Guinea

Executive Summary

On September 5, 2021 Colonel Mamadi Doumbouya and Guinean military special forces seized power and detained former President Alpha Conde through a coup d’état.  COL Doumbouya declared himself Guinea’s head of state, dissolved the government and National Assembly and suspended the constitution.  Guinea is currently governed by the National Committee for Reunification and Development (CNRD), which is led by COL Doumbouya and comprised primarily of military officials.  On September 27, 2021 COL Doumbouya released the Transitional Charter which supersedes the constitution until a new Constitution is promulgated; Guinea’s penal and civil codes remains in force.  On October 1, 2021 the Supreme Court Justice installed COL Doumbouya as Head of State, Transition President, CNRD President, and Commander-in-Chief of Security Forces.  On January 22, 2022 the National Transition Council, the transition government’s legislative body, was installed but no timeline for future elections or return to civilian rule was provided as of April 2022.

Guinea enjoys sizeable endowments of natural resources, energy opportunities, and arable land.

These seeming advantages have not yet resulted in economic development, and may in fact hinder it, in an example of the famous “resource curse.”  Guinea’s economy has been based on extraction of primary resources, from at least the French colonial era and the slave trade before it.  This extractive paradigm and legacy of underdevelopment, combined with low levels of education, and longstanding patterns of nondemocratic governance dating back to the colonial era, limit the potential for broad-based economic growth based on value addition, innovation, and productive as opposed to extractive or rent-seeking investment.  At the same time, a sense of national identity and unity, and both formal and informal practices of solidarity that tend towards wealth redistribution may prove to be assets for the country’s development, if the government and the private sector can harness them productively.

The 2021 coup d’etat, persistent corruption, and fiscal mismanagement make the near-term economic prognosis for Guinea mixed.  In this context, Guinea has looked to foreign investment to bolster tax and export revenues and to support infrastructure projects and overall economic growth.  China, Guinea’s largest trading partner, dramatically increased its role in years leading up to the coup with a variety of infrastructure investments.  Investors should proceed with caution, understanding that the potential for profits comes with significant political risk.  Weak institutions mean that investors may secure lucrative concessions from the government in the short term, but these could be open to renegotiation or rescission in the long term.  Prior to the coup, former President Conde’s government implemented reforms to improve various aspects of the investment climate.  For example, the former government reduced property transfers fees from 2 to 1.2 percent of property value.  The time required to obtain a construction permit was reduced and import procedures were improved.  Since 2019, Guinea has implemented a permanent taxpayer identification number system that requires all payments to be made by “Real Time Gross System” (RTGS) immediate transfers.

Since the coup d’etat, the transition government has spoken extensively about fighting corruption and increasing transparency.  Transition President COL Doumbouya created the Court to Repress Economic and Financial Crimes (CRIEF) to handle cases involving embezzlement, corruption, and misuse of public funds over one billion GNF (approximately $110,000) in December 2021.  As of April 2022, the court has focused on collecting evidence for corruption cases against businesses tied to and officials that served in former President Conde’s government.

Endowed with abundant mineral resources, Guinea has the raw materials to be an economic leader in the extractives industry.  Guinea is home to a third of the world’s reserves of bauxite (aluminum ore), and bauxite accounts for over half of Guinea’s present exports.  Historically, most of the country’s bauxite was exported by Compagnie des Bauxites de Guinee (CBG) (Bauxite Company of Guinea) [a joint venture between the Government of Guinea, U.S.-based Alcoa, the Anglo-Australian firm Rio Tinto, and Dadco Investments of the Channel Islands], via a designated port in Kamsar.  While CBG still retains the largest reserves, the Societe Miniere de Boke (SMB) (Mineral Company of Boke), a Sino-Singaporean conglomerate, recently surpassed CBG as the largest single producer of bauxite.  New investment by SMB and CBG, in addition to new market entrants, are expected to significantly increase Guinea’s bauxite output over the next five to ten years.  Guinea also possesses over four billion tons of untapped high-grade iron ore, significant gold and diamond reserves, undetermined amounts of uranium, as well as prospective offshore oil reserves.  Artisanal and medium-sized industrial gold mining in the Siguiri region is a significant contributor to the Guinean economy, but some suspect much of the gold leaves the country clandestinely, without generating any government revenue.  In the long term, both former President Conde’s government and the transition government project that Guinea’s greatest potential economic driver will be the Simandou iron ore project, which is slated to be the largest greenfield project ever developed in Africa.  The transition government reached an ambitious agreement with Rio Tinto and the SMB-Winning Consortium (WCS) in March 2022 to develop the rail and port infrastructure to bring ore from Simandou to market by early 2025.  In 2017, the governments of Guinea and China signed a USD 20 billion framework agreement giving Guinea potentially USD 1 billion per year in infrastructure projects in exchange for increased access to mineral wealth.  In 2018, the Chinese Group TBEA invested USD 2.89 billion in the bauxite and alumina sector.  The project includes development of a bauxite mine, the construction of a port, railroad, and power plant to facilitate the supply chain.  The project is estimated to generate USD 406 million in annual revenue for Guinea.

The amended 2013 Mining Code stipulates that raw ore producers in Guinea begin processing raw ore into refined or processed products within a few years of development, depending on the terms of the individual investment and the mandate with the Ministry of Mines and Geology.  In April 2022, the transition government called upon bauxite concessionaires to solidify refining plans by May 2022.  U.S.-based companies are in varying stages of proposing LNG projects to furnish this upcoming tremendous energy need.  China is reportedly offering coal-based solutions to meet the potential demand.

Guinea’s abundant rainfall and natural geography bode well for hydroelectric and renewable energy production. The largest energy sector investment in Guinea is the 450MW Souapiti dam project (valued at USD 2.1 billion), begun in late 2015 with Chinese investment, which likewise completed the 240MW Kaleta Dam (valued at USD 526 million) in May 2015.  Kaleta more than doubled Guinea’s electricity supply, and for the first-time furnished Conakry with more reliable, albeit seasonal, electricity (May-November). Souapiti began producing electricity in 2021. A third hydroelectric dam on the same river, dubbed Amaria, began construction in January 2019 and is expected to be operational in 2024. The Chinese mining firm TBEA is providing financing for the Amaria power plant (300 MW, USD 1.2 billion investment).  If corresponding distribution infrastructure is built, and pricing enables it, these projects could make Guinea an energy exporter in West Africa. In addition, U.S.-based Endeavor began operating Project Te in November 2020, a 50MW thermal plant on the outskirts of the capital.  Former President Conde’s government also signed an emergency agreement in December 2019 to buy power from the 105 MW Turkish Karpowership barge anchored off Conakry’s coast.  Former President Conde’s government emphasized investment in solar and other energy sources to compensate for hydroelectric deficits during Guinea’s dry season.  Toward that end, former President Conde’s government entered into several Memoranda of Understanding with the private sector to develop solar projects.

Agriculture and fisheries hold other areas of opportunity and growth in Guinea.  Already an exporter of fruits, vegetables, and palm oil to its immediate neighbors, Guinea is climatically well suited for large-scale agricultural production and export.  However, the sector has suffered from decades of neglect and mismanagement, lack of transportation infrastructure, and lack of electricity and a reliable cold chain.  Guinea is an importer of rice, its primary staple crop.

Guinea’s macroeconomic and financial situation is weak.  The aftermath of the 2014-2016 Ebola crisis left former President Conde’s government with few financial resources to invest in social services and infrastructure.  Lower natural resource revenues stemming from a drop in world commodities prices and ill-advised government loans strained an already tight budget.  In 2018 the government borrowed excessively from the Central Bank (BCRG), which threatened the first review of Guinea’s current International Monetary Fund (IMF) program.  Lower than forecast natural resource revenues in 2019 due to heavy rains and political violence threatened the fourth review, which Guinea passed in April 2020.  In December 2020, the Executive Board of the IMF completed its fifth and sixth reviews of Guinea’s economic performance. The completion of these reviews enabled the immediate disbursement of USD 49.47 million – bringing total disbursements under Guinea’s third extended credit facility to USD 66.60 million before the program’s end.

A shortage of credit persists, particularly for small- and medium-sized enterprises, and the government is increasingly looking to international investment to increase growth, provide jobs, and kick-start the economy. On March 13, 2020, Guinea confirmed its first Covid-19 case. The pandemic negatively impacted the well-being of households, particularly those working in the informal sector, who have limited access to savings and financial services.  Guinea experienced an Ebola epidemic from February to June 2021.  Despite its able handling of the epidemic, which kept deaths to a minimum, cross-border trade with Liberia, Ivory Coast, and Sierra Leone was reduced temporarily during the outbreak.  Violence surrounding the March 2020 legislative election and constitutional referendum, as well as the October 2020 presidential election, all negatively impacted Guinea’s growth prospects.  The transition government has worked to maintain economic stability since the 2021 coup d’etat, though without a timeline for elections, the uncertain political situation further limits potential growth.

Prior to the coup, Guinea passed and implemented an anti-corruption law, updated its Investment Code, and renewed efforts to attract international investors, including a new investment promotion website put in place in 2016 by Guinea’s investment promotion agency to increase transparency and streamline processes for new investors.  However, Guinea’s capacity to enforce its more investor-friendly laws is compromised by a weak and unreliable legal system.  Then President Conde inaugurated the first Trade Court of Guinea on March 20, 2018.  Transition President COL Doumbouya created the Court to Repress Economic and Financial Crimes (CRIEF) to handle cases involving embezzlement, corruption, and misuse of public funds over one billion GNF (approximately $110,000) in December 2021.  As of April 2022, the court has focused on collecting evidence for corruption cases against businesses tied to and officials that served in former President Conde’s government.

To attract foreign investment, the Private Investment Promotion Agency (APIP) and the Ministry of Commerce, Industry, and Small and Medium Enterprises hosted the second annual Guinea Investment Forum (GUIF) in Dubai in February 2022, following the inaugural event in Guinea in February 2021.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 150 of 175 http://www.transparency.org/research/cpi/overview
Global Innovation Index 2021 130 of 132 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2020 $278 million https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2020 $1,020 https://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

Former President Conde’s government had adopted a strong, positive attitude toward foreign direct investment (FDI), an approach that has been echoed by the transition government.  In the face of budget shortfalls and low commodity prices, both former President Conde’s government and the transition government have expressed hope FDI will help diversify the economy, spur GDP growth, and provide reliable employment.  To that end, former President Conde’s government reduced land transfer fees, and improved procedures for import and construction permits.  Guinea does not discriminate against foreign investors, with the exception of a prohibition on foreign media ownership.  One area of concern, mining companies have negotiated different taxation rates despite mining code requirements.  In some instances, short-term tax breaks end up being costly for the investor as they are then expected to “contribute” resources like electrical energy or roadbuilding as an informal quid pro quo for the lighter tax burden.  According to the 2021World Investment Report, FDI in Guinea increased from USD 44 million in 2019 to 325 million in 2020.  In late 2015, the U.S. Embassy facilitated the establishment of an informal international investors group to liaise with the government, although the group has not been very active since.  There is the Chambre des Mines (Chamber of Mines), a government-sanctioned advisory organization that includes Guinea’s major mining firms.  Guinea’s Agency for the Promotion of Private Investment (APIP) provides support in the following areas:

  1. Create and register businesses
  2. Facilitate access to incentives offered under the investment code
  3. Provide information and resources to potential investors
  4. Publish targeted sector studies and statistics
  5. Provide training and technical assistance
  6. Facilitate solutions for investors in Guinea’s interior

On March 13, 2021, a presidential decree changed the structure of APIP into a public agency under the technical supervision of the Ministry of Investments and Public Private Partnerships, and under the financial supervision of the Ministry of Economy and Finance.  Since the September 2021 coup d’etat, APIP falls under the Ministry of Commerce, Industry, and Small and Medium Enterprises.

More information about APIP can be found at: http://apip.gov.gn/

Investors can register under one of four categories of business in Guinea. More information on the four types of business registration is available at http://invest.gov.gn/page/create-your-company.  There are no general limits on foreign ownership or control, and 100 percent ownership by foreign firms is legal in most sectors.  Foreign ownership of print media, radio, and television stations is not permitted.  The 2013 Mining Code gives the government the right to a 15 percent interest in any major mining operation in Guinea (the government decides when an operation has become large enough to qualify).  Mining and media notwithstanding, there are no sector-specific restrictions that discriminate against market access for foreign investment.  Despite this lack of official discrimination, many enterprises have discovered the licensing process to be laden with bureaucratic delays that are usually dealt with by paying consultant fees to help expedite matters.  The U.S. Embassy may be able to advocate on behalf of American companies when it is aware of excessive delays.

According to the Investment Code, the National Investment Commission has a role in reviewing requests for approval of foreign investment and for monitoring companies’ efforts to comply with investment obligations.  The Ministry of Planning and Economic Development hosts the secretariat for this commission, which grants investment approvals.  The government gives approved companies, especially industrial firms, the use of the land necessary for their plant, with the duration and conditions of use set out in the terms of the approval.  The land and associated buildings belong to the State but can also be rented by or transferred to another firm with government approval.

There has been no investment policy review conducted by the UN Conference on Trade and Development or the Organization for Economic Cooperation and Development within the past several years.  The World Trade Organization (WTO) last conducted a review of Guinea in 2018.  The 2018 report can be viewed here: https://www.wto.org/english/tratop_e/tpr_e/tp470_e.htm.

APIP promotes investment, helps register businesses, assists with the expansion of local companies, and works to improve the local business climate.  APIP maintains an online guide for potential investors in Guinea (http://invest.gov.gn).  Business registration can be completed in person at APIP’s office in Conakry or through their online platform:  https://synergui.apipguinee.com/fr/utilisateurs/register/.  The only internationally accredited business facilitation organization that assesses Guinea is the Global Enterprise Registration (GER.co), which gives Guinea’s business creation/investment website a 6/10 rating for 2021.  It takes roughly seventy-two hours to register a business.  APIP’s services are available to both Guinean and foreign investors.  The “One Stop Shop” at APIP’s Conakry office can provide small and medium sized enterprises (SMEs) with requisite registration numbers, including tax administration numbers and social security numbers.  Notaries are required for the creation of any other type of enterprise.

An SME in Guinea is defined as a business with less than 50 employees and revenue less than 500 million Guinean francs (GNF) (around USD 50,000).  SMEs are taxed at a yearly fixed rate of GNF 15 million (USD 1,500).  Administrative modalities are simplified and funneled through the “One Stop Shop”.   In December 2019, the Prime Minister inaugurated the “Maison des PME,” (“The SME House”) a public-private partnership between the Societe Generale bank and APIP to help local SMEs expand and develop.

Guinea does not formally promote outward investment, though the government does not restrict domestic investors from investing abroad.

3. Legal Regime

Under former President Alpha Conde, Guinea made its laws and regulations more transparent, though draft bills were not always made available for public comment.  Ministries did not develop forward-looking regulatory plans and publish neither summaries nor proposed legislation.  Once ratified, laws were not enforceable until published in the government’s official gazette.  Since January 2022, the National Transition Council (CNT) has served as Guinea’s legislative body, tasked by the CNRD to draft a new constitution and recommend an electoral timeline to return to democratic and civilian rule.  All laws relevant to international investors are posted (in French) on invest.gov.gn. When investing, it is important to engage with all levels of government to ensure each authority is aware of expectations and responsibilities on both sides.

Guinea has had an independent Supreme Audit Institution since 2016. The institution is charged with making available information on public finances.  The institution presented its first 2016 activities report in January 2018. The institution presented the 2017, 2018, 2019 and 2020 activities report to the President of CNT in February 2022

Guinea’s 2013 amended Mining Code commits the country to increasing transparency in the mining sector. In the code, the government commits to awarding mining contracts by competitive tender and to publish all past, current, and future mining contracts for public scrutiny.  Members of mining sector governing bodies and employees of the Ministry of Mines are prohibited from owning shares in mining companies active in Guinea or their subcontractors.  Each mining company must sign a code of good conduct and develop and implement a corruption-monitoring plan.  There is a public database of mining contracts designed by the Natural Resource Governance Institute (http://www.contratsminiersguinee.org/).

The Extractive Industries Transparency Initiative (EITI) ensures greater transparency in the governance of Guinea’s natural resources and full disclosure of government revenues from its extractives sector. The EITI standard aims to provide a global set of conditions that ensures greater transparency of the management of a country’s oil, gas, and mineral resources. EITI reiterates the need to augment support for countries and governments that are making genuine efforts to address corruption but lack the capacity and systems necessary to manage effectively the businesses, revenues, and royalties derived from extractive industries.  Guinea requires mining companies to file environmental, social, and governance (ESG) disclosures.

Guinea was accepted as EITI compliant for the first time by the international EITI Board at its meeting in Mexico City on July 2, 2014.  As an EITI country, Guinea must disclose the government’s revenues from natural resources.  Guinea completed its most recent report in December 2020 for the 2018 reporting period.  The report is located at: https://www.itie-guinee.org/rapport-itie-guinee-2018/.

While Guinea’s laws promote free enterprise and competition, there is often a lack of transparency in the law’s application.  Business owners openly assert that application procedures are sufficiently opaque to allow for corruption, and regulatory activity is often instigated due to personal interests.

Every year Guinea publishes budget documents and debt obligations.  The yearly enacted budgets are published online LOIS DE FINANCES | Ministère du Budget Guinée (mbudget.gov.gn) https://mbudget.gov.gn/.

Guinea has historically been a member of ECOWAS, but not a member of the West African Economic and Monetary Union (UEMOA) and as such has its own currency.  At the beginning of 2017, Guinea adopted ECOWAS’s Common Exterior Tariff (TEC), which harmonizes Guinea’s import taxes with other West African states and eliminates the need for assessing import duties at Guinea’s land border crossings, though, sometimes it is difficult to get the required certificates to export under these ECOWAS exemptions.  Guinea is a member of the WTO and is not party to any trade disputes.  Since the September 2021 coup, the African Union and ECOWAS have suspended Guinea’s memberships.

Guinea’s legal system is codified and largely based upon French civil law.  Under former President Conde, the judicial system was reported to be generally understaffed, corrupt, and opaque.  Accounting practices and bookkeeping in Guinean courts are frequently unreliable.  U.S. businesspersons should exercise extreme caution when negotiating contract arrangements and do so with proper local legal representation.  Although the current transition charter, former constitution, and laws provide for an independent judiciary; in practice the judicial system lacks independence, is underfunded, inefficient, and is portrayed in the press as corrupt.  Budget shortfalls, a shortage of qualified lawyers and magistrates, nepotism, and ethnic bias contribute to the judiciary’s challenges.  Former President Conde’s administration successfully implemented some judicial reforms and increased the salaries of judges by 400 percent to discourage corruption.

After the September 2021 coup, Guinea’s penal and civil code remains in force. The transition government maintained the existing legal structure and stated that “justice will be the compass guiding every Guinean citizen.”  Transition President COL Doumbouya created the Court to Repress Economic and Financial Crimes (CRIEF) to handle cases involving embezzlement, corruption, and misuse of public funds over one billion GNF (approximately $110,000) in December 2021.  As of April 2022, the court has focused on collecting evidence for corruption cases against businesses tied to and officials that served in former President Conde’s government.

There are few international investment lawyers accredited in Guinea and it is a best practice to include international arbitration clauses in all major contracts.  U.S. companies have identified the absence of a dependable legal system as a major barrier to investment.  Despite dispute settlement procedures set forth in Guinean law, business executives complain of the glacial pace of the adjudication of business disputes.  Most legal cases take years and significant legal fees to resolve.  In speaking with local business leaders, the general sentiment is that any resolution occurring within three to five years might be considered quick.

In many cases, the government does not meet payment obligations to private suppliers of goods and services, either foreign or Guinean, in a timely fashion.  Arrears to the private sector are a major issue that is often ignored.  There is no independent enforcement mechanism for collecting debts from the government, although some contracts have international arbitration clauses. The government, while bound by law to honor judgments made by the arbitration court, often actively influences the decision itself.

Although the situation has improved recently, Guinean and foreign business executives have publicly expressed concern over the rule of law in the country. In 2014, high-ranking members of the military harassed foreign managers of a telecommunications company because they did not renew a contract.  American businesses experience long delays in getting required signatures and approvals from government ministries, and in some cases the presidency, under both former President Conde’s government and the transition government.  Some businesses have been subject to sporadic harassment from tax authorities and demands for donations from military and police personnel.

The National Assembly ratified an Investment Code regulating FDI in May 2015. Developed in cooperation with the Work Bank and IMF, the code harmonizes Guinea’s FDI regulations with other countries in the region and broadens the definition of FDI. The code also allows for direct agreements between investors and the State. Other important legislation related to FDI includes the Procurement Code, the BOT (Build Operate Transfer, now Public Private Partnership or PPP) Law and the Customs Code.  An October 2017 Public-Private Partnerships (PPP) law replaced the earlier BOT law, providing a clearer, updated, and more secure legal, regulatory, and institutional framework for PPP projects, including through partnership agreements, BOT schemes, concessions, public leasing, and delegated public service.  PPP procurement tender processes also have been clarified and updated.  The PPP law seeks to increase infrastructure development in Guinea.  Under the new law, Parliament no longer needs to approve Guinean government contracts with private companies, as was required under BOT, apart from mining contracts.  Obligations to conduct feasibility studies and to precisely define public needs also have been increased in this new law.  Guinea’s investment promotion agency has a website (www.invest.gov.gn) to increase transparency and streamline investment procedures.

The legal system handles domestic cases involving foreign investors.  However, the legal system continues to be weak, is in need of reform, and continues to be subject to interference.  Although the transition charter provides for an independent judiciary, in practice the judicial system lacks independence and is underfunded, inefficient, and is perceived by many to be corrupt.

APIP launched a website in 2016 that lists information related to laws, rules, procedures, and registration requirements for foreign investors, as well as strategy documents for specific sectors http://invest.gov.gn.  Further information on APIP’s services is available at https://apip.gov.gn/.   APIP has a largely bilingual (English and French) staff and is designed to be a clearinghouse of information for investors.

The National Assembly ratified an Investment Code regulating FDI in May 2015. Developed in cooperation with the Work Bank and IMF, the code harmonizes Guinea’s FDI regulations with other countries in the region and broadens the definition of FDI. The code also allows for direct agreements between investors and the State. Other important legislation related to FDI includes the Procurement Code, the BOT (Build Operate Transfer, now Public Private Partnership or PPP) Law and the Customs Code.  An October 2017 Public-Private Partnerships (PPP) law replaced the earlier BOT law, providing a clearer, updated, and more secure legal, regulatory, and institutional framework for PPP projects, including through partnership agreements, BOT schemes, concessions, public leasing, and delegated public service.  PPP procurement tender processes also have been clarified and updated.  The PPP law seeks to increase infrastructure development in Guinea.  Under the new law, Parliament no longer needs to approve Guinean government contracts with private companies, as was required under BOT, apart from mining contracts.  Obligations to conduct feasibility studies and to precisely define public needs also have been increased in this new law.  Guinea’s investment promotion agency has a website (www.invest.gov.gn) to increase transparency and streamline investment procedures.

