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Burkina Faso

Executive Summary

On January 24, 2022, the Burkinabé military officers deposed the democratically-elected government of former President Roch Marc Christian Kabore, dissolved the government and national assembly, and suspended the constitution. The coup leader Lieutenant Colonel Paul-Henri Damiba assumed the role of president of Burkina Faso’s Transition Government. In February 2022, a transitional charter was signed by Transition President LTC Damiba laying out a three-year transition period before democratic elections could be held. Since then, a Transitional government and a Transition Legislative Assembly have been installed.

Burkina Faso is a landlocked country and the world’s seventh poorest country according to the 2020 UN Development Program (UNDP) Human Development Index, ranked at 182 out of 189 countries. Burkina Faso has an estimated population of 22 million inhabitants (as of June 2022) according to the United Nations, and the IMF estimates its growth domestic product (GDP) at US$ 19.62 billion. Burkina Faso’s economy rebounded in 2021 and grew at an estimated 8.5 percent, attributable to increases in gold exports and the services sector, according to the World Bank. The economy is forecasted to grow at 5.6 percent in 2022. The fiscal deficit stood at 5.5 percent of GDP in 2022, but could reach 6.6 percent of GDP in 2022 as a result of the multitude of challenges Burkina Faso faces, including security, humanitarian, food, and social, etc. Over 40 percent of the Burkinabe population live below the poverty line, and the country ranks 144th out of 157 countries in the World Bank’s Human Capital Index. Some 80 percent of the country’s population is engaged in agriculture—mostly subsistence—with only a small fraction directly involved in agribusiness. In 2020, as a response to the COVID-19 crisis, the Burkinabe government announced a series of socio-economic measures ranging from tax breaks to subsidies and food support to low-income families. The overall cost of the measures was estimated at US$656 million.

Overall, Burkina Faso welcomes foreign investment and actively seeks to attract foreign partners to aid in its development. It has partially put in place the legal and regulatory framework necessary to ensure that foreign investors are treated fairly, including setting up a venue for commercial disputes and streamlining the issuance of permits and company registration requirements. More progress is needed to diminish the dominance of state-owned firms in certain sectors and to enforce intellectual property protections.

Burkina Faso ranks 100th of 177 countries in the Heritage Foundation’s economic freedom report 2022 Economic Freedom Index. Among the 51 African countries in the report, Burkina Faso ranked 14th, improving its 21st position in the 2021 economic freedom report. Burkina Faso’s corruption perception score improved slightly from 40 in 2020 to 42 in 2021 and improved the country’s ranking from 86th to 78th of 180 countries.

The gold mining industry has boomed in the last decade, and the bulk of foreign investment is in the mining sector, mostly from Canadian firms. Moroccan, French and UAE companies control local subsidiaries in the telecommunications industry, while foreign investors are also active in sectors such as agriculture, transport and logistics, energy, and financial technology. There is a growing foreign investment interest in the security sector. In June 2015, a new mining code was approved to standardize contract terms and better regulate the sector. In 2018, the parliament adopted a new investment code that offers many advantages to foreign investors. This code offers a range of tax breaks and incentives to lure foreign investors, including exemptions from value-added tax (VAT) on certain equipment. Effective tax rates as a result are lower than the regional average, though the tax system is complex, and compliance can be burdensome. Opportunities for U.S. firms exist in many sectors, but including in agriculture and manufacturing

Burkina Faso remains committed to a market-based economy without barriers to trade. Over the last 15 years, the national power utility’s Société Nationale de l’Eléctricité du Burkina (SONABEL) customer base and energy demand ballooned. Between 2015 and 2021, SONABEL customer base grew by 64%. However, supply can only meet the demand in non-peak periods. Burkina Faso imports nearly 70 percent of its electricity from neighboring Ghana and Cote d’Ivoire and faces electricity reliability and affordability challenges. It also imports other energy products such as gasoline and gas through a network of foreign companies to meet local demand. the Millennium Challenge Corporation (MCC) suspended the US$ 500 million compact with the Government of Burkina Faso. The Compact aimed to unlock economic growth by strengthening electricity sector effectiveness, energy reliability cost-effectiveness, and grid development and access, creating a more favorable investment environment for firms in the energy sector and the wider economy and spurring further foreign direct investment in Burkina Faso.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 78 of 180 2021 Corruption Perceptions Index – Explore the… – Transparency.org
Global Innovation Index 2020 115 of 132 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2020 NA https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2020 $770 GNI per capita, Atlas method (current US$) | Data (worldbank.org)

1. Openness To, and Restrictions Upon, Foreign Investment

Following the 2020 reelection of former President Kabore for his second term, a new national socioeconomic development plan (PNDES-II, 2021-2025) was adopted to replace a previous plan (2016-2020). The plan covered four strategic goals: (1) the consolidation of resilience, security, social cohesion, and peace, (2) the deepening of institutional reforms and modernization of public administration, (3) improving sustainable human development, and (4) promoting high impact sectors of the economy and jobs. However, it remains unclear how PNDES II will be impacted by the January 24 coup d’état.

After overthrowing the government on January 24, 2022, LTC Paul-Henri Sandaogo Damiba met with the private sector on February 1 to allay the concerns of the business community and other investors. A Transitional legislative assembly, a transitional government and a transitional charter and agenda were adopted on March 1, 2022, for a 36-month transition that would lead to presidential and legislative elections. However, in an April 1 address to the nation, interim president LTC Damiba indicated that the 36-month transition timeline to democracy could be revised, should the security situation improve.

In a speech to the Transitional Legislative Assembly on April 04, 2022, Prime Minister (PM) Albert Ouedraogo laid out four major pillars or priorities for his government: (1) fighting terrorism and restoring territorial integrity, (2) Responding to the humanitarian crisis, (3) refoundation (or restoration) of the state and improving governance, (4) working towards national reconciliation and social cohesion. PM Ouedraogo indicated plans for a new development plan for the transition period that would incorporate major strategic projects from the PNDES II.

Article 8 of the investment code stipulates that there is to be no discrimination against foreign investors. For any foreign investor to benefit from the exemptions provided for by the investment code, it is required to submit a request to the General Directorate for the Promotion of the Private Sector.

Burkina Faso hosts a certain number of trade fairs and exhibitions to attract foreign investments. These initiatives encompass several sectors, including the bi-annual International Cotton and Textile Fair (SICOT), the annual West Africa Mining Activities Week (SAMAO), the bi-annual Ouagadougou International Arts and Crafts Fair (SIAO) and the bi-annual Panafrican Film and Television Festival of Ouagadougou (FESPACO). SICOT—which was supposed to place on January 27-29 but was postponed due to the coup d’état—convenes cotton sector actors to advance the cotton value chain in Burkina Faso, Africa and globally. SICOT aspires to be the international forum for promoting African cotton by marketing the sector to the world, promoting industrial processing, attracting investment, and boosting industrial cotton production. Burkina Faso is the third largest producer of cotton in Africa, producing 518,545 tons in the 2021-2022 harvest. Burkina Faso also organizes the Burkina Economic days (JEB) to engage potential investors and foster mutually beneficial partnership opportunities. Previous JEB events have been held in Ouagadougou and across the world, including Canada, Paris, Vienna, and Seoul, among others.

Burkina Faso is a member of the Organization for the Harmonization of Corporate Law in Africa (OHCLA). All the Uniform Acts enacted by this organization are applicable in the country. Regarding business structures, OHCLA allows most forms of companies admissible under French business law, namely public corporations, limited liability companies, limited share partnerships, sole proprietorships, subsidiaries, and affiliates of foreign enterprises. Each kind of company has a corresponding set of related preferences, duty exceptions, corporate tax exemptions, and operation-related taxes.

From 1995 to 2018, Law 062-95, which was amended several times, governed investments in Burkina Faso. However, to adapt this code to the new exigencies of the world economy and to respond to the fierce competition between states to attract foreign investment, the National Assembly adopted a new Investment Code (Law 038) on October 30, 2018. It replaces Law 062-95 of December 14, 1995, which had several shortcomings, including the non-coverage of investments in renewable energies and other energy sources. According to Article 5 of the Investment Code, certain sectors of activity may be subject to restrictions on foreign direct investment. Foreign companies wishing to invest in these sectors must follow a specific procedure specified by decree. However, Burkina Faso has not yet established a procedure to scrutinize foreign direct investment. Under the investment code, all personal and legal entities lawfully established in Burkina Faso, both local and foreign, are entitled to the following rights: fixed property; forest and industrial rights; concessions; administrative authorizations; access to permits; and participation in government procurement process.

The Investment Code establishes a special tax and customs regime for investment agreements signed by the state with large investors—from approximately US$ 162,000 (100,000,000 FCFA) to $1.62 million (1,000,000,000 FCFA). This scheme provides significant tax benefits. U.S. investors are not specifically targeted regarding ownership or control mechanisms.

In March 2013, the GoBF created the Burkina Faso Investment Promotion Agency (API-BF). The establishment of the Presidential Council fulfilled recommendations of a 2009 UNCTAD Investment Policy Review. The website is www.investburkina.com .

To simplify the registration process for companies wishing to establish a presence in Burkina Faso, the government created eight enterprise registration centers called Centres de Formalités des Entreprises (CEFOREs). The CEFOREs are one-stop shops for company registration. On average, a company can register its business in nine days according to the 2019 Doing Business report. The CEFOREs are in Ouagadougou, Bobo-Dioulasso, Ouahigouya, Tenkodogo, Koudougou, Fada N’Gourma, Kaya, Dedougou and Gaoua.

In 2018, Burkina Faso strengthened protections for minority investors by enhancing access to shareholder actions and by increasing disclosure requirements on related-party transactions. The 2020 Doing Business report ranked Burkina Faso 151 of 190 in minority investor protection.

Other sites of interest:

Among the 21 countries covered by the World Bank’s Investing across Sectors indicators in Sub-Saharan Africa, Burkina Faso is one of the more open economies to foreign equity ownership. Most of its sectors are fully open to foreign capital participation, although the law requires companies providing mobile or wireless communication services to have at least one domestic shareholder. Furthermore, the state automatically owns 10 percent of the shares of all companies active in the mining sector. The government is entitled to nominate one member of the board of directors for such companies. Select additional strategic sectors the oil and gas sector, and the electricity transmission and distribution sectors, are characterized by monopolistic market structures.

The Burkinabe Government tries to promote inward investment via the Investment Promotion Agency of Burkina Faso or l’Agence de Promotion des Investissements du Burkina Faso (API-BF), which sits under the Presidential Council for Investment (Conseil Presidentiel pour l’Investissement). The API-BF’s mission is to promote the economic potential of Burkina Faso to attract investment and spur economic development. Burkina Faso currently imposes no restrictions for investors interested in investing abroad, within the framework of the Economic Community of West African States (ECOWAS) and West African Economic and Monetary Union (WAEMU) regional markets.

3. Legal Regime

The government of Burkina Faso aims for transparency in law and policy to foster competition. By law, prices of goods and services must be established according to fair and sound competition. The Burkinabe government does not promote or require environmental, social, and governance disclosure to help investors and consumers distinguish between high and low quality investments. However, the government believes that cartels, the abuse of dominant position, restrictive practices, refusal to sell to consumers, discriminatory practices, unauthorized sales, and selling at a loss are practices that distort free competition. At the same time, the price of some staple goods and services are still regulated by the government, including fuel, essential generic drugs, tobacco, cotton, school supplies, water, electricity, and telecommunications, and bread (e.g. baguettes). There are regulatory authorities for government procurement, for electronic communication and posts, for electricity, and for quality standards. Provinces and municipalities have the power to regulate in their jurisdiction, but that regulation has a minimal effect on business entities. There are several regulatory bodies at the national level, and they usually internalize regulations enacted by international organizations. Regulations exist at the supra-national level mostly through WAEMU and ECOWAS.

Burkina Faso’s legal, regulatory, and accounting systems are transparent and consistent with international norms. Since January 2018, Burkina Faso, as a member state of the Organization for the Harmonization of Corporate Law in Africa (OHCLA), adopted the revised version of the OHCLA accounting system. It is composed of the Uniform Act on Accounting and Financial Law (AUDCIF); the OHADA General Accounting Plan (PCGO); the OHADA Accounting System (SYSCOHADA) application guide, and the International Financial Reporting Standards (IFRS) application guide. The OHCLA accounting system complies with the IFRS norms.

There is no online Regulatory Disclosure. However, the regulations of the National Assembly allow the various commissions to hear civil society organizations wishing to share information to inform parliamentarians when they are examining bills.

Burkina Faso is a member of the West African Economic Monetary Union (WAEMU) and the Economic Community of West African States (ECOWAS). There is a supranational relationship between these organizations and their state members. Burkina Faso is also a member of the Organization for the Harmonization of Corporate Law in Africa (OHCLA). As such, Uniform Laws adopted by the OHCLA are automatically part of the national legal system.

The Government of Burkina Faso regularly notifies all the draft technical barriers to the relevant WTO Committee. In the October 2017 Trade Policy Review, the WTO congratulated WAEMU countries for their continued efforts to improve their international trading environment, especially through the implementation of the Trade Facilitation Agreement (TFA). Burkina Faso has begun the ratification process of the TFA, but it has not yet completed it. However, WAEMU and ECOWAS members already implement many of the TFA provisions.

The legal system of Burkina Faso is the civil law. Contracts must always be performed in good faith. Burkina Faso has commercial courts and commercial law is constituted by the uniform acts of the OHADA. The Commercial Code governs all matters that are not covered by the OHADA law. The Burkinabe judiciary is independent although there are press reports of cases of corruption of judges. The Disciplinary Commission of the Judiciary has sanctioned corrupt judges. There are three degrees of jurisdiction in Burkina Faso allowing the loser to appeal a decision rendered in first instance. In the event of a dispute over the execution of a contract, the plaintiff must first obtain a judgment from a court and if the loser does not execute, the winner can retain a bailiff.

The investment code adopted by law 038-2018 demonstrates the government’s interest in attracting FDI to create industries that produce export goods and provide training and jobs for its domestic workforce. The code provides standardized guarantees to all legally established firms operating in Burkina Faso, whether foreign or domestic. It contains four investment and operations preference schemes, which are equally applicable to all investments, mergers, and acquisitions. Burkina Faso’s regulations governing the establishment of businesses include most forms of companies admissible under French business law, including public corporations, limited liability companies, limited share partnerships, sole proprietorships, subsidiaries, and affiliates of foreign enterprises. With each scheme, there is a corresponding set of related preferences, duty exceptions, corporate tax exemptions, and operation-related taxes.

Under the investment code, all personal and legal entities lawfully established in Burkina Faso, both local and foreign, are entitled to the following rights: fixed property, forest and industrial rights, concessions, administrative authorizations, access to permits, and participation in state contracts.

The National Commission for Competition and Consumption (Commission Nationale pour la Concurrence et la Consommation) reviews competition matters. Some competition matters are under the aegis of the West African Economic and Monetary Union (WAEMU). Law No. 016-2017/AN of 27 April 2017 on organizing competition in Burkina Faso governs market competitiveness. This law is intended to create a free and transparent market, a guarantee of the development of a market economy driven by competitive and wealth-creating businesses.

The Burkinabe constitution guarantees basic property rights. These rights cannot be infringed upon except in the case of public necessity, as defined by the government. This has rarely occurred. Until 2007, all land belonged to the government but could be leased to interested parties. The government reserves the right to expropriate land at any time for public use. In instances where property is expropriated, the government must compensate the property holder in advance, except in the event of an emergency.

In 2007, Burkina Faso drafted a national land reform policy that recognizes and protects the rights of all rural and urban stakeholders to land and natural resources. It also clarifies the institutional framework for conflict resolution at a local level, establishes a viable institutional framework for land management, and strengthens the general capacities of the government, local communities, and civil society on land issues. A 2009 rural land management law provides for equitable access to rural lands to promote agricultural productivity, manage natural resources, encourage investment, and reduce poverty. It enables legal recognition of rights legitimated by traditional rules and practices. In rural areas, traditional land tenure rules have long governed land transactions and allocations. The 2009 law reinforces the decentralization and devolution of authority over land matters and provides for formalization of individual and collective use rights and the possibility of transforming these rights into private titles.

In 2012, the government revised the 2009 law, marking the end of exclusive authority of the state over all land. The new law includes provisions to recognize local land use practices. The new law provides conciliation committees to resolve conflicts between parties prior to any legal action. There are several property rights recognition and protection acts, such as land charters, individual or collective land ownership certificates, and loan agreements that govern the nature, duration, and counterparties for transfer rights between a landowner and a third party.

The first Millennium Challenge Corporation (MCC) compact (2010-2014) supported the establishment of local authorities and the issuance of titles as part of the land tenure reform process.

Since Burkina Faso is a member of the OHADA, the Uniform Act on Bankruptcy is applicable.

There are no bankruptcy courts in Burkina Faso. The World Bank’s 2019 “Doing Business” report ranked Burkina Faso 107 out of 190 countries for Resolving Insolvency.

4. Industrial Policies

The 2018 investment code demonstrates the government’s interest in attracting FDI to create industries that produce export goods and provide training and jobs for its domestic workforce. The code provides standardized guarantees to all legally established firms operating in Burkina Faso, whether foreign or domestic. It contains five investment and operations preference schemes, which are equally applicable to all investments, mergers, and acquisitions. Since its adoption in October 2018 to date, there are approximately 195 companies which have been approved for the various schemes under the new Investment Code. The current investment does not envisage any incentives for clean energy investments such as tax incentives, feed-in tariffs, or discounts on electricity rates.

Burkina Faso’s regulations governing the establishment of businesses include most forms of companies admissible under French business law, including public corporations, limited liability companies, limited share partnerships, sole proprietorships, subsidiaries, and affiliates of foreign enterprises. With each corporate structure, there is a corresponding set of related preferences, duty exceptions, corporate tax exemptions, and operation-related taxes.

Under the investment code, all personal and legal entities lawfully established in Burkina Faso, both local and foreign, are entitled to the following rights: fixed property, forest and industrial rights, concessions, administrative authorizations, access to permits, and participation in state contracts.

There are no foreign trade zones, free ports, or special economic zones in Burkina Faso. The Burkinabe investment code prohibits discrimination against foreigners. American firms not registered in Burkina Faso can compete for contracts on projects financed by international sources such as the World Bank, U.N. organizations, or the African Development Bank.

The African Continental Free Trade Area (AfCFTA) refers to a continental geographic zone where goods and services move among member states of the AU with no restrictions. The AfCFTA aims to boost intra-African trade by providing a comprehensive and mutually beneficial trade agreement among the member states, covering trade in goods and services, investment, intellectual property rights and competition policy. As of May 2022, 43 countries (including Burkina Faso) have deposited their instruments of ratification. Of the 55 AU member states, only Eritrea has yet to sign. Start of trading under the AfCFTA Agreement began on January 1,2021. The AfCFTA will be governed by five operational instruments: The Rules of Origin; the online negotiating forum; the monitoring and elimination of non-tariff barriers; a digital payments system and the African Trade Observatory. A digital payments system was scheduled to start in 2020 but has since been postponed due to the COVID-19 pandemic. On March 10, 2022, the Enhanced Integrated Framework (EIF) of the United Nations Economic Commission for Africa (UNECA) and the International Islamic Trade Finance Corporation (ITFC) launched a project to support the implementation of more than 30 activities in the AfCFTA in signatory countries, including Burkina Faso.

The GoBF does not mandate local employment, but in recent years has encouraged investors to promote local employment and support local economies. The GoBF does not require investors to purchase materials from local sources or to export a certain percentage of output. However, regarding the mining sector, according to the article 101 of the mining code, “Holders of mining title or authorization and their subcontractors give preference to Burkinabe enterprises for any contract of provision of services or supplies of goods in equivalence of price, quality and time.” A decree was adopted by the Burkina Faso government in September 2021 to guide the application of the provision of article 101 and provided a list of goods for which the decree is applicable. It will come into force on January 1, 2023. The GoBF does not impose “offset” requirements, which dictate that major procurements be approved only if the foreign supplier invests in Burkinabe manufacturing, research and development, or service facilities in areas related to the items being procured. Burkina Faso does not have “forced localization” policies.

5. Protection of Property Rights

Since the 2009 land tenure reform law, the government of Burkina Faso has been engaged to issue titles recognizing land ownership rights. The MCC’s first compact focused on beginning this process in 47 communes, with plans for the government to expand the effort throughout the country.

Only about 5,000 land titles have been granted countrywide since 1960, according to the National Land Observatory, and the majority of those were issued pursuant to the first Millennium Challenge compact. Obtaining a title is the last step in the process of land acquisition and is preceded by obtaining a use permit or an urban dwelling permit, developing the land, and paying applicable fees. The titleholder becomes the owner of the surface and the subsoil.

Mortgages exist in Burkina Faso both for land and for structures. Rules governing mortgages are set at the regional level by the West African Economic and Monetary Union, specifically under the Organization for the Synchronization of Business Rights in Africa (Organisation pour l’Harmonisation en Afrique des Droits des Affaires (OHADA). Liens are not widely used.

Burkina Faso’s legal system offers protection for intellectual property rights (IPR), including patents, copyrights, trademarks, trade secrets, and semiconductor chip design. In practice, however, government enforcement of IPR law is lax. Burkina Faso is a destination point for counterfeit medicines, which can be purchased readily in Ouagadougou and Bobo-Dioulasso.

Burkina Faso is a member of the World Intellectual Property Organization (WIPO) and the African Intellectual Property Organization (AIPO). The national investment code guarantees foreign investors the same rights and protection as Burkinabe enterprises for trademarks, patent rights, labels, copyrights, and licenses. In 1999, the government ratified both the WIPO Copyrights Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT). In 2002, Burkina Faso was one of 30 countries that put the WCT and WPPT treaties into force. The government has also issued several decrees and rules to implement the two treaties.

The implementation of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) is under the purview of two ministries. The first is the Office of Copyrights (le Bureau Burkinabe des Droits d’Auteurs, or BBDA) under the Ministry of Art, Culture and Tourism, which has the lead for copyright and related rights. The National Directorate of Industrial Property under the Ministry of Commerce, Industry, and Handicrafts has the lead for industrial property issues. These two authorities have the technical competence to identify needs. Arrangements are underway to assess the needs for the implementation of the TRIPS Agreement in Burkina Faso.

Statistics on the seizure of counterfeit goods are available upon request from the relevant agency. For example, the BDDA tracks seizures pertaining to artistic material, and the National Directorate of Industrial Property tracks seizures pertaining to pharmaceuticals.

Burkina Faso is not cited in the United States Trade Representative (USTR) Special 301 Reports or the Notorious Markets List.

6. Financial Sector

The government of Burkina Faso is more focused on attracting FDI and concessionary lending for development than it is on developing its capital markets. Net portfolio inflows were estimated at US$ 148.6 million ( 0.83 percent of GDP) in 2020, per the World Bank. While the government does issue some sovereign bonds to raise capital in the WAEMU regional bond market, in general the availability of different kinds of investment instruments is extremely limited. As part of its mechanism to fund its fiscal budget, the Burkina Faso government regularly issues 182-day maturity treasury bills (BAT) on the regional financial market of the West African Economic and Monetary Union (WAEMU, or UEMOA in French).

The banking system is sound, relatively profitable, and well capitalized, but credit is highly concentrated to a small number of clients and a few sectors of the economy, according to the IMF. Only an estimated 15 percent of the population are believed to have checking accounts. Like all member states of WAEMU, Burkina Faso is a member of the Central Bank of West African States. Many foreign banks have branches in the country. The traditional banking sector is composed of twelve commercial banks and five specialized credit institutions called “établissements financiers.” In Burkina, the national strategy for inclusive finance was adopted on April 23, 2019. The use of mobile money is becoming more prevalent. In addition to two of the three main mobile carriers offering mobile money services, in 2021 other companies, both foreign and local have launched mobile money service operations and are conquering an important client base. This trend has forced traditional banks to install own mobile transfer planforms.

Burkina Faso does not have a sovereign wealth fund. However, in 2017, the government created the Deposit and Consignment Fund (CDC-BF), an autonomous legal and financial entity whose mandate is to receive and manage assets of various funds and entities, in particular funds from dormant accounts transferred to the Public Treasury (National Social Security Fund, Autonomous Retirement Fund for Civil Servants, National Post Office). Its mandate is to invest the funds locally. The CDC-BF is not yet fully rolled out.

7. State-Owned Enterprises

GoBF announcements for privatization bids are widely distributed, targeting both local and foreign investors. Bids are published in local papers, international magazines, mailed to different diplomatic missions, e-mailed to interested foreign investors, and published on the Internet on sites such as http://www.dgmarket.com .

