Known as the “Smiling Coast of Africa,” The Gambia is a small country of roughly 2 million people located in West Africa. The Gambia has an active private sector, and the government has announced its support for encouraging local investment and attracting foreign direct investment. There is a government agency dedicated to attracting foreign investment and promoting exports and it provides guidelines and incentives to all investors whose portfolios qualify for a Special Investment Certificate.
The Gambia has a small economy that relies primarily on agriculture, tourism, and remittances for support. Although The Gambia remains heavily reliant on the agriculture sector, recent economic growth has been mainly driven by the services sector, including financial services, telecommunication and construction. The country also has a long trading history and is a party to several trade agreements, which have the potential to make it an attractive production platform for the region and beyond. Strides are also expected to be made in the energy sector (oil exploration and exploitation; renewable energies, specifically solar); natural resources (heavy mineral sands); agriculture (rice, cereal); processed foods production; tourism; and finally, infrastructure (roads, telecommunications systems, drainage systems, and bridges).
The Gambia is a member of the Economic Community of West African States (ECOWAS), a regional economic union of 15 countries located in West Africa. The Gambia’s major trading partners are Ivory Coast (15% of total imports) and China (15%). Others include: United States, Germany, India, and the United Kingdom.
With its young and rapidly growing population, Gambia provides a market with numerous opportunities for the sale of international products and services. Many Gambians have strong personal or professional ties to the United States, as well as a strong affinity for American brands. There is ongoing interest in new American brands, and many Gambians have opened shops aiming to exclusively sell American products. The quality and durability of American products are highly regarded. English is the official language and the business language across the country. Many Gambians are multilingual, speaking English and other regional languages.
Disputes over land ownership and use are a major problem in The Gambia. There are occasional disagreements in rural areas mainly in the West Coast Region over land ownership or succession. Most conflicts occur when community leaders sell a plot of land to multiple buyers. The Lands Office, responsible for recording and maintaining deeds, relies on an outdated manual record keeping system, with no digitization of land records, hindering efficiency and effectiveness and exacerbating land ownership conflicts.
Economy and Impact of COVID-19
While inclusive and sustained economic growth remains one of the main objectives of the Government of The Gambia (GoTG), the country’s strengthened economic growth trend that began following the peaceful transition of presidential power in 2017 was severely disrupted by the COVID-19 pandemic. For the first time in nine years, GDP contracted in 2020 to -1.5% against original forecasted 6.5% growth. The impacts of airport closures, land border restrictions, and the total collapse of the tourism industry continue to reverberate. The government has stated that economic recovery will be at the core of reform policy priorities for the upcoming year, with medium-term policy priorities anchored on achieving and sustaining a more diversified growth to improve the living standards of all citizens, in addition to creating a favorable environment for the private sector to thrive.
COVID-19 crippled the tourism sector and dampened economic activities throughout the country very early on. From April 2020 to October 2020, The Gambia was in a state of emergency with several restrictive measures put in place, including the closure or scaling down of businesses, schools, markets, restaurants, and nightclubs. For the remainder of the 2019-2020 season, the normally-lucrative tourism sector ground to a standstill as tourists returned to their home countries and many hotels and tourism service-related businesses shut down. The resulting drop in wages or loss of work altogether for Gambians employed in the tourism and service sectors reverberated throughout the local economy.
1. Openness to and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
The GoTG has made increasing foreign direct investment a priority. It also aims to create a business environment that allows the private sector to be the engine of growth, transformation, and job creation. FDI is welcomed in almost every sector of the Gambian economy. There is no restriction on ownership of businesses by foreign investors in most sectors and local companies are not prioritized over local companies. While restrictions are limited, foreign investors and companies often complain about the excessive and inconsistently applied bureaucratic procedures and the decision-making process – and often lack of transparency – for public tenders and contracts.
The Gambia Investment & Export Promotion Agency (GIEPA) is the national agency responsible for the promotion and facilitation of private sector investments in The Gambia. Through the GIEPA, eight areas are identified as “priority sectors” which qualify for a Special Investment Certificate (SIC) that provides several incentives, including duty waivers and tax holidays. The Investment Section at Office of The President plans to start handling foreign direct investment matters.
To maintain dialogue with investors, The Gambia Competitiveness Improvement Forum was created as part of the 2015 GIEPA Act, which hosts sector-based forums to maintain dialogue with investors. GIEPA normally hosts forums at which investors comment on the government’s policies and action.