The legal system handles domestic cases involving foreign investors.  However, the legal system continues to be weak, is in need of reform, and continues to be subject to interference.  Although the transition charter provides for an independent judiciary, in practice the judicial system lacks independence and is underfunded, inefficient, and is perceived by many to be corrupt.

APIP launched a website in 2016 that lists information related to laws, rules, procedures, and registration requirements for foreign investors, as well as strategy documents for specific sectors http://invest.gov.gn.  Further information on APIP’s services is available at https://apip.gov.gn/.   APIP has a largely bilingual (English and French) staff and is designed to be a clearinghouse of information for investors.

There are no agencies that review transactions for competition-related concerns.

Guinea’s Investment Code states that the government will not take any steps to expropriate or nationalize investments made by individuals and companies, except for reasons of public interest.  It also promises fair compensation for expropriated property.

In 2011, the former President Conde’s government claimed full ownership of several languishing industrial facilities in which it had previously held partial shares as part of several joint ventures—including a canned food factory and processing plants for peanuts, tea, mangoes, and tobacco—with no compensation to the private sector partner.  Each of these facilities was privatized under opaque circumstances in the late 1980s and early 1990s.  By expropriating these businesses, which the Conde government deemed to be corrupt and/or ineffective, and putting them to public auction, Guinea hoped to correct past mistakes and put the assets in more productive hands.  During the 1990s, a U.S. investor acquired a 67 percent stake in an explosives and munitions factory from a Canadian entity.  The Guinean government owned the remaining 33 percent.  From 2000 to 2008, the government halted manufacturing at the factory, nationalizing the factory in 2010.

While there had not been recent large-scale expropriation cases by the end of former President Conde’s administration, some mining concession contracts have had their initial award revoked and were sold to another bidder.  In 2008, the previous regime of Lansana Conde stripped Rio Tinto of 50 percent of its concession of the Simandou iron ore mine and sold it to another company.  In March 2022, the transition government began seizing property they believed belonged to the state and was inappropriately sold under former President Conde’s government, in some cases demolishing houses and buildings on the disputed land before legal challenges were exhausted.

Guinea, as a member of OHADA, has the same bankruptcy laws as most West African francophone countries.  OHADA’s Uniform Act on the Organization of Securities enforces collective proceedings for writing off debts and defines bankruptcy in articles 227 to 233.  The Uniform Act also distinguishes fraudulent from non-fraudulent bankruptcies.  There is no distinction between foreign and domestic investors.  The only distinction made is a privilege ranking that defines which claims must be paid first from the bankrupt company’s assets.  Articles 180 to 190 of OHADA’s Uniform Act define which creditors are entitled to priority compensation.  Bankruptcy is only criminalized when it occurs due to fraudulent actions and leaves criminal penalties to national authorities.  Non-fraudulent bankruptcy is adjudicated though the Uniform Act.

4. Industrial Policies

The Investment Code provides preferential tax treatment for investments meeting certain criteria (See Screening of FDI).  Some mining companies currently benefit from preferential tax treatment.  Other exemptions can be agreed to during contract negotiations with the government.  The government’s priority investments categories include promotion of small- and medium-sized Guinean businesses, development of non-traditional exports, processing of local natural resources and local raw materials, and establishment of activities in economically less developed regions.  Priority activities include agricultural promotion, especially of food, and rural development; commercial farming involving processing and packaging; livestock, especially when coupled with veterinary services; fisheries; fertilizer production, chemical or mechanical preparation and processing industries for vegetable, animal, or mineral products; health and education-related businesses; tourism facilities and hotel operations; socially beneficial real estate development; and investment banks or any credit institutions settled outside specified population centers.  Detailed information on each of these opportunities is available at http://invest.gov.gn.

Neither former President Conde’s government nor the transition government provide incentives for businesses owned by underrepresented investors, such as women.

Guinea currently has no foreign trade zones or free ports. In 2017, a presidential decree created a special economic zone in the Boke corridor of western Guinea.

Under the revised 2013 Mining Code, mining companies are required to employ Guinean citizens as a certain percentage of their staff, to eventually transition to a Guinean country director, and to award a certain percentage of contracts to Guinean-owned firms.  The percentage varies based on employment category and the chronological phase of the project.  The Mining Code requires that 20 percent of senior managers be Guinean; however, the Code does not define what constitutes senior management.  The Code also aims to liberalize mining development and promote investment.  In 2013, the Code called for the creation of a Mining Promotion and Development Center, a One Stop Shop for mining administrative processes for investors, which opened in May 2016.  Guinea has no forced localization policy related to the use of domestic content in goods or technology, and there are no requirements for foreign IT providers to turn over source code or provide access to surveillance or to store data within Guinea.

In 2019, the government launched an e-visa platform allowing for online visa applications at http://www.paf.gov.gn/.  Fees vary depending on citizenship.  This is the only way to apply for a visa to Guinea as Guinean embassies around the world no longer process visa applications.

5. Protection of Property Rights

The Estate and Land Tenure Code of 1992 provides a legal base for documentation of property ownership.  Mortgages are nearly non-existent in Guinea.  As with ownership of business enterprises, both foreign and Guinean individuals have the right to own property.  However, enforcement of these rights depends upon an inefficient Guinean legal and administrative system.  It is not uncommon for the same piece of land to have several overlapping deeds. Furthermore, land sales and business contracts generally lack transparency.  Only about 2.5 percent of the population has title to real property.  The Ministry of Urban Affairs is developing an online platform that will facilitate the registration of land titles and reduce waiting times to about five days.  The Ministry of Urban Development, Housing, and Regional Planning launched the Building Permit One-Stop-Shop in February 2022, which is slated to reduce building permit procurement processing from 40 to seven days.

Guinea is a member of the African Intellectual Property Organization (OAPI) and the World Intellectual Property Organization (WIPO).  OAPI is a signatory to the Paris Convention for the Protection of Industrial Property, the Berne Convention for the Protection of Literary and Artistic Works, the Patent Cooperation Treaty, the World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), and several other intellectual property treaties.  Guinea modified its intellectual property rights (IPR) laws in 2000 to bring them into line with established international standards.  There have been no formal complaints filed on behalf of American companies concerning IPR infringement in Guinea.  However, it is not certain that an affirmative IPR judgment would be enforceable, given the general lack of law enforcement capability.  The Property Rights office in Guinea is severely understaffed and underfunded.  Guinea 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 https://www.wipo.int/directory/en/contact.jsp?country_id=67&type=ADMIN.

6. Financial Sector

Commercial credit for private enterprises is difficult and expensive to obtain in Guinea. The FY 2022 Millennium Challenge Corporation score for Access to Credit in Guinea reached 30 percent, increasing from 21 percent in FY 2021.

Guinea adopted a Build-Operate-Transfer (BOT) law in 1998, but the law was never fully implemented as the government failed to adopt the decree necessary for its implementation.  An October 2017 Public-Private Partnerships (PPP) law replaced the earlier BOT law, providing a clearer, updated, and more secure legal, regulatory, and institutional framework for PPP projects, including through partnership agreements, BOT schemes, concessions, public leasing, and delegated public service.  PPP procurement tender processes also have been clarified and updated.  The PPP law seeks to increase infrastructure development in Guinea.  Under the new law, Parliament no longer needs to approve Guinean government contracts with private companies, as was required under BOT, apart from mining contracts. Obligations to conduct feasibility studies and to precisely define public needs also have been increased in this new law.  Guinea’s investment promotion agency has a website (www.invest.gov.gn) to increase transparency and streamline investment procedures.  However, in practice businesses often wait months or years to receive final approvals from one ministry or another or the President, depending on the sector.  Guinea’s capacity to enforce its more investor-friendly laws is compromised by a weak and unreliable legal system.  Some especially large-scale enterprises or extractives industry firms must wait for final permission from the President himself to begin operations.  These facts make personal relationships with high-ranking officials desirable and indeed generally essential, though as mentioned above, this brings the risk of a project’s becoming associated with specific individuals or administrations, and thus subject to subsequent rescission.

Guinea updated its Investment Code in 2015 and renewed efforts to attract international investors.  The Investment Code allows income derived from investment in Guinea, the proceeds of liquidating that investment, and the compensation paid in the event of nationalization, to be transferred to any country in convertible currency.  The legal and regulatory procedures, based on French civil law, are not always applied uniformly or transparently.

Individuals or legal entities making foreign investments in Guinea are guaranteed the freedom to transfer the original foreign capital, profits resulting from investment, capital gains on disposal of investment, and fair compensation paid in the case of nationalization or expropriation of the investment to any country of their choice.  The Guinean franc is subject to a managed floating exchange rate.  The few commercial banks in Guinea are dependent on the Central Bank (BCRG) for foreign exchange liquidity, making large transfers of foreign currency difficult.

Laws governing takeovers, mergers, acquisitions, and cross-shareholding are limited to rules for documenting financial transactions and filing any change of status documents with the economic register.  There are no laws or regulations that specifically authorize private firms to adopt articles of incorporation that limit or prohibit investment.

Guinea’s financial system is small and dominated by the banking sector. It comprises 19 active banks, 19 insurance companies and 19 microfinance institutions.  Guinea’s banking sector is overseen by the Central Bank (BCRG), which also serves as the agent of the government treasury for overseeing banking and credit operations in Guinea and abroad. The BCRG manages foreign exchange reserves on behalf of the State.  The Office of Technical Assistance of the Department of the Treasury assesses that Guinea does not properly manage debt and that its treasury is too involved in the process, although improvements made in 2017-2018 point to a better future.  Further information on the BCRG can be found in French at http://www.bcrg-guinee.org.

Due to the difficulty of accessing funding from commercial banks, small commercial and agricultural enterprises have increasingly turned to microfinance, which has been growing rapidly with a net increase in deposits and loans.  The quality of products in the microfinance sector remains mediocre, with bad debt accounting for five percent of loans with approximately 17 percent of gross loans outstanding.

Guinea plans to broaden the country’s SME base through investment climate reform, improved access to finance, and the establishment of SME growth corridors.  Severely limited access to finance (especially for SMEs), inadequate infrastructure, deficiencies in logistics and trade facilitation, corruption and the diminished capacity of the government, inflation, and poor education of the workforce has seriously undermined investor confidence in Guinean institutions.  Guinea’s weak enabling environment for business, its history of poor governance, erratic policy, and inconsistent regulatory enforcement exacerbate the country’s poor reputation as an investment destination.  As a result, private participation in the economy remains low and firms’ productivity measured by value added is one of the lowest in Africa. Firms’ links with the financial sector are weak:  only 3.9 percent of firms surveyed in the 2016 World Bank Enterprise survey had a bank loan.

Credit to the private sector is low, at around 8.6 percent of GDP in 2021.  Commercial banks are reluctant to extend loans due to the lack of credit history reporting for potential borrowers. Through the Central Bank, Guinea is in the process of establishing a credit information bureau to overcome this asymmetry of credit information.  Despite the pandemic and September 2021 coup, the banking sector remains liquid and solvent with limited credit available to the private sector.  Heavy government borrowing drained the excess liquidity and crowded out private sector credit in 2021.  Despite the COVID-19 slowdown and political instability, private sector credit grew by 7.36 percent from January 2021 to January 2022.

Guinea is a cash-based society driven by trade, agriculture, and the informal sector, which all function outside the banking sector.  The banking sector is highly concentrated in Conakry and is technologically behind.  Banks in Guinea tend to favor short-term lending at high interest rates.  In collaboration with the U.S. Treasury’s Office of Technical Assistance, the Central Bank began planning to implement a bank deposit insurance scheme.  The deposit coverage limit has not been set yet, but the Central Bank began to collect premiums from commercial banks in 2019.

While the microfinance sector grew strongly from a small base, it was hit hard during the 2014-2016 Ebola crisis.  Currently it is not generally profitable and needs capacity and technology upgrades.  Furthermore, many microfinance institutions struggle to meet higher minimum capital requirements imposed by the Central Bank since 2019.  This heightened financial hurdle will likely lead to a consolidation of the microfinance sector.  The efficiency and use of payment services by all potential users needs to be improved, with an emphasis on greater financial inclusion.

The penetration of digital cellphone fund transfers is increasing.  Four foreign e-money (or mobile banking) institutions lead the effort to digitize payments and improve access to financial services in underserved and rural segments of the population.  However, the vast majority of operations processed by these e-money institutions remain cash-in cash-out transactions within a single network.  In an effort to modernize payment methods, the transition government is continuing an initiative of former President Conde’s administration to implement a national switch — a nationwide platform that will interface all electronic payment systems and facilitate payment processing between service providers.  This service was still under development in 2022, and the Central Bank is in the process of selecting a service provider.

Generally, there are no restrictions on foreigners’ ability to establish bank accounts in Guinea. EcoBank is the preferred bank for most U.S. dealings with Foreign Account Tax Compliant Act (FACTA) reporting requirements. With the acquisition of a majority stake in BICIGUI (Banque Internationale pour le Commerce et l’Industrie de la Guinee) in July 2021, Vista Bank became the largest bank in Guinea, a first on the African continent for a U.S.-owned financial institution.

Guinea does not have a sovereign wealth fund.

7. State-Owned Enterprises

While all Guinea’s public utilities (water and electricity) are state-owned enterprises (SOEs), the former Conde administration proposed permitting private enterprises to operate in this sphere.  In 2015, the French firm Veolia was contracted to manage the state-owned electric utility Electricité de Guinée (EDG) – a contract which ended in October 2019.  Several private projects aimed at harnessing Guinea’s solar energy potential and gas-powered thermal plants are being implemented with the goal of producing and selling energy throughout Guinea and possibly to neighboring countries.  Other SOEs are found in the telecommunications, road construction, lottery, and transportation sectors.  There are several other mixed companies where the state owns a significant or majority share, that are typically related to the extractives industry.

The hydroelectricity sector could support Guinea’s modernization, and possibly even supply regional markets.  Guinea’s hydropower potential is estimated at over 6,000MW, making it a potential exporter of power to neighboring countries.  The largest energy sector investment in Guinea is the 450MW Souapiti dam project (valued at USD 2.1 billion), begun in late 2015 with Chinese investment.  A Chinese firm likewise completed the 240MW Kaleta Dam (valued at USD 526 million) in May 2015. Kaleta more than doubled Guinea’s electricity supply, and for the first-time furnished Conakry with more reliable, albeit seasonal, electricity (May-November). Souapiti began producing electricity in 2021.  A third hydroelectric dam on the same river, dubbed Amaria, began construction in January 2019 and is expected to be operational in 2024. The Chinese mining firm TBEA is providing financing for the Amaria power plant (300 MW, USD 1.2 billion investment).  If corresponding distribution infrastructure is built, and pricing enables it, these projects could make Guinea an energy exporter in West Africa.

Plans for improving the distribution network to enable electricity export are in process with the development of the Gambia River Basin Development (OMVG) (Organization pour la Mise en Oeuvre de Fleuve Gambie, in French) transmission project connecting Guinea, Senegal, Guinea Bissau, and The Gambia.  The OMVG project involves the construction of 1,677 kilometers of 225-volt transmission network capable of handling 800MW to provide electricity for over two million people.  At the same time, Guinea is moving forward with the Côte d’Ivoire, Liberia, and Sierra Leone, (CLSG) transmission interconnector project, which will integrate Guinea into the West African Power Pool (WAPP) and allow for energy import-export across the region.  While neither former President Conde’s administration nor the transition government have published significant information concerning the financial stability of SOEs, EDG’s balance sheet is understood to be in the red. The IMF reported that as recently as 2017, up to 28 percent of Guinea’s budget went towards subsidizing electricity, and the IMF urged that EDG improve tariff collection since large numbers of its users do not pay. Former Prime Minister Ibrahima Kassory Fofana announced in March 2021 that EDG subsidies cost Guinea’s government USD 350 million annually.

The amount of research and development (R&D) expenditures is not known, but it would be highly unlikely that any of Guinea’s SOEs would devote significant funding to R&D.  Guinean SOEs are entitled to subsidized fuel, which EDG uses to run thermal generator stations in Conakry.  Guinea is not party to the Government Procurement Agreement.

Corporate governance of SOEs is determined by the government. Guinean SOEs do not adhere to the OECD guidelines.  SOEs are supposed to report to the Office of the President, however, typically they report to a ministry.  Seats on the board of governance for SOEs are usually allocated by presidential decree.

The transition government is continuing the former Conde administration’s initiative to privatize the energy sector.  In April 2015, the government tendered a management contract to run the state-owned electrical utility EDG.  French company Veolia won the tender and attempted to manage and rehabilitate the insolvent utility until the end of 2019.  In February 2020, EDG became a public limited company with its own board of directors.  The new directors were appointed by former President Conde through decree, replaced with a new Board of Directors with a decree from Transition President COL Doumbouya in February 2022.  Bidding processes are clearly spelled out for potential bidders; however, Guinea gives weight to competence in the French language and experience working on similar projects in West Africa.  In spring 2015, a U.S. company lost a fiber optics tender largely due to its lack of native French speakers on the project and lack of regional experience.

8. Responsible Business Conduct

The 2013 Mining Code includes Guinea’s first legal framework outlining corporate social responsibility.  Under the provisions of the code, mining companies must submit social and environmental impact plans for approval before operations can begin and sign a code of good conduct, agreeing to refrain from corrupt activities and to follow the precepts of the Extractive Industry Transparency Initiative (EITI).  However, lack of capacity in the various ministries involved makes government monitoring and enforcement of corporate social responsibility requirements difficult, a gap that some non-governmental organizations (NGOs) are filling.  In February 2019, Guinea was found to have achieved meaningful progress in implementing EITI standards.  The EITI Board outlined eight corrective actions, including disclosing more information on infrastructure agreements, direct subnational payments, and quasi-fiscal expenditures.  The Board noted that the EITI should play a role in overseeing the new Local Economic Development Fund (FODEL).  Mining companies continue to note a lack of transparency in the expenditure of revenues by the National Agency for Mining Infrastructure (ANAIM).

The 2019 Environmental Code also has specific provisions regarding environmental and social due diligence on any development projects.  The Code requires each development project to conduct an environmental impact study which includes a list of mitigation measures for any negative impact.

Guinea has laws that protect the population from adverse business impacts however, these laws are not effectively enforced.  In the last few years, there were several cases of private enterprise having an adverse impact on human rights, especially in the mining and energy sectors.  The government is often reluctant to fully enforce legislation regarding responsible conduct and the mitigation of these impacts.  There are several local and international organizations that are promoting and monitoring the implementation of RBCs.  Guinea is not signatory of the Montreux document on Private Military and Security Companies.

Department of State

Department of the Treasury

Department of Labor

Guinea ratified the United Nations Framework Convention on Climate Change (UNFCCC) in 1993 and the Kyoto Protocol in 2005.  Guinea prepared an Initial National Communication in 2001 to inventory greenhouse gases (GHG), based on emissions in 1994).  A second GHG inventory was completed in 2011, based on 2000 emissions.  Guinea prepared its National Adaptation Plan of Action (NAPA) in 2007 and undertook several projects to implement the plan.  Prior to COP 21 in Paris in December 2015, Guinea submitted an Intended National Contribution Determination in September 2015, committing to a 13 percent decrease in GHG emissions by 2030, as compared to 1994 emission levels.  In preparation for COP 26 in Edinburgh in November 2021, Guinea prepared a Nationally Determined Contribution in July 2021, making a commitment to a 17 percent reduction target across sectors, potentially reaching a 49 percent reduction by 2030 by including land-use and forestry.  Guinea has not yet prepared a National Adaptation Plan.

As of April 2022, Guinea does not offer any regulatory incentives to achieve policy outcomes that preserve climate change benefits, nor do public procurement policies include environmental and green growth considerations.

9. Corruption

According to Transparency International’s 2021 Corruption Perception Index, Guinea lost 13 points and was ranked 150 out of 180 countries listed.

Guinea passed an Anti-Corruption Law in 2017, and in April 2019, a former director of the Guinean Office of Advertising was sentenced to five years in prison for embezzling GNF 39 billion (approximately USD four million), though in June 2019, he was acquitted by the Appeals Court and was elected a member of the National Assembly in March 2020.  It is not clear whether the Anti-Corruption Law was used to prosecute the case.  According to a 2019 Afrobarometer survey, at least 40 percent of Guineans reported having given a government official a bribe, while a 2016 World Bank Enterprise Survey reported that of 150 firms surveyed, 48.7 percent reported that they were expected to give “gifts” to public officials to get things done, but only 7.9 percent reported having paid a bribe.

The business and political culture, coupled with low salaries, have historically combined to promote and encourage corruption.  Requests for bribes are a common occurrence.  Though it is illegal to pay bribes in Guinea, there is little enforcement of these laws.  In practice, it is difficult and time-consuming to conduct business without giving “gifts” in Guinea, leaving U.S. companies, who must comply with the Foreign Corrupt Practices Act, at a disadvantage.

Although the law provides criminal penalties for corruption, the law does not extend to family members of government officials. It does include provisions for political parties.  According to the World Bank’s 2018 Worldwide Governance Indicators, corruption continues to remain a severe problem, and Guinea is in the 13th percentile, down from being in the 15th percentile in 2012.  Public funds have been diverted for private use or for illegitimate public uses, such as buying vehicles for government workers.  Land sales and business contracts generally lack transparency.

Guinea’s Anti-Corruption Agency (ANLC) is an autonomous agency established by presidential decree in 2004.  The ANLC reports directly to the President and is currently the only state agency focused solely on fighting corruption, though it has been largely ineffective in its role with no successful convictions.  The ANLC’s Bureau of Complaint Reception fields anonymous tips forwarded to the ANLC. Investigations and cases must then be prosecuted through criminal courts.  According to the ANLC, during the past year there were no prosecutions as a result of tips.  The agency is underfunded, understaffed, and lacks computers and vehicles.  The ANLC is comprised of 52 employees in seven field offices, with a budget of USD 1.1 million in 2018.

Former President Conde’s administration named corruption in both the governmental and commercial spheres as one of its top agenda items.  In November 2019, Ibrahim Magu, the acting Chairman of the Economic and Financial Crimes Commission of Nigeria, and President Alpha Conde reached an agreement through which the Commission will assist Guinea to establish an anti-corruption agency; however, it is not clear if that meant reforming the existing anti-corruption agency or establishing a new anti-corruption agency.

In January 2021, Beny Steinmetz, an Israeli businessman and billionaire was sentenced to five years in jail in Geneva for bribing the wife of Guinea’s late President Lansana Conté to gain the rights to one of the world’s richest iron-ore deposits.  He was also ordered to pay a 50 million Swiss franc (USD 56 million) fine.  Steinmetz has long claimed to be a victim of a vast international conspiracy to deprive him of the rights to the Simandou project.  He plans to appeal his case.

Transition President COL Doumbouya created the Court to Repress Economic and Financial Crimes (CRIEF) to handle cases involving embezzlement, corruption, and misuse of public funds over one billion GNF (approximately $110,000) in December 2021.  As of April 2022, the court has focused on collecting evidence for corruption cases against businesses tied to and officials that served in former President Conde’s government.

