With a welcoming investment climate and modern transportation infrastructure, Togo’s steadily improving economic outlook offers opportunities for U.S. firms interested in doing business locally and in the sub-region. Even with a dip in growth due to the pandemic, Togo has sustained steady economic expansion since 2008 through reforms to encourage economic development and a better business environment, growing 5.5% in 2019, 1.8% in 2020 and 4.8% in 2021. It ranked 97th on the Work Bank’s 2020 Doing Business report, an improvement of 59 places from the previous two years and the highest ranking in West Africa.
Current government policy is guided by the National Development Plan (PND) and an addendum policy roadmap for 2020-2025 that integrates business reforms and infrastructure projects designed to attract investment.
Togo launched its five-year PND in 2018, focusing on three axes. The plan’s first goal is to leverage the country’s geographic position by transforming Lome into a regional trading center and transport hub. Togo has already completed hundreds of kilometers of refurbished roadways, expanded and modernized the Port of Lome, and inaugurated in 2016 the new Lome international airport that conforms to international standards. The second goal is to increase agricultural production through agricultural centers (Agropoles) and increase manufacturing. The third goal is improving social development, including furthering electrification of the country. The government seeks private sector investment to fulfill its PND goals and has had notable successes, including a new 2022 connection with the “Equiano” subsea cable owned by Google that will dramatically improve the quality of local broadband.
In January 2021, Prime Minister Victoire Tomégah-Dogbe presented a detailed developmental roadmap to extend, supplement, and focus the goals of the PND for the remainder of the presidential term, which ends in 2025. The roadmap incorporates 42 specific projects, including universal access to identity documents and electricity; increased access to education, drinking water and sanitation; 20,000 new social housing units; a digital bank; construction of an industrial park around the port of Lome; and the extension of the road network.
Nevertheless, Togo must tackle several challenges to maintain its momentum. Challenges include a weak and opaque legal system, lack of clear land titles, and government interference in various sectors. Corruption remains a common problem in Togo, especially for businesses. Often “donations” or “gratuities” result in expedited registrations, permits, and licenses, thus resulting in an unfair advantage for companies that engage in such practices. Although Togo has government bodies charged with combatting corruption, corruption-related charges are rarely brought or prosecuted. The government has made efforts to professionalize key institutions such as the Public Procurement Regulatory Authority (ARMP), the Chamber of Commerce (CCIT), and the National Employment Agency (ANPE) including with new anti-corruption, ethics, and transparency measures.
|TI Corruption Perceptions Index||2020||134 of 180||http://www.transparency.org/research/cpi/overview|
|Global Innovation Index||2020||125 of 132||https://www.globalinnovationindex.org/analysis-indicator|
|U.S. FDI in partner country ($M USD, historical stock positions)||2019||N/A||https://apps.bea.gov/international/factsheet/|
|World Bank GNI per capita||2019||$690||https://data.worldbank.org/indicator/NY.GNP.PCAP.CD|
1. Openness To, and Restrictions Upon, Foreign Investment
Attracting foreign direct investment (FDI) is a priority for Togo. The most recent data shows annual FDI flows to Togo almost doubling between 2019 and 2020 to $639 million, driven largely by increased investment from other West African countries, especially in the cement sector (UNCTAD, World Investment Report 2021). CimMetal Group (Burkina Faso) in 2021 established a $125 million construction materials plant) and Dangote (Nigeria) in 2020 invested in a $60 million cement plant.
Reforms to increase the ease of doing business and new power plant should sustain continued FDI growth over the next several years, with opportunities available in infrastructure, information and communications technology, agribusiness, energy, banking, and mining.
The Ministry of Investments serves as an interface for potential investors, allowing them to target investment sectors and present priority projects. Despite the pandemic, government officials made trips abroad in 2021 to promote Togo as a place to invest and show the government’s desire to diversify its economic partners.
Togo does not have any laws or practices that discriminate against foreign investors. The Investment Code, adopted in June 2019, prescribes equal treatment for Togolese and foreign businesses and investors; free management and circulation of capital for foreign investors; respect of private property; protection of private investment against expropriation; and investment dispute resolution regulation. The code meets West African Economic and Monetary Union (WAEMU) standards.
