Cameroon’s Leading Textile Company Nears Insolvency, Faces over FCFA 22bn Debt
September 12, 2023
By Lateu Synthia
According to media reports, CICAM controls only about 5% of the Cameroonian fabric market
BUEA, September 12, 2023 – The leading textile company in Cameroon, CICAM, is faced with a debt burden of more than FCFA 22 billion and a negative result of CFA3.55 billion since 2021 as reported on July 14 by the Bureau for Business Upgrading, BMN.
A decision made public on August 31 by the company's director general Edouard Ebah Abada, has animated public debates over the days. It revealed that the company is challenged with paying workers’ salaries of April 2023 in cash.
Edouard Ebah Abada explained in this internal note following a meeting with staff representatives that the company had worker's salaries during this month that would be paid if they made enough money from the sale of the printed fabric for World Teachers' Day.
The letter furthered that the funds raised were not enough to proceed with the payment and the company took measures to pay the amount in two installments.
“Since the fund currently available is not enough to cover the salary spending, we have agreed to pay them in two installments. We will first pay CFA50, 000 per employee on September 1 and the remaining will come as soon as we gather the revenues from the sale of the teachers' day’s fabric,” Edouard Ebah Abada said.
The situation of CICAM is said to have resulted from aging production equipment and the arrival of many other textile companies, imposing stiff competition on the Cameroon market.
According to a media report, a source within the company revealed that CICAM controls only about 5% of the Cameroonian fabric market, compared to 80% for products from Asia, mainly China, 10% from Nigeria, and 5% from other West African countries.
The situation also worsened due to COVID-19 and the barrier measures taken by the government which led to reduced production in CICAM with 50% lost turnover. The Technical Commission for the Rehabilitation of Companies in the Public and Parapublic Sector CTR reported in 2020 that 48.2 billion FCFA were needed to prevent saving the company, which was threatened with bankruptcy.