 

A 2016 survey by the ANLC, the Open Society Initiative-West Africa (OSIWA), and Transparency International found that among private households, 61 percent of the respondents stated they were asked to pay a bribe for national services and 24 percent for local services.  Furthermore, 24 percent claimed to have paid traffic-related bribes to police, 24 percent for better medical treatment, 19 percent for better water or electricity services, and 8 percent for better judicial treatment.

Guinea is a party to the UN Anticorruption Convention.  http://www.unodc.org/unodc/en/treaties/CAC/signatories.html

Guinea is not a party to the OECD Convention on Combatting Bribery.  http://www.oecd.org/daf/anti-bribery/countryreportsontheimplementationoftheoecdanti-briberyconvention.htm

Since 2012, Guinea has had a Code for Public Procurement (Code de Marches Publics et Delegations de Service Public) that provides regulations for countering conflicts of interest in awarding contracts or in government procurements.  In 2016, the government issued a Transparency and Ethics charter for public procurement that provides the main do’s and don’ts in public procurement, highlighting avoidance of conflict of interest as a priority.  The charter also includes a template letter that companies must sign when bidding for public contracts stating that they will comply with local legislation and public procurement provisions, including practices to prevent corruption.

Since April 2020, Government of Guinea officials and family must complete the asset declaration form which is available on the Court of Audit website.

Resources to Report Corruption

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

National Agency to Fight Corruption (ANLC)
Cite des Nations, Villa 20, Conakry, Guinea
Korak Bailo Sow, Permanent Secretary
+224 622 411 796
ddiallo556@gmail.com
+224 620 647 878
cc@anlcgn.org

Contact at a “watchdog” organization:

Transparency International
Dakar, Senegal
+221-33-842-40-44
forumcivil@orange.sn  

Guinea Association for Transparency
Oumar Kanah Diallo, President
+224 622 404 142
okandiallo77@gmail.com
agtguinee224@gmail.com 

10. Political and Security Environment

Guinea has had a long history of political repression, with more recent episodes of politically-motivated violence around elections.  The country suffered under authoritarian rule from independence in 1958 until its first democratic presidential election in 2010.  It has seen continued political violence associated with national and local elections since 2010, culminating in the most recent September 2021 coup d’etat.

On September 5, 2021 Colonel Mamadi Doumbouya and Guinean military special forces seized power and detained former President Alpha Conde through a coup d’état.  COL Doumbouya declared himself Guinea’s head of state, dissolved the government and National Assembly and suspended the constitution.  Guinea is currently governed by the National Committee for Reunification and Development (CNRD), which is led by COL Doumbouya and comprised primarily of military officials.  On September 27, 2021 COL Doumbouya released the Transitional Charter which supersedes the constitution until a new Constitution is promulgated; Guinea’s penal and civil codes remains in force.  On October 1, 2021 the Supreme Court Justice installed COL Doumbouya as Head of State, Transition President, CNRD President, and Commander-in-Chief of Security Forces.  On January 22, 2022 the National Transition Council, the transition government’s legislative body, was installed but no timeline for future elections or return to civilian rule was provided as of April 2022.

In March 2020, the former Conde administration amended the constitution through a referendum that allowed former President Conde to seek a third term in office.  Observers noted the process was not transparent, inclusive, or consultative.  Major opposition parties boycotted the referendum and accompanying legislative elections.  This resulted in resetting presidential term limits and the ruling party, the Rally for the Guinean People, gaining a super majority in the National Assembly.  Domestic and international observers raised concerns regarding widespread violence and voting irregularities in the legislative elections, including closed and ransacked polling stations.

In October 2020 President Alpha Conde ran for reelection for a third term under the new constitution.  International and domestic observers raised concerns about widespread electoral violence, restrictions on freedom of assembly, the lack of transparency in vote tabulation, and inconsistencies between the announced results and tally sheet results from polling stations.  Violent protests during both elections closed businesses in major population centers, resulted in about 150 deaths, and the arbitrary detention of hundreds of people including several prominent opposition figures.  Political intimidation and arbitrary detention of opposition members continued for several months after the election.

The local populace in Boke, Bel-Air, and Sangaredi disrupted road and/or railroad traffic on at least three occasions in 2017 and at least twice in 2018, in response to grievances over employment, lack of services, and other issues.  Although none of these events targeted American or foreign investors, they were disruptive to business in general and eroded confidence in the security situation under which investors must operate in Guinea.  Street violence is difficult to predict or avoid, but generally does not target westerners.

Presidential elections in 2015 sparked violent protests in Conakry, but clashes between police and demonstrators were largely contained.  In addition to political violence, sporadic and generally peaceful protests over fuel prices, lack of electricity, labor disputes, and other issues have occurred in the capital and sometimes beyond since 2013.  In February 2017, seven civilians died in confrontations with security services during large protests against education reforms.  After two days of violent protests in March 2018, teachers’ unions and the government agreed to a raise of 40 percent.  These protests over teacher union pay became intermingled with political protests over voting irregularities in the February 4 local elections.  The political opposition claims the government is responsible for the deaths of over 90 people during political protests over the past eight years.

Other instances of violence occurred in 2014 and 2015 during the Ebola epidemic when local citizens attacked the vehicles and facilities of aid workers.  The Red Cross, MSF (Doctors Without Borders) and the World Health Organization (WHO) also reported cases of property damage (destroyed vehicles, ransacked warehouses, etc.).  On September 16, 2014, in the Forest Region village of Womei, eight people were killed by a mob when they visited the village as part of an Ebola education campaign. The casualties included radio journalists, local officials, and Guinean health care workers.

The small mining town of Zogota, located in Guinea’s Forest Region, saw the deaths of five villagers, including the village chief, during August 2012 clashes with security forces over claims that the Brazilian iron-mining company Vale was not hiring enough local employees and was instead bringing workers from other regions of Guinea.  The ensuing instability led to Vale evacuating all expatriate personnel from the town.

Following the death of President Lansana Conte on December 22, 2008, a military junta calling themselves the National Council for Democracy and Development (CNDD) took power in a bloodless coup.  Immediately following the coup, the U.S. government suspended all but humanitarian and election assistance to Guinea.  The African Union (AU) and ECOWAS suspended Guinea’s membership pending democratic elections and a relinquishment of power by the military junta.  In September 2009, junta security forces attacked a political rally in a stadium in Conakry, killing 150 people, and raping over a hundred women.

The state had persecuted political dissidents and opposition parties for decades.  The Sekou Toure regime (1958-1984) and the Lansana Conte regime (1984-2008) were marked by political violence and human rights abuses.

11. Labor Policies and Practices

Guinea has a young population and a high unemployment rate.  Potential employees often lack specialized skills.  The country has a poor educational system and lacks professionals in all sectors of the economy. Guinea has deficits in specialized skills needed for large-scale projects of any kind.

According to a 2019 World Bank report on “Employment, productivity and inclusion of youth”, in 2017 Guinea’s economy was based on services (49 percent of GDP), mining and industry (37 percent) and agriculture (10 percent).  The tendencies show that employment in Guinea is like other countries in the region, with a high level of employment in the informal sector.  According to the 2018 World Bank Development Indicators, approximately 65 percent of Guineans above 15 years old, (56 percent males and 44 percent females) were employed in the formal or informal sectors.  Of those employed, 52 percent were working in agricultural sector, 34 percent in commerce, and 14 percent in industry and manufacturing.

In March 2020, the National Assembly revised the Children’s Code to increase protections and rights afforded to minors.  The new code provides increased penalties for offenses that expose children to violence, sexuality, the display or dissemination of obscene images, and messages not intended for children.  The new code also increases penalties relating to child labor, sexual abuse, sexual exploitation of children and the fight against child pornography.  Under the new code children between the ages of 12 and 14 can perform light work, which does not meet international standards, as it applies to children under age 13.  In addition, the new code does not prescribe the number of hours per week permitted for light work, nor does it specify the conditions under which light work may be done. Moreover, these laws only apply to workers with written employment contracts, leaving self-employed children and children working outside of formal employment relationships vulnerable to exploitation.

Guinea’s National Assembly adopted a new labor code in February 2014 which protects the rights of employees and is enforced by the Ministry of Technical Education, Vocational Training, Employment and Labor.  The Labor Code sets forth guidelines in various sectors, the most stringent being the mining sector.  Guidelines cover wages, holidays, work schedules, overtime pay, vacation, and sick leave.  The Labor Code also outlaws all discrimination in hiring, including on the basis of sex, disability, and ethnicity.  It also prohibits all forms of workplace harassment, including sexual harassment.  However, the law does not provide antidiscrimination protections for persons based on sexual orientation and/or gender identity.

Although the law provides for the rights of workers to organize and join independent unions, engage in strikes, and bargain collectively, the law also places restrictions on the free exercise of these rights.  The Labor Code requires unions to obtain the support of 20 percent of the workers in a company, region, or trade that the union claims to represent.  The code mandates that unions provide ten days’ notice to the labor ministry before striking, but the code does allow work slowdowns. Strikes are only permitted for professional claims.  The Labor Code does not apply to government workers or members of the armed forces.  While the Labor Code protects union officials from anti-union discrimination, it does not extend that same protection to other workers.

The law prohibits child labor in the formal sector and sets forth penalties of three to ten years imprisonment and confiscation of resulting profits.  The law does not protect children in the informal sector.  The minimum age for employment is 16.  Exceptions allow children to work at age twelve as apprentices for light work in such sectors as domestic service and agriculture, and at 14 for other work.  A new child code was adopted at the National Assembly in December 2019, though it was never enacted by former President Conde.  The new child code provides more severe sentences for violations related to child labor.

The Labor Code allows the government to set a minimum monthly wage through the Consultative Commission for Labor and Social Laws.  The minimum wage for all sectors was established in 2013 at 440,000 GNF (approximately USD 50).  There is no known official poverty income level established by the government.

The law mandates that regular work should not exceed ten-hour days or 48-hour weeks, and it mandates a period of at least 24 consecutive hours of rest each week, usually on Sunday.  Every salaried worker has the legal right to an annual paid vacation, accumulated at the rate of at least two workdays per month of work.  There also are provisions in the law for overtime and night wages, which are a fixed percentage of the regular wage.  The law stipulates a maximum of 100 hours of compulsory overtime a year.

The law contains general provisions regarding occupational safety and health, but neither former President Conde’s government nor the transition government have established a set of practical workplace health and safety standards.  Moreover, no orders have been issued laying out the specific safety requirements for certain occupations or for certain methods of work called for in the Labor Code.  All workers, foreign and migrant included, have the right to refuse to work in unsafe conditions without penalty.

Authorities rarely monitor work practices or enforced the workweek standards and the overtime rules.  Teachers’ wages are low, and teachers sometimes have gone for months without pay.  When salary arrears are not paid, some teachers live in abject poverty.  From 2016-2018, teachers conducted regular strikes and as a result and were promised a 40 percent increase in pay.  Initially they received only ten percent, but in March 2018, the government began to pay the remaining 30 percent.  In February 2019, the teacher’s union accepted the government proposal at the time and returned to work.  In January 2020, the teachers started an indefinite strike demanding higher wages and the re-running of a census of currently employed teachers.  As of end of March 2020, the teachers’ strike was put on hold due to the COVID-19 pandemic.

Despite legal protection against working in unsafe conditions, many workers feared retaliation and did not exercise their right to refuse to work under unsafe conditions.  Accidents in unsafe working conditions remain common.  The government banned artisanal mining during the rainy season to prevent deaths from mudslides, but the practice continues.

Pursuant to the Labor Code, any person is considered a worker, regardless of gender or nationality, who is engaged in any occupational activity in return for remuneration, under the direction and authority of another individual or entity, whether public or private, secular, or religious.  In accordance with this code, forced or compulsory labor means any work or services extracted from an individual under threat of a penalty and for which the individual concerned has not offered himself willingly.

A contract of employment is a contract under which a person agrees to be at the disposal and under the direction of another person in return for remuneration.  The contract may be agreed upon for an indefinite or a fixed term and may only be agreed upon by individuals of at least 16 years of age, although minors under the age of 16 may be contracted only with the authorization of the minor’s parent or guardian.  An unjustified dismissal provides the employee the right to receive compensation from the employer in an amount equal to at least six months’ salary with the last gross wage paid to the employee being used as the basis for calculating the compensation due.

The Investment Code obliges new companies to prioritize hiring local employees and provide capacity training and promotion opportunities for Guineans, a sentiment echoed by public remarks from Transition President COL Doumbouya and other members of the transition government.

14. Contact for More Information

Caroline Corcoran
Economic and Commercial Officer
U.S. Embassy Conakry
+224 655 104 428
corcorance@state.gov

Liberia

Executive Summary

Liberia offers opportunities for investment, especially in natural resources such as mining, agriculture, fishing, and forestry, but also in more specialized sectors such as energy, telecommunications, tourism, and financial services. The economy, which was severely damaged by more than a decade of civil wars that ended in 2003, has been slowly recovering, but Liberia has yet to attain pre-war levels of development. Liberia’s largely commodities-based economy relies heavily on imports even for most basic needs like fuel, clothing, and rice – Liberia’s most important staple food. The COVID-19 pandemic disrupted many sectors of the economy, which contracted in 2019 and 2020. However, the World Bank and IMF expect per capita GDP to return to pre-COVID-19 levels by 2023. Growth will be driven mainly by the mining sector, although structural reforms are also expected to increase activity in agriculture and construction.

Low human development indicators, expensive and unreliable electricity, poor roads, a lack of reliable internet access (especially outside urban areas), and pervasive government corruption constrain investment and development. Most of Liberia lacks reliable power, although efforts to expand access to the electricity grid are ongoing through an extension from the Mount Coffee Hydropower Plant, connection to the West Africa Power Pool, and other internationally supported energy projects. Public perception of corruption in the public sector is high, as indicated by Liberia’s poor showing in Transparency International’s 2021 Corruption Perceptions Index, where Liberia ranked 136 out of 180 countries. Low public trust in the banking sector and seasonal currency shortages result in most cash being held outside of banks. To remedy this, the Central Bank of Liberia (CBL) in 2021 initiated a plan to print and circulate additional currency. The new printing and minting will provide 48 billion Liberian dollars through 2024. The CBL and commercial banks have also successfully pushed the adoption of mobile money, which Liberians access through their mobile phones to make everyday purchases and pay bills. However, the government has yet to activate the “national switch,” meaning banking instruments like ATMs and mobile money accounts remain unintegrated and are not interoperable.

The government-backed Business Climate Working Group (BCWG) works with public and private sector stakeholders to explore how to create a friendlier business environment.  International donors also work with the government to improve the investment climate, which ranks toward the global bottom by most global measures. Despite these numerous challenges, Liberia is rich in natural resources. It has large expanses of potentially productive agricultural land and abundant rainfall to sustain agribusinesses. Its rich mineral resources offer significant potential to investors in extractive industries. Several large international concessionaires have invested successfully in agriculture and mining, though negotiating these agreements with the government often proves to be a lengthy and byzantine struggle. The fishing industry, long dormant compared to pre-war levels, is making improvements that should make it more attractive for investment.

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 2020 N/A https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in Liberia ($M USD, historical stock positions) 2019 -$94 million https://apps.bea.gov/international/factsheet/ 
World Bank GNI per capita 2020 $570 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

1. Openness To, and Restrictions Upon, Foreign Investment

The Government of Liberia describes the country as “open for business” and supports programs and initiatives to foster commerce, including an ad hoc Business Climate Working Group (BCWG)  to improve the investment climate. During Liberia’s National Judicial Conference  in June 2021, President George Weah  called on the Judiciary to partner with agencies on reforms to improve the investment climate. The BCWG, chaired by the Minister of Finance and Development Planning, collaborates with the Ministry of Commerce and Industry , Liberia Business Registry (LBR) , National Investment Commission (NIC) , and Liberia Revenue Authority (LRA) . The National Investment Commission (NIC) is Liberia’s investment promotion agency. It develops investment strategies, policies, and programs to attract foreign investment and negotiates investment contracts and concessions. The NIC oversees the implementation of Liberia’s 2010 Investment Act and chairs an ad hoc Inter-Ministerial Concession Committee (IMCC). In 2021, the NIC became a member of the World Association of Investment Promotion Agencies (WAIPA)  See link ( https://waipa.org/members/ ). It also participates in the African Investment Promotion Agencies (IPAs)  Forum.

In practice, however, the government does much to discourage investors and investment. Some business leaders report it is difficult even to meet with government representatives to discuss new investment or policies damaging to the business climate. A weak legal and regulatory framework, lack of transparency in contract awards, and widespread corruption inhibit foreign direct investment. Investors are often treated as opportunities for graft, and government decisions affecting the business sector are driven more by political cronyism than investment climate considerations. Many businesses find it easy to operate illegally if the right political interests are being paid, whereas those that try to follow the rules receive little if any assistance from government agencies. The Investment Act restricts market access for foreign investors, including U.S. investors, in certain economic sectors or industries. See “Limits on Foreign Control and Right to Foreign Ownership and Establishment” below for more detail.

Foreign and domestic private entities may own and establish business enterprises in many sectors. The Liberian constitution restricts land ownership to citizens, but non-Liberians may hold long-term leases to land. Examples are rubber, oil palm, and logging concessions that cover a quarter of Liberia’s total land mass. See Real Property, below, for further details.

The National Investment Commission is the oversight agency to screen and monitor investments. The Investment Act and Revenue Code mandate that only Liberian citizens may operate businesses in the following sectors and industries, but it is not clear to what degree this mandate is enforced:

  1. Supply of sand
  2. Block making
  3. Peddling
  4. Travel agencies
  5. Retail sale of rice and cement
  6. Ice making and sale of ice
  7. Tire repair shops
  8. Auto repair shops with an investment of less than USD 550,000
  9. Shoe repair shops
  10. Retail sale of timber and planks
  11. Operation of gas stations
  12. Video clubs
  13. Operation of taxis
  14. Importation or sale of second-hand or used clothing
  15. Distribution in Liberia of locally manufactured products
  16. Importation and sale of used cars (except authorized dealerships, which may deal in certified used vehicles of their make)

The Investment Act also sets minimum capital investment thresholds for foreign investors in other business activities, industries, and enterprises. (See Section 16 of the Act: http://www.moci.gov.lr/doc/TheInvestmentActof2010(1).pdf .) For enterprises owned exclusively by non-Liberians, the Act requires at least USD 500,000 in investment capital. For foreign investors partnering with Liberians, the Act requires at least USD 300,000 in total capital investment and at least 25 percent aggregate Liberian ownership.

All businesses must register with the  Liberia Business Registry (LBR)  to conduct business or provide services in Liberia.

Investment contracts, such as concessions, are reviewed by the Inter-Ministerial Concessions Committee (IMCC). Concessions are ratified by the national legislature and approved by the president. Businesses register with the Liberia Revenue Authority (LRA) for taxes and the National Social Security and Welfare Corporation (NASSCORP) for social security.

It is possible for foreign companies to obtain investment incentives through the National Investment Commission. In 2021, two companies, Mano Manufacturing Company and Jetty Rubber LLC, received long-term investment incentives, according to NIC’s 2021 Annual Report. Foreign companies must use local counsel when establishing a subsidiary. If the subsidiary will engage in manufacturing and international trade, it must obtain a trade license from the LBR. For more information about investment laws, bilateral investment treaties, and other treaties with investment provisions, see:  https://investmentpolicy.unctad.org/country-navigator/121/liberia .

Liberia is a member of the OECD Inclusive Framework on Base Erosion and Profit Shifting and a party to the Inclusive Framework’s October 2021 deal on the two-pillar solution to global tax challenges, including a global minimum corporate tax.

The government neither promotes nor incentivizes outward investment but it does not restrict Liberian citizens from investing abroad.

3. Legal Regime

Companies are required to adhere to International Financial Reporting Standards (IFRS) consistent with international norms. In many instances, however, authorities do not consistently enforce or apply national laws and international standards. Furthermore, no systematic oversight or enforcement mechanisms exist to ensure government authorities correctly follow administrative rules. Accounting, legal, and regulatory procedures are often not transparent. The government does not require environmental, social, and governance (ESG) disclosure to facilitate transparency or help investors and consumers distinguish between high-and low-quality investments. Liberia passed a Freedom of Information Law in 2010 requiring government agencies to appoint a public information officer and make records available to the public, but access to government records is often difficult or impossible. Some government ministries and agencies have overlapping responsibilities, resulting in inconsistent application of laws. Government agencies are not legally required to disclose regulations before or after enactment and there is no requirement for public comment, although finalized regulations are often published. No central clearinghouse exists to access proposed regulations. Government finances, including revenues and debt obligations, are partially captured in national budgets, but are not fully transparent. Some budget documents are accessible online. For more information on regulatory transparency, see: https://rulemaking.worldbank.org/en/data/explorecountries/liberia .

Liberia is a member of the Economic Community of West African States (ECOWAS)  and the Mano River Union (MRU) . The Liberia Revenue Authority (LRA)  is standardizing the country’s customs and tariff systems and harmonizing its tax regime with the ECOWAS Common External Tariff . Liberia is a member of the World Trade Organization.

Liberia’s legal system uses common law alongside local customary law.  The common law-based court system operates in parallel with local customary law, which incorporates unwritten, indigenous practices, culture, and traditions. Adjudication under these dual systems often results in conflicting decisions between entities based in Monrovia and communities outside of Monrovia, as well as within communities.

The Commercial Court  hears commercial and contractual issues, including debt disputes of USD 15,000 and above. In theory, the Commercial Court presides over all financial, contractual, and commercial disputes, serving as an additional avenue to expedite commercial and contractual cases. Under the Liberian constitution, the judicial branch is independent from the executive, but reports regularly indicate that the executive branch frequently interferes in both judicial and legislative matters. Cases can be subject to extensive delays and procedural and other errors, and investors have questioned the fairness and reliability of judicial decisions. There are widespread reports that court officials solicit bribes to act on cases. Regulations or enforcement actions are appealable, and appeals are adjudicated in the Supreme Court . The high volume of appeals is a significant burden on the court’s five judges and often results in long delays.

Laws guiding foreign investment include the Investment Act of 2010 , the Revenue Code , the Public Procurement and Concessions Act , and the National Competitive Bidding Regulation . No major laws or judicial decisions pertaining to foreign direct investment have come out in the past year. The government does not maintain a “one-stop-shop” website for investment laws, rules, procedures, or reporting requirements.

The Ministry of Commerce and Industry (MOCI)  reviews domestic and international trade transactions for competition-related concerns. If the MOCI cannot resolve the issue or it requires investigation, it may be referred to the Department of Economic Affairs at the Ministry of Justice  (MOJ). The MOJ refers potential violations of civil or criminal law to the court system, including the Commercial Court. There were no significant competition cases during the review period. Liberia does not have anti-trust laws.