Limits on Foreign Control and Right to Private Ownership and Establishment
Foreign and domestic private entities have a right to own business enterprises and engage in in all forms of remunerative activities in The Gambia. There are no limits on foreign ownership or control of businesses except in the operations of defense industries, which are closed to all private sector participation, irrespective of nationality. Apart from defense related activities, there are no sector-specific restrictions, limitations, or requirements were legally applied to foreign ownership and control.
Foreign investors are not denied national treatment (i.e. the same treatment as domestic firms) or MFN treatment (i.e. the same treatment as the most favored foreign investor) in any sector. There is no mandatory screening of foreign direct investment, but such screening may be conducted if there is suspicion of money laundering or terrorism financing. Investors subjected to such a screening may be asked for business registration documents and bank statements. As part of the country’s privatization program, foreign investors are treated equal to local investors.
Other Investment Policy Reviews
The WTO last conducted a Trade Policy Review (TPR) in January 2018. The Gambia has maintained its generally open trade and investment regime since the last TPR in 2010. The main trade policy reform has been the adoption of the five-band ECOWAS Common External Tariff (CET) from 1 January 2017. An executive summary of the findings can be found at: https://www.wto.org/english/tratop_e/tpr_e/tp465_e.htm. The United Nations Conference on Trade and Development (UNCTAD) conducted an Investment Policy Review in 2017. The review shows The Gambia has adopted an open regime for investment and a range of modern business regulation tools. However, supply-side constraints, vulnerability to exogenous shocks and remaining regulatory and institutional bottlenecks have negatively affected the development of the private sector and the country’s performance in attracting FDI. The report can be downloaded at: https://unctad.org/webflyer/investment-policy-review-gambia.
The Ministry of Justice, which offers a range of administrative services to foreign investors, is the point of entry for company registration. The government has drastically reduced the average number of days it takes to start a business in recent years, from 25 to two.
According to the 2020 Doing Business report, it takes six procedures and, an average of one to two days to start a business in the country. These procedures include registering a unique company name, notarizing company status, obtaining a tax identification number (TIN), registering employees with the Social Security and Housing Finance Corporation, registering with the Commercial Registry, and obtaining an operational license. While this can be done by anyone in theory, a local attorney who is familiar with the system can facilitate the process. In 2010, a Single Window Business Registration Desk was established at the Ministry of Justice. This initiative has reduced the number of days it takes to register a business in the country to one day.
Foreign investment in The Gambia is facilitated by the GIEPA and the Gambia Chamber of Commerce and Industry (GCCI). The two organizations’ mandate includes export promotion and support for small and micro enterprise (SME) development. Domestic investors have no limitations when it comes to investing abroad. Post has been working with the American Chamber of Commerce to expand its role in facilitating trade between The Gambia and the United States.
2. Bilateral Investment and Taxation Treaties
The Gambia signed Bilateral Investment and Taxation Treaties with following countries: UAE, Mauritius, Kuwait, Turkey, Spain, Iran, Morocco, Taiwan, Mali, Guinea, Netherlands, United Kingdom, Qatar, Ukraine, Mauritania, Libya, and Switzerland. In April 2019, The Gambia became the 22nd country to approve the Africa Continental Free Trade Agreement (AfCFTA), allowing the agreement to meet the minimum threshold and come into force. The AfCFTA, which was enacted in 2018, seeks to create the largest trade zone in the world, increase intra-African trade by 52% by 2022 and remove tariffs on 90% of goods.
The Gambia is a member of the Economic Community of West African States (ECOWAS) and acceded to the World Trade organization (WTO) in 1996. The Gambia does not have a bilateral trade agreement with the United States, but as a member of ECOWAS it is a beneficiary of the Trade and Investment Framework Agreements (TIFAs) which the United States has had with the West African Economic and Monetary Union (WAEMU) since 2013. The Gambia regained its African Growth and Opportunity Act (AGOA) and Millennium Challenge Corporation (MCC) eligibility in 2018. In 2019, MCC designed a Power Sector Program in The Gambia which will provide tools over a multi-year period for the Gambian government to improve the Gambia’s electricity sector.
3. Legal Regime
Transparency of the Regulatory System
The GOTG uses transparent policies and effective laws to foster competition on a non-discriminatory basis to establish uniform rules and regulations. The statutes governing The Gambia’s legal, regulatory, and accounting systems are transparent and consistent with international norms. Statute mandates the creation of a commission to advocate for competition in The Gambia. The Gambia Competition and Consumer Protection Commission (GCCP) is a commercial watchdog that ensures the protection of consumers from unfair and misleading market practices and prohibits illegal business practices. The GCCP also determines and imposes penalties or appropriate remedies to ensure businesses refrain from prohibited restrictive practices. Despite the existence of this statutory and regulatory framework, businesses often struggle to timely resolve disputes in the court system, whether the dispute be among private parties or with the government.