8. Responsible Business Conduct

There is a general awareness of corporate social responsibility among both producers and consumers. The GoBF requires mining companies to invest in social infrastructure, such as health centers and schools, and other projects to benefit the local populations in the areas of their mining operations. To this end, the 2015 mining code stipulated the establishment of the Mining Fund for Local Development (FMDL). FMDL is a mechanism to decentralize national resources wealth. To fund the FMDL, the GOBF contributes 20% of the royalties it collects and the mining firms contribute about 1% of their gross revenues. FMDL entered into force in 2019 and has since distributed about US$ 129 million to 351 communes nationwide. A common practice for many companies is to provide food supplies, typically rice or millet, to their workers often at the end of the year. Larger private businesses, such as civil engineering firms, sponsor sport events like the Tour du Faso and donate sporting equipment to disadvantaged communities. SOEs such as SONABHY and LONAB frequently undertake social projects.

Burkina Faso is a member of the Extractive Industries Transparency Initiative (EITI) since 2008. EITI declares Burkina Faso as a compliant country, recognizing the country’s “significant progress in the implementation of the 2016 EITI Standard, with considerable improvements,” including satisfactory scores on five of the six corrective measures assessed.

Department of State

Department of Labor

Burkina Faso is ranked 46 in the latest Bloomberg NEF’s Climatescope rankings. The country does not appear in the ITIF’s Global Energy Innovation Index, the Global Green Growth Index, or the Green Future Index. However, Burkina Faso is engaged internationally on climate issues. Burkina Faso sent a 60-person delegation to COP26 in Glasgow. Burkina Faso continues to align itself with the positions of the African Group (AGN), Least Developed Countries (LDC) and the G77+China Group. Burkina supports the implementation of the African Renewable Energy Initiative (AREI), the Adaptation of Agriculture in Africa (AAA Initiative), the Sahel Climate Commission, the Congo Basin Region Commission, and the Islamic States Commission. In Glasgow, Burkina Faso reiterated its supports for initiatives related to climate adaptation, finance, and mitigation, as well as those on technology transfer, capacity building, among others. Burkina Faso has called for the international community to do more to respond to climate change challenges.

9. Corruption

Transparency International’s 2021 Corruption Perceptions Index indicates that Burkina Faso ranks 78 out of 180 countries. Nearly 82 percent of Burkinabe believe corruption is frequent or very frequent in their country, according to a report released November 2021by the National Network for Anti-corruption Fight (REN-LAC). The percentage of people who thought corruption was frequent or very frequent (82%) has risen steadily since 2019 (76%) and 2018 (67%). The Burkinabe public also believe that the fight against corruption is going in the wrong direction. The report also ranks the most corrupt public services as perceived by the public as (1) municipal police, (2) national police, (3) customs, (4) General-Directorate for Road and Maritime Transports (DGTTM), and (5) gendarmerie. The State Supreme Audit Authority (ASCE-LC) is the leading government anti-corruption body that publishes an annual report documenting financial irregularities, embezzlement, and improper use of public funds in various ministries, government agencies, and state-run companies. In 2018, the ASCE-LC opened at least two high profile corruption investigations against the Ministers of Defense and Infrastructure. The minister of defense was jailed under corruption charges and provisionally released due to health conditions. The Burkinabe government continues to grant access within its own ministries to the non-governmental watchdog REN-LAC, which examines the management of private and public-sector entities and publishes annual reports on corruption levels within the country.

Legislation requires government officials, including the president, lawmakers, ministers, ambassadors, members of the military leadership, judges, and anyone charged with managing state funds, to declare their assets as well as any gifts or donations received while in office. Infractions are punishable by a maximum jail term of 20 years and fines of up to USD 41,670. In May 2020, former Minister of Defense, Jean-Claude Bouda, was arrested on “money laundering” and “illicit enrichment” charges following a complaint by the National Anti-Corruption Network. In June 2021, State Prosecutor Harouna Yoda announced that the Deputy Director General of Customs, William Alassane Kaboré, was placed under “judicial control,” for acts of illicit enrichment and money laundering amounting to 1.3 billion CFA (USD 2.2 million). Additionally, investigations are underway on the mayor of Ouagadougou and some magistrates who allegedly tried to bury this case.

One of the main governmental bodies for fighting official corruption is the Superior Authority of State Control (ASCE), an entity under the authority of the Prime Minister. ASCE has the authority to investigate ethics violations and mismanagement of public funds in the public sector, including civil service employees, local and public authorities, state-owned companies, and all national organizations involved with public service missions. ASCE publishes an annual report of activities, which provides details on its investigations and issues recommendations on how to resolve them. Many of its findings are followed by judicial action.

The Cour des Comptes (Court of Audit) is another institution that participates in the control of the execution of the annual budget. It draws up an annual report on the execution of the annual budget. Every year, it produces a public report, including the observations of all its audits, which is submitted to the President of Burkina Faso. It also draws up a general report for the President of Faso on the activity, management, and results of the companies it audits on a bi-annual basis.

The Autorité de Régulation de la Commande Publique (ARCOP), established in July 2008, is the regulatory oversight body that ensures fairness in the procurement process by monitoring the execution of all government contracts. ARCOP may impose sanctions, initiate lawsuits, and publish the names of fraudulent or delinquent businesses. It also educates communities benefiting from public investment monies to take a more active part in monitoring contractors. ARCOP works with the media to strengthen journalists’ capacity to investigate suspected fraud cases. Since 2012, the media has noticeably increased its coverage of high-profile corruption cases.

The Reseau National de Lutte Contre la Corruption (REN-LAC)’s annual state of corruption report has led to a wide range of anti-corruption initiatives and tools. REN-LAC has a 24-hour hotline that allows it to gather information on alleged corrupt practices anonymously reported by citizens. African Parliamentarians’ Network against Corruption also has a local chapter in Burkina Faso and cooperates with REN-LAC. To put an end to tax fraud, the government passed into law Article 17 of the November 21, 2013, Law No. 037-2013/AN of the 2014 Budget Law, which called for standardized invoices (Facture Normalisée) in commercial transactions. The Burkina Faso Chamber of Commerce will help facilitate its implementations. This provision however only became operational in early 2022.

As a member of the West African Economic and Monetary Union (WAEMU), Burkina Faso has agreed to enforce a regional law against money laundering and has issued a national law against money laundering and financial crimes.

Burkina Faso has taken steps to fully adopt regional and international anti-corruption frameworks, and the country ratified the UN Convention against Corruption in October 2006.

According to World Bank rating for control of corruption, Burkina Faso has improved steadily since 2013 and currently ranks above the regional average.

REN-LAC hotline: (+226) 8000 1122
Or contact:

Sagado NACANABO
Executive Secretary
REN-LAC
Telephone : +226 25 36 32 15

Luc Marius Ibriga
Contrôleur Général d’Etat
Autorité Supérieure de Contrôle d’Etat et de la Lutte contre la Corruption (ASCE-LC)
Telephone: +226 25 30 10 91 or +226 25 33 60 39

10. Political and Security Environment

Rampant insecurity and the government’s inability to stem violent extremism contributed to the military overthrow of the democratically elected government of President Roch Marc Christian Kaboré on January 24, 2022. In 2021, Burkina Faso recorded the highest number of attacks during its five-plus year battle with violent extremism. The result has led to a crisis resulting in the closure of schools and the massive displacement of people from their homes and communities. President Roch Marc Christian Kabore had been reelected to a second and final term in November 2020. This was the first time a democratic handover of power occurred in Burkina Faso’s history since it gained independence in 1960. During the same period legislative elections were organized and results were accepted by all political parties.

However, Violent extremists remain very active in Burkina Faso. Both the Islamic State for the Greater Sahara and the Jama’ at Nasr Al Islam wal Muslimin (JNIM) coalition have expanded their operation footprints in recent years. Security incidents include violence using tactics such as, improvised explosive devices, kidnapping, attacks, and targeted killings in an expanding part of the country in the north, east, and south. Targets appeared to shift from military and gendarmerie units to civilians and volunteer defense groups. In May 2022, VEOs carried out 61 attacks against civilians and security forces, killing a total of 173 people and injuring 40 others, The number of terrorist incidents in Burkina Faso’s southwestern Boucle du Mouhoun region rose significantly in May compared to the numbers reported for the three previous months. Since October 2021, over 799 people died in terrorist incidents, and an additional 600 individuals sustained injuries during the same period. On June 4, 2021, VEOs killed 160 civilians in Solhan in the Sahel region near the border with Niger. This was the second deadliest terrorist attack globally in 2021, according to the 2022 Global Terrorism Index. The report also indicates that 732 people died from terrorist incidents in Burkina Faso in 2021. The African Center for Strategic Studies noted in its July 2021 report that most violent attacks in the Sahel in 2020 were carried out in Burkina Faso (516 versus 361 in Mali and 118 in Niger).

In April 2022, a U.S. citizen was reportedly abducted in Burkina’s Centre-Nord,. In 2018, an American citizen was abducted but was later discovered by French operatives during an unrelated mission to recover French nationals abducted by extremists. Three Europeans – two Spanish and one Irish – were killed in an attack on an anti-poaching patrol in eastern Burkina Faso on April 27, 2021. In 2021, attacks spiked in the southern part of Burkina Faso, contiguous to the north of Cote d’Ivoire. The Cascades region border area, which has suffered several attacks in the past, is seen by experts as a hide-out for armed terrorist groups and a threat for coastal countries. As of April 2022, terrorist attacks have generated around 1.9 million Internally Displaced Persons (IDPs) mostly in Burkina Faso’s Sahel, Centre-Nord, Nord, and Est regions. Since 2018, the Government of Burkina Faso has maintained a state of emergency due to insecurity in many parts of the country

As of May 2022, the U.S. State Department’s travel advisory to Burkina Faso is at Level 4: Do Not Travel due to terrorism, crime, and kidnapping.

11. Labor Policies and Practices

Burkinabe workers have a reputation as hardworking and dedicated employees. While unskilled labor is abundantly available in Burkina Faso, skilled labor resources are limited. There is a scarcity of skilled workers, mainly in management, engineering, and the electrical trades. Construction, civil engineering, mining, and manufacturing industries employ the majority of the formal labor force. Burkinabe law allows workers, except for essential workers such as magistrates, police, military, and other security personnel, to form and join independent unions of their choice without previous authorization, and to bargain collectively. The law provides for the right to strike, but also limits this right with pre-strike requirements or restrictions (including notice submission and government’s requisition power to secure minimum service in essential services).

Public servants are also entitled to engage in bargaining. In recent years, a series of public sector unions have gone on strike to demand better living and working conditions. However, increasing labor demands across multiple ministries have begun to put stress on an already strained public finance system, and have affected the tax collection processes. Although President Kabore has announced the intention to present a comprehensive labor deal (as opposed to the piecemeal settlement of strikes in different sectors that has been the case until now), it is not clear that any progress is being made on this front. The Minister of Public Service has decided to establish for civil servants.

It is the GoBF’s policy to increase employment opportunities for Burkinabe workers. Therefore, in professions where there are too many registered and unemployed Burkinabe, a job-seeker card will not be issued to non-nationals. When non-nationals are hired, the Director of Labor authorizes their employment contract. According to the 1967 decree, statements must be made to the Regional Inspector of Work and Social Rules before the start-up of any new enterprise.

Burkina Faso has undertaken reforms of labor policy to make the labor market more flexible while ensuring workers’ rights, including workers’ safety and health. To promote local employment, the government has established several financing instruments targeted at firms interested in obtaining start-up monies. These instruments include Fonds National d’Appui à la Promotion de l’Emploi – FONAPE (Employment Promotion Support Fund), Fonds d’Appui au Secteur Informel – FASI (Informal Sector Support Fund), Fonds d’Appui aux Activités Génératrices de Revenus des Femmes – FAARF (Women’s Income Generating Activities Support Fund), Fonds d’Appui aux Initiatives des Jeunes – FAIJ (Youth Initiative Support Fund), and Fonds Burkinabe de Développement Economique et Social – FBDES (Burkinabe Fund for Social and Economic Development).

In the event of a reduction in personnel, the labor code requires the employer to first dismiss employees with the least training and seniority. The employer must advise employees of termination at least 30 days in advance. Workers terminated in a general workforce reduction have re-employment priority over other applicants for a two-year period. Employees terminated for reasons other than theft or flagrant neglect of duty have the right to termination benefits. In Burkina Faso, however, the informal sector is an important sector of the economy. A sizable part of the Burkinabe population earns a living in the informal economy, especially in agriculture and artisanal mining sectors. For instance, artisanal mining alone is estimated to employ one million to 1.3 million people directly. The value of gold extracted annually through artisanal mining is estimated at about US$1 billion, or about 20 tons of gold. However, they noted that much of Burkina Faso’s artisanal mining output is smuggled out through neighboring countries without royalties or tax revenue going to the state budget. In some regions of the country, over 90 percent of youth earn a living through artisanal mining, with some abandoning agriculture for the lure of gold mining. Nevertheless, there are no indications that the informal economy negatively impacts or crowds out investment across industries.

To date, Burkina Faso has approved and ratified 43 conventions of the International Labor Organization, including conventions on Freedom of Association and the Right to Organize, Abolition of Forced Labor, and the Worst Forms of Child Labor. The Ministry of Civil Service, Labor, and Social Security and a labor court enforce the labor code. Unions are well organized, independent from the government, and defend employee interests in industrial disputes. Workers know their rights and do not hesitate to seek redress of grievances.

Despite the government’s substantial efforts to reduce child labor in the past few years, 42 percent of children in Burkina Faso continue to engage in child labor, particularly in agriculture. The worst forms of child labor take place in mining. Cotton and gold are included on the U.S. government’s Executive Order 13126 List of Goods Produced by Forced and Indentured Child Labor.

The 1982 Commercial Sector Collective Agreement divides employees (laborers, artisans, and senior staff) into eight categories with minimum basic pay rates from 25,000 FCFA (about USD 45) per month. Conditions for the employment of workers by enterprises are provided in Decree no. 98 of 1967. An employer should ask job candidates for their job-seeker registration card issued by the Office of Employment Promotion, which is part of the Ministry of Civil Service, Labor, and Social Security.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2021 $19.2 Billion https://www.imf.org/en/Countries/BFA#countrydata
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/direct-investment-and-multinational-enterprises-comprehensive-data
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/direct-investment-and-multinational-enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP N/A N/A 2021 0.03% UNCTAD data available at

https://unctad.org/en/Pages/DIAE/World%20Investment%20Report/Country-Fact-Sheets.aspx  

Table 3: Sources and Destination of FDI
Data not available.

14. Contact for More Information

Renaud Hien
Economic and Commercial Specialist
U.S. Embassy Ouagadougou
Secteur 15, Ouaga 2000
Avenue Sembene Ousmane, Rue 15.873
Ouagadougou, Burkina Faso
+226 25 49 53 00
HienRM@state.gov 

Chad

Executive Summary

Chad is Africa’s fifth largest country by surface area, encompassing three bioclimatic zones. Chad is landlocked, bordering Libya to the north, Sudan to the east, Central African Republic (CAR) to the south, and Cameroon, Nigeria, and Niger to the west (with which it shares Lake Chad). The nearest port — Douala, Cameroon — is 1,700 km from the capital, N’Djamena. Chad is one of six countries that constitute the Central African Economic and Monetary Community (CEMAC), a common market. Chad’s human development is one of the lowest in the world according to the UN Human Development Index (HDI). Poverty afflicts a large proportion of the population.

The Government of Chad (GOC) actively solicits foreign investment, especially from North America. Opportunities for foreign investment exist in Agribusiness; Agricultural, Construction, Building & Heavy Equipment; Automotive & Ground Transportation; Education; Energy & Mining; Environmental Technologies; Food Processing & Packaging; Health Technologies; Information Technology; Industrial Equipment & Supplies; Information & Communication; and Services. Since oil production began in 2003, the petroleum sector has dominated economic activity and been the largest target of foreign investment, including from U.S. companies. Agriculture and livestock breeding are also important economic activities, employing most of the population. In recent years, the GOC has prioritized agriculture, solar energy production, gold mining, livestock breeding and processing, and information technology to diversify the economy and lessen fiscal dependence on volatile global energy markets.

Chad’s investment climate is challenging. Private sector development suffers from a lack of transport infrastructure, GDP growth, skilled labor, reliable electricity, adequate contract enforcement, good governance, and attractive tax rates. Frequent border closures with neighboring countries complicate trade. The COVID-19 pandemic, and associated restrictions, halted Chad’s modest 2019 economic recovery following several years of recession caused by low global oil prices and disruptive debt payments to Glencore. Overall vaccination rates remain low. Existing IMF and World Bank programs aim to improve governance, increase transparency, and reduce internal arrears. Private sector financing is limited, and low GDP growth constrains government investment. Corruption and historically frequent replacement of senior level government figures present further roadblocks, as does cumbersome French-based labor law. The GOC’s interest in maintaining a stake in investment projects, while facilitating access to key decision makers, also introduces financial and operational risks.

Despite these challenges, the success of several foreign investments into Chad illustrates opportunities for experienced, dedicated, and patient investors. Successful investors typically operate with trusted local partners. The oil sector will mark 20 years of operations in 2023. Singapore-based Olam International entered Chad’s cotton market in 2018. Mindful of the imperative to enact reforms, the GOC operationalized a Presidential Council to Improve the Business Climate in January 2021. With rich natural resources, minimally developed agriculture and meat processing sectors, ample sunshine, increasing telecommunications coverage, and a rapidly growing population, Chad presents an opportunity for targeted investment in key sectors.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2022 164 of 180 http://www.transparency.org/research/cpi/overview
Global Innovation Index 2021 N/A https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) N/A N/A https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2020 $630 https://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

The GOC’s policies towards foreign direct investment (FDI) are generally positive. Chad’s laws and regulations encourage FDI, and there are few formal restrictions on foreign trade and investment. Under Chadian law, foreign and domestic entities may establish and own business enterprises.

The National Investment Charter of 2008 permits full foreign ownership of companies in Chad. The only limit on foreign control is on ownership of companies deemed related to national security. The National Investment Charter guarantees both foreign companies and individuals equal standing with Chadian companies and individuals in the privatization process. In principle, tenders for foreign investment in state-owned enterprises (SOEs) and for government contracts are conducted through open international bid procedures. The National Investment Charter also offers incentives to certain foreign companies establishing significant operations in Chad, including up to five years of tax-exempt status.

Chad’s National Agency for Investment and Exports (ANIE, Agence Nationale des Investissements et des Exports), an agency of the Ministry of Industrial and Commercial Development & Private Sector Promotion, facilitates foreign investment. ANIE’s mandate is to contribute to the creation of a business environment that meets international standing, promote investment and exports, support the development of SMEs, and inform GOC decision makers about economic policy. ANIE acts as a one-stop shop for new investors.

Chad has demonstrated few signs of prioritizing investment retention or maintaining an ongoing dialogue with investors, such as through a formal business roundtable or Ombudsman. The Presidential Council for Improving the Investment Climate has met only twice since its 2021 establishment and is still working to clarify its work plan.

There are no limits on foreign ownership or control. There are no sector-specific restrictions that discriminate against market access for U.S. or other foreign investors, and no de facto anti-foreign discriminatory practices. In terms of investment screening mechanisms, the government reviews potential investment projects in a holistic and project-by-project way but has not made public any fixed criteria or standardized methodology.

UNCTAD published a French-language Investment Policy Review (IPR) on Chad in July 2019 ( https://investmentpolicy.unctad.org/publications/1212/investment-policy-review-of-chad ).

The World Trade Organization (WTO) published a joint trade policy review for Chad, Cameroon, Republic of Congo, Gabon, and Central African Republic in 2013 ( https://www.wto.org/english/tratop_e/tpr_e/tp385_e.htm ), and a standalone trade policy review for Chad in 2007 ( https://www.wto.org/english/tratop_e/tpr_e/tp275_e.htm ).

The OECD has not published any investment policy reviews of Chad.

Civil society groups have not shared useful reviews of investment policy-related concerns, though many Chadians at large have voiced concern about the negative effects of Chad’s onerous and lethargic tourist visa process as dissuading potential foreign investment, compared to other countries which boast inexpensive, hassle-free visas on arrival. To date, the government has shown little interest in addressing this common complaint. A Chamber of Commerce does exist, though has published little information regarding policy-related investment concerns.

Foreign businesses interested in investing in or establishing an office in Chad should contact ANIE, which offers a one-stop shop for filing the legal forms needed to start a business. The process officially takes 72 hours and is the most important legal requirement for investment. ANIE’s website ( www.anie-tchad.com ) provides additional information. An easy step to facilitate business (that the government has not taken) would be completing online business registration via the Global Enterprise Registration web site ( www.GER.co ) and the Business Facilitation Program ( www.businessfacilitation.org ). The World Bank estimated in 2019 that it took, on average, 58 days to start a business in Chad.

Contracts are tailored to each investment and often include additional incentives and concessions, such as permissions to import labor or agreements to work with specific local suppliers. Some contracts are confidential. Occasionally, government ministries attempt to change the terms of contracts or apply new laws broadly, even to companies that have pre-existing agreements that exempt them. Chad’s judicial system is weak, and rulings, including those relating to contract disputes, are susceptible to government interference. There is limited capacity within the judiciary to address commercial issues, including contract disputes. Frivolous lawsuits are expensive and difficult to resolve. Parties usually settle disputes directly or through arbitration provided by the Chamber of Commerce, Industry, Agriculture, Mining, and Crafts (CCIAMA) or through an outside entity, such as the International Chamber of Commerce (ICC) in Paris.

The GOC does not offer any programs or incentives encouraging outward investment. The GOC does not restrict domestic investors from investing abroad.

3. Legal Regime

Chad implements laws to foster competition and establish clear rules based on Uniform Acts produced by the Organization for the Harmonization of Business Law in Africa (OHADA, Organisation pour l’Harmonisation en Afrique du Droit des Affaires, www.ohada.com ). However, certain Chadian and foreign companies may encounter difficulties from well-established companies with a corner on the market, discouraging competition.

Regulations and financial policies generally do not impede competition in the financial sector. Legal, regulatory, and accounting systems pertaining to banking are transparent and consistent with international norms. Chad began using OHADA’s accounting system in 2002, bringing its national standards into harmony with accounting systems throughout the region. Several international accounting firms have offices in Chad. However, while accounting, legal, and regulatory procedures are consistent with international norms, some local firms do not use generally accepted standards and procedures in their business practices.

Chad develops forward regulatory plans to encourage foreign investment and budget support. Government ministries draft regulations, subject to approval by the Secretary General of the Government, Council of Ministers, National Assembly, and President. National regulations are most relevant to foreign investors. There are no informal regulatory processes managed by nongovernmental organizations or private sector associations. The GOC occasionally provides opportunities for local associations, such as the National Council of Employers (CNPT, Conseil National du Patronat Tchadien) or the CCIAMA to comment on proposed laws and regulations pertaining to investment. All contracts and practices are subject to legal review, which can be weak.

The government publishes all budget information, including on the Ministry of Finance and Budget website. Other proposed laws and regulations are not published in draft form for public comment. The Observatory on Public Finance is an online framework for the dissemination of public finance data and the operationalization of the Code of Transparency and Good Governance. This code is an implementation of one of the six CEMAC directives on the December 2011 harmonized framework for public financial management that set 2020 as its goal for complete implementation.

The Presidential Council to Improve the Business Climate was announced in 2018, met once in late 2019, and formally launched in January 2021 due to the negative impact of COVID-19 in 2020. This effort to reform Chad’s investment climate and improve Chad’s performance in World Bank assessments is still in its embryonic stage.

The government has not registered Chad on UNCTAD’s website for helping governments simplify, digitize, and automate administrative procedures, www.businessfacilitation.org , despite the website’s ability to be customized for any procedure or level of government without changing any of its laws. To date, the government has not promoted or required companies environmental, social, and governance (ESG) disclosure to facilitate transparency and/or help investors and consumers distinguish between the quality of potential investments.

While the government publishes both its general budget and a simplified “citizen” budget to the website of the Ministry of Finance and Budget and to the Observatory on Public Finance website, it does not allow transparency into its debt obligations, including explicit and contingent liabilities.

Chad has been a member of the WTO since October 19, 1996, and a member of GATT since July 12, 1963. Chad is a member of OHADA and the CEMAC ( www.cemac.int ). Since 2017, Chad is gradually implementing business and economic laws and regulations based on CEMAC standards and OHADA Uniform Acts. Chad’s banking sector is regulated by COBAC (Commission Bancaire de l’Afrique Centrale), a regional agency.