The Liberian Constitution permits the government to expropriate property for “national security issues or where the public health and safety are endangered, or for any other public purposes.” The government must pay just compensation and landowners may challenge the expropriation in court. When property taken for a purpose is no longer used for that purpose, the former owner has the right of first refusal to reacquire the property. The 2010 Investment Act further defines the circumstances under which the government can legally expropriate property and includes protections for foreign enterprises against expropriation or nationalization. Liberia is a signatory to the Multilateral Investment Guarantee Agency (MIGA) Convention.

4. Industrial Policies

The government provides tax deductions for equipment, machinery, cost of buildings and fixtures used in manufacturing. It also provides exemptions on import duties and goods and services taxes as investment incentives for the following sectors:

  • Tourism
  • Manufacturing
  • Energy
  • Hospitals and Medical
  • Housing
  • Transportation
  • Information Technology
  • Banking
  • Agriculture and Agro-processing (fisheries, poultry, aquaculture, food processing)

Investments in economically deprived regions qualify for additional incentives of up to 12.5 percent. Additional investment incentives are available if an investment creates more than 100 direct jobs, or if an investment uses at least 60 percent local materials to manufacture finished products.

The government does not issue guarantees or jointly finance foreign direct investment projects.

In 2019, the government established a Special Economic Zone (SEZ) Steering Committee, “to create, drive, guide, enhance, coordinate, and manage single, multiple and mixed-use (SEZs) in Liberia.” The government identified the port city of Buchanan in Grand Bassa County for the first special economic zone, now known as the Buchanan Special Economic Zone. In 2021, the African Development Bank (AfDB)  announced it would fund a Special Agro-Industrial Processing Zone (SAPZ) Project in the Buchanan Special Economic Zone.

Liberia has no performance or data localization requirements.

5. Protection of Property Rights

Liberian law protects property rights and interests, but with weak enforcement mechanisms. “Long term” mortgages or construction loans of up to 10 years are only available through the  Liberia Bank for Development and Investment.   Only Liberians may own land, with the limited exception provided in Article 22(c) of the Constitution that non-citizen missionary, educational, and other benevolent institutions shall have the right to own property, if that property is used for the purposes for which acquired. Property no longer so used reverts to the Government of Liberia.

Other foreigners and non-resident investors may acquire land on leases, which ordinarily run for 25 to 50 years.  Liberian law provides for no official waiver mechanisms for limitations on foreign land ownership.

The Liberia Land Authority (LLA) , a one-stop-shop for all land-related matters, is working with international partners, including USAID, to implement strategic and targeted programs aimed at resolving critical land issues. Although the LLA encourages property owners to identify and register land titles, it does not have systemic enforcement programs.  The LLA estimates that less than 25 percent of the country’s total land is formally registered. Conflicting land ownership records are common. Investors sometimes experience costly and complex land dispute issues, even after concluding agreements with the government.

The Land Rights Act, enacted in 2018, was designed to resolve historical land disputes that have caused conflict and communal strife in the past. The Act defines four categories of land ownership as follows:

Public land, which is owned, but currently not used by the government

Government land, which is used by government agencies (for office buildings or other purposes)

Customary land, on which the livelihoods of most rural communities depend

Private land owned by private citizens.

Public awareness of the Land Rights Act is growing, but still limited.

See Limits on Foreign Control and Right to Private Ownership and Establishment, above, for further information, including implementation of the Land Rights Act. See, also: https://www.doingbusiness.org/en/data/exploreeconomies/liberia#DB_rp     .

Foreign companies seeking to lease land may lease privately or publicly held land. Frequently, foreign companies seeking to acquire land leases do so through direct negotiations with landlords or owners.

Liberia has a weak legal structure and regulatory environment for enforcement of Intellectual Property Rights (IPR). The Liberia Intellectual Property Act covers domain names, traditional knowledge, transfer of technology, patents, and copyrights.  The Liberia Intellectual Property Office (LIPO)  operates as a semi-autonomous agency under the oversight of the Ministry of Commerce and Industry. LIPO, however, lacks the technical and financial capacity to address infringements of intellectual property rights.

The Copyright Society of Liberia (COSOL)  collaborates with the MOCI and LIPO to develop legal and international frameworks to guide the collection and distribution of royalties. In February 2021, LIPO and COSOL rolled out nationwide public awareness and inspection campaigns to remove pirated copyright materials from the Liberian market. In October 2021, during a meeting of the World Intellectual Property Organization (WIPO), the government recommitted to global efforts to protect and promote intellectual property rights.

There is no system to track and report on seizures of counterfeit goods. The government rarely prosecutes intellectual property violations. Many Liberians are unfamiliar with intellectual property rights, and intellectual property infringement is common, including unauthorized duplication of movies, music, and books. Counterfeit drugs, apparel, cosmetics, mobile phones, computer software, and hardware are sold openly.

Liberia is not listed in USTR’s Special 301 Report or the Notorious Markets List.

For additional information about national laws and local IPR points of contact, see WIPO’s country profiles at  https://www.wipo.int/directory/en/  .  

6. Financial Sector

The government welcomes foreign investment, but Liberia’s capital market is highly underdeveloped. Private investors have limited credit and investment options. The country does not have a domestic stock market and does not have an effective system to encourage portfolio investments. In 2019, Liberia committed to non-discriminatory foreign exchange auctions consistent with its obligations under IMF Article VIII  , and the country does not restrict international payments and transfers. Commercial credit is allocated on market terms, and foreign investors can get credit on the local market. Many foreign investors prefer to obtain credit from foreign banks.

The country’s financial sector regulatory authority is the Central Bank of Liberia . Foreign banks or branches can establish operations in Liberia subject to the CBL’s regulations. There are 10 commercial banks. Most are foreign-owned with branch outlets in the country. Non-bank financial institutions also provide diverse financial services. These include a development finance company, a deposit-taking microfinance institution, numerous non-deposit-taking microfinance institutions, rural community finance institutions, money remittance entities, foreign exchange bureaus, credit unions, and village savings and loans associations. However, chronic liquidity shortages, especially of Liberian dollars in recent years, have undermined confidence in banks. The CBL’s 2021 third-quarter report described the banking industry as “relatively stable” based on indicators such as total assets, deposits, loans, and total capital. As of November 2021, the capital adequacy ratio of 27.47 was well above the 10% regulatory minimum, and the liquidity ratio was 44.17, above the 15% regulatory minimum. Although the banking sector is sufficiently capitalized, it is not well positioned to withstand shocks. The sector’s primary weaknesses include a high number of non-performing loans (21% in November 2021), low profitability due to high operating expenses, periodic cash shortages for depositors, low public confidence, and inadequate policing and prosecution of money laundering and other financial crimes. There are no restrictions on a foreigner’s ability to establish a bank account.

The Government of Liberia does not maintain a Sovereign Wealth Fund (SWF) or similar entity.

7. State-Owned Enterprises

Liberia has approximately 20 state-owned enterprises (SOEs), which are governed by boards of directors and management teams overseen by government ministries. All are wholly government-owned and semi-autonomous. The president of Liberia appoints board members and directors or managers to govern and run SOEs. The Public Financial Management (PFM) Act defines the requirements for SOEs.

SOEs employ more than 10,000 people in sea and airport services, electricity supply, oil and gas, water and sewage, agriculture, forestry, maritime, petroleum importation and storage, and information and communication technology services. Not all SOEs are profitable, and some citizens and advocacy groups have called for SOEs to be dissolved or privatized. Liberia does not have a clearly defined corporate code for SOEs. Reportedly, high-level officials, including some who sit on SOE boards, influence government-owned enterprises to conduct business in ways not consistent with standard corporate governance. Not all SOEs pay taxes, or do so transparently, and SOE revenue is not always transparently reported or adequately reflected in national budgets.

In 2016 Liberia’s Ministry of Education initiated a school privatization program that, as of the 2021-22 school year, had privatized 525 schools. Operation of the schools was outsourced to domestic and foreign for-profit and nonprofit education providers and NGOs. There have been numerous calls from political leaders and government officials to privatize government-owned enterprises, including the Liberia Electricity Corporation, the Liberia Water & Sewer Corporation, and Liberia Petroleum Refining Company, but the government does not have an official privatization program.

8. Responsible Business Conduct

Liberian authorities have not clearly defined responsible business conduct (RBC). The Liberian Environmental Protection Agency (EPA), however, includes RBC requirements in policies such as the National Disaster Risk Reduction and Resilience Strategy (2020-2030), the National Climate Change Response Strategy (2018), and the National Adaptation Plan (2020-2030).   Foreign companies are encouraged, but not required, to publicly disclose their policies, procedures, and practices to highlight their RBC practices.

Some non-governmental organizations (NGOs), civil society organizations (CSOs), and workers organizations/unions promote or monitor foreign company RBC policies and practices. However, NGOs and CSOs monitoring or advocating for RBC do not conduct their activities in a structured and coordinated manner, nor do they tend to monitor locally owned companies.

Most Liberians are generally unaware of RBC standards.  Generally, the government expects foreign investors to offer social services to local communities and contribute to a government-controlled social development fund for the area in which the enterprise conducts its business. Some communities complain that these contributions to social development funds do not reach them.  The government frequently includes clauses in concession agreements that oblige investors to provide social services such as educational facilities, health care, and other services which other governments typically provide. Foreign investors have reported that some local communities expect benefits in addition to those outlined in formal concession agreements.

Liberia is a member of the Extractive Industries Transparency Initiative (EITI). The National Bureau of Concessions monitors and evaluates concession company compliance with concession agreements, but it does not design policies to promote and encourage RBC. Some NGOs report that several concessions have violated human or labor rights, including child labor and environmental pollution. Liberia has several private security companies, but the country is not a signatory to the Montreux Document on Private and Security Companies. Private security companies are regulated by the Ministry of Justice, and they perform a range of tasks such as providing security or surveillance to large businesses, international organizations, diplomatic missions, and some private homes.

Department of State

Department of the Treasury

Department of Labor

Liberia ratified the United Nations Framework Convention on Climate Change (UNFCCC) and the Kyoto Protocol in 2002. In 2018, Liberia ratified the Paris Agreement and adopted the Liberia National Policy and Response Strategy on Climate Change. Liberia released its revised Nationally Determined Contribution in 2021, when it committed to reducing economy-wide greenhouse gas emissions by 64 percent below business-as-usual levels by 2030. The revised NDC targets nine sectors: Agriculture, Forests, Coastal zones, Fisheries, Health, Transport, Industry, Energy, and Waste. Liberia’s Environmental Protection Agency (EPA) maintains a director of climate finance instruments eligible for Liberia that can be used for public or private sector projects. Liberia has been working with national and international development partners since 2008 to reform its forestry sector and is currently implementing Reducing Emissions from Deforestation and Forest Degradation (REDD+) readiness activities, which include a National Forest Inventory, and institutionalizing its National Forest Monitoring System. In 2019, Liberia set up its Safeguard Information System , a free public web-based platform hosted by the EPA to provide information on how social and environmental safeguards are being addressed. However, the site does not appear to be updated regularly.

9. Corruption

Liberia has laws against economic sabotage, mismanagement of funds, bribery, and other corruption-related acts, including conflicts of interest. However, Liberia suffers from corruption in both the public and private sectors. The government does not implement its laws effectively and consistently, and there have been numerous reports of corruption by public officials, including some in positions of responsibility for fighting corrupt practices. On December 9, 2021, the United States Treasury Department sanctioned Nimba County Senator Prince Yormie Johnson under the Global Magnitsky Act for personally enriching himself through pay-for-play funding schemes with government ministries and organizations. In 2021, Liberia ranked 136 out of 180 countries on Transparency International’s Corruption Perception Index . See http://www.transparency.org/research/cpi/overview .

The  Liberia Anti-Corruption Commission     (LACC) currently cannot directly prosecute corruption cases without first referring cases to the  Ministry of Justice     (MOJ) for prosecution. If the MOJ does not prosecute within 90 days, the LACC may then take those cases to court, although it has not exercised this right to date. The LACC continues to seek public support for the establishment of a specialized court to exclusively try corruption cases.

In October 2021 the Liberia Anti-Corruption Commission (LACC), with the Swedish International Development Cooperation Agency (SIDA) and the United Nations Development Program (UNDP), launched “The Anti-Corruption Innovation Initiative Project.” LACC will hire at least 15 officers around the country who will report on corruption to the LACC. LACC is also developing a national digital platform for the public to report corruption.

Foreign investors generally report that corruption is most pervasive in government procurement, contract and concession awards, customs and taxation systems, regulatory systems, performance requirements, and government payments systems.  Multinational firms often report paying fees not stipulated in investment agreements. Private companies do not have generally agreed and structured internal controls, ethics, or compliance programs to detect and prevent bribery of public officials. No laws explicitly protect NGOs that investigate corruption.

Liberia is signatory to the Economic Community of West African States (ECOWAS) Protocol on the Fight against Corruption, the African Union Convention on Preventing and Combating Corruption (AUCPCC), and the UN Convention against Corruption (UNCAC), but Liberia’s association with these conventions has done little to reduce rampant government corruption.

Contact at government agencies responsible for combating corruption:

Baba Borkai, Chief Investigator
Liberia Anti-Corruption Commission (LACC), Monrovia,  http://lacc.gov.lr/   bborkai@lacc.gov.lr
Tel: (+231) 777-313131
Email:  bborkai@lacc.gov.lr 

Contact at a “watchdog” organization (local or nongovernmental organization operating in Liberia that monitors corruption):

Anderson Miamen, Executive Director
Center for Transparency and Accountability in Liberia (CENTAL)
Tel: (+231) 886-818855
Email:  admiamen@gmail.com 

10. Political and Security Environment

President Weah’s inauguration in January 2018 marked the first peaceful transfer of power in Liberia from one democratically elected president to another since 1944. International and domestic observers have said midterm senatorial and special elections since then have been largely peaceful, although there were reported instances of vote tempering, election violence, intimidation, and harassment of female candidates. Liberia’s relatively free media landscape has led to vigorous pursuit of civil liberties, resulting in active, often acrimonious political debates, and organized, non-violent demonstrations. Liberia adopted a press freedom law in 2019, but there have been reports and instances of violence and harassment against the media and journalists. Numerous radio stations and newspapers distribute news throughout the country. The government has identified land disputes and high rates of youth and urban unemployment as potential threats to security, peace, and political stability.

The United Nations Mission in Liberia (UNMIL), a peacekeeping force, withdrew from Liberia in March 2018 and turned over responsibility for security to the government. Protests and demonstrations may occur with little warning. The Armed Forces of Liberia and law enforcement agencies, including the Liberia National Police (LNP) , Liberia Immigration Service (LIS) , and Liberia Drug Enforcement Agency (LDEA) , maintain security in the country. There are also many private security firms. Most security personnel are in the capital city Monrovia and other urban areas. The effectiveness of soldiers and police is limited by lack of money and poor infrastructure.

11. Labor Policies and Practices

With a literacy rate of just under 50 percent, much of the Liberian labor force is unskilled.  Most Liberians, particularly those in rural areas, lack basic vocational or computer skills.  Liberia has no reliable data on labor force statistics, such as unemployment rates.  Government workers comprise the majority of formally employed Liberians.

An estimated four out of five Liberian workers engage in “vulnerable” or “informal” employment. Many work in difficult and dangerous conditions that undermine their basic rights.  The Ministry of Labor (MOL) largely attributes high levels of vulnerable and informal employment to the private sector’s inability to create employment.  There is an acute shortage of specialized labor skills, particularly in medicine, information and communication technology, and science, technology, engineering, and mathematics (STEM). Migrant workers are employed throughout the country, particularly in service industries, artisanal diamond and gold mining, timber, and fisheries.

The predominantly female workers who sell in markets and on the streets face significant challenges, including a lack of access to credit and banking services, limited financial literacy and business training, few social protections or childcare options, harassment from citizens and local authorities, and poor sanitation within marketplaces. Through the Bureau of Small Business Administration (SBA) at the Ministry of Commerce and Industry, businesses owned by female informal workers are being formalized using a “one-stop shop” registration mechanism. Development partners are also designing programs aimed at empowering women businesses and entrepreneurs.

Liberia’s labor law, the 2015 Decent Work Act, gives preference to employing Liberian citizens, and most investment contracts require companies to employ a defined percentage of Liberians, including in top management positions. In 2021, the Ministry of Labor issued an order that restricts certain employment opportunities in commercial business establishments with branches in Monrovia and other parts of the country to Liberians. The order was the result of a memorandum of understanding between the Ministry of Labor and the Liberia Chamber of Commerce  calling for the creation of five hundred jobs for new college and university graduates.

Foreign companies often report difficulty finding local skilled labor. Child labor is a problem, particularly in extractive industries. The Decent Work Act guarantees freedom of association and gives employees the right to establish labor unions. Employees can become members of organizations of their own choosing without prior authorization. Workers, except for civil servants and employees of state-owned enterprises, are covered by the Act.  The Act allows workers’ unions to conduct activities without interference by employers. It also prohibits employers from discriminating against employees because of membership in or affiliation with a labor organization. Unions are independent from the government and political parties.  Employees, through their associations or unions, often demand and sometimes strike for better compensation. When company ownership changes, workers sometimes seek payment of obligations owed by previous owners or employers.

The Decent Work Act provides that labor organizations, including trade or employees’ associations, have the right to draw up constitutions and rules regarding electing representatives, organizing activities, and formulating programs.

There were no major labor union-related negotiations affecting workers or the labor market during 2021.

While the law prohibits anti-union discrimination and provides for the reinstatement of workers dismissed because of union activities, it allows for dismissal without cause provided the company pays statutory severance packages. The Decent Work Act sets out fundamental rights of workers and contains provisions on employment and termination of employment, minimum conditions of work, occupational safety and health, workers’ compensation, industrial relations, and employment agencies.  It also provides for periodic reviews of the labor market as well as adjustments in wages as the labor conditions dictate. The government does not waive labor laws to attract or retain investment, but the National Investment Commissions (NIC) provides investment incentives based on economic sectors and geographic areas (see Investment Incentives in section 4 above).

The MOL does not have an adequate or effective inspection system to identify and remedy labor violations and hold violators accountable. It lacks the capacity to effectively investigate and prosecute unfair labor practices, such as harassment or dismissal of union members or instances of forced labor, child labor, and human trafficking.

14. Contact for More Information

U.S. Commercial Service Contact Information
Email:  Monrovia-Commerce@state.gov 
Phone: (+231) 77-677-7000

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 

Morocco

Executive Summary

At the confluence of Europe, Sub-Saharan Africa, and the Middle East, Morocco seeks to transform itself into a regional business hub by leveraging its geographically strategic location, political stability, and world-class infrastructure to expand as a regional manufacturing and export base for international companies. Morocco actively encourages and facilitates foreign investment, particularly in export sectors like manufacturing, through positive macro-economic policies, trade liberalization, investment incentives, and structural reforms. The Government of Morocco implements strategies aimed at boosting employment, attracting foreign investment, and raising performance and output in key revenue-earning sectors, with an emphasis placed on value-added industries such as renewables, automotive, aerospace, textile, pharmaceuticals, outsourcing, and agro-food. Most of the government’s strategies are laid out in the New Development Model released in April of 2021. As part of the Government’s development plan, Morocco continues to make major investments in renewable energy, is on track to meet its stated goal of 64 percent total installed capacity by 2030, and announced an even more ambitious goal of 80 percent by 2050.

According to the United Nations Conference on Trade and Development’s (UNCTAD)  World Investment Report 2021  , Morocco attracted the ninth-most foreign direct investment (FDI) in Africa in 2020. Peaking in 2018 when Morocco attracted $3.6 billion in FDI, inbound FDI dropped by 55 percent to $1.7 billion in 2019 and remained largely unchanged at $1.7 billion in 2020. UAE, France, and Spain hold a majority of FDI stocks. Manufacturing attracted the highest share of FDI stocks, followed by real estate, trade, tourism, and transportation. Morocco continues to orient itself as the “gateway to Africa,” and expanded on this role with its return to the African Union in January 2017 and the launch of the African Continental Free Trade Area (CFTA) which entered into force in 2021. In June 2019, Morocco opened an extension of the Tangier-Med commercial shipping port, making it the largest in Africa and the Mediterranean; the government is developing a third phase for the port which will increase capacity to five million twenty-foot equivalent units (TEUs). Tangier is connected to Morocco’s political capital in Rabat and commercial hub in Casablanca by Africa’s first high-speed train service. But weak intellectual property rights protections, inefficient government bureaucracy, corruption, inadequate money laundering safeguards and the slow pace of regulatory reform remain challenges. In 2021, Morocco was placed on the Financial Action Task Force’s (FATF) “grey list” of countries subjected to increased monitoring due to deficiencies int the fight against money laundering and terrorist financing.

Morocco has ratified 72 investment treaties for the promotion and protection of investments and 62 economic agreements, including with the United States and most EU nations, that aim to eliminate the double taxation of income or gains. Morocco is the only country on the African continent with a Free Trade Agreement (FTA) with the United States, eliminating tariffs on more than 95 percent of qualifying consumer and industrial goods. The Government of Morocco plans to phase out tariffs for some products through 2030. The FTA supports Morocco’s goals to develop as a regional financial and trade hub, providing opportunities for the localization of services and the finishing and re-export of goods to markets in Africa, Europe, and the Middle East. Since the U.S.-Morocco FTA came into effect bilateral trade in goods has grown nearly five-fold. The U.S. and Moroccan governments work closely to increase trade and investment through high-level consultations, bilateral dialogue, and other forums to inform U.S. businesses of investment opportunities and strengthen business-to-business ties.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perception Index 2021 87 of 180 http://www.transparency.org/research/cpi/overview
Global Innovation Index 2021 77 of 132 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2020 $457 https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2020 $3,020 https://data.worldbank.org/indicator/NY.GNP.PCAP.CD

 

1. Openness To, and Restrictions Upon, Foreign Investment

Morocco actively encourages foreign investment through macro-economic policies, trade liberalization, structural reforms, infrastructure improvements, and incentives for investors.  The Investment Charter, Law 18-95 of October 1995, is the current foundational Moroccan text governing investment and applies to both domestic and foreign investment (direct and portfolio). An updated Investment Charter is under development and is expected to significantly expand incentives for foreign investment. The new charter aims to increase the private investment by two-thirds of total investment by 2035, includes additional incentives to draw investment to promising sectors and less favored regions, and provide additional support for the development of strategic industries such as defense and pharmaceuticals. The Ministry of Industry is executing its second Industrial Acceleration Plan (PAI), running from 2021-2025, which aims to build on the progress made in the previous 2014-2020 PAI and expand industrial development throughout all Moroccan regions. The PAI is based on establishing “ecosystems” that integrate value chains and supplier relationships between large companies and small- and medium-sized enterprises. Moroccan legislation governing FDI applies equally to Moroccan and foreign legal entities, except for certain protected sectors.