As an Investment Holding Company, Togo Invest Corporation focuses on investments involving the government through Public-Private-Partnerships. Although Togo prioritizes investment retention, the government does not maintain a formal dialogue channel with investors.
There is a right for foreign and domestic private entities to establish and own business enterprises and engage in all forms of remunerative activities. The foreign investor can also create a wholly owned subsidiary. It has no obligation to associate itself with a local investor. This right is contained in the Investment Code “le Code des Investissements,” adopted June 17, 2019, and there are no general limits on foreign ownership or control. Section 3 of the Investment Code states that any company established in the Togolese Republic freely determines its production and marketing policy, in compliance with the laws and regulations in force in the Togolese Republic. Additionally, there are no formal investment approval mechanisms in place for inbound foreign investment nor rules, restrictions, limitations, or requirements applied to private investments.
Togo conducted an investment policy review through the World Trade Organization (WTO) in October 2017. A link to the report can be found at: https://www.wto.org/english/tratop_e/tpr_e/tp_rep_e.htm
There have been no major recent reviews of investment policy by civil society.
Togo has dramatically improved its business climate in recent years through the implementation of bold reforms. It now takes only seven hours to register a new company online with the “Centre de Formalité des Entreprises” (https://www.cfetogo.org/eentreprise ), and Togo has continued to work simply procedures and reduce costs for businesses, including digitizing and automating tax payments.
Togo has streamlined construction permits and eliminated a redundant requirement to receive a certificate of registration from the National Association of Architects. A new central office for property transactions (called the Guichet Unique Foncier) at the Togolese Revenue Office (OTR) also allows applicants to drop off their applications and retrieve their permits in one place, eliminating the need to visit multiple administrative offices to process paperwork.
Togo has also improved the monitoring and regulation of power outages by recording data on the annual Average System Outage Duration Index (SAIDI) and Average System Interruption Frequency Index (SAIFI).
In August 2021, with support from the United Nations Development Program (UNDP) and the United Nations Conference on Trade and Development (UNCTAD), Togo launched two digital portals to provide information and assist investors in accessing finance and completing administrative procedures to facilitate market entry.
The website investautogo.tg provides information on the business environment and investment in Togo, including the documentation required for administrative procedure. It also promotes business opportunities and tax incentives, with information on the investment code and the Export Processing Zone (EPZ).
The website apizf.tg also presents useful documentation for investors to better understand the Togo business environment and investment procedures.
Togo’s efforts have received international recognition, enabling it to achieve the rank of African Top Performer and third best in the world in terms of improving the business environment relative to its size (Greenfield FDI Performance Index Best Performers 2020). Togo’s ranking in the World Bank’s Ease of Doing Business report has also spiked, moving from 137th globally in 2019 to 97th in 2020, the most recent report.
Togo does not promote outward investment, nor does it restrict domestic investors from investing abroad.
3. Legal Regime
In June 2019, the National Assembly adopted a new investment code, which is in line with the objectives of the National Development Plan (PND) and embraces the government’s desire to make the private sector the driver of economic growth.
The Investment Code seeks to make Togo an attractive place for international companies, supporting the development of logistics hubs by offering tax incentives. The incentives are proportional to the size of the investments made and the number of jobs created. At a time when Togo is committed to decentralization, the new investment code provides additional advantages to investments that create jobs outside of major urban centers. The code operationalizes the National Agency for the Promotion of Investments and the Free Zone (API-ZF) which simplifies formalities. The deadline for adjudicating files is now set at 30 days maximum.
As a member of West African Economic and Monetary Union (WAEMU), Togo participates in zone-wide plans to harmonize and rationalize regulations governing economic activity within the Organization for the Harmonization of Business Law in Africa (OHADA – Organisation pour L’Harmonisation en Afrique du Droit des Affaires). OHADA includes sixteen African countries, including Togo, and one of the principal goals is a common charter on investment. Togo directly implements WAEMU and OHADA regulations without requiring an internal ratification process by the National Assembly.
Togo’s Investment Code also specifies the provision of incentives to encourage investment. Incentives are to be proportional to the size of investment, with tax benefits conditional on job creation. Tax benefits include a lump sum tax reduction per job created and incentives to invest in rural areas, to consolidate social development and strengthen inclusion measures.
