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2010 Investment Climate Statement - Chad


2010 Investment Climate Statement
Bureau of Economic, Energy and Business Affairs
March 2010
Report
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Context and General Climate

This is the first Investment Climate Statement produced for Chad since 2006. In the intervening years, the country has suffered from repeated rebel attacks, attempted coups, and influxes of refugees from two neighboring nations, as well as attendant turmoil and loss of life and property. All forms of development – economic, political, civil, social – were essentially put on hold until stability returned in 2009 and the GoC regained its security footing. A travel advisory for American citizens remains in effect. With a population of just over 11 million (80 per cent of whom are engaged in subsistence farming or herding) and a per capita income for 2009 estimated at USD 640, this land-locked and inaccessible nation is, and will remain for some time, a poor and undeveloped market. Still, improvements are beginning to occur, providing hope that Chad will one day offer more to investors.

The general climate for investors is mixed. The Government of Chad officially encourages foreign investment, particularly from regional partners in CEMAC, CEEAC and OHADA, associations of mainly non-anglophone African nations. These groups seek to standardize tax policy, customs practices, and commercial law. Chad, currently rotating Presidency nation of both CEEAC and CEMAC, is working to improve the Central African business and investment climate in accordance with organizational goals. Chad has no national anti-investment laws or regulations. Bureaucratic requirements including Ministry of Commerce approvals slow down the foreign investment process, but approvals are routinely granted without discrimination against foreign firms. Most Chadian law dates from the French colonial era (circa 1960) and is neutral or silent on investment matters.

Chad adopted a new Investment Charter in 2008 to offer incentives for foreign companies wishing to establish operations in Chad. President Deby hosted the first-ever OHADA Summit in December 2009, with the aim of encouraging all member states to adopt an enhanced OHADA Investment Arrangement, which offers benefits beyond those in Chad’s 2008 national Investment Charter. The Charter and the subsequent OHADA Arrangement, which went into effect in Chad in January 2010, have together brought Chad into closer compliance with WTO and WCO standards, to which Chad, as a member of both organizations, formally aspires.

According to the 2008 Investment Charter, foreign firms are given three years of tax-exempt status. Export taxes have largely been eliminated, and a value-added tax has been adopted throughout the CEMAC region that in principle allows goods to circulate duty-free among member states. (In practice, bribery and corruption impede the free flow of goods.) An IMF Staff-Monitored Program has been in place in Chad since April 2009 to assist with public revenue management, including development and implementation of tax policy.

The most ambitious and innovative foreign investment initiatives under way in Chad are in the petroleum sector. Exxon Mobil (40 per cent private equity) leads Esso Chad, a consortium also including Chevron Texaco (25 per cent) and Petronas Malaysia (35 per cent), which has invested more than USD 7 billion (USD 885 million of which was invested in 2009) to develop oil reserves near Doba, in the southern part of the country. Oil production began in 2003, with the completion of a pipeline (financed in part by the World Bank) linking oilfields of Southern Chad with terminals on the Atlantic coast of Cameroon.

Chinese firms are also expanding oil exploration efforts. One of them, the China National Petroleum Company, is a 60 per cent partner in a joint venture with the Chadian National Hydrocarbon Company (40 per cent). The entity began building a refinery 35 kilometers north of N’Djamena in 2008. The refinery is expected to produce 20,000 barrels a day once it becomes fully operational.

In the past, the Chadian government reserved some sectors of the economy for state ownership, including cotton, sugar, electricity/water and telecommunications. In recent years, the government has privatized 18 state enterprises and liquidated 14 others. Some of the resulting firms have been plagued by mismanagement, and the privatization effort does not seem to be being pursued vigorously for the time being, although newer telecommunications methods, including mobile phone and internet services, are private and highly competitive.

Foreign firms are invited to participate in international tenders for privatization of parastatal enterprises; these are generally announced in local newspapers, and are shared informally throughout the business community. Few foreign firms have responded, so little information is available on acquisitions, mergers or takeovers.