Chad’s legal system and commercial law are based on the French Civil Code which gives rise to the proliferation of frivolous lawsuits and judicial abuse by corrupt authorities. The constitution recognizes customary and traditional law if it does not interfere with public order or constitutional rights. Chad’s judicial system, which often lacks access to printed versions of Chad’s own laws, rules on commercial disputes in a limited technical capacity. Courts normally award monetary judgments in local currency, although it may designate awards in foreign currencies based on the circumstances of the disputed transaction. Historically, the Chadian President appointed judges without National Assembly confirmation, and thus the judiciary may have been subject to executive influence. Following the April 2021 establishment of the Transitional Military Council, its members appointed 93 members to an interim legislative body known as the Transitional National Council (CNT). Many Chadian civil society groups criticized the CNT’s appointment, rather than popular election, as well as its makeup as disproportionately reflecting individuals aligned with former President Deby, and for resulting perceptions of a lack of neutrality.

Chad’s commercial laws are based on standards promulgated by CEMAC, OHADA, and the Economic Community of Central African States (CEEAC, Communaute Economique des Etats de l’Afrique Centrale, http://www.ceeac-eccas.org ). The government is in the process of adopting legislation to comply fully with all these provisions.

Specialized commercial tribunal courts were authorized in 1998 and operationalized in 2004. These tribunals exist in five major cities but lack adequate technical capacity to perform their duties. Firms not satisfied with judgments in these tribunals may appeal to OHADA’s regional court in Abidjan, Cote d’Ivoire, that ensures uniformity and consistent legal interpretations across its member countries. Several Chadian companies have done so. OHADA also allows foreign companies to utilize tribunals outside of Chad, generally in Paris, France, to adjudicate business disputes. Finally, 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 agree, and settlements do not violate Chadian law, Chadian courts uphold the decision of the court in the nation where an agreement was signed, such as the United States. This principle also applies to disputes between foreign companies and the Chadian Government. The International Chamber of Commerce (ICC) can arbitrate such disputes and foreign companies frequently choose to include clauses in their contract to mandate ICC arbitration.

Bilateral judicial cooperation is in effect between Chad and certain nations. Chad signed the Antananarivo Convention in 1970, 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.

The National Investment Charter encourages foreign direct investment. Chad is a member of CEMAC and OHADA. Since 2017, Chad has gradually implemented business and economic laws and regulations based on CEMAC standards and OHADA Uniform Acts.

Foreign investors using the court system are not generally subject to executive interference. In addition, the OHADA Treaty allows foreign companies to utilize tribunals outside of Chad, e.g., the International Chamber of Commerce (ICC) in Paris, France, to adjudicate any disputes. Companies may also access the OHADA’s court located in Abidjan, Ivory Coast.

Foreign businesses interested in investing in or establishing an office in Chad should contact ANIE, which offers a one-stop shop for filing the legal forms needed to start a business. The process officially takes 72 hours and is the most important legal requirement for investment. ANIE’s website ( www.anie-tchad.com ) provides additional information.

Regulation of competition is covered by the OHADA Uniform Acts that form the basis for Chadian business and economic laws and regulations. The Office of Competition in Chad’s Ministry of Industrial and Commercial Development & Private Sector Promotion reviews transactions for competition-related concerns.

Chadian law protects businesses from nationalization and expropriation, except in cases where expropriation is in the public interest. There were no direct government expropriations of foreign-owned property in 2021, though the government maintains indirect expropriation measures, such as a confiscatory tax regime that boasts the third-highest corporate tax rate in the world. There are no indications that the GOC intends to directly expropriate foreign property in the near term, though foreign businesses have reported difficulty repatriating profits from Chadian bank accounts and the open-source reporting indicates that the Chadian government has demanded an extralegal multi-million dollar exit payment from a large multinational.

Historically, a 1967 Land Law has prohibited since its passage the deprivation of ownership without due process, stipulating that the state may not take possession of expropriated properties until 15 days after the payment of compensation. While the government continues to work on reform of the 1967 Land Law, the May 2018 constitution (amended in December 2020), prohibited in its Article 45 the seizure of private property, except in cases of urgent public need — of which there are no known cases. The transitional government’s constitutional charter, which came into place in April 2021 upon the dissolution of Chad’s constitution by the Transitional Military Council, likewise prohibits expropriation outside the framework of the law in its Article 26, though without inclusion of “public utility” or “fair and prior compensation” that were present in the 2018 document.

Chad’s bankruptcy laws are based on OHADA Uniform Acts. According to Section 3, Articles 234 – 239 of OHADA’s Uniform Insolvency Act, creditors and equity shareholders may designate trustees to lodge complaints or claims to the commercial court collectively or individually. The OHADA provisions grant Chad the discretion to apply its own sentences.

4. Industrial Policies

The Chadian tax code (CGI, Code General des Impôts) offers incentives to new business start-ups, new activities, or substantial extensions of existing activities. Eligible economic activities are limited to the industrial, mining, agricultural, forestry, and real estate sectors, and may not compete with existing enterprises already operating in a satisfactory manner (Articles 16 and 118 of the National Investment Charter).

To spur investment into target sectors, the GOC authorized tax credits, discounts, and exemptions for investments in the agriculture, animal husbandry, solar and wind energy, information technology, oil, and plastics sectors in the 2021 Finance Law.

Foreign investors may ask the GOC for other incentives through investment-specific negotiations. Large companies usually sign separate agreements with the government, which contain negotiated incentives and obligations. The possibility of special tax exemptions exists for some public procurement contracts, and a preferential tax regime applies to contractors and sub-contractors for major oil projects. The government occasionally offers lower license fees in addition to ad hoc tax exemptions. Incentives tend to increase with the size of a given investment, its potential for job creation, and the location of the investment, with rural development being a GOC priority. Investors may address inquiries about possible incentives directly to the Ministry of Industrial and Commercial Development and Private Sector Promotion.

The GOC does not issue guarantees but jointly finances some foreign direct investments, with mixed results.

There are currently no foreign trade zones in Chad. The Chadian Agency for Investment and Exportation (ANIE) is examining the possibility of creating a duty-free zone. The United Nations Conference on Trade and Investment (UNCTAD) estimated in 2014 that Chad received less than one percent of Foreign Direct Investment (FDI) to Africa. There are no Special Economic Zones and none currently planned. Given poor infrastructure, lack of port access, and high cost of air transport (especially for relatively heavy agricultural or livestock products that result from the large percentage of the unskilled population employed in those industries), Chad’s non-oil exports have historically been extremely limited. Intra-African trade is no different; UNCTAD estimates that Chad accounts for 0.2 percent of intra-African exports (the lowest on the continent).

Chad does not follow forced localization, the policy in which foreign investors must use domestic content in goods or technology.

Foreign companies are legally required to employ Chadian nationals for 98 percent of their staff. Firms can formally apply for permission from the Labor Promotion Office (ONAPE) to employ more than two percent expatriates if they can demonstrate that skilled local workers are not available. Most foreign firms operating in Chad have obtained these permissions. Foreign workers require work permits in Chad, renewable annually. Companies must present personnel files of local candidates not hired to the GOC for comparison against the profiles of foreign workers. Multinational companies and international non-governmental organizations routinely protest these measures.

There are no requirements for foreign IT providers to turn over source code and/or provide access to surveillance (backdoors into hardware and software or turn over keys for encryption). There are no rules on maintaining a certain amount of data storage within Chad.

5. Protection of Property Rights

Real Property

The Chadian Civil Code protects property rights. Since 2013, landowners may register land titles with the One-Stop Land Titling Office (Guichet Unique pour les Affaires Foncieres). However, enforcement of these rights is difficult because most landowners do not have a title or a deed for their property. In 2022, an effort by the Food and Agricultural Organization of the United Nations (FAO) to advise the government on a more systematic framework to approach property issues marked the first major effort in many years to address property rights conflicts.

The office of Domain and Registration (Direction de Domaine et Enregistrement) in the Ministry of Finance and Budget is responsible for recording property deeds and mortgages. In practice, this office asserts authority only in urban areas; rural property titles are managed by traditional leaders who apply customary law. Chadian courts frequently deal with cases of multiple or conflicting titles to the same property. A significant portion of the legal system’s bandwidth is involved in ongoing land disputes. In cases of multiple titles, the earliest title issued usually has precedence. Fraud is common in property transactions. By law, all land for which no title exists is owned by the government and can only be given to a separate entity by presidential decree. There have been incidents in which the government has reclaimed land for which individuals held titles, which government officials then granted to other individuals without the backing of presidential decrees.

The GOC does not provide clear definitions and protections of traditional use rights of indigenous peoples, tribes, or farmers.

Chad is a member of the African Intellectual Property Organization (OAPI) and the World Intellectual Property Organization (WIPO). Chad ratified the revised Bangui Agreement (1999) in 2000 and the Berne Convention in 1971. The GOC adheres to OAPI rules within the constraints of its administrative capacity.

Within the ministry responsible for trade, the Department of Industrial Property and Technology addresses intellectual property rights (IPR) issues. This department is the National Liaison Unit (SNL) within the OAPI and is the designated point of contact under Article 69 of the World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

Intellectual property violations are widespread. Counterfeit pharmaceuticals and pirated artistic works, such as music and films, are common in Chad. Imported counterfeit watches, athletic apparel, footwear, denim jeans, cosmetics, perfumes, and other goods are also readily available. Despite limited resources, Chadian customs officials make occasional efforts to enforce copyright laws, normally by seizing and burning counterfeit medicines, CDs, and mobile phones, though the government does not regularly track or report on seizures of counterfeit goods or on prosecution of IPR violations. Occasionally, Chadian authorities will, however, announce such a seizure in the local press. Customs officers have the authority to seize and destroy counterfeit goods ex officio. The government pays for storage and destruction of such goods. In 2021, the government did not enact any new intellectual policy laws or regulations.

Chad is not listed on the United States Trade Representative (USTR) Special 301 Report or Notorious Markets List. For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ .

6. Financial Sector

Chad’s financial system is underdeveloped. There are no capital markets or money markets in Chad. A limited number of financial instruments are available to the private sector, including letters of credit, short- and medium-term loans, foreign exchange services, and long-term savings instruments. Chad maintains an exchange system that is free from restrictions and multiple currency practices on payments and transfers for current international transactions. This includes due to any actions delegated to BEAC.

Commercial banks offer credit on market terms, often at rates of 12 to 25 percent for short-term loans. Access to credit is available but is prohibitively expensive for most Chadians in the private sector. Medium-term loans are difficult to obtain, as lending criteria are rigid. Most large businesses maintain accounts with foreign banks and borrow money outside of Chad. There are ATMs in some major hotels, most neighborhoods of N’Djamena, the N’Djamena airport, and in major cities.

Chad does not have a stock market and has no effective regulatory system to encourage or facilitate portfolio investments. A small regional stock exchange, known as the Central African Stock Exchange, in Libreville, Gabon, was established by CEMAC countries in 2006. Cameroon, a CEMAC member, launched its own market in 2005. Both exchanges are poorly capitalized.

Chad’s banking sector is small and continues to streamline lending practices and reduce the volume of bad debt accumulated before and during the 2016-2017 economic crisis. While Chad’s banking rate remains low due to low aggregate savings and limited trust in and exposure to banks, according to the World Bank it increased from nine to 22 percent between 2009 and 2017.

Chad’s four largest banks have been privatized. The former Banque Internationale pour l’Afrique au Tchad (BIAT) became a part of Togo-based Ecobank; the former Banque Tchadienne de Credit et de Depôt was re-organized as the Societe Generale Tchad; the former Financial Bank became part of Togo-based Orabank; and the former Banque de Developpement du Tchad (BDT) was reorganized as Commercial Bank Tchad (CBT), in partnership with Cameroon-based Commercial Bank of Cameroon. There are two Libyan banks in Chad, BCC (formerly Banque Libyenne) and BSCIC (Banque Sahelo-Saharienne pour l’Investissement et le Commerce), along with one Nigerian bank — United Bank for Africa (UBA). In 2018, the GOC funded a new bank Banque de l’Habitat du Tchad (BHT) with the GOC as majority shareholder with 50 percent of the shares and two public companies, the National Social Insurance Fund (Caisse Nationale de Prevoyance Sociale, CNPS) and the Chadian Petroleum Company (Societe des Hydrocarbures du Tchad, SHT), each holding 25 percent.

Chad, as a CEMAC member, shares a central bank with Cameroon, Central African Republic, Republic of Congo, Equatorial Guinea, and Gabon — the Central African Economic Bank (BEAC, Banque des Etats de l’Afrique Centrale), headquartered in Yaounde, Cameroon.

Foreigners must establish legal residency in order to establish a bank account.

The GOC does not maintain a Sovereign Wealth Fund.

7. State-Owned Enterprises

All Chadian SOEs operate under the umbrella of government ministries. SOE senior management reports to the minister responsible for the relevant sector, as well as a board of directors and an executive board. Historically, the president appointed members of SOE boards of directors, executive boards, and CEOs though no new appointments have happened since the April 2021 establishment of the Transitional Military Council. The boards of directors give general directives over the year, while the executive boards manage general guidelines set by the boards of directors. Some executive directors consult with their respective ministries before making business decisions.

The GOC operates SOEs in several sectors, including Energy and Environmental Industries; Agribusiness; Construction, Building and Heavy Equipment; and Information and Communication. The percentage of their annual budget that SOEs allocate to research and development (R&D) is unpublished.

There were no reports of discriminatory action taken by SOEs against the interests of foreign investors in 2021. Some foreign companies operated in direct competition with SOEs. Chad’s Public Tender Code (PTC) provides preferential treatment for domestic competitors, including SOEs.

SOEs are not subject to the same tax burden and tax rebate policies as their private sector competitors and are often afforded material advantages such as preferential access to land and raw materials. SOEs receive government subsidies under the national budget, which the government does not publish. SOEs often comingle government and SOE funds, which complicates their financial picture.

Chad is not a party to the Agreement on Government Procurement within the framework of the WTO. Chadian practices are not consistent with the OECD Guidelines on Corporate Governance for SOEs.

(Please use DOC key words for industries in this section; list available at https://www.export.gov/industries ).

Foreign investors are permitted and encouraged to participate in the privatization process. There is a public, non-discriminatory bidding process. Having a local contact in Chad to assist with the bidding process is important. To combat corruption, the GOC has recently hired private international companies to oversee the bidding process for government tenders. The Chamber of Commerce submitted a ‘white paper’ (livre blanc) in 2018 with recommendations for the GOC to facilitate and simplify private sector operations, including establishing a Business Observatory and a Presidential Council, which would implement over 70 recommendations to improve the investment climate in Chad. The Presidential Council became operational in January 2021.

The GOC has expressed general willingness to privatize its generally unprofitable SOEs, including to foreign investors. As an example, in 2018, it sold a majority stake in cotton export company CotonTchad Société Nouvelle (CotonTchad SN) to the Singaporean Olam International. Qatari investors recently purchased a slaughterhouse in Moundou as well. Investors from the UAE are under talks to purchase a slaughterhouse in Farcha, though their progress has stalled.

Chad is considering privatization in the following industries:

  • Information & Communication (SOTEL Tchad)
  • Food Processing & Packaging (the Société Tchadienne de Jus de Fruit (STJF), which produces fruit juice in Doba
  • Agricultural Products (Société Moderne de Abbatoires (SMA), a slaughterhouse and meat packaging company in Farcha)

In addition, a 2019 law opened the market for power generation to private companies, though involvement in transmission remains under the control of the state-owned Societe Nationale d’Electricite du Tchad (SNE), which is reportedly unprofitable.

8. Responsible Business Conduct

There is a general awareness of Responsible Business Conduct (RBC) among firms in Chad. Most Western firms operating in Chad adhere to RBC, particularly those in the petroleum and telecommunications sectors. For example, Esso Exploration and Production Chad, Inc. (EEPCI), a significant oil producer, has implemented Environmental Management Plans (EMPs), prioritizing hiring local residents and local purchase of goods and services, establishing international safety standards, and protecting biodiversity. A critical part of EMP has been the Land Use Management Action Plan (LUMAP) that compensates individuals and communities for land used by the project. LUMAP has distributed approximately $1.7 million in cash, in-kind goods, and training. EMP’s efforts are complemented by the ExxonMobil Foundation, which supports projects to improve girls’ education and fight malaria.

Many foreign firms commit to extensive skill-building of local staff, purchasing local goods, and donating excess equipment to charities or local governments. Internet companies Airtel and Moov, as well as some banks, continue to engage in RBC focused on public awareness campaigns countering violent extremism and promoting social cohesion.

While work safety and environmental protection regulations exist, the government does not always enforce them, and companies do not always adhere to them. There are several local NGOs, particularly in the southern oil-producing regions, which monitor safety and environmental protection in the oil sector, and which have held government and private companies publicly accountable. EEPCI adheres to U.S. Occupational Safety and Health Administration (OSHA) guidelines for recording accidents and injuries and implements a rigorous program of safety procedures and protocols.

Chad joined the Extractive Industries Transparency Initiative (EITI) in 2010. While private security companies do operate within Chad, they typically employ unarmed guards at private residences and business premises.

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 ()

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 ()
  • Comply Chain ()

9. Corruption

Foreign investors should be aware that corruption is endemic in Chad and constitutes a significant deterrent to nearly all economic activity, including foreign direct investment. Corruption is pervasive in many areas of government, including procurement, the awarding of licenses or concessions, dispute settlement, regulation enforcement, customs, and taxation.

Chad is not a signatory country of the UN Convention Against Corruption (UNCAC). Chad is not a party to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (“the OECD Anti-Bribery Convention”).

There is an independent Court of Auditors (Cour des Comptes), equivalent to a supreme audit institution (SAI), to enhance independent oversight of government decisions, although its members are nominated by presidential decree. Concurrently, the GOC created a General Inspectorate for State Control within the Presidency to oversee government accountability. No reports have been published, however. In addition to these bodies, prior to the April 2021 dissolution of the National Assembly, its Finance Committee had carried out verifications of the GOC’s annual financial statement though typically did not make audits publicly available. The creation of the transitional legislature’s (CNT) Commission Controle Budget Automone is currently expected to carry out a similar responsibility, though, to date, they have not published any verifications of the GOC’s annual financial statement.

A February 2000 anti-corruption law stipulates penalties for corruption. The law does not single out family members and political parties. As in many other developing countries, weak institutional capacity, a widespread and largely accepted practice of rent seeking, low salaries for most civil servants, judicial employees, and law enforcement officials, have contributed to pervasive corruption in Chad. According to Freedom House’s Freedom in the World 2021 report, selective prosecutions of high-level officials were widely viewed as efforts to discredit those posing a threat to the former president or his allies. The report stated that security forces routinely stopped citizens on pretexts of minor traffic violations to extort money or confiscate goods.

To fight corruption and embezzlement, the Ministry of Finance and Budget set up a toll-free number (700), though it has not been working since 2018, after less than a full calendar year of connectivity. According to the Minister of Finance and Budget, the toll-free number 700 was designed to allow members of the public to alert the Inspectorate General of Finance to denounce any member of government who directly or indirectly solicits a bribe related their official duties, such as regarding administrative documents or tax payments. As of April 2022, the ministry confirms that they rely on postal mail for the lodging of these complaints and have no clear date for reestablishment of the compliant line. In addition to an unworking complaint line, there are no specific laws to counter conflict of interest, nor does the GOC require or encourage private companies to establish internal codes of conduct prohibiting bribery of public officials.

Local NGO Center for Studies and Research on Governance, Extractive Industries, and Sustainable Development (CERGIED), formerly GRAMP-TC (Groupe Alternatif de Recherche et de Monitoring de Petrole – Tchad), tracks government expenditures of oil revenue. There are no indications that anti-corruption laws are enforced differently for foreign investors than for Chadian citizens. There is no specific protection for NGOs involved in investigating corruption, which, to avoid repercussions, results in self-censorship of complaints about corrupt officials.

10. Political and Security Environment

Chad enjoyed relative political stability from 2010 to April 2021, when armed groups entered from Libya and engaged in armed hostilities with Chadian government forces following the government’s announcement of former President Idriss Déby having won a sixth term. During this incursion, Deby, who had ruled the country since 1990, was killed. A group of 15 generals called the Transitional Military Council, with former President Deby’s son Mahamat Deby at the head, dissolved Chad’s constitution and legislative National Assembly in favor of a constitutional charter and interim legislature (Transitional National Council, CNT) based on an 18-month mandate. During these 18 months, set to end in October 2022, the government plans to hold a National Dialogue in May on a range of social, economic, political, and security issues pertinent to the country to inform the drafting of a new constitution to be adopted by referendum a possible pre-election census, and parliamentary and presidential elections to return to civilian-led government. Following the creation of the transitional government, Chad has entered a period of tenuous peace as the government engages in negotiations with armed political groups over their possible terms for participation in the May National Dialogue as well as disarmament, demobilization, and reintegration (DDR) into Chadian society. Cross-border intercommunal violence near neighboring Darfur threatens to hamstring the prospect of a lasting peace, as do widespread frustrations over poor socio-economic conditions and impunity for excessive use of force by government security forces.

Prior to July 2021, the government typically denied permits for demonstrations or suppressed them using tear gas while arresting participants and organizers. Since then, the transitional government has allowed limited protests in N’Djamena while insisting on rigid adherence to pre-approved routes with occasional use of tear gas to disperse protestors. On the other hand, state security forces outside N’Djamena repressed public demonstrations, including live ammunition that resulted in fatalities, to quell political dissent. In December 2021, in northern Chad’s city of Faya, government forces used live ammunition to disperse protestors frustrated with changes in customs procedures, reportedly resulting in one fatality. In January, in the eastern city of Abeche, government security forces violently confronted protestors frustrated with appointment of traditional official, leaving a reported 14 dead and 64 wounded. There were no reports of politically motivated damage to investment projects and/or installations in recent years, including during incursions by armed groups into Chad in 2008 and 2021.

While Chad, which depends on oil for nearly 80 percent of its export revenues, has faced the stresses of an extended period of reduced oil revenues, recent increases in oil prices have begun to alleviate this issue. The COVID-19 pandemic, despite a low estimated incidence rate in Chad, strains Chad’s limited medical infrastructure, disrupts trade routes with neighboring countries, and complicates international air travel.

Regional violent extremist organizations threaten regional stability and foreign investments along the Lake Chad Basin and. Armed non-governmental groups operate along the Libyan border in northern Chad. Violent attacks by Boko Haram have choked off vital trade routes with Nigeria and the road between N’Djamena and Douala, Cameroon, the principal port serving Chad. This has increased costs for imports and decreased exports.

U.S. businesses and organizations in Chad are welcome to inquire at the Embassy about joining the Overseas Security Advisory Committee (OSAC).

For up-to-date information on political and security conditions in Chad, please refer to the Consular Affairs Bureau’s Travel Warning and Country Specific Information at http://www.travel.state.gov. The Embassy encourages all U.S. Citizens in Chad to enroll online with the Smart Traveler Enrollment (STEP) program or with the Embassy upon arrival to receive the latest safety and security updates via email.

11. Labor Policies and Practices

Chad’s population demonstrates a significant youth bulge, leading to widespread youth unemployment.

While some government ministries and SOEs provide job-related training to their employees, Chad has a shortage of skilled labor in most sectors and, at best, a nascent pipeline of human resource development to address this need. Local universities produce a surplus of graduates able to fill entry-level management and administrative positions though jobs in Chad’s anemic formal sector remain scarce. Skilled workers even more rare. Thus, given rampant unemployment and underemployment, approximately 80 percent of the Chadian labor force survive in the informal sector, despite the economic output of these primarily subsistence activities of farming, herding, and fishing accounting for only roughly 35 percent of GDP.

The International Labor Organization (ILO) reports that Chad has managed, compared to its average share of non-agricultural informal economy employment average from 1990-1999, to reduce this average by nearly five percentage points compared to the 2010-2014 period.

As a result, unskilled and day laborers are readily available and motivated, but frequently uneducated; Chad’s literacy rate is approximately 22 percent. While few Chadians speak English, translators and interpreters are available. Chad has never been an attractive destination for regular labor migration given widespread poverty, poor infrastructure, and a weak economy, though northeastern gold mines have reportedly drawn some migrant workers, often en route to Libya or Europe from the Horn of Africa region.

Significant gender inequality exists in Chad, as social norms have historically limited most women to the home and early marriages are common. Access to modern family planning methods is scant, which contributes to a leaky pipeline of women into the workforce as expectations of child-rearing tasks following unplanned pregnancies often impel their exit from the labor force. This results in approximately 50 percent of women participating in Chad’s workforce in some way, compared to approximately 75 percent of men. The government has recognized this as an issue, and taken some minor steps to address it, such as mandating 30 percent women for the transitional government’s interim legislature (CNT).