Although the government does not make draft bills and proposed regulations available for public comment, ministries and regulatory agencies in Togo generally give notice of and distribute the text of proposed regulations to relevant stakeholders. Ministries and regulatory agencies also generally request and receive comments on proposed regulations through targeted outreach to business associations and other stakeholders.
Togo is a member of UNCTAD’s international network of transparent investment procedures http://togo.eregulations.org . Foreign and national investors can find detailed information on administrative procedures applicable to investment and income generating operations including the number of steps, name and contact details of the entities, persons in charge of procedures, required documents and conditions, costs, processing time, and legal bases justifying the procedures. The site is generally up-to-date and useful.
The Public Procurement Regulatory Authority (ARMP) ensures compliance and transparency with respect to government procurements. Each responsible ministry ensures compliance with its regulations which are developed in conformity with international standards and agreements such as WTO or WAEMU norms. Regulations are not reviewed based on scientific or data-driven assessments. The government has not announced any upcoming changes to the regulatory enforcement system. In December 2021, the government adopted Law 2021-033 on public procurement aimed at improving the legal framework and reducing the delays in procurement procedures, in particular through digitalization.
Togo joined the Development Center of OECD in June 2019, an opportunity to share experiences and pool resources.
Togo is a member of the World Trade Organization (WTO). It is not known if the government notifies all draft technical regulations to the WTO Committee on Technical Barriers to Trade (TBT).
For the most part, in economic terms, the Togolese legal and administrative framework is aligned with the community texts of UEMOA, ECOWAS or larger groups.
On the financial side, Togo depends on sub-regional institutions, notably the Central Bank of West African States (BCEAO) whose head office is in Dakar. The Regional Council for Public Savings and Financial Markets (CREPMF), headquartered in Abidjan, regulates financial markets.
The Togolese insurance market is subject to the rules of the CIMA zone (Inter African Conference of Insurance Markets).
With regard to intellectual property, Togo relies on OAPI (African Intellectual Property Organization).
The main laws and directives of these different legal and administrative areas are available, among others, on the website www.droit-afrique.com under the heading Togo.
More broadly, Togo is a member of the United Nations (UN), the World Trade Organization (WTO) or the International Renewable Energy Agency (IRENA).
At the African level, the country is also party to the Council of the Agreement, the Benin Electric Community (CEB), the African Peer Review Mechanism (APRM), the Alliance Zone and the Co-operation Zone for Prosperity (ZACOP), and the African Union.
Togo practices a code-based legal system inherited from the French system. The judiciary is recognized as the third power after the executive and the legislative (the press being the 4th) and thus remains independent of the executive branch. Togo, as a member of the OHADA, has a judicial process that is procedurally competent, fair, and reliable. Regulations or enforcement actions are appealable like any other civil actions and are adjudicated in the national court system.
A Court of Arbitration and Mediation created in 2011 legally enforces contracts. The main law covering commercial issues is the Investment Code adopted in 2012. In 2013, Togo created three commercial Chambers within the Lomé tribunal with specialized magistrates who have exclusive trial court level jurisdiction over contract enforcement and business disputes.
The Investment Code allows the resolution of investment disputes involving foreigners through: (a) bilateral agreements between Togo and the investor’s government; (b) arbitration procedures agreed to between the interested parties; or (c) through the offices of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States. The OHADA also provides a forum and legal process for resolving legal disputes in 16 African countries.
Investment disputes are managed by SEGUCE Togo (Societe d’Exploitation du Guichet Unique pour le Commerce Exterieur), and can be accessed at www.segucetogo.tg
Togo is a member of UNCTAD’s international network of transparent investment procedures http://togo.eregulations.org . Foreign and national investors can find detailed information on administrative procedures applicable to investment and income generating operations including the number of steps, name and contact details of the entities and persons in charge of procedures, required documents and conditions, costs, processing time, and legal bases justifying the procedures.
The Public Procurement Regulatory Authority (ARMP) ensures compliance and transparency for competition-related concerns. The government regularly seeks to improve the framework for public procurement (including professionalizing the public procurement sector, moving procurement online, enacting legislative regulations, etc). The Public Procurement Bill of December 2021 aims to increase transparency and efficiency in the consumption of investment credits.
