-Americans, Mexican-Americans amongst others.
-Cultural Universals: In a cultural universal society people learn new behaviors and patterns of life irrespective of their cultural origin. In such a cultural society, a common language is use for communication; people are classified base on marriage and descent relationship, the use of gender and age, application of leadership rules and concept of privacy. Culture could also mean national or ethnic cultures that deal with primary socialization or secondary culture where sub groups socialize into other cultures in a given community. Culture is therefore an indispensable tool that can be used to create awareness and discipline in a society that makes people feel they have a moral obligation in the community they find themselves.
Integration in simple terms implies that states should put their resources together, aspire for efficient production, enjoy economies of large scale production and expand their market zone. It is through such a combination of human and natural resources that member states can face stiff competition from other regions or communities. There is often the fear that integration will lead to reduction of state sovereignty because states are bound to be interdependent and cooperate in order to ensure sustainable development. Smaller or weaker states see this as a treat to their own growth and development coupled with the fact that there is a progressive transfer of certain competencies in favor of community courts to the detriment of states.
Conclusively, there is no single institution or organization around the world without problems, but what is important is how these institutions or organizations assemble their resources to look for solutions. Given the fact that member states of CEMAC have agreed to the terms of certain treaties that should guide their organization, it is important for these states to strive to balance the exigencies of sovereignty and to respect the norms of courts and other institutions that work on the bases of regional integration, cooperation and economic growth.  If developed giant states around the world are coming together because the benefits of regional integration out weighs its disadvantages, what more of weak African states that are too weak to stand on a single pillar. CEMAC member states ought to dump naked protectionism and liberate trade because it is only through regional integration that they can survive the acceleration and challenges of globalization because every region of the world seems to be on the same band wagon. If diplomacy and market forces are combined together the Central African sub region will soon be a “Market place Africa” where renowned businesses and international investors will be scrambling for investment.

Nfor Canicius Ndi

                                                             Bibliography

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en.wikipedia.org/wiki/economic of Central African States
allafrica.com/stories/2010008270974.html


[1] NAFTA stands for North American Free Trade Agreement
[2] APEC is Asian Pacific Economic Cooperation
[3] UEAC is the Economic Union of Central Africa
[4] UMAC stands for the Monetary Union of Central Africa
[5] COPAX is a mutual security pact in Central Africa to promote, maintain and consolidate peace and security.
[6] ESEAC is a regional framework for information exchange, provision of raw materials human and other assistants
7COSUMAF stands for  Market Surveillance Fund
[8] Intra-regional means trade within the same region
[9] BEAC is Bank of Central African States
[10] Banking Commission of Central African States