Generally speaking, Chad’s commercial climate suffers from limited infrastructure, chronic energy shortages, high energy costs, a scarcity of skilled labor, a high tax burden (after tax-free incentives have expired) and corruption. Transport costs are high, and most of Chad’s roads are unpaved and can become impassable during the rainy season. The government has recently undertaken a national road improvement project that will eventually make some inaccessible regions easier to reach. That very little English is spoken in Chad, and that French commercial interests have predominated here in the past, have also discouraged U.S. investors. Still, Chad’s private business community is increasingly trying to diversify commercial contacts to include U.S. partners. Since mid-2009, the government has been engaged in a nation-wide anti-corruption campaign that has attracted broad public support. Its impact on the business climate remains to be seen.

Chad’s positions in standard rankings for openness to doing business are not favorable:
-- World Bank’s Doing Business: 178 out of 180
-- Transparency International’s Corruption Index: 175 out of 180
-- Heritage Foundation’s Economic Freedom Index: 161 (38 of 46 in Sub-Saharan Africa)

Conversion and Transfer Policies

There are no restrictions on transfers of funds into Chad, but any individual who wishes to transfer money exceeding USD 1,000 out of Chad must seek approval from the Ministry of Finance. Additional requirements exist for companies intending to send more than USD 800,000 out of the country. Approvals are routine, although the Ministry has occasionally restricted capital outflows for temporary periods. There was no report of any such restriction being levied in 2009. Businesses can gain advance approvals for regular money transfers.

Chad is a member of the Communaute Financiere Africaine zone. This, coupled with its participation in CEMAC, guarantees the convertibility of CFA francs into Euros at a fixed rate. Since 2002, the rate has been 655.99 to the Euro. In 2009, the exchange rate for the dollar fluctuated between 440 and 460 CFA, as a function of the performance of the dollar against the euro.

Expropriation and Compensation

There has been no known government expropriation of foreign-owned private property in recent years. In 2006, the GoC threatened to replace the two minor partners in the Esso Chad consortium with Chad’s own national oil company, but the parties settled, as they settled a dispute in 2009 concerning a government decision to increase work permit fees for Esso’s international staff.

Article 41 of Chad’s Constitution prohibits seizure of private property except in cases of urgent public need. A 1967 Land Law prohibits deprivation of ownership without due process, and stipulates that the state may not take possession of expropriated properties until 15 days after the payment of compensation. In 2008, Chadian authorities forcibly evicted several thousand families from their homes in N’Djamena on grounds that they were illegally occupying state-owned land needed for infrastructure projects. Some of those evicted appear to have ownership papers and have gone to court to challenge what they believe to be lack of due process. Others seem not to have had land titles.

Dispute Settlement

Chad’s legal system and commercial law is based on the French Civil Code, with an admixture of traditional law and supra-national arrangements as agreed among the memberships of CEMAC, CEEAC and OHADA. In January 2010, the OHADA Investment Arrangement, with provisions for securities, arbitration, dispute settlement, bankruptcy, recovery and other aspects of commercial regulation, will begin taking precedence over national business laws. The OHADA Arrangement spells out rights for approved creditors in various categories (e.g., the Chadian Treasury, wage earners, etc.)

Chad’s court system is capable of handling investment disputes, but it has relatively little experience and is still developing competence and reliability. Judges are appointed by the Chadian President without National Assembly confirmation, thus potentially making them vulnerable to influence from the executive branch. We know of no recent cases where executive pressure was brought against judges dealing with commercial issues. Monetary judgments are usually awarded in local currency, although they can be awarded in dollars or euros when disputes concern transactions initially made in foreign currency.

In 2005, Chad announced plans to establish five commercial tribunals to share information on business law and to settle disputes. In December 2009, four of the five were functioning (in N’Djamena, Abeche, Bongor and Moundou). The N’Djamena tribunal has dealt with cases brought by foreign companies. Firms not satisfied with judgments in these tribunals have recourse to OHADA’s regional court in Abidjan; several Chadian companies have pursued dispute-settlement through the OHADA mechanism. CEMAC established a regional court in N’Djamena in 2001 to hear business disputes, but this body is not widely used.