These reforms directly benefit the private sector, which serves as the driver of the National Development Plan (PND) and related Government Roadmap.
The government can legally expropriate property through a Presidential decree submitted by the cabinet of ministers and signed by the President.
Only two major expropriations of property have taken place in Togo’s history. The first was the February 1974 nationalization of the then French-owned phosphate mines. The second was the November 2014 nationalization of the Hôtel du 2 Février after it had ceased operations for several years. Shortly after the nationalization of the hotel, Togo announced that it was establishing a commission to determine the fair market amount owed as compensation to the hotel’s Libyan owners/investors. Setting aside the case of the Hôtel du 2 Février as an isolated example, there is little evidence to suggest a trend towards expropriation or “creeping expropriation.” The government designed the 2012 Investment Code to protect against government expropriations. There are some claimants from lands expropriated for recent road construction, however, and the procedure to investigate and resolve those claims is slow. Another issue is that land titles are very unclear with traditional and modern systems overlapping. The government has occasionally earmarked land for development with unclear title that has raised complaints from local communities.
ICSID Convention and New York Convention
Togo is not a party to the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards. Togo is, however, a party to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention – also known as the Washington Convention), which it ratified in 1967.
Investor-State Dispute Settlement
Togo does not have Bilateral Investment Treaty (BIT) or Free Trade Agreement (FTA) with an investment chapter with the United States.
Togo does not have a history of extrajudicial action against foreign investors, notwithstanding the two historical examples above. There do not appear to be any investment disputes involving U.S. persons from the past ten years. Local courts recognize and enforce foreign arbitral awards issued against the government.
International Commercial Arbitration and Foreign Courts
The dispute resolution alternative is the Court of Arbitration of Togo (CATO), which conforms to standards as established by the Investment Climate Facility for Africa (ICF). Local courts recognize and enforce foreign arbitral awards and there are no known State-Owned Enterprise investment disputes that have gone to the domestic court system.
The World Bank’s International Finance Corporation (IFC) worked with the Government of Togo to improve commercial justice through the strengthening of alternative dispute resolution mechanisms. The aim of the project was to increase the speed and efficiency of settlement of commercial disputes through the procedures used by the CATO.
As a result of the project, 30 new arbitrators and 100 magistrates and professionals received training in mediation/arbitration techniques. Further, the new CATO procedure manual is explicit that the time between filing and judgment shall be a maximum of six months as per article 36 of the ruling procedures.
Togo uses the standards set forth under the Organization for the Harmonization of Business Law in Africa (OHADA). That law states that if bankruptcy occurs, the competent jurisdiction designates an expert that concludes an agreement with creditors and stakeholders (preventive arrangement). The Manager (or managers) can be put under “patrimonial sanctions,” meaning they can be personally liable for the debts of the company. The manager is then forbidden to do business, to manage, administer, or control an enterprise, or hold political or administrative office, for three to ten years. Bankruptcy is criminalized, but generally as a last resort.
According to data collected by the World Bank, insolvency proceedings take three years on average and cost approximately 15 percent of the debtor’s estate, with the most likely outcome being that the company will be sold off in pieces. The average recovery rate is 27.9 cents on the dollar. The World Bank’s Doing Business 2020 places Togo at 88 of 190 for the “Resolving Insolvency” indicator, well above the Sub-Saharan Africa regional average.
4. Industrial Policies
Investment incentives are available to foreign investors that invest more than $100,000. Incentives include exemption from VAT and Customs Duties on new imported plant and materials, reduced income taxes for up to five years, and depending on the number of permanent jobs created for nationals, reduction on salary taxes during an approved period of time. Incentives are also available in the Export Processing Zone (EPZ).
With the creation of the High Council of Togolese Abroad (HCTE), Togo wants to mobilize and attract investment from its diaspora. For this, the government has set up a diaspora office, appointed diaspora points of contact in strategic institutions like the Togolese Revenue Office (L’Office Togolais des Recettes – OTR) and the National Employment Agency (ANPE – Agence Nationale Pour l’Emploi) and inaugurated the Maison de la Diaspora in November 2021 to assist Togolese expatriates in realizing investment projects.
For clean energy investments, while some long-term Power Purchase Agreements and taxation incentives exist, these measures tend to favor firms with a government stake, rather than private investment.