Same-sex activity became illegal in Chad via a March 2017 update to its penal code #2017-01, whose. Article 354 stipulated penalties of three months to two years in prison plus 50,000 to 500,000 CFA. The lack of social protections and widespread homophobia result in widespread self-censorship of full expression of identity by underrepresented workers, such as lesbian, gay, bisexual, transgender, queer, and intersex (LGBTQI+) individuals. As a result, little data exists regarding their participation in the labor market. More broadly, given entrenched patronage networks and their obstruction of the development of a meritocratic, rather than a connections- or ethnic-based system of hiring, individuals not connected to the Zaghawa group of former president Deby are underrepresented in government and military positions, especially at senior levels.

Child labor remains a problem. Children were involved in the following sectors: street begging in urban centers, street work as hawkers and porters, carpentry, vehicle garages, gold mining in the north of the country, service industries such as waiters/waitresses, and as domestic workers. Child labor is common in the agriculture sector. Children are also involved in cattle-herding and charcoal production. In some regions, children are involved in catching, smoking, and selling fish. Chadian cattle are included on the U.S. Government’s List of Goods Produced by Child Labor or Forced Labor.

Chad has ratified all eight Fundamental Conventions of the International Labor Organization. International labor rights such as freedom of association, the elimination of forced labor, child labor, employment discrimination, minimum wage, occupational safety and health, and weekly work hours are recognized within the labor code. However, significant gaps remain in law and practice. Chadian labor law derives from French law and tends to provide strong protection for Chadian workers; priority is given to Chadian nationals; foreign investors cite these provisions as unproductive and wearisome, especially for termination of underperforming employees. Labor unions operate independently from the government and, in fact, often challenge the government. The two main labor federations, the Confederation Libre des Travailleurs du Tchad (CLTT) and the Union des Syndicats du Tchad (UST), to which most individual unions belong, are the most influential.

The labor court is the labor dispute mechanism in Chad. In case of a dispute, the aggrieved party contacts a labor inspector directly or through the labor union to settle the dispute or lodge a complaint with the labor court.

Labor unions practice collective bargaining, and the labor code monitors labor abuses, health, and safety standards in low-wage assembly operations. The enforcement of the code is not effectively conducted; most disputes are based on contract termination. The GOC did not pass any new labor laws in 2021.

The GOC may provide incentives for foreign businesses but does not waive laws to attract or retain investment. Companies report constant frustration with ambiguous and archaic French-based labor law and its outsized worker-based provisions making any reductions in their workforce extremely difficult and often quite expensive, even following in cases of well-documented flagrant misconduct or criminality, to say nothing of employers merely adjusting employment to respond to fluctuating market conditions. Companies are often forced to settle frivolous lawsuits out of pocket sometimes based, in part, on pressure by corrupt judicial officials looking to exploit legal technicalities for personal gain. The law mandates severance packages for all employees whose employment ends, and larger packages for those who are laid off for reasons out of their control than for those fired for cause. No unemployment insurance or other social safety net programs exist, nor has the public received notice about discussions having happened regarding the possible implementation in the future of such programs.

Beginning in summer, the national teacher’s union went on strike, demanding unpaid compensation and calling for an improved learning environment at different universities throughout the country, including the southern city of Moundou, the eastern city of Abeche, and in N’Djamena. They also called for payment of salaries, bonuses, and overtime arrears.

Throughout the latter half of 2021, workers at ExxonMobil’s Doba oilfield participated in a labor strike after the company announced it was in talks with Savannah Energy to sell its interests in the project. The workers demanded pre-sale compensation and their strike caused ExxonMobil to temporarily decrease production. ExxonMobil actively engaged in discussions with the workers and the government to resolve the dispute, which lasted for months.

14. Contact for More Information

Economic and Commercial Officer
U.S. Embassy N’Djamena
Rondpoint Chagoua BP 413
N’Djamena Chad
+235 2251-5017 Ext 24408 and 24289
NDjamena-Commercial@state.gov 

Mali

Executive Summary Title

Despite enthusiasm for U.S. investment, there are significant obstacles to investing in Mali, including political instability, economic sanctions, allegations of corruption, poor infrastructure, and ongoing insecurity throughout the country. Mali remains under transition government rule after a coup d’etat in August 2020, followed by a further consolidation of military power in May 2021. The U.S. Department of State maintains a “Level 4: Do Not Travel” travel advisory for Mali due to crime, terrorism, and kidnapping. Continued insecurity throughout Mali is exacerbated by the minimal presence of the state in many areas and has permitted terrorist groups to conduct attacks against Western targets and Malian security forces. Intercommunal violence stemming from conflict between livestock herders and crop farmers in central Mali further contributes to instability.

Mali depends on bilateral donors and multilateral financial institutions, including the World Bank, International Monetary Fund (IMF), and African Development Bank, to fund major development projects, particularly in health, infrastructure, education, and agriculture. Mali received significant financial support in 2020 to address the COVID-19 pandemic and to support post-pandemic economic recovery. Since then, however, donors such as Denmark and France have partially or fully interrupted their development support to Mali, intensifying the financing needs.

The COVID-19 crisis interrupted a five-year period of consistent growth. As a result, Mali’s growth in 2020 reached only two percent against an initial projection of five percent. The transition government took measures to support households and businesses amid this economic slowdown, further increasing its fiscal deficit, which reached 6.2 percent of GDP in 2020, against an initial projection of 3.5 percent. In March 2021, the IMF projected GDP growth of six percent for Mali, as well as average inflation of two percent. Mali was relying on these positive projections to reduce its budget deficit to 4.5 percent of GDP, down from 5.5 percent a year ago. These projected figures will likely be significantly affected by the ECOWAS and WAEMU sanctions in force during the first half of 2022.

Business contacts report both Malian and foreign businesses face corruption in procurement, customs procedures, tax payment, and land administration, although the transition government has committed to undertaking reform, including through improved public financial management practices and increased tax revenues. Efforts to strengthen revenue collection agencies, particularly customs, are ongoing following significant revenue shortfalls in 2018 that the IMF attributed to corruption, weak taxpayer compliance, and fraud. Malian businesses generally view U.S. products favorably and openly search for new partnerships with U.S. firms, particularly in infrastructure, energy, mining, and agriculture.

Investors may consult the website of Mali’s Investment Promotion Agency (API-Mali)

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 136 of 180 http://www.transparency.org/research/cpi/overview
Global Innovation Index 2021 124 of 132 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2020 USD 0* https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2020 USD 830 https://data.worldbank.org/indicator/NY.GNP.PCAP.CD

* A nonzero value that rounds to zero.

1. Openness To, and Restrictions Upon, Foreign Investment

Mali encourages foreign investment. In general, the law treats foreign and domestic investment equally. In practice, U.S. investors report facing many of the same challenges as other foreign investors do, including allegedly unfair application of tax collection laws, difficulties clearing goods through customs, and requests for bribes. Corruption in the judiciary is common and foreign companies may find themselves at a disadvantage vis-à-vis Malian investors in enforcing contracts and competing for public procurement tenders.

The transition government has instituted policies promoting direct investment and export-oriented businesses. Foreign investors go through the same screening process as domestic investors. Criteria for authorizing an investment under Mali’s 2012 investment code include the size of the proposed capital investment, the use of locally produced raw materials, and the level of job creation.

Mali’s Investment Promotion Agency (API-Mali) serves as a one-stop shop for prospective investors and serves both Malian and foreign enterprises of all sizes. API-Mali’s website ( https://apimali.gov.ml/ ) provides information on business registration, investment opportunities, tax incentives, and other topics relevant to prospective investors.

Mali maintains an office in charge of business climate reform (Cellule Technique des Réformes du Climat des Affaires or CTRCA). Since 2015, Mali has also had a committee for monitoring business environment reforms that includes both government and private sector members. Mali adopted a law governing public-private partnerships (PPPs) in 2016 and has a dedicated PPP unit charged with reviewing and facilitating implementation of PPP projects in a multitude of sectors.

Foreign and domestic private entities have the right to establish and own business enterprises with no restriction to forms of remunerative activities. There are some specific limits on ownership in the mining and media sector: Malian law requires the owners and primary shareholders of media companies be Malian nationals. Foreign investors in the mining sector can own up to 90 percent of a mining company. WAEMU, of which Mali is a member, requires Malian and foreign companies to report if they will hold foreign currency reserves in their Malian business accounts and to receive approval from the Ministry of Economy and Finances and from the Central Bank for West African States (BCEAO).

The World Trade Organization (WTO) reviewed the trade and investment policies of WAEMU members, including Mali, in 2018. The review can be accessed here . The United Nations Human Rights Office of the High Commissioner released reports on Mali human rights situation.

Mali’s Investment Promotion Agency, API-Mali ( https://apimali.gov.ml/ ), serves as a one-stop shop to facilitate both foreign and local investment. API successfully reduced the average time to start a business in Mali to 72 hours, which it expects to further reduce to 48 hours. API provides investors with information relating to authorizations for business creation, waivers, the organization of investments promotion events, and other information. API opened regional satellite offices in Kayes, Koulikoro, Sikasso, Segou, and Mopti. There is no noted discrimination based on gender, age, or ethnicity in the process of business registration.

Foreign companies wishing to register in Mali may receive tax and customs benefits depending on the size of investment. Small and medium-sized enterprises (for which there is no common definition across government entities) are also eligible for some fiscal advantages.

The transition government has no specific policy to promote outward investment. Mali has gradually begun to introduce economic diplomacy by appointing economic advisors in its diplomatic representations. In general, its outward direct investment flows to neighboring countries.

3. Legal Regime

In its 2022 Fiscal Transparency Report Survey, the Department of State determined Mali does not meet the minimum requirements of fiscal transparency nor did it make significant progress toward achieving that goal in the previous year. Mali has adopted laws designed to meet the requirements of fair competition, ease bureaucratic procedures, and facilitate the hiring and firing of employees, but in practice many international firms complain of lack of transparency in the regulatory system and challenges in enforcing regulatory requirements to the detriment of business prospects. There is no public comment period or other opportunity for citizens or businesses to comment upon proposed laws.

Mali is a member of UNCTAD’s international network of transparent investment procedures. Mali is also a member of the African Organization for the Harmonization of Business Law (OHADA) and implements the Accounting System of West African States (SYSCOA), which harmonizes business practices among several African countries consistent with international norms. There are no informal regulatory processes managed by nongovernmental organizations or associations.

Mali’s Public Procurement Regulatory Authority (Autorité de régulation des marchés publics or ARMDS) is tasked with ensuring transparency in public procurement projects and may receive complaints from businesses on public procurement-related issues. ARMDS publishes information about its decisions in disputes as well as key laws relating to public procurement on its website at http://www.armds.ml/ .

The transition government regularly reviews regulations in order to adapt them to the current national context or to international standards or commitments. The new mining code and its implementing decree, adopted respectively in 2019 and in 2020, will apply to future mining projects. In February, the ministry of mines declared it is working on the new mining code to improve it and correct deficiencies. In December 2021, the transition government approved a new customs code in order to simplify the customs procedures and facilitate international trade. The government planned also to reform the investment code. The tax code and the tax procedures book (Livre de procédures fiscales) were substantially amended in September 2020, mainly to introduce a mandatory registration of all taxpayers, to operate changes in the VAT refund, to classify companies in terms of risks for the tax office, to digitize tax return and payment. The tax office had also planned to make e-filing mandatory. More information is available on the tax office’s website here .

The reform initiatives in Mali capitalize on experience, input from stakeholders (citizens, elected officials, and technical and financial partners), and reflect the requirements of the new directives establishing a harmonized, renewed framework for public finance in WAEMU member states. Mali has enacted the following directives: Law N°2013-031 of July 23, 2013, adopting the Code of Transparency in Public Finances; Law N°2013-028 of July 11, 2013, relating to the Finance Laws; Decree 2014-0349 of May 22, 2014, on the General Regulations of Public Accounting; and Decree 2014-0774 of October 14, 2014, on the State Chart of Accounts.

Mali makes public finance documents, including the budgets for all government ministries and offices, available on the Ministry of Economy of Finance’s website (https://www.finances.ml/loidesfinances). Mali’s national budget provides details on the expenditures of government entities (including the presidency and prime minister’s office) and the revenues of tax collection authorities, including customs, the public debt directorate, the land administration directorate, and the treasury and public accounting directorate. The budget also includes information on public debt, as well as government subsidies to petroleum products and to the state-owned utility company (Energie du Mali or EDM). Mali also publishes a simplified version of the budget known as the citizen’s budget.

Mali has multiple audit institutions tasked with monitoring public spending. The Malian supreme court’s accounts section is responsible for reviewing and approving the financial statements of all government departments. The Office of the Auditor General (Bureau du Vérificateur General, or BVG) is authorized to audit the accounts of all government entities as well as private companies or other entities that receive public funds. Its reports are made public and can be accessed at http://www.bvg-mali.org/ . Mali has other auditing institutions, including the Office to Fight against Illicit Enrichment (Office central de Lutte contre l’Enrichissement illicite or OCLEI), the General Comptroller of Public Services (Contrôle Général des Services Publics or CGSP), and the Support Unit for Administrative Auditing Bodies (Cellule d’Appui aux Structures de Contrôle de l’Administration or CASCA). Despite the existence of multiple audit institutions, management of public funds remains opaque and subject to corrupt practices, particularly in public procurements.

Mali remains a suspended member of WAEMU and ECOWAS. Mali is a member of the WTO. Mali has not notified the WTO of any measures concerning investments related to trade in goods that are inconsistent with the requirements of Trade Related Investment Measures. Information on other notifications from Mali to the WTO can be found at https://www.wto.org/english/thewto_e/countries_e/mali_e.htm  under the “Notifications from Mali” section.

Mali’s legal system is based on French civil law. Mali uses its investment code, mining code, commerce code, labor code, and code on competition and price to govern disputes. Disputes occasionally arise between the government or state-owned enterprises and foreign companies. Some investors report certain cases involve wrongdoing on the part of corrupt government officials.

Although Mali’s judicial system is independent, many companies have noted it is subject to political influence. Numerous business complaints are awaiting an outcome in the courts. The Minister of Justice wields influence over the career paths of judges and prosecutors, which may compromise their independence. Corruption in the judicial system is common, leading to what foreign investors have characterized as flawed decisions.

An independent commercial court was established in 1991 with the encouragement of the U.S. government to expedite the handling of business litigation. Commercial courts, located in Bamako, Kayes, and Mopti, can hear intellectual property rights cases. In areas where there is no commercial court, the local courts of first instance have the jurisdiction to hear business disputes. Decisions made by the courts of first instance are appealable in the court of appeals and/or in the supreme court. Since its inception, the commercial court has handled cases involving foreign companies. The court is staffed by magistrates and is assisted by elected Malian Chamber of Commerce and Industry representatives. Teams composed of one magistrate and two Chamber of Commerce and Industry representatives conduct hearings. The magistrate’s role is to ensure the court renders decisions in accordance with applicable commercial laws, including internationally recognized bankruptcy laws, and court decisions are enforced under Malian law.

Mali’s investment code gives the same incentives to both domestic and foreign companies for licensing, procurement, tax and customs duty deferrals, export and import policies, and export zone status if the firm exports at least 80 percent of production. Incentives include exemptions from duties on imported equipment and machinery. Investors may also receive tax exemptions on the use of local raw materials. In addition, foreign companies can negotiate specific incentives on a case-by-case basis. Mali has reduced or eliminated many export taxes and import duties as part of ongoing economic reforms; however, export taxes remain for gold and cotton, Mali’s two primary exports. The government applies price controls to petroleum products and cotton, and occasionally to other commodities (such as rice) on a case-by-case basis.

In most cases, foreign investors may own 100 percent of any business they create, except in the mining and media sectors. Foreign investors may also purchase shares in parastatal companies. Foreign companies may also start joint-venture operations with Malian enterprises. The repatriation of capital and profit is guaranteed.

Despite having a generally favorable investment regime on paper, foreign investors have complained of facing challenges in practice, including limited access to financing, high levels of corruption, poor infrastructure (including inconsistent electricity access), a non-transparent judicial system, and the lack of an educated workforce.

The following websites provide additional information relating to investments in Mali:

Investment Promotion Agency: https://apimali.gov.ml/

Mali Trade Portal: https://tradeportal.ml/ 

National Council of Employers: http://www.cnpmali.org/index.php/lois-et-reglements/codes 

Niger River Authority (Officer du Niger): https://www.on-mali.org/on/ 

Ministry of Economy and Finances: http://www.finances.gouv.ml 

The Ministry of Commerce and Industry is responsible for reviewing free competition in the Malian marketplace. Mali’s national competition law (Law 2016-006 and Decree 2018-0332) and the WAEMU 2002 anti-trust rules are the primary judicial documents that govern competition in Mali. The competition law bans any agreements restricting competition or market access. It also bans control or fixation of prices through agreements. Abuses of dominance are prohibited. The commercial court (Tribunal of Commerce) and ARMDS are the primary judicial bodies that oversee competition-related concerns.

Mali’s Organization of Industrial Entrepreneurs (Organisation Patronal des Industriels or OPI) has criticized corruption and smuggling as significant hurdles to fair competition. Contacts report Mali struggles to limit illegal imports of products such as sodas, juices, tobacco, medicines, and textiles (including fabrics). The General Directorate of Customs, the National Directorate for Commerce and Competition, and the Agency for the Sanitary Security of Foods occasionally intervene to address the import and commercialization of smuggled goods but have limited capacity to effectively address the problem.

Expropriation of private property other than land for public purposes is rare. Mali has not unfairly targeted U.S. firms for expropriation. Under Malian law, the expropriation process must be public and transparent and follow the principles of international law. Compensation based on market value is awarded by court decision.

The government may exercise eminent domain in various situations, including when undertaking large-scale public projects, in cases of bankrupt companies that had a government guarantee for their financing, or when a company has not complied with the requirements of an investment agreement with the government.

In cases of illegal expropriations, Malian law affords claimants due process in principle. However, given reported corruption in the land administration sector, impartial adjudication of court cases involving land disputes is rare.

Mali’s bankruptcy law is found in its commerce code, which does not criminalize bankruptcy. The commercial code makes a distinction between insolvency and the cessation of payment or accidental difficulty. It defines the judiciary process of compulsory liquidation. Generally, a bankrupt company will be sold piecemeal.

4. Industrial Policies

Mali’s investment, mining, commerce, and labor codes aim to encourage investment and attract foreign investors. By law, there is no discrimination between foreign-owned firms and Malian entities with regard to investment opportunities. The investment code offers incentives to companies that reinvest profits to expand existing businesses or diversify into another relevant sector. The code also encourages the use of locally sourced inputs, which can offer tax exemptions. Companies that use at least 60 percent locally produced raw materials in their products are eligible for certain tax exemptions. Companies that invest at least five percent of their turnover in supporting local research and development are eligible for a reduction of payroll taxes for Malian employees.

Companies (foreign or domestic) that export at least 80 percent of their production are entitled to tax-free status. As such, they benefit from duty-free status on all equipment and other inputs needed for their operations. Mali encourages investment in the cultural sector by reducing taxes on imports of cultural goods. In March 2020, Mali adopted an order exempting renewable energy equipment from VAT and import taxes. Mali may also provide short-term tax exemptions on certain essential products (such as rice, cooking oil, milk, and sugar) when the prices of those goods are unusually high.

Most businesses are located in the capital city of Bamako. The investment code encourages the establishment of new businesses in other areas through incentives such as income tax exemptions for five- to eight-year periods, reduced energy prices, and the installation of water, electric power, and telecommunication lines in areas lacking public utilities.

To date, there are no dedicated free trade zones in Mali. Mali, Cote d’Ivoire, and Burkina Faso have planned to establish a special economic zone involving the agricultural areas of Sikasso in Mali, Korogho in Cote d’Ivoire, and Bobo-Dioulasso in Burkina Faso, but the zone is not yet operational. The investment code states companies operating in special economic zones will benefit from reductions of taxes on profits and of corporate taxes to 25 percent over a period of seven years.

The 2019 mining code requires large mining companies (for which there is no precise definition in the mining code) to recruit Malian nationals who possess the requisite skills and experience. Mining companies must also progressively replace foreign employees with Malian nationals who possess the requisite skills and experience. Feasibility studies for large mines must incorporate a plan to replace foreign employees with Malian employees. There is no requirement that foreign investment or foreign equity in a mine be reduced over time.

5. Protection of Property Rights

Property rights are protected under Malian law. Ownership of property is defined by the use, the profitability, and the ability of the owner to sell or donate the property.

The government established the Malian Center for the Promotion of Industrial Property to implement property rights protection laws, including the WTO TRIPS (Trade Related Aspects of Intellectual Property Rights) agreement. The Malian Center for the Promotion of Industrial Property is a member of the African Property Rights Organization and works with international agencies recognized by the United Nations Industrial Development Organization. Patents, copyrights, and trademarks are covered under property rights protection laws. These structures notwithstanding, property rights are not always adequately protected in practice.

Mali’s National Land Agency (Direction Nationale des Domaines et du Cadastre or DNDC) is in charge of the land administration. In October 2021, Mali amended the land code to simplify the process of delivering land titles. The new code creates a one-stop-shop to handle land procedures. It reinforces traditional land rights (le droit coutumier) and enables the Minister of Land to cancel the attribution or confiscation of public properties. The new code considers the land title (le titre foncier), which gives full property ownership, as the unique property title. It also empowers the Ministry of Agriculture to deliver farming rights to rural agricultural communities. It clarifies the role of different offices in the management of lands affairs. All non-registered land belongs to the state. Various government officials, including prefects, governors, or subprefects, are no longer empowered to grant land ownership status. Mali is building a nationwide land registry to reduce competing claims for land.

Mali is a member of the World Intellectual Property Organization (WIPO). Mali has ratified a number of international treaties related to intellectual property rights (IPR). There are two primary agencies involved with the protection of IPR in Mali: the Malian Office of the Rights of the Author (Bureau Malien du Droit d’Auteur or BUMDA) and the Malian Center for the Promotion of Intellectual Property (Centre Malien de Promotion de la Propriété Industrielle or CEMAPI). CEMAPI is the primary agency for patents and for industrial property rights violation claims, while BUMDA covers artistic and cultural works. In addition to registering copyrights, BUMDA conducts random searches during which it seizes and destroys counterfeit products. Mali’s Agency for the Sanitary Security of Foods, the National Directorate of Agriculture, and the National Directorate for Commerce and Competition are also charged with enforcing laws related to fair trade, fair competition, and IPR.

In general, however, the government has limited capacity to combat IPR violations or to seize counterfeit goods. There is a significant number of reported IPR violations in the artistic sector as well as in the pharmaceutical sector. According to the Malian National Pharmaceutical Association, nearly 50 percent of pharmaceuticals sold in Mali are counterfeit. Many CDs, movies, and books are reported to be pirated. Several companies have noted children are often involved in selling counterfeit products such as clothes, CDs, and books. In the past, counterfeit products were typically imported from foreign cities, including Guangzhou and Dubai. However, BUMDA has reported counterfeit products increasingly originate in Mali and Nigeria.

Mali is not included in the United States Trade Representative (USTR) Special 301 Report or the Notorious Markets List.

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

Portfolio investment is not a current practice in Mali. In 1994, the government instituted a system of treasury bonds available for purchase by individuals or companies. The payment of dividends or the repurchase of bonds may be done through a compensation procedure offsetting corporate income taxes or other sums due to the government.

The WAEMU stock exchange program based in Abidjan has a branch in each WAEMU country, including Mali. One Malian company is quoted in the stock exchange. The planned privatization of EDM, Mali’s state-run electricity company, the telecommunications entity (Societé des Telecommunications du Mali or SOTELMA), the cotton ginning company (Compagnie Malienne pour le Développement du Textile or CMDT), and the Bamako-Senou Airport offer prospects for some companies to be listed on the WAEMU stock exchange.

WAEMU statutes and the BCEAO govern the banking system and monetary policy in Mali. Commercial banks in Mali enjoyed considerable liquidity, though this was negatively affected by the imposition of financial sanctions during the first half of 2022. The majority of banks’ loanable funds, however, do not come from deposits, but rather from other liabilities, such as lines of credit from the BCEAO and North African and European banks. Despite having sufficient loanable funds, commercial banks in Mali tend to have highly conservative lending practices. Bank loans generally support short-term activities, such as letters of credit to support export-import activities and short-term lines of credit and bridge loans for established businesses. Small- and medium-sized businesses have reportedly had difficulty obtaining access to credit. The Guarantee Fund for Private Sector (le Fonds de Garantie du Secteur Privé or FGSP) is a partially state-owned financial institution which provides guarantees up to 50 percent of the loan that SMEs/SMIs and microfinance institutions could borrow from commercial banks. The FGSP also provides direct financing to the private sector. Mali recently increased the financial resources of the FGSP as a measure to support the private sector to face the economic impact of the COVID-19 pandemic. Mali also created a National Directorate of Small and Medium Enterprises (SMEs) in 2020 in part to address the challenges SMEs face in accessing financing.