Contracts and investment agreements can stipulate arbitration procedures and jurisdictions for settlement of disputes. If both parties are in agreement and provisions do not run counter to Chadian law, Chad’s courts will respect the judgments of U.S. or other foreign courts. In the absence of specification, the accepted principle is that jurisdiction belongs in the nation where a given agreement was drafted. This principle applies to disputes between companies and the Chadian government. The government will accept international arbitration if it is stipulated in advance. (For information on the settlement of two disputes involving the Esso consortium, in which Exxon Mobil and Chevron Texaco have major interests, see Expropriation and Compensation section above and Performance Requirements/Incentives section below.)

Bilateral judicial cooperation exists between Chad and certain nations. In 1970, Chad signed the Tananarive Convention, covering the discharge of judicial decisions and serving of legal documents, with eleven other former French colonies (Benin, Burkina Faso, Cameroon, CAR, Congo-Brazzaville, Gabon, Cote d’Ivoire, Madagascar, Mauritania, Niger and Senegal.) Chad has similar arrangements in place with France, Nigeria and Sudan. Chad is a member of the International Center for the Settlement of Investment Disputes (ICSID, also known as the Washington Convention.)

Performance Requirements/Incentives

Investment incentives can be negotiated, but the government's flexibility is limited by OHADA and CEMAC agreements. Based on Chad’s national Investment Charter, which went into effect in 2008, the government has offered three-year tax-exempt status to all foreign firms as an investment incentive. The possibility of special tax exemptions exists for some public procurement contracts. A special preferential tax regime applies to contractors and sub-contractors in the Doba oil project. In the past, the government occasionally offered low license fees or rent in addition to ad hoc tax exemptions. Incentives tend to increase with the size of given investments and likely job creation. Plans have been proposed for a credit guarantee fund for investment projects, but as of the end of 2009, nothing had been implemented. Investors may address inquiries about possible incentives to the Ministry of Commerce.

There are generally no performance requirements imposed on foreign investors. Foreign firms are officially required to employ local workers for 98 per cent of their staff, although in practice this law has not been applied due to the scarcity of skilled labor. Firms can formally apply for permission from the Labor Promotion Office (ONAPE) to employ a greater percentage of expatriates than the formally-allowed two per cent if they can demonstrate that skilled local workers are not available.

Work permit fees for foreign employees were long set at the equivalent of USD 1000 per year. In March 2009, the GoC signed two decrees effectively raising these fees considerably. The first stipulated that work permit fees would be equivalent to the first-time monthly salaries of foreign workers. The second required firms wishing to hire foreign employees to demonstrate that finding local skilled workers was impossible, and to present files of local candidates not selected for given jobs to the GoC for review. Exxon protested these decrees, and both have been put on hold through 2010.

There are no known discriminatory requirements for visas or residence permits that would have the effect of inhibiting foreign investors. CEMAC arrangements, once put into place and adhered to regionally, will increase free movement of people and goods, including by streamlining entry and customs procedures.

Foreign firms are able to participate in research and development programs, but the Chadian government lacks funds for such programs, with the result that foreign donors generally pay for them.

Right To Private Ownership

Chadian law guarantees the rights of foreign and domestic entities to establish and own business enterprises and to engage in remunerative activities. The national Investment Charter of 2008 offers the possibility of full foreign ownership to all companies in Chad, with the exception of national security or strategic industries. Three large state-owned enterprises, Coton Chad (the state-run cotton concern), SOTEL (the telephone company), and STEE (the electricity/water company), are slated to be privatized but are not private yet. Foreign participation in upcoming privatization tenders will be sought.

Protection of Property Rights

Property rights, including intellectual property rights, are protected by the Chadian Civil Code, but Chad has a limited capacity to enforce them. OHADA arrangements put into place in 1998 improved existing property laws, including those dealing with mortgages, making them consistent with French commercial law.