Morocco’s Investment and Export Development Agency (AMDIE) is the national agency responsible for the development and promotion of investments and exports. Following the reform to law  47-18 governing the country’s Regional Investment Centers (CRIs) in 2019, each of the 12 regions is empowered to lead their own investment promotion efforts. Each of the CRI’s websites aggregate relevant information for interested investors and include investment maps, priority sectors, procedures for creating a business, production costs, applicable laws and regulations, and general business climate information, among other investment services. The websites vary by region, with some functioning better than others. AMDIE and the 12 CRIs work together throughout the phases of investment at the national and regional level. For example, AMDIE and the CRIs coordinate contact between investors and partners. Regional investment commissions examine investment applications and send recommendations to AMDIE. The inter-ministerial investment committee, for which AMDIE acts as the secretariat, approves any investment agreement or contract which requires financial contribution from the government. The CRIs also provide an “after care” service to support investments and assist in resolving issues that may arise.

Over the last year, AMDIE made a significant push to promote international investment into Morocco under its “Morocco Now” branded campaign. Further information about Morocco’s investment laws and procedures is available on AMDIE’s “Morocco Now” website  or through the individual websites of each of the CRIs. For information on agricultural investments, visit the Agricultural Development Agency  website   or the National Agency for the Development of Aquaculture  website .

When Morocco acceded to the OECD Declaration on International Investment and Multinational Enterprises in November 2009, it guaranteed national treatment of foreign investors. The only exception to this national treatment of foreign investors is in those sectors closed to foreign investment (noted below), which Morocco delineated upon accession to the Declaration. The National Contact Point for Responsible Business Conduct (NCP), whose presidency and secretariat are held by AMDIE, is the lead agency responsible for the adherence to this declaration.

Foreign and domestic private entities may establish and own business enterprises, barring certain restrictions by sector. While the U.S. Mission is unaware of any economy-wide limits on foreign ownership, Morocco places a 49 percent cap on foreign investment in air and maritime transport companies and maritime fisheries. Foreigners from cannot own agricultural land, though they can lease it for up to 99 years; however, a new law opening agricultural land to foreign ownership has passed into law and its implementing text is forthcoming. The Moroccan government holds a monopoly on phosphate extraction through the 95 percent state-owned Office Cherifien des Phosphates (OCP). The Moroccan state also has a discretionary right to limit all foreign majority stakes in the capital of large national banks but apparently has never exercised that right. The Moroccan Central Bank (Bank Al-Maghrib) may use regulatory discretion in issuing authorizations for the establishment of domestic and foreign-owned banks. In the oil and gas sector, the National Agency for Hydrocarbons and Mines (ONHYM) retains a compulsory share of 25 percent of any exploration license or development permit. As part of   law  47-18 governing the country’s Regional Investment Centers, a reform mandated the various approval authorities for investment projects be consolidated into one “Unified Regional Commission” which has since turned an approval process which averaged 180 days into a process which takes 30 days or less, and sometimes as little as one business day. The U.S. Mission is not aware of instances in which the Moroccan government refused foreign investors for national security, economic, or other national policy reasons, nor is it aware of any U.S. investors disadvantaged or singled out by ownership or control mechanisms, sector restrictions, or investment screening mechanisms, relative to other foreign investors.

The last third-party investment policy review of Morocco was the  World Trade Organization (WTO) 2016 Trade Policy Review   (TPR), which found that the trade reforms implemented since the prior TPR in 2009 contributed to the economy’s continued growth by stimulating competition in domestic markets, encouraging innovation, creating new jobs, and contributing to growth diversification. Although some civil society organizations have been critical of certain development projects/initiatives, particularly those with environmental or social impacts, Post is unaware of a comprehensive review focused on investment policy concerns.

Prior to its discontinuation of the Doing Business Report, in 2020 the World Bank ranked Morocco 53 out of 190 economies, rising seven places since from the previous report in 2019 and climbing 75 places during the last decade from 128 in 2010. Since 2012, Morocco has implemented reforms that facilitate business registration, such as eliminating the need to file a declaration of business incorporation with the Ministry of Labor, reducing company registration fees, and eliminating minimum capital requirements for limited liability companies. Each of the 12 Regional Investment Centers (CRI) maintains a website which guides investors through the registration process.

Foreign companies may use the online business registration mechanism. Foreign companies, except for French companies, are required to provide an apostilled Arabic translated copy of their articles of association and an extract of the registry of commerce in their country of origin. Moreover, foreign companies must report the incorporation of the subsidiary a posteriori to the Foreign Exchange Office (Office de Changes) to facilitate repatriation of funds abroad such as profits and dividends. According to the World Bank, registering a business in Morocco takes an average of nine days, significantly less than the Middle East and North Africa regional average of 20 days. Morocco does not require that the business owner deposit any paid-in minimum capital.

Following the passing of electronic creation of businesses law  18-17 , the new system went live in 2021, allowing for the creation of businesses online via an electronic platform managed by the Moroccan Office of Industrial and Commercial Property (OMPIC). All procedures related to the creation, registration, and publication of company data can be carried out via this platform. A new national commission will monitor the implementation of the procedures. The Simplification of Administrative Procedures Law 55-19, passed in 2020, aims to streamline administrative processes by identifying and standardizing document requirements, eliminating unnecessary steps, and making the process fully digital via the National Administration Portal , the site launched in 2021 but is currently only available in Arabic.

The business facilitation mechanisms provide for equitable treatment of women and underrepresented minorities in the economy. Notably, according to the World Bank, the procedure, length of time, and cost to register a new business is equal for men and women in Morocco. The U.S. Mission is unaware of any official assistance provided to women and underrepresented minorities through the business registration mechanisms. In cooperation with the Moroccan government, civil society, and the private sector, there have been several initiatives aimed at improving gender equality in the workplace and access to the workplace for foreign migrants, particularly those from sub-Saharan Africa.

The Government of Morocco prioritizes investment in Africa as part of its strategy to expand its commercial and trade connections throughout the continent and secure its self-proclaimed title of “Gateway to Africa”. The African Development Bank ranks Morocco as the second biggest African investor in Sub-Saharan Africa, after South Africa, and the largest African investor in West Africa. OCP Africa, a subsidiary of Morocco’s state-owned phosphate giant OCP, has presence in 16 African countries and continues to invest in infrastructure supporting its phosphate exports. According to Morocco’s Office of Exchange, under the supervision of Minister of Economy and Finance, $808 million, or 43 percent of Morocco’s total outward FDI, was invested in the African continent in 2021. The U.S. Mission is not aware of a standalone outward investment promotion agency, although AMDIE’s mission includes supporting Moroccans seeking to invest outside of the country for the purpose of boosting Moroccan exports. Nor is the U.S. Mission aware of any restrictions for domestic investors attempting to invest abroad. However, under the Moroccan investment code, repatriation of funds is limited to “convertible” Moroccan Dirham accounts. Morocco’s Foreign Exchange Office (“Office des Changes,” OC) implemented several changes for 2022 that liberalize the country’s foreign exchange regulations. Moroccans going abroad for tourism can now exchange up to $10,000 in foreign currency per year, with the possibility to attain further allowances indexed at 30 percent of income tax filings with a maximum cap of $30,000. Business travelers can also obtain larger amounts of foreign currency, provided their company has properly filed and paid corporate income taxes. Another new provision permits banks to use foreign currency accounts to finance investments in Morocco’s Industrial Acceleration Zones.

3. Legal Regime

Morocco is a constitutional monarchy with an elected parliament and a mixed legal system of civil law based primarily on French law, with some influences from Islamic law. Legislative acts are subject to judicial review by the Constitutional Court excluding royal decrees (Dahirs) issued by the King, which have the force of law. Legislative power in Morocco is vested in both the government and the two chambers of Parliament, the Chamber of Representatives (Majlis Al-Nuwab) and the Chamber of Councilors (Majlis Al Mustashareen). The principal sources of commercial legislation in Morocco are the Code of Obligations and Contracts of 1913 and Law No. 15-95 establishing the Commercial Code. The Competition Council and the National Authority for Detecting, Preventing, and Fighting Corruption (INPPLC) have responsibility for improving public governance and advocating for further market liberalization. All levels of regulations exist (local, state, national, and supra-national). The most relevant regulations for foreign businesses depend on the sector in question. Ministries develop their own regulations and draft laws, including those related to investment, through their administrative departments, with approval by the respective minister. Each regulation and draft law is made available for public comment. Key regulatory actions are published in their entirety in Arabic and usually French in the official bulletin on the  website   of the General Secretariat of the Government. Once published, the law is final. Public enterprises and establishments can adopt their own specific regulations provided they comply with regulations regarding competition and transparency.

Morocco’s regulatory enforcement mechanisms depend on the sector in question; enforcement is legally reviewable, and made publicly available via the different agencies’ websites. The National Telecommunications Regulatory Agency (ANRT), for example, is the public body responsible for the control and regulation of the telecommunications sector. The agency regulates telecommunications by participating in the development of the legislative and regulatory framework. Morocco does not have specific regulatory impact assessment guidelines, nor are impact assessments required by law. Morocco does not have a specialized government body tasked with reviewing and monitoring regulatory impact assessments conducted by other individual agencies or government bodies.

The U.S. Mission is not aware of any informal regulatory processes managed by nongovernmental organizations or private sector associations. The Moroccan Ministry of Finance  posts quarterly statistics    (compiled in accordance with IMF recommendations) on public finance and debt on their website. A  report on public debt  is published on the Ministry of Economy and Finance’s website and is used as part of the budget bill formulation and voting processes. The fiscal year 2022 debt report was published on December 20, 2021.

Morocco joined the WTO in 1995 and reports technical regulations that could affect trade with other member countries to the WTO. Morocco is a signatory to the  Trade Facilitation Agreement   and has a 91.2 percent implementation rate of TFA requirements. European standards are widely referenced in Morocco’s regulatory system. In some cases, U.S. or international standards, guidelines, and recommendations are also accepted.

The Moroccan legal system is a hybrid of civil law (French system) and some Islamic law, regulated by the Decree of Obligations and Contracts of 1913 as amended, the 1996 Code of Commerce, and Law No. 53-95 on Commercial Courts. These courts also have sole competence to entertain industrial property disputes, as provided for in Law No. 17-97 on the Protection of Industrial Property, irrespective of the legal status of the parties. According to the European Bank for Reconstruction and Development’s 2015 Morocco Commercial Law Assessment Report , Royal Decree No. 1-97-65 (1997) established commercial court jurisdiction over commercial cases including insolvency. Although this led to some improvement in the handling of commercial disputes, the lack of training for judges on general commercial matters remains a key challenge to effective commercial dispute resolution in the country. In general, litigation procedures are time consuming and resource-intensive, and there is no legal requirement with respect to case publishing. Disputes may be brought before one of eight Commercial Courts located in Morocco’s main cities and one of three Commercial Courts of Appeal located in Casablanca, Fes, and Marrakech. There are other special courts such as the Military and Administrative Courts. Title VII of the Constitution provides that the judiciary shall be independent from the legislative and executive branches of government. The 2011 Constitution also authorized the creation of the Supreme Judicial Council, headed by the King, which has the authority to hire, dismiss, and promote judges. Enforcement actions are appealable at the Courts of Appeal, which hear appeals against decisions from the court of first instance.

The principal source of investment legislation in Morocco is Law No. 18-95 that established the 1995 Investment Charter. An updated Investment charter is under development and is expected to go into effect in 2022 Morocco’s CRIs and AMDIE provide users with investment-related information on laws and regulations, both general and specific to various industry sectors and geographic jurisdictions along with procedural information, calls for tenders, and additional resources for business creation. Each CRI hosts a website that is meant to act as an entry point to their “one-stop-shop” services that guide investors through the investment process. These websites have improved significantly and are regularly updated.

Morocco’s Competition Law No. 06-99 on Free Pricing and Competition outlines the authority of the  Competition Council   as an independent executive body with investigatory powers. Together with the INPPLC, the Competition Council is one of the main actors charged with improving public governance and advocating for further market liberalization. Law No. 20-13, adopted on August 7, 2014, amended the powers of the Competition Council to bring them in line with the 2011 Constitution. The Competition Council’s responsibilities include making decisions on anti-competition practices and controlling concentrations, with powers of investigation and sanction; providing opinions in official consultations by government authorities; and publishing reviews and studies on the state of competition. In January 2022, the Competition Council published a legal compliance guide , in partnership with the Moroccan Employers Association, to provide additional guidance for companies and professional organizations in establishing a competition law compliance program. In February 2022, Tangier-based Moroccan Association of Transport and Logistics (AMTL), a labor union, called on transport professionals to raise transport fees by 20 percent, citing the rise in diesel prices. Soon after, Morocco’s Competition Council announced an investigation. Under Morocco’s liberal market laws, prices are determined according to offer and demand principles, and no single entity holds the right to fix market prices. At the same time that the AMTL issued the memo, Morocco’s government stepped into open dialogue with labor unions, causing the AMTL to retract their memo.

Following reported mishandling of an investigation into the alleged collusion by oil distribution companies in 2020, King Mohammed VI convened an ad hoc committee to investigate the Competition Council’s dysfunctions. In March 2021, the king appointed a new council president, and parliament adopted a new bill strengthening the Competition Council by improving its legal framework and increasing transparency.

Expropriation may only occur in the public interest for public use by a state entity, although in the past, private entities that are public service “concessionaires,” mixed economy companies, or general interest companies have also been granted expropriation rights. Article 3 of Law No. 7-81 (May 1982) on expropriation, the associated Royal Decree of May 6, 1982, and Decree No. 2-82-328 of April 16, 1983, regulate government authority to expropriate property. The process of expropriation has two phases: in the administrative phase, the State declares public interest in expropriating specific land and verifies ownership, titles, and appraised value of the land. If the State and owner can come to agreement on the value, the expropriation is complete. If the owner appeals, the judicial phase begins, whereby the property is taken, a judge oversees the transfer of the property, and payment compensation is made to the owner based on the judgment. The U.S. Mission is not aware of any recent, confirmed instances of private property being expropriated for other than public purposes (eminent domain), or in a manner that is discriminatory or not in accordance with established principles of international law.

ICSID Convention and New York Convention

Morocco is a member of the International Center for Settlement of Investment Disputes (ICSID) and signed its convention in June 1967. Morocco is a party to the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards. Law No. 08-05 provides for enforcement of awards made under these conventions.

Investor-State Dispute Settlement

Morocco is signatory to over 70 bilateral treaties recognizing binding international arbitration of trade disputes, including one with the United States. Law No. 08-05 established a system of conventional arbitration and mediation, while allowing parties to apply the Code of Civil Procedure in their dispute resolution. Foreign investors commonly rely on international arbitration to resolve contractual disputes. Commercial courts recognize and enforce foreign arbitration awards. Generally, investor rights are backed by a transparent, impartial procedure for dispute settlement. There have been no claims brought by foreign investors under the investment chapter of the U.S.-Morocco Free Trade Agreement since it came into effect in 2006. The U.S. Mission is not aware of any investment disputes over the last year involving U.S. investors.

Morocco officially recognizes foreign arbitration awards issued against the government. Domestic arbitration awards are also enforceable subject to an enforcement order issued by the President of the Commercial Court, who verifies that no elements of the award violate public order or the defense rights of the parties. As Morocco is a member of the New York Convention, international awards are also enforceable in accordance with the provisions of the convention. Morocco is also a member of the Washington Convention for the International Centre for Settlement of Investment Disputes (ICSID), and as such agrees to enforce and uphold ICSID arbitral awards. The U.S. Mission is not aware of extrajudicial action against foreign investors.

International Commercial Arbitration and Foreign Courts

Morocco has a national commission on Alternative Dispute Resolution with a mandate to regulate mediation training centers and develop mediator certification systems. Morocco seeks to position itself as a regional center for arbitration in Africa, but the capacity of local courts remains a limiting factor. To remedy this shortcoming, the Moroccan government established the Center of Arbitration and Mediation in Rabat, and the Casablanca Finance City Authority established the Casablanca International Mediation and Arbitration Center, which now see a majority of investment disputes. The U.S. Mission is aware of several investment and commercial disputes and has advocated on behalf of U.S. companies to resolve the disputes.

Morocco’s bankruptcy law is based on French law. Commercial courts have jurisdiction over all cases related to insolvency, as set forth in Royal Decree No. 1-97-65 (1997). The Commercial Court in the debtor’s place of business holds jurisdiction in insolvency cases. The law gives secured debtors priority claim on assets and proceeds over unsecured debtors, who in turn have priority over equity shareholders. Bankruptcy is not criminalized. The World Bank’s 2020 Doing Business report ranked Morocco 73 out of 190 economies in “Resolving Insolvency”. The GOM revised the national insolvency code in March of 2018, but further reform is needed.

4. Industrial Policies

As set out in the Investment Code, Morocco offers incentives designed to encourage foreign and local investment. Morocco’s exisiting Investment Charter gives the same benefits to all investors regardless of the industry in which they operate (except agriculture and phosphates, which remain outside the scope of the Charter). Post is unaware of any special incentives designated for businesses owned by underrepresented investors. With respect to agricultural incentives, Morocco’s Green Generation 2020-2030   plan aims to improve the competitiveness of the agribusiness industry by supporting value chains and making the industry more resilient and environmentally sound. Agricultural companies with revenues exceeding $500,000 qualify for a lower corporate tax rate of 20 percent.

The Moroccan government launched its “investment reform plan” in 2016 to create a favorable environment for the private sector to drive growth. The plan includes the adoption of investment incentives to support the industrial ecosystem, tax and customs advantages to support investors and new investment projects, import duty exemptions, and a value added tax (VAT) exemption. Special VAT exemptions are available for medical products and vaccines and products/materials related to solar panel production. AMDIE’s website  has more details on investment incentives, but generally these incentives are based on sectoral priorities (automotive, aerospace, textile, agro-food industry, pharmaceuticals, outsourcing). Investments of $5 million or above qualify for government subsidies of land cost (20 percent), external infrastructure costs (5 percent), and training costs (20 percent).

The Moroccan Government offers several guarantee funds and sources of financing for investment projects to both Moroccan and foreign investors. For example, the Caisse Centrale de Garantie (CCG), a public finance institution, offers co-financing, equity financing, and guarantees.

Beyond tax exemptions granted under ordinary law, Moroccan regulations provide specific advantages for investors with investment agreements or contracts with the Moroccan Government if they meet the required criteria. These advantages include subsidies for certain expenses related to investment through the Industrial Development and Investment Fund subsidies of certain expenses for the promotion of investment in specific industrial sectors and the development of new technologies through the Hassan II Fund for Economic and Social Development, exemption from customs duties within the framework of Article 7.I of the Finance Law 12-98, and exemption from the Value Added Tax (VAT) on imports and domestic sales.

Morocco has several free zones offering companies incentives such as tax breaks, subsidies, and reduced customs duties. These zones aim to attract investment by companies seeking to export products from Morocco. As part of a government-wide strategy to strengthen its position as an African financial hub, Morocco offers incentives for firms that locate their regional headquarters in Morocco at Casablanca Finance City (CFC), Morocco’s flagship financial and business hub launched in 2010. For details on CFC eligibility, see CFC’s website .

In 2021, Morocco was removed from the European Union’s list of non-cooperative jurisdictions for tax purposes (the so-called “EU Tax Haven Grey List”, not to be confused with FATF AML/CFT grey list), after amending some tax policy measures deemed as potentially harmful based on the tax advantages offered to export companies, companies operating in free zones, and CFC. To enhance its competitiveness and investment attractiveness and to be aligned with international best practices, Morocco’s 2020 budget law transformed the country’s free zones into “Industrial Acceleration Zones” with a 15 percent corporate tax rate following an initial five years of exemption, compared to a previous corporate tax rate of 8.75 percent over 20 years. The zones also allow for flat 20 percent income tax applicable for all employees working within the zone, much lower than the graduated income tax which can reach up to 38 percent. Additionally, the Moroccan government also offers a VAT exemption for investors using and importing equipment goods, materials, and tools needed to achieve investment projects whose value is at least $20 million. Similarly, the CFC regime provides companies holding CFC status a tax benefit exemption for five years followed by a reduced rate of 15 percent (compared to a rate of 31 percent). It applies to financial services (such as investment services and holding companies) and non-financial services activities (such as advisory and regional headquarters and distribution centers). The CFC regime is open to both Moroccan and foreign companies and provides the same tax benefits.

The Moroccan government views foreign investment as an important vehicle for creating local employment. Visa issuance for foreign employees is contingent upon a company’s inability to find a qualified local employee for a specific position and can only be issued after the company has verified the unavailability of such an employee with the National Agency for the Promotion of Employment and Competency (ANAPEC). If these conditions are met, the Moroccan government allows the hiring of foreign employees, including for senior management. The process for obtaining and renewing visas and work permits can be onerous and may take up to six months, except for CFC members, where the processing time is reportedly one week.

Although there is no formal requirement to use domestic content in goods or technology, the government has announced its intent to pursue an import-substitution policy as part of its COVID-19-related industrial recovery plan and has amended its finance law to increase custom duties on finished products coming from non-FTA countries. Additionally, the plan established a special industrial project bank with the goal of supporting projects in 11 target sectors.

The WTO Trade Related Investment Measures’ (TRIMs) database does not indicate any reported Moroccan measures that are inconsistent with TRIMs requirements. Though not required, tenders in some industries, including solar and wind energy, are written with targets for local content percentages. Both performance requirements and investment incentives are uniformly applied to both domestic and foreign investors depending on the size of the investment.

The Moroccan Data Protection Act (Act 09-08 ) stipulates that data controllers may only transfer data if a foreign nation ensures an adequate level of protection of privacy and fundamental rights and freedoms of individuals with regard to the treatment of their personal data. Morocco’s National Data Protection Commission (CNDP) defines the exceptions according to Moroccan law. Local regulation requires the release of source code for certain telecommunications hardware products. However, the U.S. Mission is not aware of any Moroccan government requirement that foreign IT companies should allow the Moroccan government to review or have backdoor access to their source-code or systems.

5. Protection of Property Rights

Morocco permits foreign individuals and foreign companies to own land, except agricultural land. Passed in 2021 Land Reform bill 62-19, which will open rural land acquisition to joint ventures and limited partnerships, is awaiting the publication of regulatory texts. Foreigners may acquire agricultural land to carry out an investment or other economic project that is not agricultural in nature, subject to first obtaining a certificate of non-agricultural use from the authorities. Morocco has a formal registration system maintained by the National Agency for Real Estate Conservation, Property Registries, and Cartography (ANCFCC), which issues titles of land ownership.

Approximately 30 percent of land is registered in the formal system, and almost all of that is in urban areas. In addition to the formal registration system, there are customary documents called moulkiya issued by traditional notaries called adouls. While not providing the same level of certainty as a title, a moulkiya can provide some level of security of ownership. Morocco also recognizes prescriptive rights whereby an occupant of a land under the moulkiya system (not lands duly registered with ANCFCC) can establish ownership of that land upon fulfillment of all the legal requirements, including occupation of the land for a certain period (10 years if the occupant and the landlord are not related and 40 years if the occupant is a family member). There are other specific legal regimes applicable to some types of lands, including:

  1. Collective lands: lands which are owned collectively by some tribes, whose members only benefit from rights of usufruct;
  2. Public lands: lands which are owned by the Moroccan State;
  3. Guich lands: lands which are owned by the Moroccan State, but whose usufruct rights are vested upon some tribes;
  4. Habous lands: lands which are owned by a party (the State, a certain family, a religious or charity organization, etc.) subsequent to a donation, and the usufruct rights of which are vested upon such party (usually with the obligation to allocate the proceeds to a specific use or to use the property in a certain way).