In order to improve the business environment and soundness of the financial system, the BCEAO adopted a uniform law regarding credit reference bureaus. The government aligned its legislation with this regional requirement by authorizing a credit reference bureau in Mali to collect and process information from financial institutions, public sources, water and electricity companies, and other entities to create credit records for clients. The credit rating system aims to increase the solvency of borrowers and improve access to credit.

Mali’s microfinance sector has grown rapidly. Despite this growth, microfinance institutions suffer from poor governance and management of resources and have not put in place all government regulations or regional best practices to ensure sufficient financial controls and transparency.

Money laundering and terrorist financing are concerns in Mali. Although Mali’s anti-money laundering law designates several reporting entities, companies have noted very few comply with their legal obligations. While businesses are technically required to report cash transactions over approximately $10,000, most reportedly do not. Despite terrorist networks operating throughout Mali, the country’s financial intelligence unit, the National Financial Information Processing Unit (CENTIF), receives relatively few suspicious transaction reports concerning possible cases of terrorist financing. With the exception of casinos, designated non-financial businesses and professions are not subject to customer due diligence requirements.

Mali is a member of the Inter-Governmental Action Group Against Money Laundering in West Africa (GIABA), a Financial Action Task Force (FATF)-style regional body. Mali’s most recent mutual evaluation report, completed in November 2019, can be found at http://www.giaba.org/reports/mutual-evaluation/Mali.html .

Mali does not have a sovereign wealth fund.

7. State-Owned Enterprises

Mali has privatized or reduced government involvement in many state-owned enterprises (SOEs). However, there are still 45 state-owned or partially state-owned companies in Mali, including 12 mining companies, five banks, the national electricity company EDM, the telecommunications entity SOTELMA, the cotton ginning company CMDT, as well as cigarette company (Société nationale de tabac et allumettes du Mali or SONATAM), sugar companies Sukala and N-Sukala, and the Airports of Mali. The government no longer has shares in two banks, Banque Sahelo-Saharienne pour l’Investissement et le Commerce (BSIC-Mali), and Coris Bank International-Mali, in which it had respectively 25 and 10 percent shares as of December 2017. The government reduced its shares in the Malian Development Bank (BDM) and Malian Solidarity Bank (BMS) while it maintained its share in the Banque Nationale de Developpement Agricole (BNDA), which increased its total capital stock by 21.5 percent in 2019 compared with 2018.

Private and public enterprises compete under the same terms and conditions. No preferential treatment is given to SOEs, although they can be at a competitive disadvantage due to limited flexibility in their management decision-making process. Malian law guarantees equal treatment for financing, land access, tax burden, tax rebate, and access to raw materials for private firms and SOEs.

The government is active in the agricultural sector. The parastatal Niger River Authority (Office du Niger) controls much of the irrigated rice fields and vegetable production in the Niger River inland delta, although some private operators have been granted plots of land to develop. The Office du Niger encourages both national and foreign private investment to develop the farmlands it manages. Under a Millennium Challenge Corporation-funded irrigation project, Mali granted titles to small private farmers; an adjacent tranche developed with MCC was to have been open to large-scale private investment through a public tender process. However, all MCC projects were suspended as a result of the coup d’état of March 2012 and discontinued when the projects reached the end of their implementation deadline. The national cotton production company, CMDT, which is yet to be privatized, provides financing for fertilizers and inputs to cotton farmers, sets cotton prices, purchases cotton from producers, and exports cotton fiber via ports in neighboring countries. The agricultural sector, including cotton growing, is subject to erratic rainfalls.

The government also remains active in the banking sector. The state owns shares in five of the 14 banks in Mali: BDM (19.5 percent share), Banque Internationale pour le Mali (BIM) (10.5 percent), BNDA (36.5 percent), BMS (13.8 percent), and Banque Commerciale du Sahel (BCS) (3.3 percent). While the government no longer has a majority stake in BDM, it has significant influence over its management, including the privilege to appoint the head of the Board of Directors.

Senior transition government officials from different ministries make up the boards of SOEs. Major procurement decisions or equity raising decisions are referred to the Council of Ministers. Government powers remain in the hands of ministries or government agencies reporting to the ministries. No SOE has delegated powers from the government.

SOEs are required by law to publish an annual report. They hold a mandatory annual board of directors meeting to discuss financial statements prepared by a certified accountant and certified by an outside auditor in accordance with domestic standards (which are comparable to international financial reporting standards). Mali’s independent Auditor General conducts an annual review of public spending, which may result in the prosecution of cases of corruption. Audits of several state-owned mining companies have revealed significant irregularities.

The government’s privatization program for state enterprises provides investment opportunities through a process of open international bidding. Foreign companies have responded successfully to calls for bids in several cases. The government publishes announcements for bids in the government-owned daily newspaper, L’Essor. The process is non-discriminatory in principle; however, there have been many allegations of corruption in public procurement.

8. Responsible Business Conduct

There is no general awareness or defined standard of responsible business conduct in Mali among producers or consumers. Despite the creation of the Malian Agency for Normalization and Quality Promotion (Agence Malienne de Normalisation et de Promotion de la Qualité or AMANORM) and the National Agency for the Sanitary Security of Foods (Agence Nationale pour la Securité Sanitaire des Aliments or ANSSA), some report Mali continues to produce, import, and export dangerous products and products of poor quality. Allegations of violations of hygiene and quality standards are common in the food-processing industry and investors have reported there is no general awareness about the dangers of unsafe and toxic chemical products in food production.

Labor rights are not generally respected given Mali’s large and unregulated informal sector. Even formal businesses often hire workers informally, such that employees do not always receive social security, retirement, or other related benefits. Mali has various laws intended to prevent child and forced labor, as well as business practices harmful to the environment and local communities. Despite these laws, there are frequent reported cases of child labor and forced labor in the mining, agricultural, service, and industrial sectors. The mining code requires owners of mining and exploitation permits to present local development plans to mitigate the health, security, hygiene, environment, and cultural heritage impacts of their mining activities. Conflicts between local artisanal mining communities and foreign mining companies over land ownership rights are frequent. Local communities have voiced concern with the significant environmental impacts of mining, including from dredging, as well as the lack of government efforts to restore and rehabilitate the environment after mine closures. Foreign mining and oil exploration companies sometimes provide schools and health clinics to communities in proximity of their activities as a form of corporate social responsibility. These activities are not done in accordance with the OECD Guidelines for Multinational Enterprises but are rather the result of individual negotiations between the company and the leaders of neighboring communities.

Mali is an active member of the Extractive Industries Transparency Initiative (EITI) and since 2011 has been designated as a “compliant country.” The latest EITI decision available at https://eiti.org/board-decision/2019-47  notes Mali made “meaningful progress with considerable improvements in implementing the 2016 EITI Standard.”

Acute insecurity and intercommunal violence in the northern and central regions as well as episodic terrorist attacks in the southern regions have contributed to the development of the private security sector, which proposes services to the government, local companies, foreign governments and companies, and international organizations. The deployment of Russia-backed private military company Wagner Group in Mali has raised concerns from the international community and the U.S. government that the group may further destabilize Mali’s territory. Mali is not a signatory to the Montreux Document on Private Military and Security Companies, nor of the International Code of Conduct for Private Security Service Providers’ Association (ICoCA).

Demographic pressure and natural resource exploitation have exacerbated environmental degradation in Mali. Desertification, CO₂ and methane gas emissions, waterway pollution, and the destruction of natural habitats constitute significant challenges for environmental protection. That said, Mali has taken some measures to reduce its greenhouse emissions, even as it considers itself a carbon sink. Mali released its first nationally determined contribution (NDC) in 2015, followed by a second, more robust NDC in 2021. This second NDC outlines Mali’s exposure to climate change as a result of increased temperatures and decreased rainfalls. The plan focuses on agriculture, forestry, energy, and waste, and specifically aims to strengthen Mali’s strategy for carbon sequestration and greenhouse gas reduction. The plan seeks to promote sustainable development through the promotion of green economy across various sectors.

The National Policy for the Protection of the Environment and the National Policy for Climate Change are the main policy documents. While the Agency for Environment and Sustainable Development (Agence de l’Environnement et le Développement Durable, or AEDD) coordinates the implementation of climate policy, many other departments, including but not limited to the National Directorate for Water and Forest, the Agency for Renewable Energy (AER), the Agency for Rural Electrification (AMADER), and the Agency for Treatment of Wastewater, participate in its implementation. In 2021, Climatescope ranked Mali 62 out of 107 countries for energy transition investment attractiveness. Mali’s climate policy implementation may face significant challenges related to the limitation in financial resources and limited absorption capacity of large projects.

More information can be found on this ClimateScope Report.

9. Corruption

Many companies claim corruption is the most significant obstacle to foreign investment and economic development in Mali. While corruption is a crime punishable under the penal code, bribery is frequently reported in many large contracts and investment projects. Some investors report government officials often solicit bribes to complete otherwise routine procedures. The transition government has pledged to prioritize anti-corruption efforts. In 2021, Transparency International’s global corruption ranking for Mali decreased to 136th of 180 ranked countries (from 129th of 180 in 2020). Mali’s perceived public corruption score from Transparency International was 29 out of 100 in 2020 (with 0 being “highly corrupt” and 100 being “very clean”). Relative to other developing countries, Mali was rated at the 67th percentile for control of corruption on the FY2020 MCC Scorecard (based on World Bank and Brookings Worldwide Governance Indicators reports).

Corruption is reportedly common in government procurement and dispute settlement. The government has addressed this issue by requiring procurement contracts to be inspected by the Directorate General for Public Procurement with the Ministry of Economy and Finance, which determines whether the procedure meets fairness, price competitiveness, and quality standards. However, there are allegations of significant political interference in procurement. In addition, both foreign and domestic companies complain about harassment and requests for bribes from officials involved in tax collection. Mali’s international donor community has been working with the government to reduce corruption.

Investors have found the judicial sector to be neither independent nor transparent. Questionable judgments in commercial cases have occasionally been successfully overturned at the supreme court. However, there is a general perception among the populace that while prosecution of minor economic crimes is routine, official corruption, particularly at the higher levels, goes largely unpunished.

In 2004, then-president of Mali Amadou Toumani Touré created the Office of the Auditor General (BVG) as an independent agency tasked with auditing public spending. Since its inception, the BVG has uncovered several significant cases of corruption, including in the customs directorate. However, few findings of corruption have resulted in prosecutions.

Growing pressure from international donors for more transparency in public resource management led to changing the appointment process for directors of finance and equipment across many ministries. As a result, in March 2017, the Minister of Economy and Finances dismissed 15 Directors of Finance and Equipment. Eighteen others were moved to other ministries. The government opened OCLEI in 2017 to combat illicit enrichment by government officials. OCLEI has the authority to collect asset declarations from public servants, to conduct investigations of government officials suspected of corruption, and to refer cases for prosecution if sufficient evidence is gathered against the defendant. However, OCLEI’s operations were suspended following civil servants’ union protests against asset declaration requirements. Negotiations between the unions, the government, and donors eventually yielded a satisfactory solution that enabled the office to resume operations, and the office has begun registering asset declarations for certain categories of civil servants. According to its 2017-2018 report, OCLEI received asset declarations from approximately 1,000 civil servants (nearly 70 percent of all civil servants in Mali are subject to assets declaration) over 2017-2018 and referred three suspected cases of corruption to the justice system. However, OCLEI came under significant pressure in 2020 when Mali’s main workers union requested the government close OCLEI.

Following a cabinet reshuffle in 2019, the newly appointed Minister of Justice took measures to address corruption by appointing a new prosecutor in the Economic and Financial Specialized Judicial Office of Bamako, a court in charge of prosecution of corruption. Since these changes, many high-profile business and political leaders have been arrested due to corruption allegations. In 2021, Mali’s Auditor General released 11 financial audit reports, two performance audit reports, four reports of conformity, and four reports on the level of implementation of recommendations it made in previous audit reports. The Auditor General refers cases of fraud or other unlawful practices to the Economic and Financial Specialized Judicial Office of Bamako. Since the beginning of the transition government in 2020, reports from the Auditor General have led to the arrest of many high-profile former government officials for alleged involvement in corruption business dealings. Though these are welcome developments for some observers, others have highlighted the political motivations behind these arrests and the failure of the judicial branch to prosecute them properly and in a timely manner. In sum, the results of recent anti-corruption efforts remain a mixed bag.

In September 2021, the National Transition Council (CNT) passed the law on the creation of the national court dedicated to combating economic and financial crimes. The Act amends provisions of the Criminal Procedure Code and provides the legal basis for establishing a much-needed institution to prosecute economic and financial crimes wherever they occur in Mali.  The new Criminal Procedure Code established three specialized anti-corruption chambers under the jurisdictions of appellate courts in Kayes, Bamako, and Mopti.

The new, national anti-corruption court establishes a comprehensive system to fight corruption and to coordinate across numerous specialized agencies such as CENTIF, OCLEI, and BVG. It is also the single judicial point of contact for economic and financial crimes with authority to liaise on cooperation requests for international mutual assistance on corruption related criminal matters.

Mali’s transition authorities have prioritized messaging about anti-corruption and the need for enhanced financial transparency in governance. The creation of a national anti-corruption court that is professionally staffed and empowered to aggressively prosecute economic and financial crimes is an important step toward real progress on this issue.

10. Political and Security Environment

The U.S. Department of State’s Fact Sheet on Mali is available at https://www.state.gov/u-s-relations-with-mali/. The current Travel Advisory for Mali is available at https://travel.state.gov/content/travel/en/traveladvisories/traveladvisories/mali-travel-advisory.html.

Throughout nearly three decades of multi-party democracy, Mali has consistently encouraged private enterprise and investment. However, the destabilizing effects of Mali’s 2012 coup d’état led to a deterioration of the economic situation and uncertainty in the investment climate. The August 2020 coup d’état and the May 2021 consolidation of military power have plunged the country into political uncertainty and instability, further exacerbating existing challenges. Mali remains under transition government rule, although ECOWAS and other international organizations maintain pressure on the government to organize elections in a timely manner. Mali continues to face significant political and security challenges amidst slow implementation of a peace agreement signed in 2015 that aims to resolve the ongoing conflict in northern Mali. A disparate group of signatory armed groups, militias, bandits, and terrorist groups continue to exert influence in wide swathes of Mali’s largely ungoverned northern areas as well as central Mali. Furthermore, terrorist groups have increased the frequency and range of their attacks—particularly against the base camps of the UN peacekeeping mission (MINUSMA) and the Malian Armed Forces (FAMa) in northern and central Mali—in an effort to destabilize the country. The situation in central Mali—namely in the Segou and Mopti regions—is increasingly unstable due to intercommunal conflict, localized political violence, and the incursion of extremist groups into the region.

Terrorist groups with varying degrees of allegiance to al-Qaeda and ISIS operate in Mali, and often pursue local agendas complementary to these global extremist movements. Groups linked to al-Qaeda in the Islamic Maghreb (AQIM), which have merged under the banner of Jama’at Nusrat al-Islam wal-Muslimin (JNIM), continued to conduct terrorist attacks throughout 2021, primarily targeting international and Malian military forces. These groups have claimed responsibility for recent gun and improvised explosives attacks, kidnappings, and other violent actions in northern and central Mali.

While the MINUSMA peacekeeping effort is still present in Mali, in February French authorities declared their intent to remove troops from the country. Malian security forces have undertaken counterterrorism operations in the central and the tri-border region since November 2021. However, they have been unable to counter every threat, and in many cases they are accused of targeting civilians. In March of this year, extremist groups attacked FAMa in Mondoro, resulting in dozens of dead, including among FAMa. The UN peacekeepers’ northern base camps are often targeted by terrorist groups. Attacks by violent extremist groups have moved beyond the traditional conflict zone in northern Mali to central and southern Mali, where many villages are controlled by extremist groups who prevent farmers from growing crops, destroy planted crops, and impose zakat. The tri-border area (the border with Burkina Faso and Niger) and some remote parts of southern Mali are increasingly under threat of attack.

While Malian forces, backed by MINUSMA and French forces, had taken steps to reassert control over most of the major cities, much of northern and central Mali remain unstable, with large swaths of the country outside state control. AQIM, long entrenched in northeastern Mali, remains a threat. AQIM has demonstrated a pattern of kidnapping hostages for ransom and launching operations against neighboring Algeria, Mauritania, Burkina Faso, and Niger. AQIM and its local affiliates have been involved in various terrorist attacks targeting Westerners in Mali, including at a restaurant in Bamako in March 2015; at a hotel frequented by foreigners in Sevare in August 2015; against the Radisson Blu Hotel in Bamako in November 2015; and against the Campement de Kangaba hotel in June 2017.

While previous extremist attacks have generally spared foreign companies, aside from hotels and restaurants, some attacks have targeted infrastructure projects involving foreign companies. In October 2017, extremists attacked a foreign company in charge of the construction of a road in Timbuktu and destroyed several vehicles. In March 2018, terrorists attacked and destroyed a USD 66 million dam construction project in Djenne. In April 2020, extremist groups carried out attacks in the southwestern region of Kayes, Mali’s gold-mining region. In 2021, extremist groups attacked mobile companies’ infrastructure in different areas of northern Mali, resulting in facility damage and service interruptions. In September 2021, a mining company convoy accompanied by Malian security forces was attacked by terrorists on the road from Bamako to Kayes, resulting in at least five deaths. While Malian armed forces have increased pressure on extremist groups, observers consider that the departure of the French forces may result in increased security challenges, including from signatories of the Algiers Peace Accord.

U.S. citizens living or traveling in Mali are encouraged to enroll in the Smart Traveler Enrollment Program (STEP) at https://step.state.gov/step to receive security messages and make it easier to be located in an emergency.

11. Labor Policies and Practices

Labor is widely available in Mali, but companies have reported skilled labor is in short supply. Reliable unemployment data is difficult to obtain. While a 2021 survey by the transition government found an unemployment rate of 6.1 percent, the actual figure is likely much higher. The rate is generally higher for youth between the ages of 15-24, coming in at 9.9 percent according to the government’s 2021 survey. Workers have the right to unionize. Relations between labor and management are often contentious and strikes are common. The government has ratified all International Labor Organization (ILO) conventions protecting the rights of workers.

Since June 2014, the government faced several strikes led by different unions, including the national union of workers (UNTM), the union of university and basic education professors, the union of workers from the tax office, the union of workers of the national radio and television company, the confederation of unions (CSTM), the union of judges, and the union of health workers. Since its inauguration in September 2020, the transition government has also faced a series of strikes across sectors. The private sector also participates in strikes, as seen in 2015, 2017, and 2022, which have affected banking, finance, and telecommunications companies. While employers and workers are often able to reach a resolution, strikes can significantly disrupt economic activities, particularly when they involve key sectors like transportation or the financial sector. The labor code adopted in 1992 (amended in December 2011, in June 2017, and in July 2019) streamlined hiring and firing procedures. Conflicts often arise when employers terminate contracts and fire employees. Large Malian and international employers have had difficulty enforcing their rights in court, given that powerful and independent labor unions play an important role in supporting their members and in other national affairs. Compensation plan negotiations and firing procedures are time-consuming and closely scrutinized by the Ministry of Labor and the judiciary. Labor laws differentiate between layoffs and firing. Employees who are laid off are not entitled to unemployment compensation but are entitled to other benefits, including one-month gross salary and compensation for untaken leave. Employers are required to provide advance notice and a certificate to laid off employees. Although not a requirement, it is advisable to have regular contacts with labor inspectors, especially when concluding new hiring contracts or considering terminations or reductions in force.

Child labor and trafficking in persons continue to be serious problems in Mali. The ILO reports over 46 percent of children in Mali engage in child labor, including the worst forms of child labor such as child soldiering and hazardous activities in the agriculture and gold mining sectors. A 2021 transition government survey reported 11.6 percent of children between 5 and 17 years old are employed. The survey suggests the prevalence of child labor depends on the age, with 20 percent of children between the age of 10 and 17 years old being employed, compared with 2.5 percent of children aged 5 to 9 years old. Cotton, artisanal gold, and rice are included on the U.S. government’s List of Goods Produced by Child Labor or Forced Labor. Additionally, rice is included on the U.S. government’s Executive Order 13126 List of Goods Produced by Forced and Indentured Child Labor. The government has action plans for monitoring child labor and unsafe working conditions. Labor inspection entities, however, are underfunded and unable to regularly conduct inspections or provide support for victims of violations. In June 2017, Mali amended its labor code to align Malian law on the minimum age of employment with the ILO standard, increasing the minimum age of employment from 14 up to 15. The amended labor law bans discrimination based on religion, race, or gender. It also requires equality in terms of remuneration and forbids forced and compulsory labor.

Mauritania

Executive Summary

The deterioration of the global economy that resulted from the COVID-19 pandemic had a severe impact on the Mauritanian economy and reversed the previously bright economic outlook that led to the reduction of the country’s poverty rate from 10.9 percent in 2008 to 6.0 percent in 2014. The Mauritanian government response has been swift in mitigating the impact of the pandemic with the support from international partners by way of assistance funds and debt service suspensions. As a response to the pandemic’s economic impact, President Ghazouani launched the Economic Recovery Plan (ProPEP) in September 2020. ProPEP aims to boost the economy and improve the living conditions of vulnerable populations by reducing extreme poverty, expanding basic socio-economic infrastructures, organizing the information sector, and adopting a regulatory framework conducive to private sector development. As part of his annual speech to the parliament on January 29, Prime Minister Bilal presented a brighter picture of Mauritania’s economic outlook highlighting the government’s push to attract more investors. His presentation highlighted Mauritania’s natural resources which consist of deposits of copper, gypsum, uranium, and hydrocarbons including one of Africa’s largest offshores discoveries, the Greater Tortue Ahmeyim (GTA) natural gas field.

The 2022 budget reflects the Mauritanian government’s priorities as it attempts to revitalize the national economy and alleviate poverty, especially in the informal sector which was particularly impacted by COVID-19 and comprises 70 to 75 percent of the total economy. With its considerable natural resources, Mauritania places great importance on foreign direct investment (FDI). The continued global demand for iron-ore boded well for Mauritania throughout the pandemic as iron ore production is a main contributor to the country’s GDP. Real GDP is expected to grow from 2.8 percent in 2021 to 4.2 percent in 2022.

Mauritania has substantial renewable energy potential, particularly when it comes to solar, wind, and hydro power resources. The natural gas reserves at GTA are expected to enter production in 2023. The energy sector (hydrocarbons and renewable energy) offers opportunities for increased U.S. direct investment in Mauritania. On February 28, Kosmos Energy announced that it will increase investments in Mauritania and Senegal in 2022 by USD 300 million to accelerate development of the GTA gas field. According to Power Africa, the Government of Mauritania is working to expand its electricity supply and encourage investment in the renewable energy sector to stimulate the economy with the aim of reaching universal access by 2030. To do this, the GIRM will:

  • Increase new production capacity from local resources, mainly natural gas;
  • Increase the share of renewable energies in its total energy production, targeting 60 % by 2030;
  • Further develop the transmission network and interconnections with neighboring countries; and
  • Implement decentralized solutions in isolated areas.

Traditionally, U.S. investment in Mauritania has been primarily in the hydrocarbons and mining sectors. However, the Mauritanian government’s efforts to meet the challenges of food self-sufficiency provide an opportunity for U.S. agro-businesses to engage with Mauritania through supplies and equipment sales, as well as technical training. In 2019, Mauritania ranked as the United States’ 157th largest goods export market amounting to USD 91 million. Mauritania’s top export categories were machinery (USD 24 million), meat poultry (USD 15 million), vehicles (used and new) (USD 9 million), minerals fuels (USD 9 million).

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 140 of 180 http://www.transparency.org/research/cpi/overview 
Global Innovation Index 2021 N/A https://www.globalinnovationindex.org/analysis-indicator 
U.S.  FDI in partner country ($M USD, historical stock positions) 2019 USD 96 https://apps.bea.gov/international/factsheet/  
World Bank GNI per capita 2020 USD 1,670 https://data.worldbank.org/indicator/NY.GNP.PCAP.CD   

1. Openness To, and Restrictions Upon, Foreign Investment

The Government of the Islamic Republic of Mauritania (GIRM) has been proactive in attracting more Foreign Direct Investment (FDI) and has signed several MOU’s with international firms mainly from the Gulf and Turkey Mauritania is rich in minerals, has one of Africa’s richest fishing grounds and excessive potential in renewable energy, natural gas, and agriculture. Mauritania’s geographical position makes it a potential hub between Europe, North Africa, and Sub-Saharan Africa.

