Are you a Cameroonian entrepreneur looking for a sweet investment opportunity? With the rising demand for chocolate and the introduction of a 10% export tax on cocoa, 2023 could be the perfect time to invest in the growing chocolate market!
With the right strategies, you could be looking at a lucrative return on your investment – and a lot of delicious chocolate! So what are the benefits of investing in the chocolate market? Let’s take a closer look!
Overview of the Growing Chocolate Market
The chocolate market is growing globally, with the global chocolate market projected to reach $79.28 billion by 2027, growing at a CAGR of 4.6% [Source: Market Watch].
The demand for chocolate is driven by many factors, including changing consumer tastes, rising disposable incomes, and increased health-consciousness.
Since 2016, the cocoa market revenue has seen a steady rise worldwide, with an estimated 854.5 million U.S. dollars growth in the four years to 2020. This positive trend is projected to continue until 2028, making it an exciting time for the cocoa industry [Source: Statista].
In Cameroon, cocoa and other chocolate related products are popular and considered a luxury item.
Government of Cameroon’s Imposition of Export Duty
The government of Cameroon has imposed a 10% export duty on cocoa export. Cocoa is a delicious and nutritious ingredient that is essential for making chocolate. Not only does it give chocolate its distinctive flavor, but it also adds a hint of sweetness and richness.
The purpose of this duty is to protect small businesses and encourage the development of domestic production. This duty may cause an increase in prices of imported products because they will be buying cocoa at a higher price, resulting in increased profits for domestic producers.
Benefits of Investing in the Growing Chocolate Market
There are many benefits to investing in the chocolate market, including increased profits from domestic production, reduced competition from imported products, and encouragement for small businesses.
It’s a low-risk market as high demand and low supply ensure a steady price for consumers. There are many opportunities for growth, especially in emerging markets, and it’s a market that people enjoy and trust, so it’s a great way to build your brand.
Cameroon is one of the few African countries that are heavily involved in the chocolate industry. With rich cocoa plantations and a strong export capacity, the country is a major player in the global market for chocolate. As a result, local investors in Cameroon are presented with a unique opportunity to invest in the chocolate industry and benefit from its potential.
Here are some of the most important ones:
1. Attractive Benefits
Investing in the chocolate industry in Cameroon can be an incredibly rewarding experience for investors. One of the most attractive benefits is the potential for financial returns. Due to its high demand in the global market, chocolate has remained a reliable source of income for Cameroonian investors. Furthermore, the country is a major exporter of cocoa and other raw materials used in chocolate production, further boosting the potential for profit.
2. Possible Gains in the Export Market
In addition to the financial returns, investing in the chocolate industry in Cameroon can also provide investors with a unique opportunity to get involved in the export market.
With its strategic location in Central Africa, the country offers access to markets in the United States, Europe, Asia, and the Middle East. This means that Cameroonian investors can take advantage of the global demand for chocolate and reap the benefits of export profits.
3. Benefit from Government Incentives
Investing in the chocolate industry in Cameroon can also provide investors with a lucrative opportunity to take advantage of the government’s export duty incentives.
The government offers numerous incentives to encourage local businesses to export their products, including tax deductions and export credits. This can help investors to reduce their costs and maximize their profits.
4. Increased Profits from Domestic Production
Due to the export duty imposed by the government of Cameroon, domestic producers of chocolate related products will see increased profits as the prices of imported products increase. This means that the price of imported chocolate will be more expensive as the cost of exporting its main raw material, cocoa, will be higher.
This will also create a more competitive domestic market, which will benefit businesses that are able to produce high-quality products at competitive prices.
5. Reduced Competition from Imported Products
The export duty imposed by the government of Cameroon will also reduce competition from imported products. This will create a more favorable market for domestic producers, who will be able to compete with imported products on a more even playing field.
Export duties are a type of import tax that is imposed on imported goods and services. One of the reasons for export duties is to discourage international trade by making imported goods more expensive.
6. Encouragement for Small Businesses
The export duty will also encourage small businesses to enter the chocolate market. Small businesses will have the opportunity to compete with larger companies and benefit from the increased profits due to the export duty.
Export taxes are used by governments to safeguard domestic supply and promote processing industry. By using export taxes, the government can ensure that the domestic industry gets the raw materials it needs to continue churning out products while the exporters can recoup the costs of producing their exports.
In the short run, export taxes are used to protect domestic producers from foreign competition and, in the longer run, to reduce the cost of production.
In summary, investing in the chocolate industry in Cameroon can be an incredibly rewarding experience for investors. From potential financial returns to access to global markets and export duty incentives, the potential benefits are numerous. For those looking to invest in the chocolate industry, Cameroon is an attractive option that should not be overlooked.
Additional Resources
Links to Relevant Financial and Market Analysis
– The Global Cocoa Market (Cocoa Daily Prices International Cocoa Organisation)
– Cocoa Impact Report – 2020 [Fairtrade America]
– Production of cocoa beans in Cameroon from 2012/2013 to 2021/2022 [Statista]
– Chocolate Confectionery in Cameroon [Euromonitor]
– Cameroon Import Duty on Some Agricultural Products [OpenHub Digital]
OpenHub Consulting is here to help you make the most of your investments in the growing chocolate market. With our expertise in market analysis and financial planning, we can help you make informed decisions and maximize your profits. Contact us today to get started.