The office of "Direction de Domaine et Enregistrement" in the Ministry of Finance is responsible for recording property deeds and mortgages. In practice, this office only asserts authority in urban areas; rural property titles are managed by traditional leaders. Chadian courts frequently deal with cases of multiple deeds to the same property, indicating that problems with the existing title registration system remain unaddressed. In cases of multiple titles, the earliest usually has precedence. Fraud is common in property transactions, so investors should exercise particular caution in this domain. As part of the Chadian government’s generalized series of anti-corruption efforts under way since mid-2009, the Ministry of Infrastructures has put in place a computerized system designed to help detect false property titles.

Chad is a party to the 1958 Paris Convention and the 1977 Bangui Agreement on IPR. The Bangui agreement groups together 16 other francophone African nations in the African Intellectual Property Rights Organization (OAPI). Chad adheres to OAPI rules within the abilities of its limited administrative capacity. The Ministry of Trade and Industry has established an office to register copyrights, as well as a branch office of OAPI to process patent applications (valid in all OAPI states). In 2000, Chad's National Assembly adopted a 1999 OAPI standard on IPR designed to bring member states into compliance with the WTO's TRIPS agreement, which specifies protections for software, literary works, sound recordings, and industrial patents.

In 2005 the Chadian government established an office charged with protecting authors’ rights. An enforcement mechanism able to take action against piracy is scheduled to be added in 2010. Although prohibited, counterfeit watches, sports clothing, footwear, jeans, audio materials, cosmetics, perfumes, and other goods are readily available on the Chadian market. These products are not produced locally but are imported, often informally, from Asia and neighboring countries.

Transparency of Regulatory System

No provisions in Chadian law nor any multilateral regimes affecting Chad impose discriminatory provisions that might discourage foreign investment. But bureaucratic procedures for opening a business are cumbersome and slow, consisting of as many as 15 steps and visits to several agencies and ministries. Clear rules exist on paper, but they are not always followed. The process usually results in approval.

The heavy tax burden that has traditionally been imposed on formal-sector businesses discourages investment and puts informal sector competitors at an advantage. The Chadian government is working with the IMF, EU and other multilateral institutions to develop and implement a more transparent and competitive system. Efforts are being made in regional institutions and via technical assistance from the IFIs and EU in the aim of simplifying tax laws and streamlining government procedures. The World Bank, before it reduced operations in Chad in 2006 in a dispute over management of oil revenues, helped the GoC to computerize and modernize its customs service, including the creation of an up-to-date statistics database. (The World Bank announced in mid-2009 that it would resume assistance projects in Chad.)

Efficient Capital Markets/Portfolio Investment

Chad's financial system is generally sound and unhindered by restrictive regulation, but it is quite limited in size and in variety of services. There is no capital or money market in Chad, nor sophisticated financial products. A limited number of financial instruments are available to the private sector, including letters of credit, short- and medium-term loans, foreign exchange operations and some long-term savings instruments. The International Finance Corporation is prepared to add funds through existing banks if demand develops.

Chad’s banking sector improved after undergoing internal reforms in 1990 to streamline lending practices and reduce the volume of bad debt. Chad’s three largest banks have been privatized: ECO BANK (formerly BIAT), Societe General Tchad (formerly BTCD) and CBT (formerly BDT). Two Libyan banks have recently established themselves in Chad: BCC (formerly la Banque libyenne) and BSCIC, along with one Nigerian Bank (UBA). A number of European banks have long maintained offices here. Credit is available from commercial banks on market terms, which are expensive (usually 16 to 25 percent for short-term loans). Medium-term loans are difficult to obtain, as lending criteria are rigid. Many large businesses maintain accounts with foreign banks. The success of large foreign investments in the oil sector could have a positive impact on Chadian banks down the road.

