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With vast areas of agricultural land and rising domestic consumption, the Central African country of Cameroon is well placed to boost its agri-processing industry.

“Agriculture represents a major business opportunity,” says Ousmanou Kouotou, country manager of DHL Express Cameroon. “The country is already the biggest agricultural producer in Central Africa, but we have not reached our full potential in terms of the production and processing of crops.”

Cameroon is Africa’s fourth-largest producer of cocoa, and is also a grower of coffee, palm oil, cotton, rubber and bananas. However, it remains highly dependent on food imports; Ecobank estimates US$843m worth of cereals, flour and fish was imported in 2014.

According to a recent report by PwC, the domestic processing of agricultural commodities is an under-exploited industry. Processed food products can be sold in the local market, where increasingly busy lifestyles are driving demand for convenience food. The International Monetary Fund expects Cameroon’s economy to grow at annual rate of 4.5%-plus for the remainder of the decade.

In addition there are opportunities to supply the greater West and Central Africa from Cameroon, leveraging the country’s status as a trade hub. Chococam, a cocoa-based consumer products manufacturer, is already benefiting from exporting to the regional market. In 2008 it was acquired by South Africa’s Tiger Brands, which in its latest interim results noted Chococam achieved “excellent growth in operating income (up 11% in constant currency terms), driven by strong volume growth and tight cost management, despite significantly higher raw material costs”.

Food company Nestlé produces its Maggi brand of stock cubes in Cameroon, but wants to source more inputs from local farmers. “We see opportunities to source more of our raw materials locally. Improved local sourcing is a win-win because it gives us a competitive advantage and also contributes to rural development. In Cameroon we have a whole list of ingredients that we theoretically should be able to source domestically. Currently, we are importing corn starch from Europe, but we are working with the government to see if we can source starch from locally-grown cassava. However, these initiatives need long-term planning and involve working together with the government and NGOs,” a company representative was quoted saying in PwC’s report.

Garment production is another area where domestic operators can add value. According to Carlos Lopes, executive secretary of the United Nations Economic Commission for Africa, only 1% of Cameroon’s clothing industry is controlled by locals, despite significant cotton production in the north of the county. “With entrepreneurs demanding locally-sourced quality inputs, the proceeds from the clothing industry can be distributed to reduce the share of imports of new and second-hand clothes,” says Lopes.

However, agri-processing doesn’t come without its challenges. For example, according to Ecobank, of the 232,500 tonnes of cocoa produced in the 2014-2015 season, only 30,000 tonnes were ground locally. This was because of bean shortages, quality issues related to the drying and fermenting of beans, and high electricity costs.

And business people also have to contend with more general challenges, such as under-developed infrastructure.

But DHL’s Kouotou says prospective investors shouldn’t be discouraged by these hurdles. “Some people think it is very difficult to do business in Cameroon. They should come and visit the country to see the many ongoing business success stories.”

He, however, stresses the importance of complying with the various laws and regulations.

“Cameroon is a land of opportunities. There are many ongoing initiatives to make it easier to do business – and these are expected to positively impact the economy.”