The 2011 law modifying the 1989 law creating the Export Processing Zone (EPZ) provides an advantageous taxation scheme for companies based in the EPZ with a reduced tax bill on their profits for their first 20 years of operation, including a five percent tax on profits for the first five years. The law also exempts companies from customs duties and VAT on imported equipment and inputs, as well as an exemption from VAT on goods and services purchased locally. It also provides EPZ companies the freedom to repatriate capital, including dividends and other income. The law also exempts companies within the EPZ from providing workers with many legal protections, including protection against anti-union discrimination with regard to hiring and firing.
The National Agency for the Promotion of Investments and the Free Zone (API-ZF) is a government agency designed to help accelerate the growth of investments in line with the government road map and boost national and international investments across all sectors. The new operating model of API-ZF is to attract investment, facilitate the installation of investors in Togo, and offer a post-investment service.
Togo hopes to leverage the African Continental Free Trade Area (AfCFTA / ZLECAF) to facilitate intra-African trade and eliminate customs duties for 90% of goods from other African countries. The trade accord also aims to reduce or eliminate non-tariff impediments such as corruption and border delays and encourage trade facilitation measures. Additionally, UNDP and AfCFTA signed a March 2021 agreement to promote trade as a stimulus for Africa’s socio-economic recovery from the COVID-19 crisis, especially for women and youth.
Firms are required by law to employ Togolese nationals on a priority basis, and after five years foreign workers cannot account for more than 20 percent of the total workforce or of any professional category. In practice, the Togolese government strongly encourages large foreign employers outside of the EPZ to hire as many Togolese nationals as practical. These encouragement schemes do not typically apply to senior management level employees.
There are reports that foreigners seeking to legalize their status for long-term work and residence purposes have encountered significant administrative obstacles and delays, although the steps for receiving residence permits are well defined. Issuance of such permits is the responsibility of the National Police.
There are no government-imposed conditions on permission to invest and there is no policy on “forced localization.” Foreign IT providers are not required to turn over source code and/or provide access to encryption and there are no measures that prevent or unduly impede companies from freely transmitting customer or other business-related data outside the economy/country’s territory.
5. Protection of Property Rights
Property rights and interests are enforced, although nearly 80% of court cases are reported to involve land title disputes. Mortgages and liens exist but land titles are precarious and often subject to litigation. Most land does not have a clear title, especially outside of urban areas. The government is attempting to fix this issue through various commissions that will issue recommendations, but it will take years to resolve.
The average time to proceed with property transfer decreased from eight days in 2018 to five days in 2019.
All land-related operations are carried out via the government’s “One-Stop Shop” for property transactions (called the Guichet Unique Foncier) at the Togolese Revenue Office (OTR). This “One-Stop Shop” within the OTR simplifies property transfer procedures, reduces administrative costs, and minimizes the risks in the process. The government has reduced the registration fee for property transfer to a 35,000 FCFA ($64) flat fee rather than the previous 4% of market value. The process of issuing a land title now takes only five hours, down from 48 hours in 2018.
An independent complaints mechanism exists in the Togolese Revenue Office (OTR). OTR has been set up to deal with land complaints. The office gives itself 48 hours to respond to requests.
Since December 10, 2019, all cadastral maps of greater Lomé (2,568 in total) were digitized and are made available in a database. This makes it possible to update the targeted plans and to carry out studies and validation of files at the “Guichet Unique Foncier” (GUF).
In Togo, only Togolese citizens, French citizens, foreign governments, and those granted citizenship by the judiciary are allowed to possess real property. Other foreigners must request permission from the Prime Minister, which is usually granted for investors who will develop the land. Land speculation is discouraged by the government. Property legally purchased that remains unoccupied will not be reverted to other owners under the law; however, in practice, unused land that is not protected will likely be occupied or used by others and potentially subject to lengthy court battles to prove ownership.
The regional African Intellectual Property Organization (OAPI) and National Institute for Industrial Property and Technology (INPIT) are the two agencies that protect IP in Togo. On November 30, 2020, Togo ratified the Bangui Agreement, which governs intellectual property in the 17 OAPI member states. There are no official figures available on how the country tracks and reports on seizures of counterfeit goods. The country may prosecute IPR violations, but there are no known cases.