The GIRM promotes international investment through the Agency for the Promotion of Investment in Mauritania (APIM), which was launched in 2021. APIM aims to attract FDI to accelerate the government economic development plan. Through APIM, the government hopes to make Mauritania the new investment frontier for the Sahel by improving the investment code and providing a stable business environment. In addition to APIM, the Economic Governance and Investment Management Support Project (PA2GI) — an African Development Bank project active from 2021-2024 – will prioritize public and private investment in strategic sectors of the President’s Economic Recovery Plan (ProPEP). It is an institutional support project intended to assist Mauritania in its efforts to ensure robust, sustainable and job-creating economic growth. It involves striving to ensure public investment optimization, private investment promotion and the strengthening of tax and land governance in support of Mauritania’s Strategy for Accelerated Growth and Shared Prosperity (SCAPP) and President Ghazouani’s Economic Recovery Plan (ProPEP).

There is no law prohibiting or limiting foreign investment in any sector of the economy. There are no laws or regulations specifically authorizing private firms to adopt articles of incorporation or association, which limit or prohibit foreign investment, participation, or control. There are no other practices by private firms to restrict foreign investment. The government continues to prioritize foreign investment in all sectors of the economy and is working closely with the International Monetary Fund (IMF), the World Bank, and the international donor community to improve basic infrastructure and to update laws and regulations.

Both domestic and foreign entities can engage in all forms of remunerative activities, except activities involving selling pork meat or alcohol. There are no limits on the transfer of profit or repatriation of capital, royalties, or service fees, provided the investments were authorized and made through official channels. The government performs mandatory screening of foreign investments. These screening mechanisms are routine and non-discriminatory. The “Guichet Unique” created in 2020 is a one-stop shop that takes care of all administrative needs related to registering a company. The Guichet Unique provides the administrative review for all sectors, except for the petroleum and mining sectors, which require approval from a cabinet meeting led by the president.

The latest investment policy review occurred in February 2008. The United Nations Conference on Trade and Development (UNCTAD) review is available online, in French, at: http://unctad.org/en/Docs/iteipc20085_fr.pdf . The report recommended that Mauritania diversify its economy, improve its investment potential through increasing revenue generated by the exploitation of natural resources, accelerate required reforms, and enhance the business and investment climate. On November 2021, Mauritania joined the Inclusive Framework on BEPS and participates in the agreement to address the tax challenges arising from the digitalization of the economy. By joining this framework, the GIRM joins the international efforts against tax evasion.

In May 2018, Mauritania underwent its third World Trade Organization (WTO) trade policy review. The report is available online at https://www.wto.org/english/tratop_e/tpr_e/tp471_e.htm . The report states that, since its second Trade Policy Review (TPR) in 2011, Mauritania has had five years of products (chiefly iron ore) and massive public investment in the new airport, the extension of the port of Nouakchott, and road infrastructure. In addition, the report indicates that Mauritania’s goods imports and export mechanism has been modernized and simplified since 2011.

There are no civil society organization within Mauritania and neighboring counties that have provided reviews of investment policy-related concerns. Sporadically, Members of Parliament will request reviews of existing contracts (mainly in the fishing sector), but thus far, no formal results have been shared.

The GIRM continues to amend its laws and regulations to facilitate business registration. Under the Ministry of Economy, the Public Private Partnership Unit is responsible for providing technical support and expertise to the inter-ministerial committee during the process of identification, preparation, development, and execution of PPP projects in Mauritania. Created in February 2020, this inter-ministerial committee consists of the Prime Minister, Minister of Commerce, Minister of Economy, Minister of Finance, and the Private Sector Association. The committee is chaired by the Prime Minister and is charged with improving the business climate and driving investment.

In March 2021, the government created the Agency for Promotion of Investment in Mauritania to facilitate the administrative work of foreign investors. APIM helps investors navigate the business permit process, various administrative procedures, and the rules and regulations concerning foreign workforces.

To further expedite the business registration process, the government moved the one-stop shop Guichet Unique from the Nouadhibou Free Trade Zone Authority ( http://www.ndbfreezone.mr/ ) to become a stand-alone unit ( https://www.guichetunique-mr.info/ ) that is mandated to help set up companies and complete all business registration. This one-stop shop has started digitizing the business registration process which has led to the reduction of the standard registration time from seven days to 48 hours. The government is hoping this move to create an independent one- stop shop will serve to further encourage FDI.

Government incentives toward promoting outward investment remain limited. Mauritania’s major exports are iron ore (46 percent), non-fillet frozen fish (16 percent), and gold (11 percent). There are no investment restrictions on domestic investors from investing abroad.

3. Legal Regime

The government continues to adopt laws and regulations to improve transparency. During the review period, the government passed the 2022 budget through the parliament, accessible to the public via the Ministry of Finance portal ( https://www.finances.gov.mr/ ). The expansionary budget aims to boost the economic recovery and longer-term inclusive growth. The accounting documents provided a complete picture of the government’s planned expenditures and revenue streams, including natural resource revenues. Budget documents were generally prepared according to internationally accepted principles. The government holds full authority in allocating the licenses for all natural resources and controls their finances. The criteria and procedures by which the government awards natural resource extraction contracts or licenses are specified in Mauritania’s investment code, mining code, and a new hydrocarbon law. Basic information on tenders is publicly available on government websites, through the relevant ministry portal, or via the private job search platform ( https://beta.mr/beta/liste_offres/3 ) .

There is no law or policy impeding foreign investment in Mauritania. However, there is a complex and often overlapping system of permits and licenses required to establish and run a business. There continues to be a lack of transparency in implementation of the legal and regulatory policies.

The government does not require companies environmental, social and governance (ESG) disclosure to facilitate transparency and/or help investors and consumers distinguish between high- and low-quality investments

Post is not aware of any informal regulatory processes managed by nongovernmental organizations or private sector associations, and laws and regulations do not discriminate against foreign investment.

Please see Section 2- Bilateral Investment and Taxation Treaties

The Mauritanian judicial system combines French and Islamic (Malikite school) judicial systems. The constitution guarantees the independence of the judiciary (Article 89), and an organic law also protects judges from undue influence. Civil and Commercial Codes exist and are designed to protect contracts, although dispute settlement can be difficult and court enforcement is slow and often inconsistent. The judicial system remains weak and unpredictable in its application of the law, due in part to the training judges receive in two separate and distinct legal systems: Shari’a law and laws modeled after the French legal system. Judges remain undercompensated and susceptible to tribal pressures and bribery. Specialized commercial law courts exist, but judges sometimes lack training and experience in commercial and financial law. Some judges may only have formal training in the Shari’a legal system, while others are only familiar with the French civil law system. A lack of standardization of applicable legal knowledge in the judiciary leads to inefficiency in the execution of judgments in a timely and efficient manner. Laws and decrees related to commercial and financial sectors exist, but they are not always publicly available.

Most judgments are not issued within prescribed time limits and records are not always well maintained. Judgments of foreign courts are recognized by national courts, but enforcement is limited. During the last few years, the government has taken steps to provide training to judges and lawyers as an attempt to professionalize the system to reduce the backlog and work through cases in a more efficient manner. In 2017, the GIRM passed a small new claims law that covers cases valued at less than USD 11,000. In January 2020, the government opened a new international center for mediation and arbitration. The center provides an alternative legal office for settlement of investment disputes and allows arbitration and mediation from international courts.

There were no new major investment laws or judicial decisions ratified last year. However, the government launched the Investment Promotion Agency (APIM in French) under the Ministry of Economy to develop and facilitate procedures and processes related to investment. The investment code, which was last updated in June 2012, was designed to encourage direct investment by enhancing the security of investments and facilitating administrative procedures. The code provides for free repatriation of foreign capital and wages for foreign employees. The code also created free points of importation and export incentives. Small and medium enterprises (SME), which register through OPPS, do not pay corporate taxes or customs duties.

The Ministry of Economy’s Office of Procurement Commission of the Economic and Finance Sectors is the government agency that reviews tenders and bids in accordance with the law and regulations. Suppliers for large government contracts are selected through a tender process initiated at the ministry level. Invitations for some tenders are publicly announced in local newspapers and on government websites. After issuing an invitation for tenders, the Ministry of Economy’s commission in charge of reviewing tenders selects the offer that best fulfills government requirements. If two offers, i.e., one from a foreign company and one from a Mauritanian company, are otherwise considered equal, statutes require that the government award the tender to the Mauritanian company. In practice, this has resulted in contracts awarded to companies that have strong ties to government officials and tribal leaders, regardless of the merits of an individual offer. Preferential treatment remains common in government procurement, despite the government’s recent efforts to promote transparency in the public sector.

In an effort to make tenders more transparent, the National Assembly adopted a bill on December 21, 2021, the Public Procurement Code on December 21, 2021, No. 21-025 repealing and replacing the law No. 044-2010 that was enacted On July 2010. This new code will help the government become more transparent in handling tenders. The current code is structured around:

  • Reducing the measures of the preliminary control of the public procurement control body;
  • Clarifying the circumstances in which the awarding of contracts by mutual agreement becomes possible;
  • Excluding from the provisions of this law, public contracts related to defense and national security needs and procurement operations in emergency situations;
  • Promoting small and medium-sized enterprises by facilitating their access to public contracts; and
  • Making procedures more flexible to speed up the process of concluding public contracts and handling complaints.

The revised Investment Code provides more property guarantees and protection to business owners. The Code protects private companies against nationalization, expropriation, and requisition. However, if a foreign enterprise is facing difficulties, the government can propose an expropriation plan to avoid bankruptcy and to protect jobs of local employees, with fair and equitable compensation.

The only known case of expropriation since Mauritania’s independence was the nationalization of the French mining MIFERMA in November 1974. In that case, the two parties agreed on a compensation plan.

The country has bankruptcy laws which carry the potential for criminal penalties. Mauritania’s bankruptcy laws were last updated in 2001. The bankruptcy law allows for the reorganization or restructuring of a business. There are very few reported cases of these laws being applied

4. Industrial Policies

Investment incentives such as free land, deferred and reduced taxes, and tax-free importation of materials and equipment are available to encourage foreign investors. The Ministry of

Economy offers tax benefits, including exemptions in some instances, to enterprises in Special Economic Zones (SEZs) and some companies in priority sectors throughout the country (e.g., mining, hydrocarbons, and fishing). The Investment Code outlines standard investment incentives, but foreign investors may negotiate other incentives directly with the government. In 2018, the government adopted the Public-Private Partnerships (PPPs) law. This law supports the 2017 budget diversification agenda through increased private sector participation in non-extractives sectors. The law provides legal and regulatory framework for PPPs participation in the national economy. It also addresses land tenure and property rights issues to facilitate credit access. According to World Bank and IMF analysis, the PPP law will enable the country to reduce reliance on commodities and raises long-term growth prospects in a more sustained and inclusive manner.

Although Mauritania has high energy potential, the government does not offer any incentives, such as feed-in tariffs, discounts on electricity rates, or tax incentives, for clean energy investments (including renewable energy, energy storage, energy efficiency, clean hydrogen).

The Investment Code creates Special Economic Zones (Free Export Zone or Cluster of Development in the Interior https://www.ndbfreezone.mr/en/home/ ) by decree. SEZs are subject to continuous monitoring by the Customs Service in a manner specified in the decree. Nouadhibou, the commercial capital of Mauritania, is designated as a Free Trade Zone by the government. The Nouadhibou Free Trade Zone has its own regulatory structure. As of January 2020, the Nouadhibou Free Trade Zone has granted 750 authorizations for companies, primarily in the tourism, services, and fisheries sectors.

The Investment Code provides three main preferential tax regimes: Small and Medium Enterprises Regimes, which apply to any investment between USD 167,000 and USD 667,000; Free Export Zones/Clusters of Development; and Targeted Industries, which includes agriculture, artisanal fishing, tourism, renewable energy, and raw material processing. Land concessions allocated to companies located in Free Economic Zones will follow a rental rate determined by joint decision of the relevant Minister and the Minister of Economy, which sets land allocation prices. As for tax advantages, companies will be exempt from taxes, excluding personnel taxes such as for retirement and social security, if they have invested at least USD 1.6 million and generated at least 50 permanent jobs, and show a potential to export at least 80 percent of their goods or services.

Additionally, under the provisions in the revised Investment Code, companies will not be taxed on patents, licenses, property, or land, but rather assessed a single municipal tax that cannot exceed an annual amount of USD 16,000. Companies established in free zones are exempt from taxes on profits for the first five years. Additionally, companies established in free zones benefit from a total exemption of customs duties and taxes on the importation and export of goods and services.

The government mandates that companies may employ expatriate staff in no more than 10 percent of key managerial staff positions, in accordance with the Labor Code and are required to have a plan in place to “Mauritanize” expatriate staff positions. Expatriate staff may be hired more than 10 percent with authorization from the appropriate industry authority by establishing that no competent Mauritanian national is available for the vacancy. Foreign companies are required to transfer skills to local employees by providing training for lower-skilled jobs. The law is specifically geared toward extractive companies to encourage recruitment of Mauritanian Nationals. It is important to note that this law has not yet been enforced with companies operating within the Nouadhibou Free Trade Zone Authority.

Current immigration laws do not discriminate nor are they considered to apply excessively onerous visa, residence, or work permit requirements inhibiting foreign investors’ mobility. However, some U.S. companies have expressed frustration with the difficulty in obtaining or renewing work and residency permits for their employees who are not Mauritanians.

The government imposes performance requirements as a condition for establishing, maintaining, or expanding an investment, or for access to tax and investment incentives. Foreign investors consistently report that government-sponsored requests for tenders lack coherence and transparency. The revised Investment Code requires investors to purchase from local sources if it is available and is of the same quality and price as could be purchased abroad. There is no requirement for investors to export a certain percentage of output or have access to foreign exchange only in relation to their exports. If imported “dumped” goods are deemed to be competing unfairly with a priority enterprise, the government will respond to industry requests for tariff surcharges, thus providing some potential protection from competition.

Expatriate staff members working for companies in accordance with the Labor Code are eligible to import, free of customs duties and taxes, their personal belongings and one passenger vehicle per household, under the regime of exceptional temporary admission (Admission Temporaire Exceptionelle or ATE). All sales, transfers, or withdrawals are subject to permission of customs officials.

The Mauritanian government does not have any requirements or a mechanism that impedes companies from transmitting data freely outside the country. There are no laws in place on local data storage.

5. Protection of Property Rights

Property rights are protected under the Mauritanian Civil Code, which is modeled on the French code. It can be difficult to gain redress for grievances through the courts. Mortgages exist and are extended by commercial banks. There is a well-developed property registration system for land and real estate in most areas of the country, but land titling and tenure issues in southern Mauritania, particularly the area along the Senegal River, are the subject of much controversy. Investors should be fully aware of the history of the lands they are purchasing or renting and should verify that the local partner has the proper authority to sell/rent large tracts of land—particularly in this region—before agreeing to any deals. For instance, in early 2021, there was a case of an alleged land grab by local authorities in the villages of Mbagne and Ferala in southern Mauritania. The land was designated for a World Bank project but following regional protests, over ownership of the property, the World Bank withdrew. The World Bank placed the project on hold until the issue between the community and the government is resolved.

The Ministry of Housing continues to digitize land licenses to provide more transparent land allocation. All information regarding the property titles is available at the Land Registry Agency housed at the Ministry of Housing, including information related to mortgages and other tax related matters. The Land Registry Agency performs due diligence prior to making the final title transfer. To register a property, owners need to have their notarized sale agreement along with the title certificate. There remains a large percentage (over 10 percent) of available owned land without a clear title. Even if property is legally purchased, there is always the possibility that the property is occupied by squatters.

The legal protection of intellectual property rights (IPR) remains a relatively new concept in Mauritania. Those seeking legal redress for IPR infringements will find very little historical record of cases or legal structures in place to support such claims. There is no separate judicial circuit that specializes in IPR.

Mauritania is a member of the Multilateral Investment Guarantee Agency (MIGA) and the African Organization of Intellectual Property (OAPI). In joining the latter, member states agree to honor IPR principles and to establish uniform procedures of implementation for the following international agreements: the Paris Convention for the Protection of Industrial Property, the Berne Convention for the Protection of Literary and Artistic Works, the Hague Convention for the Registration of Designs and Industrial Models, the Lisbon Convention for the Protection and International Registration of Original Trade Names, the Washington Treaty on Patents, and the Vienna Treaty on the Registration of Trade Names. Mauritania signed and ratified the World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) in 1994 but has yet to implement it. The government also signed and ratified the World Intellectual Property Organization (WIPO) Convention in 1976, but it has not signed or ratified the WIPO Internet treaties. The government is in the process of launching reforms related to property, product certification, and accreditation bodies to protect IPR. The Agency for Consumer Protection, housed at the Ministry of Commerce, oversees quality control and the prevention of sales of counterfeit goods in local markets, but its capabilities to track and enforce its regulations are very constrained.

Mauritania is not included in the United States Trade Representative (USTR) Special 301 Report or the Notorious Markets List.

For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ 

The government is favorable to portfolio investment. Private entities, whether foreign or national, have the right to freely establish, acquire, own, and/or dispose of interests in business enterprises and receive legal remuneration. Privatization and liberalization programs have also helped put private enterprises on an equal footing with respect to access to markets and credit. In principle, government policies encourage the free flow of financial resources and do not place restrictions on access by foreign investors. Most foreign investors, however, prefer external financing due to the high interest rates and procedural complexities that prevail locally. Credit is often difficult to obtain due to a lax legal system to enforce regulations that build trust and guarantee credit return. There are no legal or policy restrictions on converting or transferring funds associated with investments. Investors are guaranteed the free transfer of convertible currencies at the legal market rate, subject to availability. Similarly, foreigners working in Mauritania are guaranteed the prompt transfer of their professional salaries.

Commercial bank loans are virtually the only type of credit instrument. There is no stock market or other public trading of shares in Mauritanian companies. Currently, individual proprietors, family groups, and partnerships generally hold companies and portfolio investments.

The IMF has assisted Mauritania with the stabilization of the banking sector and as a result, access to domestic credit has become easier and cheaper. A proliferation of banks has fostered competition that has contributed to the decline in interest rates from 30 percent in 2000 to 10 percent in 2018, to 6.5 percent in 2020, to an annual 5 percent as part of the Central Bank of Mauritania’s (CBM) measures to countering the effects of the global pandemic. This interest rate does not include origination costs and other fees.

Nevertheless, the banking system remains fragile due to liquidity constraints in the financial markets. The country’s five largest banks are estimated to have USD 100 million in combined reserves; however, these figures cannot be independently verified, making an evaluation of the banking system’s strength impossible. As of April 2020, 25 banks, national and foreign, operate in Mauritania, even though only 15 percent of the population hold bank accounts.

The Central Bank of Mauritania oversees regulating the Mauritanian banking industry, and the Central Bank has made reforms to streamline the financial sector’s compliance with international standards. The Central Bank performs yearly audits of Mauritanian banks. There are no restrictions enforced on foreigners who wish to obtain an individual or business banking account.

In 2018, the Central Bank of Mauritania lost all correspondent banking relationships with banks in the United States due to de-risking policies enforced by U.S. banks. The Central Bank subsequently was able to reestablish a correspondent banking relationship in 2019; however, there are still no private Mauritanian banks that have been able to do the same. Local branches of international banks (such as France’s Société Générale or Morocco’s Attijari) do maintain correspondent banking relationships with U.S. banks and are able to clear transactions in USD.

The Central Bank administers the National Fund for Hydrocarbon Reserves, a sovereign wealth fund (SWF), which was established in 2006. The SWF is funded from the revenues received from the extraction of oil, any royalties, and corporate taxes from oil companies, and from the profits made through the fund’s investment activities. The fund’s mandate is to create macroeconomic stability by setting aside oil revenues for developmental projects. However, the management of the SWF lacks transparency and the projected revenue streams remain unrealized.

SOEs and the parastatal sector in Mauritania represent important drivers of the economy. They have an impact on employment, service delivery, and most importantly fiscal reserves given their importance to the economy and the state budget. In 2020 parastatal companies and SOEs experienced significant business and financial problems in the form of increasing levels of debt, operational losses, and payment delays because of the COVID pandemic. This increase in fiscal reserve risk led the government to provide subsidies to SOEs.

Hard budget constraints for SOEs are written into the Public Procurement Code but are not enforced. SOMELEC, the state-owned electricity company, has been operating in a precarious financial situation for many years. In principle, larger wholly government-owned enterprises are operated on a commercial basis. Nevertheless, many have operated at a loss since the 1970s and failed to provide the services for which they were responsible.

Most state-owned enterprises in Mauritania have independent boards of directors. Most board members are usually appointed based on political affiliations.

The Mauritanian government is putting a strong emphasis on liberalizing the trade and foreign investment frameworks and privatizing SOEs. While the GIRM has worked through its various economic reform program to privatize SOEs, (several SOEs remain, (most importantly the State Industrial and Mining Company (SNIM), the State Electricity Company (SOMELEC), the State Water Distribution Company (SNDE) and the National Airlines (Mauritania Airlines). The remaining SOEs are active in a wide range of sectors including energy, network utilities, mining, petroleum, telecommunications, transportation, commerce, and fisheries. Parastatal and wholly owned SOEs remain the major employers in the country. This includes the SNIM, which is by far the largest Mauritanian enterprise and second largest employer in the country after the government.

The publicly available financial information on parastatal and wholly owned SOEs is incomplete and outdated, except for budget transfers. There is no publication of the expenditures SOEs allocate to research and development. In addition, they execute the largest portion of government contracts, receiving preference over the private sector. According to the Public Procurement Code, there are no formal barriers to competition with SOEs. However, informal barriers such as denial of access to credit and/or land exist.

Post is not aware of any privatization programs during the reporting period.

Historically, corporate social responsibility in Mauritania is not a widespread practice. However, this is changing as more foreign-owned companies enter the Mauritanian market. Certain state-run industries have provided basic educational and training opportunities for the children of their employees and/or scholarships for their employees to study abroad, but this is usually the extent of social responsibility initiatives. Companies in the mining and hydrocarbon industries send young Mauritanians overseas to complete their studies on scholarship programs; many of the scholarship recipients have family ties to powerful individuals in the companies. The larger fishing companies have recently started to provide more opportunities for qualified youth to study at the fishing and naval training school in Nouadhibou to prepare them for careers in the fishing industry. Current projects by foreign-owned companies include providing free water to local communities; building vocational training centers, health clinics, and roadways; and providing healthcare equipment and medicines to towns near company operations.

Since 2011, three of Mauritania’s largest mining companies—Kinross, Mauritanian Copper Mines (MCM), and SNIM—funded a School of Mining with the goal of increasing the number of qualified Mauritanians to serve in the mining industry. The school has a partnership with the Ecole Polytechnique in Montreal and with the mining companies. The school is considered a public entity under the Ministry of Petroleum, Mines, and Energy. In 2017, Kosmos Energy provided financial support to Diawling National Park in the south of the country, and in 2018, launched the Kosmos Innovation Center in Mauritania to invest in youth entrepreneurs and small business who have big ideas with the goal of contributing to the overall economic growth of Mauritania. In addition to Kosmos, companies such as BP and other international oil companies now operating in Mauritania are likewise increasing corporate social responsibility programs.

Department of State

Department of the Treasury

Department of Labor

Mauritania submitted its updated National Determined Contribution (NDC) in October 2021 primarily focusing on increasing Mauritania’s resilience to climate change through the promotion of low carbon growth, while increasing adaption for low lying coastal areas, upgrading infrastructure, and strengthening the country’s food security position.

Highlights from the NDC

Mauritania raised its climate ambition with a new target to cut greenhouse (GHG) emissions by 11% in 2030.

With more substantial support, Mauritania could ensure carbon neutrality and potentially reach a 92% reduction of its greenhouse gas emissions.

As well as increased mitigation targets, Mauritania enhanced the adaptation component of its NDC, including the creation of green jobs.

The NDC is intended to serve as a framework for consultation and dialogue to design transformative resilience programs that meet the needs of the populations and ecosystems affected climate change.

Mauritania’s NDC is based on the sectoral development programs and the strategic framework for the fight against poverty. These have the overall objective of contributing to development that is low-carbon and resilient to the impacts of climate change.

The NDC provides that at the request of the Ministry of Environment and Sustainable Development (MEDD in French), each Ministry has a designated ‘Sectoral Focus Point’ in charge of climate change for its sector. Mauritania has thus developed a network of Sectoral Focus Points within ministerial departments to improve implementation of the objectives of the Convention.

Mauritania launched its National Adaption Plan (NAP) process in April 2019 with a two-day capacity building workshop led by the MEDD. The NAP is a three-year plan supported by $2.6 million from the United Nation’s Green Climate Fund (GCF). This UN contribution will provide technical support to advance climate science, ecosystem-based adaption, environmental economics, and integrated adaption strategies in Mauritania.