Regulations and financial policies generally do not impede competition in the financial sector. Legal, regulatory and accounting systems pertaining to banking are relatively transparent and consistent with international norms. Chad’s banking sector is regulated by COBAC (Commission Bancaire de l'Afrique Centrale), a regional agency. Chad began using OHADA’s accounting system in 2002, bringing its national standards into harmony with accounting systems throughout the region. Several internationally-known accounting firms have personnel in Chad. There is no effective regulatory system to encourage or facilitate portfolio investments.

CEMAC countries established a small regional stock exchange, known as the Central African Stock Exchange, in Libreville, Gabon. It began activities in 2006 (following formal establishment in 2003). In 2005, Cameroon, a CEMAC member country, launched its own stock market in Douala. CEMAC leaders have been talking about the desirability of a merger of the two exchanges for some time. Douala stock was valued at USD 2.1 million in 2009, while Libreville stock, dependent on public money, had a 2009 value of USD 200 million.

Some French firms and agencies appear to benefit from "cross-shareholding" and "stable shareholder" arrangements, thus limiting opportunities for other foreign investment and acquisition in Chad’s parastatals and in the financial sector. These practices are facilitated by the fact that there is no stock market for trading shares. The best-known case involves French participation, through the firm GEO-COTON, in Coton Tchad (the cotton parastatal). SONASUT/CST (the recently-privatized Chadian sugar concern) has a major French partner, SOMDIAA. Societe Generale Tchad (affiliated with the French Societe Generale) took over the former Chadian National Bank, BTCD, in the early 2000s.

Competition From State-Owned Enterprises

As noted above, sectors of the Chadian economy including electricity/water, some telecommunications, and cotton remain controlled by the state, although most are slated for privatization. None are solidly profitable at this stage, and the World Bank plans to renew assistance in the water sector shortly. The utility parastatal reports to the Ministry of Energy, the telecommunications parastatal to the Telecommunications Ministry, and the cotton parastatal to the Ministry of Agriculture. All have Boards of Directors. Although the energy sector is officially state-controlled, Esso Chad, the large private consortium, has been permitted to develop Chad’s petroleum resources since 2003. Esso’s royalty and tax payments to the GoC amount to 70 per cent of total government revenues.

A more recent and still-evolving development in the energy sector is the China National Petroleum Company’s joint venture with the Chadian National Hydrocarbon Company, a state-owned enterprise and minority interest in the joint venture with the Chinese. The initiative was launched in 2008 with the aim of supplying Chad’s internal petroleum requirements through a Chinese-built refinery, but in 2009 it became apparent that new oil fields being developed near Bongor will have sufficient yield that a quantity of oil will be able to be exported through the existing Esso Chad pipeline.

The general relationship between the China National Petroleum Company and its Chadian state-owned partner seems to be one of cooperation rather than competition. Further cooperation will be necessary for the Chinese-Chadian joint venture to adhere to Esso’s high standards of environmental protection and financial transparency.

Cooperation rather than competition seems to characterize other Chinese investments in Chad, which are taking place primarily in the infrastructure sector (road paving and reconstruction of buildings – including the National Assembly – destroyed in 2008 rebel attacks.) Chad has no sovereign wealth funds.

Corporate Social Responsibility

Most Western firms operating in Chad are aware that they bear a burden for social responsibility, given extremely low local standards of living here when compared with those that prevail in countries of origin. Western firms are generally committed to extensive staff training efforts, purchase of local goods where possible, and donation of excess equipment to charity. Esso Chad, involving the largest U.S. commercial presence in Chad, follows exemplary employment practices, provides safe and healthy conditions for its workforce, hews to responsible environmental protection practices, contributes to local science and technology, and complies with local, international and U.S. laws, as well as with OECD guidelines.