Morocco’s rating for “Registering Property” dropped in 2020 by 13 places, resulting in a ranking of 81 out of 190 countries worldwide in the World Bank’s Doing Business 2020 report in this category. Despite reducing the time it takes to obtain a non-encumbrance certificate, Morocco made property registration less transparent by not publishing statistics on the number of property transactions and land disputes for the previous calendar year, resulting in a lower score than in 2019.

The Ministry of Industry and Trade oversees the Moroccan Office of Industrial and Commercial Property (OMPIC), which serves as a registry for patents and trademarks in the industrial and commercial sectors. The Ministry of Youth, Culture, and Communication oversees the Moroccan Copyright Office (BMDA), which registers copyrights for literary and artistic works (including software), enforces copyright protection, and coordinates with Moroccan and international partners to combat piracy.

In 2020, OMPIC launched its second strategic plan, Strategic Vision 2025, following the conclusion of its 2016-2020 strategic plan. The new 2025 plan has three pillars: the creation of an environment conducive to entrepreneurship, creativity, and innovation; the establishment of an effective system for the protection and defense of intellectual property rights; and the implementation of economic and regional actions to enhance intangible assets and market-oriented research and development. In 2016 OMPIC partnered with the European Patent Office (EPO) and developed an agreement  for validating European patents in Morocco, and now receives roughly 80 percent of total applications via this channel. In 2021 OMPIC was certified to classify technical documents using the Cooperative Patent Classification, an extension of the International Patent Classification program which is jointly managed by the EPO and the U.S. Patent and Trademark Office. In 2021, OMPIC recorded more than 14,000 applications, a 24 percent increase from the previous year, and now exceeds pre-pandemic levels.

In 2016, the Ministry of Communication and the World Intellectual Property Organization (WIPO) signed an MOU to expand cooperation to ensure the protection of intellectual property rights in Morocco. The memorandum committed both parties to improving the judicial and operational dimensions of Morocco’s copyright enforcement, including the launch of WIPOCOS, a WIPO-developed database for collective royalty management organizations or societies.

Law No. 23-13 on Intellectual Property Rights increased penalties for violation of those rights and better defined civil and criminal jurisdiction and legal remedies. It also set in motion an accreditation system for patent attorneys to better systematize and regulate the practice of patent law. Law No. 34-05, amending and supplementing Law No. 2-00 on Copyright and Related Rights, includes 15 items (Articles 61 to 65) devoted to punitive measures against piracy and other copyright offenses. These range from civil and criminal penalties to the seizure and destruction of seized copies. Judges’ authority in sentencing and criminal procedures is proscribed, with little power to issue harsher sentences that would serve as stronger deterrents.

Moroccan authorities continue to express a commitment to cracking down on all types of counterfeiting, but due to resource constraints, only focus enforcement efforts on the most problematic areas, specifically those with public safety and/or significant economic impacts. In 2019, the Customs and Indirect Tax Administration (ADII) seized 700,000 items and received 689 requests to stop the sale of counterfeit goods.

In 2015, Morocco and the European Union concluded an agreement on the protection of Geographic Indications (GIs), which is pending ratification by both the Moroccan and European parliaments. Should it enter into force, the agreement would grant Moroccan GIs sui generis, which is especially relevant as it is a prominent element of its Green Generation 2020-2030 agricultural development plan. The U.S. government continues to urge Morocco to pursue a transparent and substantive assessment process for the EU GIs in a manner consistent with Morocco’s existing obligations, including those under the U.S.-Morocco Free Trade Agreement.

Morocco is not listed in USTR’s most recent Special 301 Report or 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/. For assistance, please refer to the U.S. Embassy local lawyers’ list, as well as to the regional U.S. IP Attaché.

Resources for Intellectual Property Rights Holders:

Peter MehravariPatent AttorneyIntellectual Property Attaché for the Middle East & North AfricaU.S. Embassy Abu Dhabi | U.S. Department of Commerce U.S. Patent & Trademark OfficeTel: +965 2259 1455

Peter.Mehravari@trade.gov

6. Financial Sector

Morocco encourages foreign portfolio investment and Moroccan legislation applies equally to Moroccan and foreign legal entities and to both domestic and foreign portfolio investment. The Casablanca Stock Exchange (CSE), founded in 1929 and re-launched as a private institution in 1993, is one of the few exchanges in the region with no restrictions on foreign participation. The CSE is regulated by the Moroccan Capital Markets Authority. Local and foreign investors have identical tax exposure on dividends (10 percent) and pay no capital gains tax. With a market capitalization of around $68 billion and 75 listed companies, CSE is the second largest exchange in Africa (after the Johannesburg Stock Exchange). Nonetheless, the CSE saw only 10 new listings between 2012-2022. There was only one new initial public offering (IPO) in 2021. Short selling, which could provide liquidity to the market, is not permitted. The Moroccan government initiated the Futures Market Act (Act 42-12) in 2015 to define the institutional framework of the futures market in Morocco and the role of the regulatory and supervisory authorities. As of March 2022, futures trading was still pending implementation and is not expected to commence until 2023.

The Casablanca Stock Exchange demutualized in November of 2015. This change allowed the CSE greater flexibility and more access to global markets, and better positioned it as an integrated financial hub for the region. The Moroccan government holds a 25 percent share of the CSE but has announced its desire to sell to another major exchange to bring additional capital and expertise to the market. Morocco has accepted the obligations of IMF Article VIII, sections 2(a), 3, and 4, and its exchange system is free of restrictions on making payments and transfers on current international transactions. Credit is allocated on market terms, and foreign investors are able to obtain credit on the local market.

Morocco has a well-developed banking sector, where penetration is rising rapidly and recent improvements in macroeconomic fundamentals have helped resolve previous liquidity shortages. Morocco has some of Africa’s largest banks, and several are major players on the continent and continue to expand their footprint. The sector has several large, homegrown institutions with international footprints, as well as several subsidiaries of foreign banks. According to Bank Al-Maghrib (the Moroccan central bank) there are 24 banks operating in Morocco (five of which are Islamic “participatory” banks), six offshore institutions, 27 finance companies, 12 micro-credit associations, and 20 intermediary companies operating in funds transfer. Among the 19 traditional banks, the top seven banks comprise 90 percent of the system’s assets (including both on- and off-balance-sheet items). Attijariwafa, Morocco’s largest bank, is the sixth largest bank in Africa by total assets (approximately $63 billion in December 2021) and operates in 25 countries, most of which are in sub-Saharan Africa. Al Mada, the Moroccan royal family holding company is the largest shareholder holding 47 percent of the company’s stock. Foreign (mainly French) financial institutions are majority stakeholders in seven banks and nine finance companies. Moroccan banks have built up their presence overseas mainly through the acquisition of local banks, thus local deposits largely fund their subsidiaries.

The overall strength of the banking sector has grown significantly in recent years. Since financial liberalization, credit is allocated freely and Bank Al-Maghrib has used indirect methods to control the interest rate and volume of credit. According to the World Bank, only 41 percent of Moroccan adults use formal financial products or services, leaving significant opportunities remaining for firms pursuing rural and less affluent segments of the market. At the start of 2017, Bank Al-Maghrib approved five requests to open Islamic banks in the country. By mid-2018, over 80 branches specializing in Islamic banking services were operating in Morocco. The first Islamic bonds (sukuk) were issued in October 2018. In 2019, Islamic banks in Morocco granted $930 million in financing. The GOM passed a law authorizing Islamic insurance products (takaful) in 2019, which became commercially available in early 2022.

Following an upward trend beginning in 2012, the ratio of non-performing loans (NPL) to bank credit stabilized in 2017 through 2019 at 7.6 percent. COVID-related complications caused the NPL rate to jump to 9.9 percent in the end of 2020 but it had partially recovered to 8.4 percent in January 2022.

Morocco’s accounting, legal, and regulatory procedures are transparent and consistent with international norms. Morocco is a member of UNCTAD’s international network of transparent investment procedures. Bank Al-Maghrib is responsible for issuing accounting standards for banks and financial institutions.  Bank Al Maghrib  requires that all entities under its supervision use International Financial Reporting Standards (IFRS). The Securities Commission is responsible for issuing financial reporting and accounting standards for public companies. Moroccan Stock Exchange Law ( Law 52-01  ) stipulates that all companies listed on the Casablanca Stock Exchange (CSE), other than banks and similar financial institutions, can choose between IFRS and Moroccan Generally Accepted Accounting Principles (GAAP). In practice, most public companies use IFRS.

Legal provisions regulating the banking sector include Law No. 76-03 on the Charter of Bank Al-Maghrib, which created an independent board of directors and prohibits the Ministry of Finance and Economy from borrowing from the Central Bank except under exceptional circumstances. Even with the financial crisis caused by COVID-19, the central bank did not provide financing directly to the state, but instead used other monetary tools (such as reducing reserve requirements) to intervene and reinforce the banking sector. Law No. 34-03 (2006) reinforced the supervisory authority of Bank Al-Maghrib over the activities of credit institutions. Law No. 51-20, passed in 2021, aims to further the strengthen the financial systems by reinforcing the supervision of financial conglomerates, improving interest rate targeting to protect consumers while, at the same time, increasing financial inclusion, and providing enhanced privacy protections. Foreign banks and branches are allowed to establish operations in Morocco and are subject to provisions regulating the banking sector. At present, the U.S. Mission is not aware of Morocco losing correspondent banking relationships.

There are no restrictions on foreigners’ abilities to establish bank accounts. However, foreigners who wish to establish a bank account are required to open a “convertible” account with foreign currency. The account holder may only deposit foreign currency into that account; at no time can they deposit dirhams. There are anecdotal reports that Moroccan banks have closed accounts without giving appropriate warning and that it has been difficult for some foreigners to open bank accounts.

A Crowdfunding law (15-18) was passed into law in 2021, establishing a legal regulatory and legal framework for collaborative financing. The law aims to increase the financial inclusion by providing new source of financing to entrepreneurs. Morocco prohibits the use of cryptocurrencies, noting that they carry significant risks that may lead to penalties. Notwithstanding the current ban, Bitcoin trading in Morocco is among the highest in North Africa, with an estimated 2.4 percent of the population owning the cryptocurrency.

Foreign Exchange

The income from foreign investments financed in foreign currency can be transferred tax-free, without amount or duration limits. This income can be dividends, attendance fees, rental income, benefits, and interest. Capital contributions made in convertible currency, contributions made by debit of forward convertible accounts, and net transfer capital gains may also be repatriated. For the transfer of dividends, bonuses, or benefit shares, the investor must provide balance sheets and profit and loss statements, annexed documents relating to the fiscal year in which the transfer is requested, as well as the statement of extra-accounting adjustments made to obtain the taxable income.

A currency-convertibility regime is available to foreign investors, including Moroccans living abroad, who invest in Morocco. This regime facilitates their investments in Morocco, repatriation of income, and profits on investments. Morocco guarantees full currency convertibility for capital transactions, free transfer of profits, and free repatriation of invested capital, when such investment is governed by the convertibility arrangement. Generally, the investors must notify the government of the investment transaction, providing the necessary legal and financial documentation. With respect to the cross-border transfer of investment proceeds to foreign investors, the rules vary depending on the type of investment. Investors may import freely without any value limits to traveler’s checks, bank or postal checks, letters of credit, payment cards or any other means of payment denominated in foreign currency. For cash and/or negotiable instruments in bearer form with a value equal to or greater than 100,000 Moroccan Dirham, importers must file a declaration with Moroccan Customs at the port of entry. Declarations are available at all border crossings, ports, and airports.

Morocco has achieved relatively stable macroeconomic and financial conditions under an exchange rate peg (60/40 Euro/Dollar split), which has helped achieve price stability and insulated the economy from nominal shocks. In March of 2020, the Moroccan Ministry of Economy, Finance, and Administrative Reform, in consultation with the Central Bank, adopted a new exchange regime in which the Moroccan dirham may now fluctuate within a band of ± 5 percent compared to the Bank’s central rate (peg). The change loosened the fluctuation band from its previous ± 2.5 percent. The change is designed to strengthen the capacity of the Moroccan economy to absorb external shocks, support its competitiveness, and contribute to improving growth.

Remittance Policies

Amounts received from abroad must pass through a convertible dirham account. This type of account facilitates investment transactions in Morocco and guarantees the transfer of proceeds for the investment, as well as the repatriation of the proceeds and the capital gains from any resale. AMDIE recommends that investors open a convertible account in dirhams on arrival in Morocco to quickly access the funds necessary for notarial transactions.

Ithmar Capital is Morocco’s investment fund and financial vehicle, which aims to support the national sectorial strategies. Ithmar Capital is a full member of the International Forum of Sovereign Wealth Funds and follows the Santiago Principles. The $1.8 billion fund was launched in 2011 by the Moroccan government, supported by the royal Hassan II Fund for Economic and Social Development. This fund initially supported the government’s long-term Vision 2020 strategic plan for tourism and has several large-scale development projects under development. The fund is currently part of the long-term development plan initiated by the government in multiple economic sectors.

8. Responsible Business Conduct

Responsible business conduct (RBC) has gained strength in the broader business community in tandem with Morocco’s economic expansion and stability. The Moroccan government does not have any regulations requiring companies to practice RBC nor does it give any preference to such companies. However, companies generally inform Moroccan authorities of their planned RBC involvement. Morocco joined the UN Global Compact network in 2006 and in 2022 counts 24 private company as signatories, including the Confederation General des Entreprises du Maroc (CGEM), Morocco’s largest private sector lobbying group that represents more than 90,000 private companies. The Compact provides support to companies that affirm their commitment to social responsibility. While there is no legislation mandating specific levels of RBC, foreign firms and some local enterprises follow generally accepted principles, such as the OECD RBC guidelines for multinational companies. NGOs and Morocco’s active civil society are also taking an increasingly active role in monitoring corporations’ RBC performance. In 2017 a non-governmental National Observatory for RBC (ORSEM) was created with the objective of promoting responsible business practices, and in 2021, in collaboration with AtlantaSanad Assurance, a Moroccan insurance company, published its first corporate social responsibility guide. Morocco does not currently participate in the Extractive Industries Transparency Initiative (EITI) or the Voluntary Principles on Security and Human Rights, though it has held some consultations aimed at eventually joining EITI. No domestic transparency measures exist that require disclosure of payments made to governments. There have not been any cases of high-profile instances of private sector impact on human rights in the recent past. Morocco is not a signatory of the Montreux Document on Private Military and Security Companies, and Post is unaware of any private military companies operating in the country.

Department of State

Department of the Treasury

Department of Labor

As part of its development strategy, outlined within the New Development Model, the Kingdom of Morocco seeks to ensure that new economic initiatives consider any environmental, economic, or social impacts and strengthen the sustainable management of natural resources and generally promote environmentally friendly economic activities. Following its commitments at past international environmental conventions, Morocco progressed in this area by implementing political, economic, and legal reforms. At the UN Climate Change Conference in Glasgow in 2021 (COP26), Morocco signed on to several climate-change commitments, including the U.S.-led Global Methane Pledge to reduce overall methane emissions by 30 percent (from 2020 levels) by 2030. Morocco has also signed on to the Global Green Growth Initiative (GGGI), which supports the Moroccan government’s commitment to transition to a green economy, one of the pillars of the country’s National Sustainable Development Strategy (NSDS). In June 2021, Morocco was one of the few countries in the world that submitted a revised Nationally Defined Contribution (NDC) to greenhouse gas reductions, strengthening the Kingdom’s 2030 target by revising overall 2030 emissions targets to be more ambitious, from 17 percent to 18.3 percent. Morocco has tied economic development planning to climate action. As part of the New Development Model announced in 2021, environmental protection, the development of green economies and industries, and the preservation and more rigorous management of its limited water sources are given utmost importance, constituting two of the Model’s five pillars.

Through Morocco’s 2008 Plan Vert and subsequent Green Generation 2020-2030 national strategies, the government committed to increasing energy production using renewables, removing subsidies on fossil fuels, expanding employment in sustainable industries, and improving the management of its water and ocean resources. Through numerous solar and wind renewable energy projects, Morocco is pursuing an ambitious goal to generate 64 percent of its electricity needs from renewables and is expected to meet that goal by 2030. Ranking as the 22nd most water-scarce country in 2019 by the World Resource Institute, the Moroccan Government directed significant resources over the past five years to managing the country’s water resources, earmarking $12 billion in 2020 for a seven-year program that will focus on building dams to increase water storage capacity, improving water consumption, preserving water resources, and increasing water supply in rural areas. Morocco ranked 26 out of 76 leading countries in MIT’s Green Future Index, and 2nd in Global Green Growth Institute’s Global Green Growth Index for the African region.

In 2021 Morocco launched a “Green Economy War Room” in its capital city, Rabat, as a collaboration between the Moroccan Agency for Energy Efficiency (AMEE) and the Ministry of Industry, Trade, and the Digital and Green Economy. The creation of the center intends to support over 150 different investment projects to maintain and boost Morocco’s pivot toward a model of a sustainable green economy.

A law proposed by the National Regulatory Authority for Electricity (ANRE), which builds off of Morocco’s Renewable Energy law 13-09, is currently undergoing public comment. The law will allow ANRE to monitor and control access to the national transmission and distribution grid, with the ultimate purpose of authorizing independent power producers to inject renewable energy into the national grid. The law is an important step forward, paving the way for increased uptake and use of low-carbon renewable energies within the Moroccan electricity grid. The law will also allow the Moroccan regulator the ability to oversee the national grid’s interconnections with foreign transmission grids, thereby allowing Morocco the ability to support other countries’ transition to lower carbon energy solutions. This law will be instrumental in the future development of the Moroccan renewable energy sector and further increase its attractiveness for private investors, support Morocco’s ambitions of greater regional integration, and provide a platform for other low carbon initiatives, such as electric vehicles and smart grid systems, to build from.

To further reduce emissions, Morocco aspires to be a global leader in the future industrial production, domestic consumption, and export of green hydrogen fuel. Morocco’s aspirations are tied to its renewable energy potential and proximity to existing energy connections with Europe and Africa. The Ministry of Energy Transition has accelerated the “ National Strategy for Green Hydrogen,” originally announced in August 2021, with a goal to capture up to four percent of the global green hydrogen market through 2050. In 2022, the Ministry launched a “GreenH2 Morocco” initiative to bring together public and private sector players in the field to prepare an appropriate regulatory framework. The International Renewable Energy Agency (IRENA) signed an agreement with the Government of Morocco in 2021 to advance technical research and development (R&D) in green hydrogen and build a suitable regulatory development. Prospects for the green hydrogen sector in Morocco are promising as the initial source of manufacturing energy, solar and wind, are plentiful, and the country already has extensive export connections for green products with Europe – a significant buyer of green energy. While several national initiatives are in the works to set the stage for Morocco to become a global leader in green hydrogen, success remains dependent on future engineering innovations, market maturity, and the establishment of an international business and regulatory environment capable of facilitating trade and developing necessary investment.”

9. Corruption

In February 2021, Morocco was placed on the Financial Action Task Force’s (FATF’s) “grey list” of countries of concern regarding money laundering and terrorist financing. Following the grey list designation, Morocco made a high-level commitment to work with the FATF and Middle East and North Africa FATF to strengthen the effectiveness of its Anti-Money Laundering (AML) and Combating Financing of Terrorism (CFT) regime. Morocco has taken steps towards improving its AML/CFT regime, including passing new AML legislation, but significant challenges remain.

In Transparency International’s 2021 Corruption Perceptions Index  , Morocco’s score dropped by one point causing its ranking to fall one additional position to 87th out of 180 countries. According to the State Department’s 2020 Country Report on Human Rights Practices, Moroccan law provides criminal penalties for corruption by officials, but the government generally did not implement the law effectively. Officials sometimes engaged in corrupt practices with impunity. There were reports of government corruption in the executive, judicial, and legislative branches during the year.

According to the Global Corruption Barometer Africa 2019 report published in July 2019, 53 percent of Moroccans surveyed think corruption increased in the previous 12 months, 31 percent of public services users paid a bribe in the previous 12 months, and 74 percent believe the government is doing a bad job in tackling corruption.

The 2011 constitution mandated the creation of a national anti-corruption entity. Morocco formally established the National Authority for Probity, Prevention, and Fighting Corruption (INPLCC) but it did not become operational until 2018 when its board was appointed by the king. The INPLCC is tasked with initiating, coordinating, and overseeing the implementation of policies for the prevention and fight against corruption, as well as gathering and disseminating information on the issue. In 2021 parliment passed Law No 19-46 to strengthen INPPLC’s effectiveness in its fight against corruption, creating an integrated framework aimed at improving cooperation and coordination, criminalizing corruption, and improving prevention efforts. Additionally, Morocco’s anti-corruption efforts include enhancing the transparency of public tenders and implementation of a requirement that senior government officials submit financial disclosure statements at the start and end of their government service, although their family members are not required to make such disclosures. Few public officials submitted such disclosures, and there are no effective penalties for failing to comply. Morocco does not have conflict of interest legislation. In 2018, thanks to the passage of an Access to Information (AI) law, Morocco joined the Open Government Partnership, a multilateral effort to make governments more transparent. As part of its 2021-2023 Open Government National Action Plan, Morocco launched a national portal for open government , to share its various commitments and allow its citizens to monitor progress and submit their suggestions and concerns. Although the Moroccan government does not require that private companies establish internal codes of conduct, the Moroccan Institute of Directors (IMA) was established in June 2009 with the goal of bringing together individuals, companies, and institutions willing to promote corporate governance and conduct. IMA published the four Moroccan Codes of Good Corporate Governance Practices. Some private companies use internal controls, ethics, and compliance programs to detect and prevent bribery of government officials. Morocco signed the UN Convention against Corruption in 2007 and hosted the States Parties to the Convention’s Fourth Session in 2011. However, Morocco does not provide any formal protections to NGOs involved in investigating corruption. For more information on corruption issues, please view the Human Rights Report. Although the U.S. Mission is not aware of cases involving corruption regarding customs or taxation issues, American businesses report encountering unexpected delays and requests for documentation that is not required under the FTA or standardized shipping norms.

Resources to Report Corruption

National Authority for Probity, Prevention, and Fighting Corruption (INPPLC)

Avenue Annakhil, Immeuble High Tech, Hall B, 3eme etage, Hay Ryad-Rabat
+212-5 37 57 86 60
Contact@inpplc.ma

Transparency International National Chapter 
24 Boulevard de Khouribga, Casablanca 20250
Telephone number: +212-22-542 699
Contact@transparencymaroc.ma

10. Political and Security Environment

Morocco enjoys political stability. There has not been any recent damage to commercial facilities and/or installations with a continued impact on the investment environment. Demonstrations occur in Morocco and usually center on economic, social, or labor issues. Demonstrations can attract hundreds to thousands of people in major city centers. Participants are typically, but not always, non-violent and the demonstrations are peaceful and orderly.