Togo is not listed in USTR’s Special 301 report or in the notorious market report. For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/.
6. Financial Sector
Togo and the other West African Economic and Monetary Union (WAEMU) member countries are working toward greater regional integration with unified external tariffs. Togo relies on the West African Economic and Monetary Union (WAEMU) Regional Stock Exchange in Abidjan, Cote d’Ivoire to trade equities for Togolese public companies.
WAEMU has established a common accounting system, periodic reviews of member countries’ macroeconomic policies based on convergence criteria, a regional stock exchange, and the legal and regulatory framework for a regional banking system. The government and central bank respect IMF Article VIII and refrain from restrictions on payments and transfers for current international transactions. Credit is generally allocated on market terms. With sufficient collateral, foreign investors are generally able to get credit on the local market. The private sector in general has access to a variety of credit instruments when and if collateral is available.
The penetration of banking services in the country is low and generally only available in major cities.
The government and the banking sector have worked to restore Togo’s reputation as a regional banking center, which was weakened by political upheavals from 1991 to 2005, and several regional and sub-regional banks now operate in Togo, including Orabank, Banque Atlantique, Bank of Africa, NSIA Group, International Bank of Africa in Togo (BIA Togo), and Coris Bank.
Additionally, Togo is home to the headquarters of the ECOWAS Bank for Investment and Development (EBID), the West African Development Bank (BOAD – the development bank of the West African Economic and Monetary Union), Oragroup, and Ecobank Transnational Inc. (ETI), the largest independent regional banking group in West Africa and Central Africa, with operations in 36 countries in Sub-Saharan Africa.
The banking sector is generally healthy, and the total assets of Togo’s largest banks are approximately $25-30 billion, including Ecobank, a very large regional bank headquartered in Lomé.
Togo’s monetary policy and banking regulations are managed by the Central Bank of West African States (BCEAO). No known correspondent relationships were lost in the past four years. No known correspondent banking relationships are in jeopardy.
There are no restrictions on the transfer of funds to other FCFA-zone countries or to France. The transfer of more than FCFA 500,000 (about $1,000) outside the FCFA-zone requires justification documents (e.g. pro forma invoice) to be presented to bank authorities.
The exchange system is free of restrictions for payments and transfers for international transactions. Some American investors in Togo have reported long delays (30 – 40 days) in transferring funds from U.S. banks to banks located in Togo. This is reportedly because banks in Togo have limited contacts with U.S. banks to facilitate the transfer of funds.
Togo uses the CFA franc (FCFA), which is the common currency of the eight West African Economic and Monetary Union (WAEMU) countries. The currency is fixed to the Euro at a rate of 656 FCFA to 1 Euro. As a result of this fixed exchange rate, Togo’s inflation rate is consistently below 2%.
The 2019 Investment Code provides for the free transfer of revenues derived from investments, including the liquidation of investments, by non-residents.
Sovereign Wealth Funds
Togo does not maintain a Sovereign Wealth Fund (SWF) or other similar entity.
8. Responsible Business Conduct
Responsible Business Conduct (RBC) is not officially addressed in Togo by the government, other than as it relates to corruption and criminal activity. RBC and its variants such as “Fair Trade” is known by independent NGOs and businesses which promote these practices and are able to do their work freely.
Some American-owned companies follow generally accepted RBC principles and participate in outreach programs to local villages where they supply, among other things, school buildings, water, electricity, and flood abatement resources. In accordance with a law passed in March 2011, new construction projects must now address environmental and social impacts.
Togo joined the Extractive Industries Transparency Initiative (EITI) in 2009 and has been officially recognized as EITI-compliant since 2013. Togo’s EITI Secretariat carries out a yearly verification of financial statements relating to the extractive industry.
The Ministry of Civil Service, Labor, Administrative Reform, and Social Protection sets workplace health and safety standards and is responsible for enforcement of all labor laws. There have been no high-profile, controversial instances of private sector impact on human rights or resolution of such cases in the recent past.