Political Violence

Chad most recently suffered a period of political instability from 2005 to 2008, in connection with the Darfur crisis in neighboring Sudan. Eastern Chad, where UN peacekeepers are currently deployed, remains less stable than the capital. On and off throughout the Chadian regime’s 20-year tenure, armed rebel groups have sought to overthrow the President and bring about regime change by force. Some rebel groups received support in the course of 2009 from the Sudanese government. In 2006 and 2008, Chadian rebels entered the capital but were repelled by the Chadian military. In 2009 Chadian rebels clashed with the Chadian national army in Eastern Chad. A January 2010 agreement between the Governments of Chad and Sudan has committed the two nations to ceasing support for rebels operating on their territories, and to ending the proxy war that Chad and Sudan have waged since 2005. The GoC has signed agreements with a number of rebels, and several commanders and many rebel soldiers returned to Chad in the course of 2009, although others continue to state that they intend to fight the regime. Meanwhile, interethnic violence between nomadic and pastoral groups persists in Southeastern Chad, and tensions between local Chadian populations and refugees from Darfur (270,000) and CAR (57,000) continue, essentially over use of scarce natural resources.

Chad was more stable and secure in 2009 than in 2008, but the variety of regional challenges that the nation faces means that stability is fragile. Elections in 2010 and 2011 could usher in opportunities for good governance and economic progress, but if their results are contested, domestic unrest could ensue.

Corruption

Corruption is a persistent and widespread problem in Chad, which ranked fifth from the bottom on Transparency International’s 2009 Index. As in other developing countries, the low salaries of most civil servants, judicial employees, and law enforcement officials, and a consequent tolerance for bribery, have contributed to corruption. Public tolerance for corruption seems to be dropping significantly. In 2009, the Chadian government launched investigations of ten high-ranking officials, including several cabinet ministers and the Mayor of N’Djamena. President Deby, in his New Year address to the nation in January 2010, pledged to continue the campaign to eliminate corruption from Chadian public life, criticized the practice of taking liberties with public goods, and promised prosecution of those who accepted kickbacks or demanded bribes.

Corruption exists at all levels of government, along with impunity, particularly for those in uniform. Street crime, sometimes committed by individuals in uniform, and ad hoc road-blocks are widespread. Foreign firms often employ large private security detachments. Corruption has traditionally been pervasive in the customs and tax enforcement services. In some cases, tax and customs authorities may facilitate evasion only to return later to pursue the infractions they facilitated. The IMF has provided considerable technical assistance in the course of the current Staff-Monitored Program to regularize tax and customs procedures and root out abuses.

Some judicial authorities are assumed to be subject to influence, and legal clerks sometimes obstruct procedures to elicit bribes. The Government Procurement Office and Infrastructure Ministry are viewed as prone to cronyism in selection of projects and awarding of contracts. But in an election year (legislative contests are set for late 2010 and a presidential election in 2011) the GoC is highly conscious of this sort of criticism and desirous of projecting a clean image. The Infrastructure Ministry’s new website contains considerable information on methods of financing and contracting.

Government procurement is often financed by multilateral organizations and other donors who stipulate conditions to ensure transparency, but there remains the potential for manipulation of the process.

Chad is not a signatory of the OECD anti-bribery convention, but a February 2000 anti-corruption law stipulates penalties for corruption.

Bilateral Investment Agreements

The U.S. has neither an investment treaty nor a tax code treaty with Chad. Chad has signed bilateral investment treaties with approximately a dozen other countries, most of them in Africa. The government does not share the list of countries or details of the treaties, but the Ministry of Commerce has indicated that the treaties establish general mechanisms for governments to facilitate dispute resolution.

Due to lack of a treaty on double taxation, some U.S. firms have complained about the excessive tax burden they face on some projects, particularly short-term consulting contracts that do not justify establishment of local offices.

OPIC, Investment Insurance

OPIC issued political risk investment insurance to Pride-Forasol, which provided early oil field drilling services for the Doba oil project. The overall oil project has dramatically increased the level of U.S. investment in Chad, and it may increase the potential for OPIC to support projects in other sectors. The U.S. Export-Import Bank has guaranteed USD hundreds of millions in U.S. exports for the Doba project.