Mauritania’s NAP aims to strengthen the country’s technical and institutional capacities to better manage climate change adaptation planning. The NAP will improve quality and access to climate change data and enhance the monitoring and evaluation of adaptation planning at the national and local levels. According to the NAP-Global Support Programme (NAP-GSP), climate change is exacerbating desertification and loss of biodiversity in Mauritania. These trends are expected to worsen in the future based on current climate projections. The NAP supports Mauritania’s commitments to the Paris Agreement by addressing the adaptation component of Mauritania’s NDC to the UNFCCC.

Mauritania recognizes its vulnerability to climate change and has made some progress to increase its climate resilience. As mentioned above, Mauritania is a member of multiple

multilateral environmental agreements, including the United Nations Framework Convention on Climate Change (UNFCCC) (1994), the Convention on Biological Diversity (CBD) and the Convention to Combat Desertification (CCD) (1996) and has signed onto several Protocols and sub-agreements, such as the Kyoto, Nagoya and Montreal Protocols and the Paris Agreement. Nationally, at the policy level, the country’s 2011-2016 planning framework (CSLPII, 2011-2016) included a vision on climate change with a plan of action considering the risks of climate change and a monitoring system (SEPANE 2).

More recently, the Sector Environment and Sustainable Development Strategy, 2017-2021 (SNEDD) provides a strategic background for integrating environmental, climate change and sustainable development goals into other sectoral policy frameworks. The country’s National Development Strategy (SCAPP 2016 – 2030, adopted in 2018) guides this integration with more focus on the Nationally Determined Contribution (NDC, 2015). Specifically, Mauritania has also developed a National Adaptation Programme of Action (NAPA) (2004). In September 2015, Mauritania submitted its Intended Nationally Determined Contribution (INDC) for the Paris Climate Agreement.

Since taking office in August 2019, President Ghazouani has made fighting corruption one of the cornerstones of his administration. In October 2019, the Court of Accounts published a detailed audit report covering fiscal years 2007 through 2017. The report highlighted lack of transparency in government tenders, weakness in public finances management, and provided credible recommendations. Based on the audit report findings, a parliamentarian committee was set up to further investigate four major government infrastructure and fisheries projects that were awarded to Chinese companies. The judiciary system moved forward with the investigation during the 2021 reporting period. On March 11, 2021, former President Mohamed Ould Abdel Aziz and 14 other suspects were charged for mismanagement of State property and resources, bribery, illicit enrichment, and money laundering. Aziz and the 14 other suspects were placed under judicial supervision (i.e. house arrest). In June 2021, after violating the terms of his house arrest, the investigative judge decided to send Aziz to pre-trial detention at the Nouakchott police academy.

Tax evasion and corruption have deprived the government of a significant source of revenue, weakening its capacity to provide necessary services. In 2009, the government passed a law requiring all high-ranking government employees to publicly declare their assets, although this law is not enforced.

Corruption is an obstacle to foreign direct investment in Mauritania, but firms generally rate access to credit, an underdeveloped infrastructure, and a lack of skilled labor as even greater impediments. Corruption is most pervasive in government procurement, bank loans, fishing license attribution, land distribution, access to port facilities and tax payments. Giving or accepting a bribe is a criminal act punishable by two to 10 years imprisonment and fines up to USD 700, but there is little application of this law. Firms commonly pay bribes to obtain telephone, electricity, and water connections, and construction permits more quickly.

There are several organizations that track corruption within Mauritania. Transparency International has a representative who reports on local corruption policies and events.

In practice, annual auditing of government accounts is not enforced and therefore rarely conducted. However, the government rectified previously misreported financial data to be more transparent; this included publishing quarterly financial statements on a government treasury website: www.tresor.mr .

In April 2016, a new anti-corruption bill was introduced to address the provisions of the UN Convention against Corruption and to provide protection to NGOs involved in investigating corruptions cases.

Contact at the government agency or agencies that are responsible for combating corruption:

Cour Des Comptes Mauritanie
Email ccomptes@cc.gov.mr
Telephone: +222 4525 34 04
Fax: +222 4525 49 64

Contact at a “watchdog” organization:
Publiez ce que vous payez” (Publish What You Pay)
Executive Office
+222 4525-0455
+222 4641-7702

The August 2019 inauguration of President Mohamed Cheikh El Ghazouani marked the first democratic transition of power from one elected leader to another in the country’s history and ushered in a broad sense of optimism. Mauritania has not suffered a terrorist attack on its soil since 2011. And while the country continues to struggle in respecting human rights, the government is beginning to take concrete steps to address these issues. On October 20, 2021, President Ghazouani’s cabinet adopted the implementing decree for the Law on Associations (“NGO Law), which was adopted by the Parliament in January 2021. The law replaces the authoritative registration system with a declarative system more in line with international standards, allowing previously excluded non-government organizations to begin officially operating. The Initiative for the Resurgence of the Abolitionist Movement (IRA) is one such organization that benefits from this new regulation; IRA’s anti-slavery mission includes combating child forced labor.

The Mauritanian economy is highly informal (especially in agriculture, artisanal fisheries/ mining, and animal husbandry) and according to the Ministry of Employment and Youth, the unemployment rate is estimated to be around 37 percent. While labor is abundant, there is a shortage of skilled workers and well-trained technical and managerial personnel in most sectors of the economy. As a result, there are few sectors of the economy that use advanced technologies because the skilled labor required to operate them is not readily available. The mining sector is led by the national company SNIM; the subsidiary of a Canadian gold mining company, Kinross-Tasiast; and the subsidiary of a Canadian company, MCM. These companies provide advanced training for their employees.

The “Mauritanization law” requires that employers give priority to nationals over foreign workers, unless the skills required for the position cannot be filled by the national labor force. Employers must develop a “Mauritanization” plan to transfer skillsets to local workers within a period of two years.

There are no restrictions on employers reducing their workforce in periods of unfavorable market conditions. However, the law requires that compensations be granted to laid-off employees.

The International Labor Organization (ILO) reported in 2018 that a significant pay gap between staff in the labor inspectorate and staff in other government inspection departments who receive better remuneration (such as tax inspectors or education inspectors) led to attrition. The ILO also reported that the labor inspectorate was subject to undue influence by employers and the government, thereby reducing the effectiveness of inspection activity. The law provides that men and women should receive equal pay for equal work. The two largest employers, the civil service and the state mining company, observed this law; most employers in the private sector reportedly did not. In the modern wage sector, women also received family benefits, including three months of paid maternity leave. Women face employment discrimination, because employers usually prefer to hire men, and women are overrepresented in low-paying positions

In March 2021, in partnership with ILO, the Mauritanian Government organized regional consultations and roundtables with child labor and protection stakeholders to draw up the list of hazardous work for children under 18 years of age, as established by the international and national standards of child labor. After collecting data from all fifteen regions, the government consolidated the data in June 2021 and narrowed the list down to 44 activities officially identified as hazardous work.

On January 17, 2022, with the support of the ILO, the Mauritanian Government banned hazardous child labor. The Ministry of Public Service and Labor issued a regulatory text listing hazardous work (LTD in French) that are prohibited for children. ( https://www.ilo.org/africa/countries-covered/mauritania/WCMS_835859/lang–en/index.htm )

The World Bank’s Logistics Performance Index (LPI) ranks Mauritania 157 out of 167 countries for the quality of infrastructure. This LPI sub-factor covers the quality and performance of ports, roads, railroads, and information technology. In addition, the World Economic Forum’s infrastructure quality rating for Mauritania’s is 2.6 out of 7, and 46 percent of companies in the country identify transportation inefficiencies as a major constraint on business. Currently, there is no investment with financial support from the Development Finance Corporation (DFC).

In 2019, Arise and Meridiam SAS entered a joint venture to support the modernization of the Nouakchott Port via a specific public-private partnership with a long-term concession of 30 years. Meridiam SAS received USD 24,840,000 in OPIC financing and political risk insurance. The project is not expected to have a negative impact on the U.S. economy. There is no U.S. procurement associated with this project, and, therefore, the project is expected to have a neutral impact on U.S. employment. But the project is expected to have a significant economic impact by expanding Mauritania’s port infrastructure capacity.

In December 2021, Arise inaugurated the new container terminal in Mauritania. This project represents a total investment of 278 million euros or USD 305 million. It is the first project developed under a Public Private Partnership scheme in Mauritania. Its scope covers the development, financing, construction, maintenance, and operation of a new and dedicated container terminal at the port of Nouakchott, designated to have an initial handling capacity of 250,000 TEUs (2), and the extension and deepening of the port area from previously 12m to 14,70 m to allow access of larger container vessels. The project foresees a significant potential for extending the capacity of the terminal in the future, which could be able to handle a potential maximum capacity of 600,000 TEU i.e., almost four times the actual container capacity.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $7,914 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S.  FDI in partner country ($M USD, stock positions) N/A N/A 2019 $96 BEA data available at https://apps.bea.gov/international/factsheet/
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP  

N/A

N/A 2018 142% UNCTAD data available at

https://unctad.org/topic/investment/
world-investment-report

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

U.S. Embassy Nouakchott
Economic/Commercial Section
NouakchottEconComm@state.gov 

Niger

Executive Summary

Niger is eager to attract foreign investment and has taken slow but deliberate steps to improve its business climate, including making reforms to liberalize the economy, encourage privatizations, appeal to foreign investors, increase imports and exports, and create new export processing zones.

In April 2021, newly elected President Bazoum Mohamed was inaugurated in Niger’s historic first democratic transfer of executive power.  Bazoum intends to build upon the advancement of his predecessors to continue to develop the nation’s mineral and petroleum wealth, while seeking to develop agricultural businesses that can take advantage of the African Continental Free Trade Agreement.  Pre-COVID economic growth averaged roughly six percent per year and the government managed positive 1.5 percent growth through the 2020 pandemic year. The Government of Niger (GoN) continues to seek foreign investment – U.S. or otherwise.

President Bazoum frequenty reiterates the need for FDI during official visits. In 2017, the GoN created the High Council for Investment, which is an organization tasked with supporting and promoting foreign direct investments in Niger, and is furthering appeals for foreign investment with the development of the GUCE, Guichet Unique du Commerce Exterieur, an information and facilitation system for foreign trade, electronic and dematerialized, intended to simplify and modernize procedures to facilitate the passage of goods entering and leaving the national territory.

U.S. investment in the country is very small; there is currently only one U.S. firm operating in Niger outside of U.S. Government-related projects. Many U.S. firms see risk due to the country’s limited internet, transport, and energy infrastructure, terrorist threats, the perception of political instability, lack of educated and skilled/experienced workers, and a climate that is dry and very hot. Foreign investment dominates key sectors: France in the the uranium sector, Morocco is making inroads with telecommunications, bank and real estate development, while Chinese and Turkish investment is paramount and expanding in the oil, mining,construction, and hospitality sectors. Much of the country’s retail stores, particularly those related to food, dry goods and clothing are operated by Lebanese and Moroccan entrepreneurs. GoN focus areas for investment include the mining and petroleum sector, infrastructure and construction, transportation, and agribusiness. The GoN also hopes to draw investment into petroleum exploration into proven reserves with the 2023 target completion of a crude oil export pipeline.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perception Index 2021 124 of 180 http://www.transparency.org/research/cpi/overview
Global Innovation Index 2021 129 of 132 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2020 N/A https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2020 $550 https://data.worldbank.org/indicator/NY.GNP.PCAP.CD

 

1. Openness To, and Restrictions Upon, Foreign Investment

The GoN is committed to attracting FDI and has repeatedly pledged to take whatever steps necessary to encourage the development of private sector and increase trade. The country offers numerous investment opportunities, particularly in agriculture, livestock, energy, telecommunication, industry, infrastructure, hydrocarbons, services and mining. In the past several years, new investor codes have been implemented, the most recent being in 2014. A Public-Private Partnership law was adopted in 2018, transparency has improved, and customs and taxation procedures have been simplified and computirized. There are no laws that specifically discriminate against foreign and/or U.S. investors. The GoN has demonstrated a willingness to negotiate with prospective foreign investors on matters of taxation and customs, despite some difficulties recently observed on the introduction of an electronic system for VAT.

The Investment Code adopted in 2014 guarantees the reception and protection of foreign direct investment, as well as tax advantages available for investment projects. The Investment Code allows tax exemptions for a certain period and according to the location and amount of the projects to be negotiated on a case-by-case basis with the Ministry of Commerce. The code guarantees fair treatment of investors regardless of their origin. The code also offers tax incentives for sectors that the government deems to be priorities and strategic, including energy production, agriculture, fishing, social housing, health, education, crafts, hotels, transportation and the agro-food industry processing. The code allows free transfer of profits and free convertibility of currencies.

The Public-Private Partnership law adopted in 2018 and implemented since then gives projects of the public private partnership type for their operations in the design and /or implementation phase, total exemption from duties and taxes collected by the State, including VAT, on the provision of services, works and services directly contributing to the realization of the project. However, parts and spare parts, and raw materials intended for projects benefit from a duty exemption and customs taxes only when not available in Niger. In the design and /or production phase, private public partnership type benefit from free registration agreements and all acts entered into by the contracting authority and the contracting partner within the framework of the project. There are no laws or practices that discriminate against foreign investors including U.S. investors.

The High Council for Investment of Niger (HCIN) reports directly to the President of the Republic. HCIN is the platform of public-private dialogue with a view to increasing Foreign Direct Investments, improving Niger’s business environment, and defining private sector priorities to possible investors. In 2018, the GoN added by Presidential Decree a Nigerien Agency for the Promotion of Private Investment and Strategic Projects (ANPIPS). This new agency reports to the HCIN and implements the lead agencies policy initiatives.

The government put in place an Institutional Framework for Improving Business Climate Indicators office (Dispositif Institutionnel d’Amélioration et de Suivi du Climat des Affaires), within the Ministry of Commerce, focused on improving business climate indicators. Its goal is to create a framework that permits the implementation of sustainable reforms.

Foreign and domestic private entities have the right to establish and own business enterprises. Energy, mineral resources, and national security related sectors restrict foreign ownership and control; otherwise, there are no limitations on ownership or control. In the extractive industries, any company to which the GoN grants a mining permit must give the GoN a minimum 10 percent share of the company. This law applies to both foreign and domestic operations.

The GoN also reserves the right to require companies exploiting mineral resources to give the GoN up to a 33 percent stake in their Nigerien operations. Although Ministry of Planning authorization is required, foreign ownership of land is permitted. In 2015, under the auspices of the Ministry of Commerce, the GoN validated a new Competition and Consumer Protection Law, replacing a 1992 law that was never operational. Niger adheres to the Community Competition Law of the West African Economic and Monetary Union (WAEMU) and directives of the Economic Community of West African States (ECOWAS) as well as those offered to investors by the Multilateral Investment Guarantee Agency (MIGA) all of which provide benefits and guarantees to private companies.

Foreign and domestic private entities have the right to establish and own business enterprises. A legal Investment Code governs most activities except accounting, which the Organization for the Harmonization of Business Law in Africa (OHADA) governs. The Mining Code governs the mining sector and the Petroleum Code governs the petroleum sector, with regulations enforced through their respective ministries. The investment code guarantees equal treatment of investors regardless of nationality. Companies are protected against nationalization, expropriation or requisitioning throughout the national territory, except for reasons of public utility.

The state remains the owner of water resources through the Niger Water Infrastructure Corporation (SPEN), created in 2001, and is responsible for the management of the state’s hydraulic infrastructure in urban and semi-urban areas, of its development, and project management. Concessions for the use of water and for the exploitation of works and hydraulic installations may be granted to legal persons governed by private law, generally by presidential decree.

An investment screening mechanism does not exist under the Investment Code. The Office of the President, however, will review investment proposals for administration approval prior to further negotiation.

In the past five years, the government has not undergone any third-party investment policy reviews through a multi-lateral organization. Neither the United Nations Conference on Trade and Development (UNCTAD), nor the Organization for Economic Cooperation and Development (OECD) has carried out a policy review for Niger.

Niger’s one-stop shop, the Maison de l’Entreprise (Enterprise House) is mandated to enhance business facilitation by mainstreaming and simplifying the procedures required to start a business within a single window registration process. From 2016 to 2019, the cost and time needed to register businesses dropped from 100,000 CFA (about $190) to 17,500 CFA (about $33), including reducing the time to get construction permits and the cost of getting access to the water and electricity networks. Further reforms have included the creation of an e-regulations website (https://niger.eregulations.org/procedure/2/1?l=fr ), which allows for a clear and complete registration process. Foreign companies may use this website. The website lists government agencies, with which a business must register. The business registration process is about 3 days.

Company registration can be done at the Centre de Formalités des Entreprises (CFE), at the Maison de l’Entreprise. Applicants must file the documents with the Commercial Registry (Registre du Commerce et du Crédit Mobilier – RCCM), which has a representative at the one-stop shop. At the same location, a company can register for taxes, obtain a tax identification number (Numéro d’Identification Fiscale – NIF), register with social security (Caisse nationale de Sécurité Sociale – CNSS), and with the employment agency (Agence Nationale pour la Promotion de l’Emploi – ANPE). Employees can be registered with CNSS at the same location.

Professional activity carried out in Niger is governed by the General Tax Code. Commercial activities are subject to income tax and the general VAT regime unless specific investment clauses have been codified. Granted exemptions normally only concern activities in line with the object of the institution and a specific investment clause (humanitarian activities, health, education, etc.). Companies with a turnover excluding tax of more than 50 million CFA per calendar year($80,000) are subject to Value Added Tax. Companies with a lower turnover are not subject to VAT. As such, they cannot charge VAT, nor deduct that which has been paid upstream (suppliers). From January 1, 2021, any taxable person who delivers goods or provides services for the needs of another taxable person or an ordinary consumer is required to issue them an electronic invoice.

The Investment Code offers VAT-inclusive tax exemptions depending on the size of the business.

At the moment of company registration, the applicant may also request for the publication of a notice of company incorporation on the Maison de l’Entreprise website: http://mde.ne/spip.php?rubrique10 . The notice of company incorporation can alternatively be published in an official newspaper (journal d’annonces légales).

The government does not promote outward investment. The government’s policy objectives, as specified in the second Nigerien Renaissance Program (section 1.2), is the development of international markets, especially that of ECOWAS, for Nigerien exports rather than investment.

The GON does not restrict domestic investors from investing abroad.

3. Legal Regime

The GoN possesses transparent policies and requisite laws to foster competition on a non-discriminatory basis, but does not enforce them equally, in large part due to corruption and weak governmental systems. Legal, regulatory, and accounting systems are generally transparent and consistent with international norms. The Legal Regime – related to the Investment Code, Labor Code and Commercial Acts – applies the provisions of the Organization for the Harmonization of Business Law in Africa (OHADA). It also offers free access to public procurement and with a moderate transparency in the procedures for awarding contract.

Niger does not have any regulatory processes managed by nongovernmental organizations or private sector associations. A company in Niger must be entered in the Register of Companies, must obtain a Tax Identification Number (TIN), be registered with the National Social Security Fund (CNSS), and with the National Employment Promotion Agency (ANPE). There, however, is a large informal sector that does not submit to any of the legal provisions and is not formally regulated.

Rule-making regulatory, and anti-corruption authorities exist in telecommunication, public procurement, and energy, all of which are relevant for foreign businesses, and are exercised at the national level. Law No 2015-58 established the Energy Sector Regulatory Agency, an independent administrative authority, to regulate the energy sector at the national level, but effectively only in major cities. The December 2012 law No 2012-70 created the Telecommunications and Post Office Regulatory Authority (ARTP). ARTP regulates all aspects of telecommunications operators. Legal, regulatory, and accounting systems are generally transparent and consistent with international norms. The Legal Regime – related to the Tax Code, Customs Code, Investment Code, Mining Code, Petroleum Code, Labor Code and Commercial Acts – applies the provisions of the Organization for the Harmonization of Business Law in Africa OHADA. It also offers free access to public procurement and transparency in the procedures for awarding contracts.

GoN officials have confirmed their intent to comply with international norms in its legal, regulatory, and accounting systems, but frequently fall short. Clear procedures are frequently not available. Draft bills are not always available for public comment, although some organizations, such as the Chamber of Commerce, are invited to offer suggestions during the drafting process.

The GoN encourages but does not require companies to disclose environmental, social, and governance (ESG) policies.

Niger does not have a centralized online location where key regulatory actions are published but does have a Directorate of National Archives where key regulatory actions are kept in print; this direction is under the Ministry Secretary of Government. Foreign and national investors, however, can find detailed information on administrative procedures applicable to investment at the following site: http://niger.eregulations.org/ . The site includes information on 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 basis justifying the procedures.

The General Inspectorate of Administrative Governance and the Regional Directorates of Archives are in place to oversee administrative processes. Their efforts are reinforced by incentives for state employees, unannounced inspections in public administrations, and an introduction of a sign-in system and exchange meetings. No major regulatory system and/or enforcement reforms were announced in 2021.

Regulations are developed via a system of ministerial collaborations and discussions, consultation with the State Council and the Council of Ministers. This is followed by discussions in the National Assembly, approval by the Constitutional Council and finally approved by the President for publication and distribution to interested stakeholders. Based on the Constitution of 2011, the regulatory power belongs to the President and the Prime Minister to issue regulations for the national territory. Other administrative authorities also have regulatory power, such as ministers, governors, or prefects and mayors, who have the power of enforcement at the local level.

Ministries or regulatory agencies do not conduct impact assessments of proposed regulations. However, ministries or regulatory agencies solicit comments on proposed regulations from the general public through public meetings and targeted outreach to stakeholders, such as business associations or other groups. Public comments are generally not published.

Public finances and debt obligations are not sufficiently transparent. The International Monetary Fund and the European Union, however, are currently funding projects to improve financial oversight and debt transparency. The 2021 assessment indicated some progress for public information on debt obligations and the release of a bi-annual national debt report.

Niger is a part of the Economic Community of West African States (ECOWAS), a 15-member West African trade block. National policy generally adheres to ECOWAS guidelines concerning business regulations. Niger is a member of the U.N. Conference on Trade and Development’s international network of transparent investment procedures:  http://niger.eregulations.org/  (French language only).

Niger is a member of the WTO, but as a lower income member, is exempt from Trade-Related Investment Measures (TRIMs) obligations. The GoN does not notify all draft technical regulations to the WTO Committee on Technical Barriers to Trade (TBT). Niger ratified a Trade Facilitation Agreement (TFA) in August 2015. The country has reported some progress on implementing the TFA requirements.

Niger’s legal system is a legacy of the French colonial system. The legal infrastructure is insufficient, making it difficult to use the courts to enforce ownership of property or contracts. While Niger’s laws protect property and commercial rights, the administration of justice can be slow and unequal.

Niger has a written commercial law that is heavily based on the Organization for the Harmonization of Business Law in Africa (OHADA). Niger has been a member of OHADA since 1995. OHADA aims to harmonize business laws in 16 African countries by adopting common rules adapted to their economies, setting up appropriate judicial procedures, and encouraging arbitration for the settlement of contractual disputes. OHADA regulations on business and commercial law include definition and classification of legal persons engaged in trade, procedures for credit and recovery of debts, means of enforcement, bankruptcy, receivership, and arbitration.

In 2015, Niger set up a Commercial Court in Niamey. In 2020, 453 cases, including 24 inherited from 2019, were in summary proceedings, of which 351 were the subject of a judgment and whose minutes are available, 38 conciliation, 68 cases canceled and two remaining and postponed to 2021. The average processing time is 37 days.

Article 116 of the constitution clearly states that the judicial system is independent of the executive and legislative branches. However, the personnel management process for assignments and promotions is through politically appointed personnel in the Ministry of Justice, seriously weakening the independence of the judiciary and raising questions about the fairness and reliability of the judicial process. Regulations or enforcement actions are appealable and adjudicated in the court system. However, it is extremely rare for individuals or corporations to challenge government regulations or enforcement actions in court due to costs and administrative obstacles. For example, the GoN may require companies to submit up to 75 percent of a claimed tax discrepancy prior to legal appeal.

Niger offers guarantees to foreign direct investors pertaining to security of capital and investment, compensation for expropriation, and equality of treatment. Foreign investors may be permitted to transfer income derived from invested capital and from liquidated investments, provided the original investment is made in convertible currencies.

Law 2015-08 from 2015 established a specialized Commercial Court in Niamey. This is a mixed court with professional magistrates, who are lawyers by training, who work in tandem with lay-judges, and who generally come from the commercial sector. The concept was to have commercial disputes resolved by a panel of judges with legal training, combined with judges who have experience in the commercial sector. The Commercial Court has 26 judges, who make up five chambers. Unlike U.S. trial courts, where cases are handled by a single judge, in Niger, cases are adjudicated by a panel of judges. Judicial decisions that have come out in the past years can be found on the Commerce Tribunal of Niamey’s website: http://www.tribunalcommerceniamey.org/index.php .

