The year 2006 was marked by two landmark events. First, there was the country's attainment of the completion point under the enhanced Heavily Indebted Poor Countries (HIPC) debt-relief initiative. One of its immediate consequences was the heightening of expectations among ordinary Cameroonians of a rapid end to their precarious living conditions, which the government felt obliged to dampen. Second, there was the achievement of an equitable agreement with Nigeria on the modalities of Nigerian withdrawal from the Bakassi peninsula, in accordance with the October 2002 International Court of Justice (ICJ) verdict.
Following their overwhelming victories in the most recent presidential (2004) and legislative elections (2002), President Biya and his party continued to dominate the political scene, aided by divisions and disagreements among the opposition. The government's main objective was to reach the completion point under the Heavily Indebted Poor Countries (HIPC) debt-relief initiative. To this end, the restoration of fiscal discipline was at the centre of its economic reform programme. However, cuts in public expenditure on goods and services and a substantial increase in taxes lowered purchasing power and disturbed business confidence.
The position of President Paul Biya, who celebrated his 25-year hold on power during 2007, was reinforced by the overwhelming victory of the ruling party in the July legislative and municipal elections. There was growing evidence that he might use the ruling party's two-thirds majority in parliament to enact constitutional amendments to remove the two-term presidential limit, thereby allowing himself to stand for another term of office. While his government succeeded in meeting most of the quantitative targets under the current PRGF, especially those related to fiscal performance, it failed to fulfil the heightened popular expectations for an improvement in the precarious living conditions following last year's substantial debt relief.
In 2004, Cameroon maintained a remarkable degree of political stability, in spite of its stark ethnic and regional cleavages. One of the most significant events was the re-election of the incumbent Paul Biya as president. This will most probably result in the continuation of the national and international policies pursued since his assumption of office in 1982. A major setback for Cameroon's socioeconomic development was the government's failure to successfully implement the three-year poverty-reduction and growth programme prescribed by the Bretton Woods institutions and Western donors.