Implications of Infrastructural Development on Cameroon’s Economic Emergence

Abstract

Coming at the wake of the quest for emergence in the country, this paper examines the implications of infrastructural development on the emergence of Cameroon. The paper uses secondary data from 1990 to 2012 collected from the World Development Indicators. Through the adoption of the Principal Component Analysis (PCA) and subsequent application of the single equation Instrumental Variable General Method of Moments (IVGMM) and the VECM methodology and associated Impulse-Response predictions, the study finds that all strands of infrastructure (economic, social and financial) positively and significantly affect economic growth in Cameroon. Moreover, the study finds that in the class of economic infrastructure, telephone network, road infrastructure and energy (electricity) production are the most significant forms of infrastructure worth emphasizing in the growth process; education and health infrastructure are the main growth-promoting social infrastructures while the mobilizations of savings and granting of domestic credits are more profound in the class of financial infrastructures that promote economic growth in the country. Based on the forecasts provided by the Impulse-Response graphs, the paper further finds that the current state of infrastructural development would slowly plunge the economy to emergence as solicited by 2035. On the basis of this, the study recommends that while security infrastructure expenditures are being reduced, there should be a joint and simultaneous provision of economic, social and financial infrastructures to drive Cameroon towards the highly solicited emergence.

Key Words: Infrastructure, Economic Growth, Principal Component Analysis, Cameroon, Emergence.