Chad is a member of the Multilateral Investment Guarantee Agency (MIGA). The OHADA Investment Arrangement includes provisions to establish an Investment Guarantee Fund, but this has not yet been accomplished. The French investment guarantee agency, COFACE, has guaranteed a number of investments in Chad.

Labor

Chad has a shortage of skilled labor in most if not all categories, but there is an increasing pool of university graduates able to fulfill many entry-level management and administrative functions. As structural adjustment programs have effectively frozen much government recruitment, educated workers have increasingly turned to the private sector in search of employment. Skilled workers are nevertheless a very small percentage of the total labor pool. About 80 percent of the labor force is engaged in subsistence activities such as fishing, farming and herding. Unskilled and day laborers are readily available. Low wage levels reduce incentives for investment in labor-saving technology. Very few workers speak any English, although a small but increasing number of university graduates and business professionals have some English skills. Acceptable translators and interpreters are available.

Chadian labor law derives from French law and tends to be far more protective of workers' rights than U.S. law. Labor courts are also quite sympathetic to workers, so it is important for companies to follow rigorously all requirements for hiring and especially firing workers. Labor unions exist and operate independently from the government. The main labor federation is the "Union des Syndicats Tchadiens" (UST), to which most individual unions belong. Most small Chadian businesses operate in the informal economy, where labor laws are widely ignored.

Foreign Trade Zones

Duty-free zones are under discussion among Chad and its neighbors/partners in regional organizations, but none currently exist. Duty free goods used to be available at the N’Djamena International Airport, but this is currently not the case.

Foreign Direct Investment Statistics

Chad does not release foreign direct investment figures. Nonetheless, it is clear that oil activity has dramatically increased the level of FDI in Chad. Esso Chad, the consortium in which Exxon Mobil and Chevron Texaco participate, has invested over USD 7 billion in the Doba exploration and pipeline project since its inception in 2003. Of this, USD 885 million was invested in 2009. Esso Chad paid revenues of USD 625 million to the GoC in 2009, and USD 4.9 billion over time (these sums are not reflected in investment figures.)

French firms remain prominent, having historically been the biggest foreign investors in Chad. The current interests of French firms include cotton, sugar, electricity generation, construction, transportation, banking and hotels. The French firm Vivendi has been awarded a contract to build a new electrical power station in N’Djamena – the city currently has three, but only one works reliably. The concerns GEO-COTON in the cotton sector, SOMDIAA in sugar, the Bollore Group in shipping and delivery, CFAO in auto distribution, Maestria in paint manufacture, Bouygues and Cegelex in construction, and Novotel and Meridien in hotels, are some well-known current French investors.

The PRC establish diplomatic relations with Chad in 2006. The Chinese-Chadian oil refinery north of N’Djamena and exploration effort near Bongor are estimated to have involved an investment of USD 1 billion since 2008. In addition to the refinery and oil exploration project, Chinese firms (whose own status as private or state-run is not always clear) have invested in construction, road paving and cement manufacture. Some smaller Taiwan firms remain active in Chad, despite Taipei’s loss of diplomatic relations, and many Chinese and Taiwan-run restaurants are present here.

A Canadian firm has recently been awarded a large contract to build public housing. Libya has built a hotel, several banks and other properties, is invested in trucking, and plans a modern grocery store. An Indian firm, Team-9, has recently invested in the Chadian textile industry, proving spinning equipment. The same Indian concern manufactures tractors. An Egyptian company has been awarded a major road improvement contract for a project northeast of N’Djamena. A Nigerian firm runs a bank, and a Cameroonian firm holds majority shares in another bank. A few Lebanese traders remain from the era when they were numerous in Chad. A collection of small traders and artisans from various African nations makes Chad home.

International peacekeeping in Eastern Chad to respond to the Darfur crisis, performed by the European Union in 2008 and the UN in 2009, afforded some international firms opportunities to invest in infrastructure to support foreign deployments. The U.S. firm PAE, a subsidiary of Lockheed Martin, was awarded a construction contract for building temporary peacekeeping camps in Abeche in 2009.



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