Togolese law provides workers, except security forces (including firefighters and police), the right to form and join unions and bargain collectively. There are supporting regulations that allow workers to form and join unions of their choosing. Workers have the right to strike, although striking healthcare workers may be ordered back to work as necessary for the security and well-being of the population. While no provisions in the law protect strikers against employer retaliation, the law requires employers to get a judgment from the labor inspectorate before they fire workers. If firms fire workers illegally, including for union activity, the companies must reinstate the employees and compensate them for lost salary.
The law recognizes the right to collective bargaining; representatives of the government, labor unions, and employers negotiate and endorse a nationwide agreement. This collective bargaining agreement sets nationwide wage standards for all formal sector workers. For sectors where the government is not an employer, the government participates in this process as a labor-management mediator. For sectors with a large government presence, including the state-owned companies, the government acts solely as an employer and does not mediate.
The government follows OHADA recommended rules and regulations on corporate governance, accounting, and executive compensation.
Private security companies are present in Togo, but the country is not a participant in the International Code of Conduct for Private Security Service Providers Association (ICoCA).
Department of State
- Country Reports on Human Rights Practices;
- Trafficking in Persons Report;
- Guidance on Implementing the “UN Guiding Principles” for Transactions Linked to Foreign Government End-Users for Products or Services with Surveillance Capabilities;
- U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises; and;
- Xinjiang Supply Chain Business Advisory
Department of the Treasury
Department of Labor
- Findings on the Worst Forms of Child Labor Report;
- List of Goods Produced by Child Labor or Forced Labor;
- Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World and;
- Comply Chain
Togo seeks unconditional greenhouse gas emissions reductions of 21% below its business-as-usual (BAU) scenario by 2030, compared to the projected increase in emissions without the new government measures. It has also made a conditional commitment to reduce emissions by an additional 30% by the same date, contingent upon international support and finance. For methane emissions, Togo’s National Plan for the Reduction of Air Pollution and Short-Lived Climate Pollutants projects a 56% reduction in methane emissions by 2040 versus the BAU scenario absent government action. Togo has not set a net-zero greenhouse gas emissions goal and was ranked 37/51 for Middle East/Africa by Climatescope in 2021.
Togo’s current National Electrification Strategy aims to provide universal access to electricity by 2030, while increasing the share of renewables in Togo’s energy mix to 50% by the same date by ambitiously rolling out new power plants and off-grid solutions. In 2021, Togo launched one solar and one thermal power plant and has plans for two additional solar plants, 315 mini-grids, and 550,000 solar kits.
Togo government has limited capacity to monitor natural capital. The National Agency of Environment Management (Agence Nationale de Gestion de l’Environnement, ANGE) under the Ministry of Environment and Forestry Resources (MERF) enforces environmental regulations, and there has been significant progress over the past two decades in promoting sustainability. While still lacking personnel and equipment, agency technical capabilities are adequate for evaluating environment and social risks for major government projects.
Togo is also working to increase the legal weight of environmental standards. A revised public procurement law and new public-private partnership (PPP) both mandate consideration of environment and climate change impact, encouraging low carbon infrastructure projects and incorporation of climate adaption and mitigation measures.
The Togolese government has established several important institutions designed in part to reduce corruption by eliminating opportunities for bribery and fraud: the Togolese Revenue Authority (OTR), the One-Stop Shop to create new businesses (CFE), and the Single Window for import/export formalities.
In 2015, the Togolese government created the High Authority for the Prevention and Fight against Corruption and Related Offenses (HAPLUCIA), which the government designed to be an independent institution dedicated to fighting corruption. The government appointed members in 2017. HAPLUCIA encourages private companies to establish internal codes of conduct that, among other things, prohibit bribery of public officials. HAPLUCIA presented on February 7, 2019 its strategic plan for the period 2019-2023; it set up a toll-free number, the “8277” to receive complaints and denunciations.
Anti-corruption laws extend to family members of officials, and to political parties and the government does not interfere in the work of anti-corruption NGOs.
In 2011, the government effectively implemented procurement reforms to increase transparency and reduce corruption. The government announces procurements weekly in a government publication. Once contracts are awarded, all bids and the winner are published in the weekly government procurement publication. Other measurable steps toward controlling corruption include joining the Extractive Industries Transparency Initiative (EITI) and establishing public finance control structures and a National Financial Information Processing Unit.
Togo signed the UN Anticorruption Convention in 2003 and ratified it on July 6, 2005.