Morocco has historically experienced terrorist attacks. Travelers should generally exercise increased caution due to terrorism as terrorist groups continue plotting possible attacks in Morocco. Terrorists may attack with little or no warning, targeting tourist locations, transportation hubs, markets/shopping malls, and local government facilities. Visitors are encouraged to consult the Department of State’s Morocco Travel Advisory for the most current information.

11. Labor Policies and Practices

In the Moroccan labor market, many Moroccan university graduates cannot find jobs commensurate with their education and training, and employers report insufficient skilled candidates. The educational system does not prioritize STEM literacy and industrial skills and many graduates are unprepared to meet contemporary job market demands. In 2011, the Moroccan government restructured its employment promotion agency, the National Agency for Promotion of Employment and Skills (ANAPEC), to assist new university graduates prepare for and find work in the private sector that requires specialized skills. The government also is pursuing a strategy to increase the number of students in vocational and professional training programs. The Bureau of Professional Training and Job Promotion (OFPPT), Morocco’s main public provider for professional training, has made several large-scale investments to address the country’s skills gap, counting more than 390 training centers with a capacity to attend 500,000 individuals annually. According to official government figures, unemployment stood at slightly above pre-pandemic levels at 11.8 percent in early 2022, with youth (ages 15-24) unemployment spiking at over 26 percent in 2020. The female labor participation rate remains extremely low at 21.6 percent, ranking 180 out of 189 countries surveyed in a 2018 World Bank survey. Of the female population in the work force, unemployment remains higher than average at 13.2 percent. The World Bank and other international institutions estimate that actual unemployment – and underemployment – rates may be higher. According to a study by Morocco’s central bank, Morocco made considerable progress incorporating its informal economy, which now hovers slightly below 30 percent of GDP. In 2021 newly elected Head of Government Aziz Akhannouch announced an aggressive plan to create 1 million jobs in the private and public sector over his government’s five-year mandate, which in part will be accomplished by increasing government positions, encouraging growth and hiring in the private sector, and further legitimizing Morocco’s informal sector.

Pursuing a forward-leaning migration policy, the Moroccan government has regularized the status of over 50,000 sub-Saharans migrants since 2014. Regularization provides these migrants with legal access to employment, employment services, and education and vocation training. The majority of sub-Saharan migrants who benefitted from the regularization program work in call centers and education institutes, if they have strong French or English skills, or domestic work and construction.

Under Moroccan Labor Code, Law Number 65-99, there are two types of employment contracts: fixed-term and permanent. Under a fixed-term labor contract, the duration of employment ends on a defined date and early termination initiated by the employer will result in damages equivalent to the amount of corresponding wages for the remainder of the contract. A permanent employment contract can be terminated at any time through the implementation of a well-defined dismissal procedure. The law prohibits the dismissal of an employee without a valid reason and failure to follow these very strict procedure would likely result in the Labor Court ruling the dismissal to be unfair and result in damages being awarded to the dismissed employee. In the case of economic or structural layoffs, the employer must notify the employee’s union presentative and seek permission from the provincial governor prior to conducting any layoffs. In the case of dismissal for misconduct, the bar of proving gross misconduct is typically high and it is common for labor courts to rule in the favor of the dismissed employee – even those who commit a blatant act of gross misconduct – if the employer does not follow the dismissal procedure properly.

Dismissals deemed as unfair carry heavy financial penalties to employers. In the case of a dismissal determined to be unfair of an employee who has worked six months or more in the same company, the Labor Code dictates the employer must compensate the dismissed employee including pay-in-lieu of notice, indemnity, damages, and other miscellaneous costs. These costs balloon as the seniority and base salary of the dismissed employee increases. Cases where employers and employees go to court are rare, as both sides typically opt for an amicable resolution settled out of court which allows employers to negotiate reduced compensation payments and quicker payouts to the employee. Businesses have the added incentive to settle outside of court since Labor Courts have a reputation of siding with the employee on wrongful dismissal lawsuits. Labor law is applicable in all sectors of employment; there are no specific labor laws to foreign trade zones or other sectors. More information is available from the Moroccan Ministry of Foreign Affairs Economic Diplomacy unit.

Morocco has roughly 20 collective bargaining agreements in the following sectors: Telecommunications, automotive industry, refining industry, road transport, fish canning industry, aircraft cable factories, collection of domestic waste, ceramics, naval construction and repair, paper industry, communication and information technology, land transport, and banks. The sectoral agreements that exist to date are in the banking, energy, printing, chemicals, ports, and agricultural sectors.

According to the State Department’s Country Report on Human Rights Practices, the Moroccan constitution grants workers the right to form and join unions, strike, and bargain collectively, with some restrictions (S 396-429 Labor Code Act 1999, 65-99). The law prohibits certain categories of government employees, including members of the armed forces, police, and some members of the judiciary, from forming or joining unions and from conducting strikes. The law allows several independent unions to exist but requires 35 percent of the total employee base to be associated with a union for the union to be representative and engage in collective bargaining. The government generally respected freedom of association and the right to collective bargaining. Employers limited the scope of collective bargaining, frequently setting wages unilaterally for the majority of unionized and nonunionized workers. Domestic NGOs reported that employers often used temporary contracts to discourage employees from affiliating with or organizing unions. Legally, unions can negotiate with the government on national-level labor issues.

Labor disputes (S 549-581 Labor Code Act 1999, 65-99) are common, and in some cases result in employers failing to implement collective bargaining agreements and withholding wages. Trade unions complain that the government sometimes uses Article 288 of the penal code to prosecute workers for striking and to suppress strikes. Labor inspectors are tasked with mediation of labor disputes. In general, strikes occur in heavily unionized sectors such as education and government services, and such strikes can lead to disruptions in government services but usually remain peaceful.

In response to the widespread difficulties caused by the COVID-19 pandemic, Morocco’s Special Commission for the Development Model presented King Mohammed VI the New Development Model in May 2021. This model will serve as a roadmap for Moroccan development with a special focus on decreasing poverty, improving social services and expanding social security protections.

Chapter 16 of the U.S.-Morocco Free Trade Agreement (FTA) addresses labor issues and commits both parties to respecting international labor standards.

14. Contact for More Information

Foreign Commercial Service
U.S. Consulate General Casablanca, Morocco
+212522642082
FCSCasaSpecialist@trade.gov  

Senegal

Executive Summary

Senegal’s stable democracy, relatively strong economic growth, and open economy offer attractive opportunities for foreign investment. Senegal’s macroeconomic environment remains generally stable, although aggressive measures to counter the economic impact of COVID-19 and rising commodity costs are pushing public debt to nearly 70 percent of GDP, the internal debt distress threshold of the Economic Community of West African States (ECOWAS). The currency – the CFA franc used in eight West African countries – is pegged to the Euro and remains stable.

The Government of Senegal (GOS) welcomes foreign investment and has prioritized efforts to improve the business climate, and many companies choose Senegal as a base for operations in Francophone Africa. Since 2012, Senegal has pursued an ambitious development program, the Plan Senegal Emergent (Emerging Senegal Plan, or “PSE”), to improve infrastructure, achieve economic reforms, increase investment in strategic sectors, and strengthen private sector competitiveness. The GOS expanded the “single window” system to provide services to companies, opening new service centers across the country, harmonizing more than 60 GOS websites, and digitizing dozens of government services and payment mechanisms. The national digital agency, ADIE, plans to lay 4,500 kilometers of additional fiberoptic cable to increase internet access. Senegal has plans to transition power plants from fuel oil to domestic natural gas starting in 2023, when two recently discovered oil and gas fields come online. A new Public-Private Partnership (PPP) law entered into force in November 2021, modernizing and clarifying PPP procedures and encouraging local content.

With good air transportation links, a modern airport, expanding seaports, availability of mobile money and other financial technologies, and improving ground transportation, Senegal aims to become a regional commercial and services hub. Three Special Economic Zones offer investors tax exemptions and other benefits. Repatriation of capital and income is generally straightforward, although the regional central bank sometimes limits the number of “offshore accounts” for companies registered in Senegal and engaged in project finance. Although some companies report problems, Senegal scores favorably on corruption indicators compared to other countries in the region.

Despite Senegal’s many advantages, significant challenges remain. Investors at times cite burdensome and unpredictable tax administration, complex customs procedures, bureaucratic hurdles, opaque public procurement practices, an inefficient judicial system, inadequate access to financing, and a rigid labor market as obstacles. High real estate and energy costs, as well as high costs of inputs for manufacturing, also constrain Senegal’s competitiveness. High levels of unemployment and underemployment, especially among the country’s large youth population, represent a long-term macroeconomic challenge.

A U.S.-Senegal Bilateral Investment Treaty went into effect since 1990. Senegal’s stock of foreign direct investment (FDI) increased from $3.4 billion in 2015 to $6.4 billion in 2019, according to UNCTAD data. U.S. investment in Senegal has expanded since 2014, including investments in power generation, renewable energy, industry, and offshore oil and gas. The IMF reports that U.S. FDI stock in Senegal was approximately $114 million in 2019 (Table 1; up from $91 million in 2018). Although France is historically Senegal’s largest source of FDI, China overtook France as Senegal’s largest bilateral trade partner in 2019. Turkish economic influence is also rising, particularly in construction. Other important investment partners include Morocco, Saudi Arabia, and other Gulf States, as well as the EU. Sectors attracting substantial investment include petroleum and natural gas, agribusiness, mining, tourism, manufacturing, and fisheries.

Investors can consult Senegal’s investment promotion agency (APIX) at www.investinsenegal.com  for information on opportunities, incentives, and procedures for foreign investment, including a copy of Senegal’s investment code.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 73 of 180 Transparency International  
Global Innovation Index 2021 105 of 131 Global Innovation Index 
U.S. FDI in partner country ($M USD, stock positions) 2019 $114.0 million U.S. Foreign Direct Investment 
World Bank GNI per capita 2020 $1,430 World Bank Gross National Income 

1. Openness To, and Restrictions Upon, Foreign Investment

The GOS welcomes foreign investment. The investment code provides for equitable treatment of foreign and local firms. There is no restriction on ownership of businesses by foreign investors in most sectors. Foreign firms generally can invest in Senegal free from systematic discrimination in favor of local firms. However, some U.S. and other foreign firms have noted that, in practice, Senegal’s investment environment favors incumbents and insiders – often other foreign firms – at the expense of new market entrants. Common complaints include excessive and inconsistently applied bureaucratic processes; nontransparent, slow judicial processes; and an opaque decision-making process for public contracts. Financial and capital markets are open, attracting domestic, regional, and international capital. In the wake of COVID-19, President Sall called for greater “economic sovereignty” in strategic sectors such as food production, pharmaceuticals, and digital technology to strengthen the country’s resilience to external shocks.

The GOS consults with the private sector through the Conseil Presidentiel de l’Investissement (Presidential Council on Investment, or “CPI”). Among other activities, the CPI for investor-government dialogue. Another important venue for dialogue is the annual Assises de l’Entreprises (Company Meetings) sponsored by the Conseil National du Patronat (www.cnp.sn), the national employers’ association. Senegal does not have a business ombudsman or other official charged with resolving business disputes. In practice, investors must often engage directly at the minister level to resolve business climate concerns. Senegal’s investment promotion agency, APIX, facilitates government review of investment proposals and the project approval process. APIX is also the exclusive administrator of all special economic zones in Senegal.

There are no barriers to ownership of businesses by foreign investors in most sectors. Exceptions include strategic sectors such as water, electricity distribution, and port services, where the government and state-owned companies maintain responsibility for most physical infrastructure but allow private companies to provide services. Senegal allows foreign investors equal access to ownership of property and does not impose any general limits on foreign control of investments. Senegal’s Investment Code includes guarantees for equal treatment of foreign investors, including the right to acquire and dispose of real property.

GOS Ministries offer guidance on large projects, primarily to verify compatibility with the country’s overall development goals and compliance with environmental regulations. The Ministry of Finance and Budget reviews project financing arrangements for projects requiring public funds to ensure compatibility with budget and debt policies.

In October 2017, Senegal, along with other members of the West African Economic and Monetary Union (WAEMU) underwent a Trade Policies Review  by WTO.

In January 2020, the Executive Board of the IMF approved a new three-year Policy Coordination Instrument (PCI) for Senegal. The IMF published its Second Review under the PCI ( IMF PCI ) on January 19, 2021.

The point of entry for business registration is Senegal’s Investment Promotion Agency, APIX, www.investinsenegal.com , which provides a range of administrative services to foreign investors. The World Bank estimates it takes six days to register a firm. In addition to other bureaucratic and documentary requirements, registering a business requires certification of certain documents by a public notary registered in Senegal. Senegalese law provides special preferences to facilitate investment and business operations by medium-sized and small enterprises, including reduced interest rates for Senegalese-owned companies. The GOS continues to expand its “single window” system, offering one-stop government services for businesses and opening new service centers. Since 2019, the GOS has made 25 government processes available online, including applications for construction permits, tax information searches, and tax and customs payments. In 2020, the GOS continued to expand its eGovernance program, harmonizing 60 government websites and creating 30 online service platforms. In 2019, APIX launched an online portal  containing extensive information regarding regulations applicable to businesses and investments in Senegal.

Senegal’s Agency for the Development and Supervision of Small and Medium-sized Enterprises (ADEPME) supports small and medium-sized enterprises (defined as having fewer than 50 employees and annual revenues less than 5 billion CFA (about $9 million)). These include tax incentives, grants for capacity building and feasibility studies, and technical assistance to help firms operating in the informal sector formalize and register. ADEPME has also launched a program to certify the creditworthiness of SMEs, making them eligible for loans at preferential rates.

Senegal’s budget and information on debt obligations are generally accessible to the public, including online.  Although Senegal included state-owned enterprise (SOE) debt in its overall debt figures, detailed information on the debt of individual SOEs was not available to the public. The budget was substantially complete and considered generally reliable.  Senegal’s supreme audit institution reviews the government’s accounts, and its reports are published online. However, the GOS has not released an audit report since 2017. Senegal is the first Francophone country in sub-Saharan Africa to submit to a fiscal transparency evaluation (FTE) by the IMF. In its January 2019 FTE, the IMF rated Senegal “average” overall for countries of similar income and institutional capacity. Senegal was rated “advanced” or “good” on fiscal forecasting, budgeting, and fiscal reporting. It was rated “basic” on monitoring risks triggered by subnational governments.

The process for allocating licenses and contracts for natural resource extraction was outlined in law and appeared to be followed in practice.  In 2019, Senegal approved a new Petroleum Code, clarifying investment terms and local content requirements for foreign investment.  Senegal is currently offering new offshore exploration blocks through an open tender process conducted in accordance with international standards. In February 2020, Senegal finalized a new Gas Code to govern development of a mid-stream gas distribution network. Basic information on natural resource extraction awards is publicly available, and the government participated actively in the Extractive Industries Transparency Initiative.

The government neither promotes nor restricts outward investment.

3. Legal Regime

Senegal has made some progress towards establishing independent regulatory institutions, having set up regulators for energy, telecommunications, and finance. While Senegal lacks established procedures for a public comment process for proposed laws and regulations, the GOS sometimes holds public hearings and workshops to discuss drafts. Suggested regulations are not always made available to the public in a timely manner, however. Although Senegalese law requires proposed legislation to be published in advance in the government’s official gazette, the GOS does not consistently update its website. The government does not promote or require companies’ environmental, social, and governance disclosure to facilitate transparency or help investors and consumers distinguish between high- and low-quality investments.

Authority to make and enforce rules rests with the relevant government ministry unless there is a separate regulatory authority. Local government bodies do not have a decisive role in regulatory decisions.

The Commission de Régulation du Secteur de l’Electricité (Electricity Sector Regulatory Commission, CRSE) was established in 1998 to regulate the electricity sector and set electricity tariffs. Although the CRSE is by law an independent agency, observers note that the government frequently exercises influence over its decisions. Under the Millennium Challenge Corporation Senegal Power Compact, the GOS has committed to reforms, including adopting a new electricity code in 2021 and strengthening the CRSE’s capacity and independence.

The Autorité de Régulation des Télécommunications et des Postes (Telecommunications and Postal Regulatory Authority, ARTP) is responsible for licensing and regulating telecommunications and postal services in Senegal. The Dakar-based Central Bank of West African States (known by its French acronym, BCEAO) regulates banking.

There is no legal requirement to conduct impact assessments of proposed regulations, and regulatory agencies rarely do so. There is no specialized government body tasked with reviewing and monitoring regulatory impacts. Legal, regulatory, and accounting systems closely follow French models. Financial statements must be prepared in accordance with the SYSCOHADA system, based on generally accepted accounting principles in France.

As a member of ECOWAS, Senegal generally adheres to regional requirements concerning the movement of people and goods. Similarly, fiscal policy directives of WAEMU are enforced in Senegal, as are regulations issued by the BCEAO. Senegal is a WTO member and generally notifies draft regulations to the WTO Committee on Technical Barriers to Trade. However, since 2005, Senegal has banned imports of uncooked poultry and poultry products without notifying the WTO. In March 2019, Senegal ratified the AfCFTA, which went into effect in January 2021.

Senegal’s legal system is based on French civil law and has well-developed commercial and investment laws. Although settlement of commercial disputes has historically been cumbersome and slow, Senegal launched a new commercial court system in 2018 with jurisdiction over commercial matters and a mandate to resolve cases within three months.  The business community welcomed the move, and in the past two years, the court has heard 11,054 cases with a combined value of nearly $500 million.

While Senegal’s constitution mandates that the judiciary operate independently of the legislature and executive, the executive frequently exerts influence, particularly in high-profile criminal cases. This type of influence is rare in strictly commercial matters. Some foreign investors, however, report discriminatory treatment by local courts. Investors may consider including binding arbitration in their contracts to avoid prolonged legal entanglements. Companies may seek judicial redress against regulatory decisions. Regulatory appeals are heard in administrative tribunals that specialize in adjudicating claims against the state.

Senegal is a member of the World Intellectual Property Organization and the Berne Copyright Convention, and in 2019 hosted a regional workshop on protecting intellectual property in the pharmaceutical and pesticide industries that gathered prosecutors, customs, and law enforcement officers. Nevertheless, the country has insufficient capacity to reliably protect intellectual property rights.

Senegal’s 2004 Investment Code provides basic guarantees for equal treatment of foreign investors and repatriation of profit and capital. It also specifies tax and customs exemptions according to investment volume and company size and location, with investments outside of Dakar eligible for longer tax exemptions. A law to enhance transparency in public procurement and public tenders entered into force in 2008, establishing a public procurement regulatory body, the Autorité de Régulation des Marchés Publics (Public Procurement Regulatory Authority, ARMP), which publishes annual reviews of public procurement.

In February 2021, Senegal’s National Assembly signed into law the long-awaited update to the law governing public-private partnership (PPP) contracts, followed by the implementing decree in November 2021. The amended law includes several important innovations, including: a unified legal framework for private sector-led, GOS-supported projects; a streamlined institutional framework to simplify procedures and avoid incompatibilities; a strengthened monitoring and control system; and provisions about local content requirements. The GOS has stated that the new law will introduce a more flexible and attractive framework for blended finance projects. Some U.S. companies have raised concerns about the local content requirements included in the law.

BCEAO regulations proscribe the use of offshore accounts in project finance transactions within the WAEMU, except when approved by ministries of finance with the express consent of the BCEAO. According to BCEAO, these restrictions allow visibility over international transactions, deter money laundering, and help it maintain adequate foreign currency reserves. BCEAO emphasizes the importance of these rules in enabling it to fulfill its mandate of maintaining the stability of the CFA franc’s peg to the Euro.

Since 2018, the BCEAO and Senegalese Ministry of Finance and Budget have tightened their approach to the approvals of offshore accounts. Although there is no “maximum” number of accounts permitted, informal guidelines suggest that transactions using one to three accounts have the greatest chance of being approved. According to the BCEAO, the intent is to encourage the minimum number of such accounts necessary to legitimately conduct the transaction. Managers and lenders should raise the subject of offshore accounts with the Ministry of Finance as early in the process as possible and should be prepared to submit a functional justification for each requested account. All offshore accounts must be “reauthorized” annually.

The Investment Code, the Mining Code, the Petroleum Code, and a government services one-stop can be found at the following:

Senegal’s national competition commission, the Commission Nationale de la Concurrence, is responsible for reviewing transactions for competition-related concerns.

Senegal’s Investment Code includes protection against expropriation or nationalization of private property, with exceptions for “reasons of public utility” provided there is “just compensation” in advance. In general, Senegal has no history of expropriation or creeping expropriation against private companies. The government may sometimes use eminent domain justifications to procure land for public infrastructure projects, with compensation provided to landowners. The U.S.-Senegal BIT specifies that international legal standards are applicable to any cases of expropriation.

Senegal is a member of the International Convention for the Settlement of Investment Disputes (ICSID) and a signatory of the Convention on the Recognition and Enforcement of Arbitral Awards (the “New York Convention”). Senegalese law recognizes the Cour d’Appel (Appeals Court) as the competent authority for the recognition and enforcement of awards rendered pursuant to ICSID. Senegal is also a signatory to the Organization for the Harmonization of Corporate Law in Africa Treaty (OHADA). This agreement supports enforcement of awards under the New York Convention. The Autorité de Régulation des Marchés Publics (Public Procurement Regulatory Authority or ARMP) manages a dispute-resolution mechanism for public tenders.

Senegal has growing experience in using international arbitration for resolution of investment disputes with foreign companies, including some cases involving tax disputes with U.S. firms. The government has also prevailed in some arbitration cases, including a 2013 arbitration decision in a high-profile case with a multinational company over an integrated mining/railway/port project, fostering greater confidence within the government in the arbitration process. Senegal’s BIT with the United States includes provisions to facilitate the referral of investment disputes to binding arbitration.

International firms have pursued a variety of investment disputes during the last decade, including at least two U.S. firms involved in tax and customs disputes. Other foreign companies in mining and telecommunications have pursued commercial disputes over licensing. These disputes have often been resolved through arbitration or an amicable settlement. Senegal has no history of extrajudicial action against foreign investors.

The GOS has commercial courts and uses alternative dispute resolution mechanisms to expedite dispute resolution. Under the OHADA treaty, Senegal recognizes the corporate law and arbitration procedures common to the 16 member states in Western and Central Africa. Senegalese courts routinely recognize arbitration clauses in contracts and agreements. It is not unusual for courts to rule against SOEs in disputes involving private enterprises.

Senegal has commercial and bankruptcy laws that address liquidation of business liabilities. Foreign creditors receive equal treatment under Senegalese bankruptcy law in making claims against liquidated assets. Monetary judgments are normally in local currency. As a member of OHADA, Senegal permits three different types of bankruptcy: liquidation through a negotiated settlement; company restructuring; or complete liquidation of assets.