The Chamber of Commerce and Industry houses a specialized institution, known as the Investment Promotion Center (CPI) which supports domestic and foreign investors in terms of business creation, extension and rehabilitation. The GoN also established the The Single Window for Foreign Trade (Guichet Unique du Commerce Exterieur), an information and facilitation system for foreign trade, electronic and dematerialized, intended to simplify and modernize procedures to facilitate the passage of goods entering and leaving the national territory of Niger. Its main missions are to: facilitate foreign trade operations by improving procedures and information flows among stakeholders; facilitate, simplify and rationalize the procedures relating to the application, issue and collection of authorizations prior to import, export and transit operations; facilitate, simplify and rationalize, for all the modes of transport concerned, the procedures relating to the processing, entry and exit of goods from the territory of the Republic of Niger; and facilitate and simplify the completion of administrative and logistical formalities while respecting the prerogatives of all stakeholders.

In 2015, the Ministry of Trade validated a new Competition and Consumer Protection Law, replacing a 1992 law that was never fully operational. Niger also adheres to the Community Competition Law of the West African Economic and Monetary Union (WAEMU).

The Investment Code guarantees that no business will be subject to nationalization or expropriation except when deemed “in the public interest” as prescribed by the law. The code requires that the government compensate any expropriated business with just and equitable payment. There have been a number of expropriations of commercial and personal property, most of which were not conducted in a manner consistent with Nigerien law requiring “just and prior compensation.” It is in fact rare for property owners to be compensated by the government after expropriations of property.

In cases of expropriation carried out by the GoN, claimants and community leaders have alleged a lack of due process. These complaints are currently limited to community forums and press coverage. Many of the families impacted lack the knowledge and ability to exercise their rights under the law. High rates of illiteracy, complexity of the legal system, and lack of resources to retain competent legal counsel present insurmountable barriers to legal remedies for people whose property has been expropriated. Even in situations where educated and wealthy business owners have had their property expropriated, legal challenges to expropriation are not lodged.

ICSID Convention and New York Convention

Niger is a contracting state of both the ICSID Convention and the New York Convention of 1958. There is no domestic legislation providing for enforcement of awards under the 1958 New York Convention and/or under the ICSID Convention.

Investor-State Dispute Settlement

The Investment Code offers the possibility for foreign nationals to seek remedy through the International Center for the Settlement of Investment Disputes. Niger does not have a BIT or FTA with the United States that would provide dispute settlement processes. Over the past 10 years, there were no investment disputes that involved a U.S. person. Local courts are generally reluctant to recognize foreign arbitral awards issued against the GoN. Niger does not have a record of extrajudicial actions against foreign investors.

International Commercial Arbitration and Foreign Courts

Niger has an operational center for mediation and arbitration of business disputes. The center’s stated aim is to maintain investor confidence by eliminating long and expensive procedures traditionally involved in the resolution of business disputes. The Investment Code provides for settlement of disputes by arbitration or by recourse to the World Bank’s International Center for Settlement of Disputes on Investment. However, investment dispute mechanisms in contracts are not always respected and exercising due diligence is extremely important. There was no publicly available information in 2021on foreign arbitral award enforcement in Niger.

Procedures are in place but are often not adhered to because of a lack of resources and corruption in the judicial system. The Investment Code offers the possibility for foreign nationals to seek remedy through the International Center for the Settlement of Investment Disputes.

Niger has laws related to insolvency and/or bankruptcy. Creditors have the right to object to decisions accepting or rejecting a creditor’s claims and may vote on debtors’ bankruptcy reorganization plans. However, the creditors’ rights are limited: creditors do not have the right to receive from a reorganized firm as much as they may have received from one that had been liquidated. Likewise, the law does not require that creditors be consulted on matters pertaining to an insolvency framework following the declaration of bankruptcy. Bankruptcy is not criminalized.

According to data collected by the World Bank’s Doing Business survey, resolving insolvency takes five years on average and costs 18 percent of the debtor’s total assets. Globally, Niger stands at 114 in the 2020 ranking of 190 economies on the ease of resolving insolvency. Niger strength of insolvency framework index (0–16) is 9.

4. Industrial Policies

Niger offers incentives that are dependent on the size of the investment and number of jobs that will be created. The Investment Code offers VAT-inclusive tax exemptions depending on the size of the business. Potential tax exemptions include start-up costs, property, industrial and commercial profits, services and materials required for production, and energy use. Exemption periods range from ten to fifteen years and include waivers of duties and license fees. There are no restrictions on foreign companies opening a local office in Niger, though they must obtain a business certificate from the Ministry of Trade.

The Investment Code has established three different tiers of incentives for investors, based on minimum investment amounts, listed below:

Tier 1: Promotional tier, for investments of 25 million CFA francs (about $40,000) or above.

Tier 2: Priority tier, for investments of 50 million CFA francs (about $81,000) or above.

Tier 3: Conventional tier, for investments of at least 2 billion CFA (about $3.25 million).

During the investment phase, the approved investments are exempt from import duties and taxes on material and equipment needed for the project that are not available locally. The advantages provided during the operational phase include exemption from profit tax (35 percent). Apart from these regimes, two additional incentive schemes are part of the investment code. These apply to companies operating in remote regions, energy, agro-industry, and low-cost housing sectors.

The government of Niger has a practice of jointly financing foreign direct investment projects through the Public-Private Partnership law. This enacted law no. 2018-40 (June 2018) regulating contracts public-private partnership stated for example in Article 59: In the design and/or development phase implementation, public-private partnership type projects benefit for their operations of a total exemption from duties and taxes collected by the State with the exception of VAT on the services of services.

In 2016, the GON updated its antiquated Customs Code to conform with the requirements of Community Customs Codes of the West African Economic and Monetary Union (WAEMU) and the Economic Community of West African States (ECOWAS).

In 2017, the GON modernized the customs procedures with the electronic payment tax which is in pace in in Niamey and is being implemented through Niger’s seven other regions. In 2016, internal customs procedures migrated to SYDONIAWORLD, a system designed to improve efficiency and permit centralized oversight and control. In 2015, Niger was the first Least Developed Country (LDC) to ratify the World Trade Organization’s Trade Facilitation Agreement (TFA). The country seeks to implement the trade policy of the West African Economic and Monetary Union (WAEMU) and has joined the Generalized System of Preferences (GSP) of the European Union.

Niger is landlocked and relies on the ports of Cotonou in Benin and Lomé in Togo as its primary seaports. Importers also use the ports of Tema, in Ghana and sometimes Lagos, Nigeria. Delivery can take months due to delays at borders and internal control points along the route. The relatively low number of commercial flights to Niger means that transport costs are high. The country’s main trade partners are Nigeria, the European Union, the United States, China, Cote d’Ivoire, and Algeria. In July 2019, Niger created a free industrial export zone, permitting a logistics zone allowing certain tax advantages for the companies with established transportation operations. The government also created in July 2019 the second industrial zone of Niamey, which aimed to reduce the difficulties linked to the quality of infrastructure and production factors, including the high cost of construction, lack of urbanized areas, roads and various networks and the lack of space in the current industrial area of Niamey which no longer meets national and international environmental and safety standards. The construction of an oil pipeline in the country will also attenuate the pressure on roads as the flux of oil trucks will be reduced considerably.

The African Continental Free Trade Area (ZLECAF) entered into force on January 1, 2021. Niger is active member of the treaty.

While Niger does require that companies attempt to hire a Nigerien before applying for a work visa for a foreign national, in practice the rule is not enforced. In addition, it allows for a company to appeal to the Ministry of Labor, if a foreigner is refused a work visa. There are also no localization requirements for senior management or boards of directors.

There are no excessively onerous visa, residence, worik permit, or similar requirements inhibiting mobility of foreign investors and their employees. In principle, there are no government/authority imposed conditions restricting investments beyond limited sectors for national security as cited in the section on “Limits on Foreign Control.”

There are no forced localization policies requiring investors to use domestic goods in content. Performance requirements are not imposed as a condition for establishing, maintaining, or expanding foreign direct investments. Niger does not require foreign IT providers to turn over source code and/or provide access to surveillance. Niger has no regulations regarding data storage.

5. Protection of Property Rights

Interests in property are enforced when the landholder is known, but property disputes are common, particularly involving community-owned land or land in rural areas where customary land titles are still common. Mortgages are relatively new instruments; Bank Atlantique introduced the first mortgages in 2014. The bank retains the title to the property until the loan is repaid.

Foreign ownership of land is permitted but requires authorization from the Ministry of Planning. Tax policies for foreign ownership of residential and commercial land was established by the 2018 national budget law. There is no understood proportion of land that has a clear title. Property records are unreliable and often under dispute. There is currently no effort by the government to register land titles independent of active transactions.

Traditional use rights are at the core of land disputes between Nigerien farmers and traditional nomadic herders. According to data collected by the World Bank’s 2020 Doing Business survey conducted in 2019, registering property in Niger requires four procedures, takes 13 days and costs 7.4 percent of the property value. Globally, Niger stands at 115 in the ranking of 190 economies on the ease of registering property. In 2014, Niger made transferring property easier by reducing registration fees.

As a signatory to the 1983 Paris Convention for the Protection of Industrial Property, Niger provides national protection under Nigerien patent and trademark laws to foreign businesses. Niger is also a member of the World Intellectual Property Organization (WIPO) and a signatory to the Universal Copyright Convention.

No new IP laws or regulations have been enacted in the past year. Niger does not regularly track and report on seizures of counterfeit goods. There is no specific information about working conditions in the production or sale of counterfeit goods. While there have been some cases of seizure, government statistics are not available. Enforcement of IP is weak due to limited capacity.

Niger is not included in the United States Trade Representative (USTR) Special 301 Report or the Notorious Markets List.

6. Financial Sector

Niger’s government welcomes foreign portfolio investment where possible. Niger’s capital markets are extremely underdeveloped, and the country do not have its own stock market. However, the country shares a regional stock market The Bourse Régionale des Valeurs Mobilières (BRVM) with the eight (8) Member States in the West African Economic and Monetary Union (WAEMU). This is the only stock market in the world shared by several countries, run totally in digital format.

Although an effective regulatory system exists, and policies in fact encourage portfolio investment, there is little market liquidity and hence little opportunity for such investment. The agency UMOA-Titres (AUT), a regional agency to support public securities issuance and management in the WAEMU (bonds market), is dedicated to helping member states use capital markets to raise the resources they need to fund their economic development policies at reasonable cost.

There are no limits on the free flow of financial resources.

The government works closely with the IMF to ensure that payments and transfers overseas occur without undue restrictions. Credit is allocated on market terms and foreigners do not face discrimination.

Credit is allocated on market terms through large corporations. Although foreign investors are generally able to get credit on the local market, limited domestic availability tends to drive investors to international markets. To access a variety of credit instruments, the private sector often looks to multinational institutions in Niger or international sources for credit. Private actors in the agriculture, livestock, forestry, and fisheries sectors (which account for more than 40 percent of GDP) receive less than one percent of total bank credit.

The banking sector in Niger is generally healthy and well capitalized, but suffers from low financial inclusion. The gross domestic savings rate increased by 1.4 percentage points, standing at 17.4% in 2017 (including the decentralized financial system). According to the Central Bank statistics, only 8 % of th active adult population have bank accounts (2020). In the WAEMU States, the average is 45%. The proportion of women excluded from financial services is 89% and that of people living in rural areas is 85% in 2020.

As of December 31, 2020, the resources mobilized by the banking system amounted to 1250.67 billion CFA (2.23 billion USD), an increase of 164.73 billion cfaf (294.1 million USD) or 15.2 percent compared to the same period of 2019. Foreign banks control about 80 percent of the sector’s assets, with SONIBANK, BIA Niger, Ecobank and Bank of Africa (BOA) being the largest banks operating in the country.

The Central Bank of West African States governs Niger’s banking institutions and sets minimum reserve requirements through its national Central Bank representation.

There are no restrictions on a foreigner’s ability to establish a bank account, and foreign banks and their subsidiaries operate within the economy without undue restrictions. Niger is a part of the West African Economic and Monetary Union (WAEMU), which utilizes the CFA, pegged to the Euro at 655.61 CFA per euro.

Foreign Exchange

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with an investment, including remittances.

Funds are freely convertible into any world currency. However, the government must approve currency conversions above 2 million CFA (approximately 3,413 USD).

The exchange rate is determined via the euro’s fluctuations on the international currency market. The CFA is pegged to the euro.

Remittance Policies

Niger’s Investment Code offers the possibility to transfer income of any kind, including capital investment and the proceeds of investment liquidation, regardless of the destination.

There are no limitations or waiting periods on remittances, though the Ministry of Finance must approve currency conversions above 2 million CFA (approximately 3,250 USD).

Niger does not maintain a Sovereign Wealth Fund (SWF), and does not subscribe to the Santiago Principles. The government has plans for a build-up of reserves at the Central Bank of West African States (BCEAO) using oil revenues.

8. Responsible Business Conduct

There is a general awareness of expectations regarding RBC, as well as business’ obligations to proactively conduct due diligence and do no harm.

Ordinance No. 97-001 of 10 January 1997 on the Institutionalization of Environmental Impact Assessments, Article 4 of which states: “Activities, projects or programs of development which, by the importance of their size or their impact on the natural and human environments, may affect the latter are subject to prior authorization from the Minister of the Environment. This authorization is granted on the basis of an assessment of the consequences of the project activities or the program updated by an environmental impact study prepared by the promoter.”

For example, in the extractive industries sector, the GoN has focused on ensuring existing obligations are met and that communities benefit from investments. Nigerien law states that 15 percent of revenues derived from extractive industries must be returned to the municipality affected by the project. However, such payments are difficult to track and the GoN is not active or engaged in follow-up.

There have been no high-profile instances of private sector impact on human rights in the recent past.

The GoN attempts to enforce domestic laws related to human rights, labor rights, consumer protection, and environmental protections. However, a lack of resources makes such enforcement difficult and only somewhat effective.

The government has not put in place corporate governance, accounting, and executive compensation standards.

There is limited NGO focus on responsible business practices. Those looking at transparency in contracts and business practices are generally able to work freely regarding engagement with businesses.

Niger is not a member of the OECD and does not adhere to OECD guidelines, including those related to supply chains of minerals from conflict-affected and high-risk areas. There are no Nigerien-owned companies that deal exclusively with minerals, including those that may originate from conflict-affected areas.

Niger was officially readmitted to the Extractive Industry Transparency Initiative in February 2020 after a three-year absence. The constitution mandates full disclosure of all payments from foreign government stemming from mining operations, as well as publication of all new exploration and exploitation contracts in the mining sector. However, in practice, payments from foreign countries to GoN officials have at times been controversial due to non-reporting of such payments.

Additional Resources

Department of State

Department of the Treasury

Department of Labor

The GoN does have a strategy to meet National Determined Contributions (NDC) to reduce greenhouse gas (GHG) contributions by 23 percent by 2030. This strategy relies principly on foreign donors to assist Niger in creating cleaner energy generation and agricultural efficiency. Niger is one of the most vulnerable nations to the impacts of climate change in the world, and forsees reductions in water and arable land resources in coming years. Conversely, Niger has one of the lowest GHG per capita levels in the world. The GoN encourages private investors to practice environmentally friendly and sustainable practices, but does not require GHG limits or environmental restrictions that exceed national or ECOWAS limits.

9. Corruption

The constitution, adopted in 2010, contains provisions for greater transparency in government reporting of revenues from the extractive industries, as well as the declaration of personal assets by government officials, including the President. On April 6th, 2021 President Bazoum Mohamed submitted a written sworn statement of his assest to the National Court of Auditors and made the fight against corruption central to his five-year term program.

The High Authority for the Fight against Corruption and Related Offenses (HALCIA) has the authority to investigate corruption charges within all government agencies. HALCIA is limited by a lack of resources and a regulatory process that is still developing. Despite the limitations, HALCIA was able to conduct a number of successful investigations during 2020-2021. Laws related to anti-corruption measures are in place and apply to government officials, their family members, and all political parties.

Legislation on Prevention and Repression of Corruption was passed into law in January 2018; a strategy for implementation was still pending in 2022. Niger has laws in place designed to counter conflict of interest in awarding contracts and/or government procurements. Bribery of public officials by private companies is officially illegal, but occurs regularly despite GoN denunciations of such conduct.

Law number 2017-10 of March 31, 2017, prohibits bribery of public officials, international administrators, and foreign agents, bribes within the private sector, illicit enrichment and abuse of function by public authorities. The High Authority Against Corruption and Relating Crimes (HALCIA) is further tasked with working with private companies on internal anti-corruption efforts. Bribery of public officials, however, occurs on a regular basis. Though most companies officially discourage such behavior, internal controls are rare except among the largest (mostly foreign) enterprises. The government/authority encourages or requires private companies to establish internal codes of conduct that, among other things, prohibit bribery of public officials. Some private companies use internal controls, ethics, and compliance programs to detect and prevent bribery of government officials.

The government does not provide any additional protections to NGOs involved in investigating corruption.

The government/authority encourages or requires private companies to establish internal codes of conduct that, among other things, prohibit bribery of public officials. Some private companies use internal controls, ethics, and compliance programs to detect and prevent bribery of government officials.

Niger has joined several international and regional anti-corruption initiatives including the UN Convention against Corruption in 2008, the African Union Convention on Preventing and Combating Corruption in 2005, and the Protocol on Combating Corruption of the economic community of the states of West Africa (ECOWAS) in 2006. Niger is alsoa member state of the GIABA, which is an institution of the Economic Community of West African States (ECOWAS) responsible for facilitating the adoption and implementation of Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) in West Africa.

As of April 2022, there is only one large U.S. telecommunications firm invested in Niger, although it gained its assets through acquisition of a U.K. company. This low number is due to reasons that include, but are not limited to, the perception of corruption. Cases of suspected corruption occasionally appear in media reports concerning GoN procurement, the award of licenses and concessions and customs.

Resources to Report Corruption

Maï Moussa Elhadji Basshir, President
High Authority to Combat Corruption and Related Infractions (HALCIA)
BP 550 Niamey – Niger
(227) 20 35 20 94/ 95/ 96/ 97
contact@halcia.ne 

Wada Maman
President
Transparency International Niger (TI-N)
BP 10423, Niamey – Niger
(227) 20 32 00 96 / 96 28 79 69
anlcti@yahoo.fr 

10. Political and Security Environment

Niger has been politically stable since 2010, when the most recent of Niger’s coup d’états (there have been four since 1990) concluded within less than a year in a return to democratic governance. The most recent general elections were held in in December 2020, with a presidential run-off in February 2021. President Bazoum Mohamed was elected in the first democratic transfer of executive power in Niger’s history. Although Niger’s politics are often contentious and antagonistic, political violence is rare. Most parties agree that national security and peaceful cohabitation among Niger’s ethnicities are the government’s principal priority. However, protests and strikes about non-payment of salaries for public employees, lack of funding for education, and general dissatisfaction with social conditions remain a concern.

Public protest over issues like poverty, corruption, and unemployment can also sometimes turn violent. In 2020, police arrested several protesters engaged in burning tires and vandalizing property in protest of embezzlement at the Ministry of National Defense. Protests also followed the government’s announcement of social lockdown procedures in March 2020 to respond to COVID-19.

Niger experiences security threats on three distinct border areas. Niger is a founding member of the G5 Sahel fighting terrorism in the Sahel while integrating the poverty reduction dimension to mitigate the effects of youth underemployment and violent extremism. The collapse of the Libyan state to the north has resulted in a flow of weapons and extremists throughout the Sahel region. Boko Haram and ISIS-West Africa terrorists regularly launch attacks in the Diffa Region in Niger’s southeast. Jama’at al Nusrat al-Islam wa al-Muslimin (JNIM), which is a loose affiliation of al-Qaeda in the Islamic Maghreb (AQIM), the Macina Liberation Front (MLF), Ansar Dine, and al-Mourabitoun; along with ISIS-Greater Sahara (ISIS-GS), threaten Niger’s northern and northwestern borders. Terrorists regularly crossed the Mali border to attack civilian and security sites in the Tillaberi and Tahoua regions. Niger has a history of western residents and aid workers being kidnapped by terrorist groups or kidnapping for ransom gangs, as recently as October 2020. So far, more than 40 out of the 266 communes in Niger are in a state of emergency. The State Department’s Travel Advisory for Niger from April 2022 advises travels to be aware that violent crimes including robbery are common and terrorism is a threat.

11. Labor Policies and Practices

Niger has an abundance of available labor, primarily unskilled. One of the most pressing concerns within the Ministry of Labor is the lack of jobs available to recent high school and university graduates, who often face long spells of unemployment or underemployment. There is very high unemployment among young workers, many of whom are uneducated and illiterate. Migration from the rural areas to the cities is a problem, as the majority of recently-arrived workers are unskilled. Such workers most often turn up in the informal economy. While informal activities are generally not reported, the World Bank estimates from 2021 stated that between 70 and 80 percent of the non-agricultural workforce is in the informal economy. Niger, as part of the Economic Community of West African States (ECOWAS) must accept laborers from neighboring ECOWAS states. While such laborers do exist within the Nigerien economy, this phenomenon is not common enough to cause friction and/or widespread resentment among local laborers.

The informal economy in Niger is vast and employs a majority of the nation’s population not involved in subsistence farming. In cities, most workers in the non-government sector are employed in an informal manner, including domestic services, markets and vending, and construction and maintenance. U.S. companies are encouraged to avoid informal employment arrangements as it presents a liability to Ministry of Labor inspectors.

Given both the need for foreign direct investment and the abundance of available labor within the country, labor laws are mostly modified, rather than waived to accommodate foreign firms. Many large foreign firms, including Orano and CNPC, are allowed to bring workers into the country provided that Nigerien laborers make up a substantial percentage of the overall workforce. As a member of ECOWAS, Niger routinely accepts labor, as obligated, from other member states.

According to Article 9 of Niger’s 2010 Labor Code, firms must hire Nigerien nationals via direct recruitment or through public or private hiring agencies.

There are no restrictions on employers regarding hiring or laying off employees to respond to fluctuating market conditions. However, before making the decision, the employer must consult with the Inspector of Labor. An employee laid off for economic reasons receives, in addition to severance pay, a non-taxable allowance paid by the employer equal to one month’s gross salary.

Given both the need for foreign direct investment and the abundance of available labor within the country, labor laws are mostly modified, rather than waived to accommodate foreign firms. Currently there are no special economic zones in Niger.

Freedom of association and the right to collective bargaining are generally respected and workers routinely exercise them. Unions have exercised the right to bargain collectively for wages above the legal minimum in the formal sectors and to improve working conditions.

Niger’s labor code, adopted in September 2012, and its decree No. 2017-682/PRN/MET/PS of August 2017 regulates employment, vocational training, remuneration, collective bargaining, labor representation, and labor disputes. The code also establishes the Consultative Commission for Labor and Employment, the Labor Court and regulates the Technical Consultative Committee for Occupational Safety and Health. The Labor Code lays out clear procedures for dispute resolution mechanisms in its Title VII on labor disputes. Labor hearings are public except at the reconciliation stage.

Although strikes are routine and common, most stem from non-payment of salaries and unsatisfactory working conditions existing within the public sector. Such strikes do not pose an investment risk.

Although Niger has ratified the International Labor Organization (ILO) Convention 182 on the Worst Forms of Child Labor and the ILO Convention 138 on the minimum age for employment, traditional caste-based servitude is still practiced in some parts of the country. In addition, child labor remains a problem particularly in the agricultural sector and the commercial and artisanal mining sectors. Gender discrimination is quite common within all workplaces.

There were no labor related laws or regulation enacted during the last year. The Labor Code adopted in September 2012 and its decree No. 2017-682/PRN/MET/PS of August 2017 with the regulatory part of the Labor Code remains the most recent legislation related to labor.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $11,191 2020 $13,741 www.worldbank.org/en/country
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://apps.bea.gov/international/
factsheet/
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP N/A N/A N/A N/A UNCTAD data available at

https://unctad.org/topic/investment/
world-investment-report
  

* Source for Host Country Data: https://data.worldbank.org/country/niger

Table 3: Sources and Destination of FDI
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 6,617 100% Total Outward N/A N/A
France 2,836 42%
China 2,678 40%
Turkey 240 4%
India 133 2%
Algeria 113 2%
“0” reflects amounts rounded to +/- USD 500,000.

 

14. Contact for More Information

Andrew Caruso
Economic Officer
US Embassy, Niamey
+227 99-49-90-40
CarusoAN@State.gov 

Boubacar Gaoh Mohamed
Economic and Commercial Assistant
BP 11201, Niamey, Niger
+227-85948158
+227 99-49-90-76
BoubacarGaohM@State.gov