Resources to Report Corruption
Contact at the government agency or agencies that are responsible for combating corruption:
President of HAPLUCIA, the High Authority for the Prevention and Fight against Corruption and Related Offenses
Tel. +228 90 21 28 46 / 90 25 77 40
Office Togolais des Recettes (OTR)
41 Rue des Impôts
02 BP 20823
+228 – 22 53 14 00
Contact at a “watchdog” organization:
Regional Coordinator, West Africa
+49 30 3438 20 773
10. Political and Security Environment
After a period of political instability and economic stagnation from 1990 to 2007, the government started the country along a gradual path to political reconciliation and democratic reform. Togo has held multiple presidential, legislative, and local elections that were deemed generally free and fair by international observers, though the most recent legislative elections were boycotted by the majority of the opposition. Political reconciliation has moved slowly. A political crisis erupted in 2017 regarding the failure of the government to implement political measures, such as presidential term limits. After international facilitation between the government and opposition parties, in May 2019 the government implemented non-retroactive term limits and a two-round election system. The government held local elections in 2019, the first since 1986. President Faure Gnassingbe was elected for a fourth term on February 22, 2020 in a peaceful election.
Political protests still occur on occasion and can often lead to tire burning, stone throwing, and government responses include the use of tear gas and other crowd control techniques. There are no known examples over the past ten years of damage to projects and/or installations pertaining to foreign investment due to political violence.
11. Labor Policies and Practices
The labor market is predominately unskilled and there is a shortage of skilled labor and English-speaking employees. Some migrant farm workers arrive from Ghana and Benin based on familial ties. Widespread underemployment exists, and an estimated 3 million workers participate in the informal economy, which motors the economy.
In general, government labor policy favors employment of nationals.
Regulations require that firms hire workers with time specific contracts that include severance requirements. The labor code, and regulations called the “Convention Collective” differentiate between layoffs and firings, but both require severance payments. Free Trade zones offer different labor law provisions to encourage investment.
Public employee unions (teacher, judicial clerks, etc) use collective bargaining, and are willing to take to the streets in non-violent protest to raise the profile of their demands. Labor disputes are often resolved on an ad-hoc basis, usually with the intervention of parliamentarians.
Togo adopted a new Labor Code on December 29, 2020, replacing the 2006 code. The new code has increased social protection measures, requires employers to register employees with the National Social Security Fund (CNSS), and introduces severance pay and precarious work premiums. At the same time, it provides greater flexibility in the labor market by allowing for a variety of contract types depending on a company’s activities (e.g. seasonal labor, project-based contracts, telework). Finally, the new code allows the government to favor disadvantaged geographic areas and social groups.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
|Host Country Statistical source*||USG or international statistical source||USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other|
|Host Country Gross Domestic Product (GDP) ($M USD)||N/A||NA||2020||$7.575
|Foreign Direct Investment||Host Country Statistical source*||USG or international statistical source||USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other|
|U.S. FDI in partner country ($M USD, stock positions)||2017||$350||2017||$0||BEA data available at https://apps.bea.gov/international/
|Host country’s FDI in the United States ($M USD, stock positions)||2017||$0||2017||$0||BEA data available at https://www.bea.gov/international/
|Total inbound stock of FDI as % host GDP||N/A||N/A||2020||8.5%||UNCTAD data available at|
*Coordinated Direct Investment Survey – Data by Economy – IMF Data
Note: U.S. based ContourGlobal built a 100 megawatt power plant in Togo in 2010. This FDI is not recorded in official U.S. government statistics.
|Direct Investment from/in Counterpart Economy Data (through 2020)|
|From Top Five Sources/To Top Five Destinations (US Dollars, Millions)|
|Inward Direct Investment||Outward Direct Investment|
|Total Inward||2,302||100%||Total Outward||5,312||100%|
|Côte d’Ivoire||112||5%||Sao Tome & Principe||444||8%|
|“0” reflects amounts rounded to +/- USD 500,000.|
Table 4: Sources of Portfolio Investment
Data not available.
14. Contact for More Information
U.S. Embassy, Lomé
4332 Blvd Eyadéma – BP 852, Lomé, Togo
+228 2261 5470, ext 4466