4. Industrial Policies

Senegal’s Investment Code provides for investment incentives, including temporary exemption from customs duties and income taxes, for investment projects. Eligibility for investment incentives depends upon a firm’s size and the type of activity, amount of the potential investment, and location of the project. To qualify for significant investment incentives, firms must invest above CFA 100 million (approximately $165,000) or in activities that lead to an increase of 25 percent or more in productive capacity. Investors may also deduct up to 40 percent of retained investment over five years. However, for companies engaged strictly in “trading activities,” investment incentives may not be available. Senegal does not provide incentives for underrepresented investors such as women, nor does it provide specific incentives for clean energy investments.

Eligible sectors for investment incentives include agriculture and agro-processing, fishing, livestock, and related industries, manufacturing, tourism, mineral exploration and mining, banking, and others. All qualifying investments benefit from the “Common Regime,” which includes two years of exemption from duties on imports of goods not produced locally for small and medium-sized firms, and three years for all others. Also included is exemption from direct and indirect taxes for the same period.

Exemption from the Minimum Personal Income Tax and from the Business License Tax can be granted to investors who use local resources for at least 65 percent of their total inputs within a fiscal year. Enterprises that locate in less industrialized areas of Senegal may benefit from exemption of the lump-sum payroll tax of three percent, with the exemption running from five to 12 years, depending on the location of the investment. The investment code provides for exemption from income tax, duties, and other taxes, phased out progressively over the last three years of the relief period. Most incentives are automatically granted to investment projects meeting the above criteria.

An existing firm requesting an extension of such incentives must be at least 20 percent self-financed. To qualify for these benefits, firms are required to create at least 150 full-time positions for Senegalese nationals, contribute the hard currency equivalent of at least 100 million CFA ($165,000), and keep regular accounts that conform to Senegalese standards. In addition, firms must provide APIX with details on company products, production, employment, and consumption of raw materials.

In 2017, Senegal passed legislation to create Special Economic Zones (SEZ). Enterprises approved under the SEZ regime may be granted tax and customs concessions for up to 25 years. Benefits may include exemptions from duties and taxes on imports of goods, raw materials and equipment (except for community levies); application of a reduced 15 percent corporate tax rate; and exemption from certain taxes and charges, such as business and property taxes. To qualify for these benefits, companies must make a minimum investment of CFA 100 million ($165,000), create at least 150 jobs during their first year, and generate at least 60 percent of their revenue from exports. In November 2018, President Sall inaugurated the country’s first SEZ in the Dakar planned suburb of Diamniadio. The GOS has since launched two additional SEZs; one in Sandiara, 80 kilometers from the capital city Dakar, and the other in Ndiass, in the vicinity of Dakar’s International Airport. According to Senegalese officials responsible for digital economy development, the GOS has installed more than 150 kilometers of high-speed fiberoptic cable throughout Diamniadio to boost access and speeds for investors locating there.

Senegal’s Data Protection Act was passed in 2008. Senegal has mandatory requirements to register mobile device SIM cards and is a signatory to the Economic Community of West African States Supplementary Act on Personal Data Protection from 2010. There is no requirement for foreign IT providers to turn over source code and/or provide access to encryption, nor are there measures that prevent or restrict companies from freely transmitting customer or other business-related data outside Senegal.

President Macky Sall inaugurated a 1,000 terabyte government data center in June 2021 with the intent to migrate all Senegalese government data and applications there and host them in the future. In March 2022, President Sall announced that national digital agency ADIE would become Société National Senegal Numerique (National Company for Digital Senegal, SEMUM) to accelerate Senegal’s digitalization.

5. Protection of Property Rights

The Senegalese Civil Code provides a framework, based on French law, for enforcing private property rights. The code provides for equality and non-discrimination against foreign-owned businesses. Senegal maintains a property title and a land registration system, but application is uneven outside of urban areas. Establishing ownership rights to real estate can be difficult. Once established, however, ownership is protected by law.

The GOS has undertaken several reforms to make it easier for investors to acquire and register property. It has streamlined procedures and reduced associated costs for property registration and developed new land tenure models intended to facilitate land acquisition by resolving conflicts between traditional and government land ownership. If the new models are widely adopted, the GOS and donors expect they will facilitate land acquisition and investment in the agricultural sector while providing benefits to traditional landowners in local communities.

The GOS generally pays compensation when it takes private property through eminent domain. Senegal’s housing finance market is under-developed, and few long-term mortgage-financing vehicles exist. There is no secondary market for mortgages or other bundled revenue streams. The judiciary is inconsistent when adjudicating property disputes. According to the World Bank, registering property requires an average of 41 days, compared to an average of 51.6 days in sub-Saharan Africa and 23.6 days in OECD countries. Five separate procedures are required.

Senegal maintains an adequate legal framework for protecting intellectual property rights (IPR), but the country has limited institutional capacity to enforce IPR laws. Senegal has been a member of the World Intellectual Property Organization (WIPO) since its inception. Senegal is also a member of the African Organization of Intellectual Property, a grouping of 15 Francophone African countries with a common system for obtaining and maintaining protection for patents, trademarks, and industrial designs. Local statutes recognize reciprocal protection for authors or artists who are nationals of countries adhering to the 1991 Paris Convention on Intellectual Property Rights. Patents may be registered with the Agence Sénégalaise pour la Propriété industrielle et l’Innovation technologique (Senegalese Agency for Industrial Property and Technical Innovation, ASPIT) and are protected for 20 years. An annual charge is levied during this period. Registered trademarks are protected for a period of 20 years. Trademarks may be renewed indefinitely by subsequent registrations. Senegal is a signatory to the Berne Convention for the Protection of Literary and Artistic Works. The Senegalese Copyright Office, part of the Ministry of Culture, protects copyrights. Bootlegging of music CDs is common and a source of concern for the local music industry. The Copyright Office has taken actions to combat media piracy, including seizure of counterfeit cassettes, CDs, and DVDs. In 2008, the government established a special police unit to improve enforcement of the country’s anti-piracy and counterfeit laws. The government has limited capacity to combat IPR violations or to seize counterfeit goods. Customs screening for counterfeit goods production is weak and confiscated goods occasionally re-appear in the market. Nevertheless, the GOS has raised awareness of the impact of counterfeit products on the Senegalese marketplace, especially regarding pharmaceuticals, and officers have participated in trainings offered by manufacturers to identify counterfeit products.

Senegal 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 WIPO country profiles .

6. Financial Sector

Senegalese authorities take a generally positive view of portfolio investment. Assisted by the debt management office of the BCEAO and thanks to a well-functioning regional debt market,

Senegal has historically issued regular debt instruments in local currency to manage its finances. Beginning in 2011, the government began accessing international debt markets, issuing U.S. dollar-denominated Eurobonds in 2011, 2014, 2017, and 2018. In June 2021, the authorities issued a 775-million-Euro Eurobond’ its first Euro-denominated obligation. Some observers, including the IMF, have expressed concern over the continued rise in Senegal’s public debt, which has more than doubled over the last decade, in part due to the country’s significant investments associated with the PSE. With the ongoing effects of COVID-19 and the consequences of the political turmoil of March 2021, Senegal’s 2021 debt-to-GDP ratio rose to 73 percent, compared to 52 percent in 2018. In late 2020, Senegal took advantage of the G20’s Debt Service Suspension Initiative, receiving relief from $163 million in debt service payments (0.6 percent of GDP) through the end of 2021. The GOS aims to mitigate concerns about its public debt by containing energy subsidies, prioritizing concessional borrowing, and taking steps to increase government revenues.

Senegal does not have its own stock market. A handful of Senegalese companies are listed on the West African Regional Stock Exchange (BRVM), headquartered in Abidjan, Cote d’Ivoire. The BRVM also has local offices in each of the WAEMU member countries, offering additional opportunities to attract foreign capital and access diversified sources of financing.

In 2018, the BCEAO launched the region’s first certification program for dealers in securities and other financial instruments. Modeled on accreditation programs offered by the Chartered Institute for Securities and Investment, the new program was supported by the U.S. Treasury’s Office of Technical Assistance.

While Senegal’s banking system is generally sound, the financial sector is underdeveloped. Senegal’s 26 commercial banks, primarily based in France, Nigeria, Morocco, and Togo, follow conservative lending guidelines, with collateral requirements that most potential borrowers cannot meet. Few firms are eligible for long-term loans, and small and medium-sized enterprises have little access to credit. According to a 2016 government survey, about 17 percent of enterprises in the formal sector receive financing from commercial banks, compared to 6 percent for informal enterprises. Authorities have committed to implement the national financial inclusion strategy (2021-25) and achieve a financial inclusion rate of 65 percent of adults and 90 percent of SMEs. Senegal’s banking sector is regulated by the BCEAO and the WAEMU regional banking commission. Increasingly available mobile money services offer Senegalese consumers alternatives to traditional banking and credit services.

In 2012, Senegal established a sovereign wealth fund (Fonds Souverain d’Investissements Strategiques, FONSIS) with a mandate to leverage public assets to support equity investments in commercial projects supporting economic development objectives. FONSIS invests primarily in strategic sectors defined in the PSE, including agriculture, fishing, infrastructure, energy, mining, tourism, and services.

Senegal maintains several taxes and funds allocated for specific purposes such as expanding access to transportation, energy, and telecommunications, including the autonomous road maintenance fund and the energy support fund. For these funds, some information is included in budget annexes; these funds are subject to the same auditing and oversight mechanisms as ordinary budgetary spending. FONSIS reports that it abides by the Santiago Principles for sovereign wealth funds.

7. State-Owned Enterprises

Senegal has generally reduced government involvement in SOEs during the last three decades. However, the GOS still owns full or majority interests in 24 SOEs, including the national electricity company (Senelec), Dakar’s public bus service, the Port of Dakar, National Post, the national rail company, and the national water utility. Senelec retains control over power transmission and distribution, but it relies increasingly on independent producers to generate power. The GOS has also retained control of the national oil company, PETROSEN, which is involved in hydrocarbon exploration in partnership with foreign oil companies and operates a small refinery dependent on government subsidies. The GOS has modest and declining ownership of agricultural enterprises, including one involved in rice production. In 2018, the government revived the state-owned airline, Air Senegal. The GOS also owns a minority share in Sonatel-Orange Senegal, the country’s largest internet and mobile communications provider.

The Direction du Secteur Parapublic, an agency within the Ministry of Finance, manages the government’s ownership rights in SOEs. The GOS’s budget includes financial allocations to these enterprises, including subsidies to Senelec. SOE revenues are not projected in budget documents, but actual revenues are included in quarterly reports published by the Ministry of Finance. Senegal’s supreme audit institution (the Cour des Comptes) conducts audits of the public sector and SOEs.

The government has no program for privatizing the remaining SOEs.

8. Responsible Business Conduct

Following the lead of foreign companies, some Senegalese firms have begun adopting corporate social responsibility programs and responsible business conduct standards. However, this movement is not yet widespread.

Senegal’s 2016 Mining Code specifies the criteria and procedures by which the government awards natural resource extraction contracts or licenses. The code requires mining companies to participate in transparency reporting following the guidelines of the Extractive Industries Transparency Initiative (EITI). The GOS appears to follow the Mining Code and its implementing regulations in practice, although unregulated artisanal mining is common in some areas. Basic information on awards was publicly available online through the government’s official journal, and included details regarding geographic areas, resources under development, companies involved, and the duration of contracts. In January 2019, the government adopted a new Petroleum Code, which clarifies mechanisms for reserving revenues from oil and gas projects to the government. Senegal has been an active member of the EITI since 2013. In May 2018, the EITI Board declared Senegal the first country in Africa to have made “satisfactory progress” in implementing EITI standards. In October 2019, Senegal hosted the 41st quarterly meeting of the EITI Board, along with a conference on EITI implementation in Africa. The government’s EITI committee reports directly to the President.

Senegal’s long-term national economic development policy – the Plan Senegal Emergent (PSE) – includes a green growth program known as “Green PSE” (PSE Vert). Launched in December 2021, the Green PSE is structured around six priority sectors: agriculture, energy, industry, water and sanitation, forestry, and construction. The Green PSE aims to build Senegal’s capacity to access financial resources from the Green Climate Fund (GCF) and private sector investment. According to the PSE Operational Bureau within the Office of the President, the GOS will convene representatives from the six priority sectors in May 2022 to identify specific projects and a roadmap for their implementation.

In December 2020, the GOS published its Nationally Determined Contribution (NDC) to the 2015 Paris Agreement. Senegal’s NDC contains a greenhouse gas mitigation plan for transport, waste, energy, industry, forestry and agriculture and an adaptation plan for key climate impacts affecting Senegal, such as coastal erosion, declining agriculture, fishing, and livestock, risks to public health/biodiversity, and urban flooding. The NDC forecasts two emissions reduction scenarios: one accomplished with domestic resources (unconditional) and the other accomplished with a combination of domestic resources and foreign assistance (conditional). The unconditional scenario calls for a 5 percent reduction by 2025 and 7 percent by 2030, compared to business as usual. The conditional scenario calls for a 23 percent reduction by 2025 and a 29 percent reduction by 2030, compared to business as usual. Biodiversity is included in the adaptation plan of the NDC. The GOS has not formally instituted a net-zero carbon emissions policy. Senegal does not provide regulatory incentives or other policies to achieve policy outcomes that preserve biodiversity, clean air, or other desirable ecological benefits.

Senegal’s NDC addresses economy-wide greenhouse gas emissions, including private sector emissions. However, the NDC does not disaggregate public and private sector emissions. Senior GOS climate officials in associated with the National Climate Change Committee have told Post that during the first half of 2022 an inter-ministerial committee will meet to validate a monitoring, reporting, and verification mechanism for emissions. Senegal’s NDC states that the country will meet either its unconditional or conditional emissions reduction targets primarily through four principal means: i) increasing carbon sequestration through improved agroforestry and forest management; ii) transitioning from highly polluting fuel oil to cleaner burning fuels in the energy sector, as well as energy efficiency improvements; iii) improving the management of solid and liquid wastes; and iv) improving industrial processes. Each of these activities involves private sector participation. However, the NDC does not include specific sectoral emissions reductions targets attributable to private sector actors.

Bloomberg Markets ranks Senegal as the 13th most attractive market for energy transition investment among emerging markets and 40th globally: Climate Scope .

9. Corruption

Senegalese law provides criminal penalties for corruption. The National Anti-Corruption Commission (OFNAC) has a mandate to enforce anti-corruption laws. In January 2020, OFNAC released overdue reports on its activities for 2017 and 2018 and swore in six new executive-level officials, bringing its managing board to a full complement for the first time in several years. A 2014 law requires the President, cabinet ministers, speaker and chief financial officer of the National Assembly, and managers of public funds more than one billion CFA francs (approximately $1.8 million) to disclose their assets to OFNAC. In 2020, all but one of these government officials complied with these disclosure requirements.

The GOS has made limited progress in improving its anti-corruption efforts. The current administration has mounted corruption investigations against several public officials (primarily the President’s political rivals) and has secured several convictions. In July 2020, President Sall launched an initiative to enforce a requirement that cabinet members and other high-level officials disclose their assets and issued a report disclosing his own personal assets.

The GOS has also taken steps to increase budget transparency in line with regional standards. Senegal ranked 73 out of 180 countries in Transparency International’s 2021 Corruption Perception Index. Notwithstanding Senegal’s positive reputation for corruption relative to regional peers, the government often did not enforce the law effectively, and some officials continued to engage in corrupt practices with impunity. Reports of corruption ranged from rent-seeking by bureaucrats involved in public approvals to opaque public procurement to corruption in the police and judiciary. Allegations of corruption against President Sall and his brother related to the development of oil and gas emerged in the press in 2019. While a subsequent investigation did not uncover wrong-doing, suspicions of high-level government corruption remain among many in civil society and the political opposition.

Senegal’s financial intelligence unit, Cellule Nationale de Traitement des Informations Financières (National Financial Information Processing Unit, CENTIF), is responsible for investigating money laundering and terrorist financing. CENTIF has broad authority to investigate suspicious financial transactions, including those of government officials. In February 2019, the regional FATF body – the Inter-Governmental Action Group against Money Laundering (GIABA) – issued a Mutual Evaluation Report of Senegal’s anti-money laundering and countering terrorist financing (AML/CTF) performance, measured by FATF standards. Although GIABA found the GOS’s understanding of AML/CTF standards and risks adequate, it gave Senegal non-compliant or partially compliant ratings on 26 of FATF’s 40 AML/CTF legal standards. Senegal also received ten low ratings and one moderate rating on the FATF’s 11 indicators measuring efforts to combat money laundering, terrorist financing, and weapons of mass destruction proliferation financing. Key weaknesses included: lack of domestic legislation implementing BCEAO AML/CTF directives; inadequate monitoring of nonprofits and non-financial professions, such as lawyers and accountants, who engage in financial transactions; inadequate inspections and sanctions of financial institutions; weak interagency cooperation; and poor AML/CTF capacity among police, judiciary, and customs. As a result, and in the absence of improvements, in February 2021, FATF added Senegal to its “gray list.” The GOS has committed to an action plan to address its deficiencies.

It is important for U.S. companies to assess corruption risks and develop an effective compliance program to prevent corruption, including bribery. U.S. firms operating in Senegal can underscore to partners that they are subject to the Foreign Corrupt Practices Act and may seek legal counsel to ensure full compliance with anti-corruption laws. The U.S. Government seeks to level the global playing field for U.S. businesses by encouraging other countries to take steps to criminalize all corruption, including bribery of officials, and requiring governments to uphold their obligations under relevant international conventions. A U.S. firm that believes a competitor is using bribery to secure a contract may convey this to U.S. officials.

Senegal is a signatory of the United Nations Convention Against Corruption but is not a signatory of the OECD Convention on Combatting Bribery.

Contact at the government agencies responsible for combating corruption:

Mrs. Seynabou Ndiaye Diakhaté
President
Office National de Lutte Contre La Fraude et la Corruption (OFNAC)
Lot 72-73, Cité Keur Gorgui à Mermoz-Pyrotechnie
Telephone: 800 000 900 / +221 33 889 98 38
www.ofnac.sn 

Mr. Birahim Seck
President
Forum Civil40 Avenue Malick Sy (1er étage) – B.P. 28 554 – Dakar
Telephone: +221 33 842 40 44
forumcivil@orange.sn  / http://www.forumcivil.sn/ 

10. Political and Security Environment

Senegal has long been regarded as an anchor of stability in politically unstable West Africa. It is the only regional country that has never had a coup d’état. International observers assessed the February 2019 presidential election, in which President Sall won a second term, as free and fair, despite a few instances of campaign violence. Public protests occasionally spawn isolated incidents of violence when unions, opposition parties, merchants, or students demand better salaries, working conditions, or other benefits.

The March 2021 arrest of opposition figure Ousmane Sonko on alleged rape charges led to several days of intense protests that spiraled into widespread riots and looting. The unrest, Senegal’s worst in decades, was fueled by pandemic-related hardship, particularly among the youth. According to press reports, 14 people died, hundreds were injured, and private businesses across the country were damaged. While a few local businesses were damaged, firms associated with France – historically targeted by some groups as relics of the colonial past — bore the brunt of the looting and property damage. Despite this bout of unrest, foreign investors largely remained confident in Senegal’s stability and economic rebound. Most observers agreed that strong private sector investment, facilitated by improvements to the business climate and better mobilization of capital, is needed to address youth employment.

Years of declining violence in the Casamance region, home of a four-decade-old separatist conflict, ignited into a full military conflict between Senegal’s army and elements of the Movement of Democratic Forces in Casamance (MFDC) in March 2022. The Senegalese government indicated that the military operation would continue until MFDC resistance is eradicated, putting an end to the armed separatist movement.

Security is a top priority for the government, which increased its defense and security budget by 92 percent between 2012 and 2017. The Armed Forces Ministry noted a 32 percent budget increase for the fiscal year 2021.

11. Labor Policies and Practices

Senegal’s Labor Code, based on the French system, was last updated in 1997. The code retains a rigid approach that, according to some observers, favors social over economic goals. Rules relating to employment contracts, layoffs, and redundancy protections are some of the most stringent in the world, imposing high costs on businesses. However, labor law is not well-enforced, especially in the dominant informal sector.

Acquiring work permits for expatriate staff is typically straightforward. Citizens from WAEMU member countries may work freely in Senegal.

Senegal has an abundant supply of unskilled and semi-skilled labor, with a more limited supply of skilled workers in engineering and technical fields. While Senegal has one of the best higher educational systems in West Africa and produces a substantial pool of educated workers, limited job opportunities in Senegal lead many to emigrate.

Relations between employees and employers are governed by the Labor Code, industry-wide collective bargaining agreements, company regulations, and individual employment contracts. The Code provides legal protection for women and children and prohibits forced or compulsory labor. It also establishes minimum standards for working age, working hours, and working conditions, and bars children from performing many dangerous jobs. Senegal ratified International Labor Organization Convention 182 on the worst forms of child labor in 2000. The Code recognizes the right of workers to form and join trade unions. Any group of workers in a similar trade or profession may create a union, although formal approval by the Ministry of the Interior is required. The right to strike is recognized but sometimes restricted. The GOS has the authority to dissolve trade unions and requisition workers from private enterprises.

Two powerful industry associations represent management’s interests: the National Council of Employers and the National Employers’ Association. The principal labor unions are the National Confederation of Senegalese Workers and the National Association of Senegalese Union Workers, a federation of independent labor unions. Collective bargaining agreements cover an estimated 44 percent of formal sector workers. Most workers, however, work in the informal sector, where labor rules are not enforced.

Child labor remains a problem, particularly in the informal sector, mining, construction, transportation, domestic work, agriculture, and fishing, where labor regulations are rarely enforced. Despite some progress, Senegal still struggles with forced child begging. Tens of thousands of religious students (talibés) are enrolled in Koranic schools (daaras) where some are forced to beg to enrich teachers, a corruption of the intended lesson in humility. The GOS has made some progress in combatting these practices, but more progress is needed.

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 2020 $25,051 Senegal GDP 
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 $114 U.S. FDI in Senegal 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 $0 Senegal FDI in United States 
Total inbound stock of FDI as % host GDP N/A N/A 2020 34.6% Total FDI in Senegal 

“0” reflects amounts rounded to +/- USD 500,000.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy
From Top Five Sources/To Top Five Destinations (US Dollars, Millions) in 2019
Inward Direct Investment Outward Direct Investment
Total Inward $4,688 100% Total Outward $949 100%
France #1 $2,333 50% France #1 $409 43%
Mauritius #2 $636 14% Mali #2 $129 14%
Canada #3 $626 14% Cote d’Ivoire #3 $127 13%
Nigeria #4 $200 4% India #4 $93 10%
China #5 $180 4% Mauritius #5 $69 7%

Data 

14. Contact for More Information

Aichatou Fall
Economic Specialist
U.S. Embassy, Route des Almadies, B.P. 49, Dakar, Senegal
+221 33 879 4000
FallAX@state.gov