There are no informal regulatory processes that are managed by nongovernmental organizations or private sector associations. Rule-making and regulatory authority exists with the President, his cabinet of ministers, and the committee members under the National Assembly of The Gambia, and various government parastatals. The accounting, legal, and regulatory procedural systems of The Gambia are consistent with international norms. Draft bills or regulations are made available to the public for commenting through public meetings and targeted outreach to stakeholders, such as business associations or other groups. This practice is in line with the U.S. federal notice and comment procedures and applies to investment laws and regulations in The Gambia.
There are no informal regulatory processes that are managed by nongovernmental organizations or private sector associations nor is there a formal stock market such as a stock exchange for trading equity securities. The accounting, legal, and regulatory procedural systems of The Gambia are consistent with international norms.
Draft bills or regulations are made available to the public for commenting through public meetings and targeted outreach to stakeholders, such as business associations or other groups. LexisNexis formed a contract with The Gambia in 2009 for the publication of the entire country’s legislation; however, access is not free of charge. The National Assembly is also in the process of compiling all regulatory actions on its website. There is not a centralized online location where key regulatory actions or their summaries are published. The Gambia also lacks a specialized government body tasked with reviewing and monitoring regulatory impact assessments conducted by other individual agencies or government bodies.
There are two types of courts in The Gambia: the Superior Courts, and the Magistrates Courts. Magistrate Courts include the lower courts, such as the Cadi Court and District Tribunals. The lower courts are established by an act of the National Assembly. The judicial power of The Gambia is vested in the courts, which exercise this power according to the respective jurisdictions conferred by acts of the National Assembly. Court processes are outdated and under capacitated, resulting in significant delays to trial and hearing procedures. No new regulatory system reforms have been announced since the last investment climate statement, but regulatory reform efforts announced in prior years are currently being implemented. The Investment Policy Plan of The Gambia is still being drafted.
Proposed laws and regulations are made available to all the relevant stakeholders for their review and discussion at validation workshops. During the process of enactment in the National Assembly, deputies are free to suggest changes. Regulations are not reviewed based on scientific or data-driven assessments. The Gambia Bureau of Statistics is a public agency that develops data based on enacted legislation. Comments received by regulators are not made public and only limited information on debt obligation are publicly available. Documents lack complete information on natural resource revenues as well as financial earnings from state-owned enterprises.
International Regulatory Considerations
The Gambia is a member of Economic Community of West African States (ECOWAS), and as such, is signatory to the 1975 ECOWAS Treaty, which harmonizes investment rules.
The Economic Community of West African States (ECOWAS) first introduced competition legislation in 2008, including a prohibition on anticompetitive mergers. The Gambia has its own regulatory system that is made through collaboration with stakeholders from the international community and NGOs, but retains its base in the UK system of regulations. The Gambia is a member of the WTO, but the government does not notify the WTO Committee on Technical Barriers to Trade (TBT) of draft technical regulations unless requested.
Legal System and Judicial Independence
The country’s legal system is based on English common law, but courts are slow to enforce property and contractual rights due to lack of capacity, lack of data processing and case management systems, as well as antiquated processes – many of which are mandated by laws that are many decades old. The Gambia has a written commercial law found in the Companies Act which is consistently applied. Monetary judgments can be made in both the investor’s currency and local currency. Disputes not covered by statute are governed by common law principles. The constitution provides for an independent judiciary, and the executive has not inappropriately intervened in judicial affairs since former President Jammeh’s departure from office. The Supreme Court, presided over by a chief justice, has both civil and criminal jurisdiction. Appeals against decisions of district tribunals (or the industrial tribunal in the case of labor disputes) may be lodged with the lower courts, the High Court and the Supreme Court, which is the highest court of appeal in the country.
Laws and Regulations on Foreign Direct Investment
The investment laws and regulations of The Gambia apply equally to local and foreign investors. These include unclear provisions of some of the laws related to investment, such as competition, labor, and corruption. Some laws are not effectively implemented due to insufficient regulations. For information on the laws, rules, procedures, and reporting required foreign investors can visit the website of GIEPA.
The Gambia Competition and Consumer Protection Commission (GCCPC) is the body primarily responsible for the promotion of competition and the protection of consumers mandated by three acts, The Competition Act of 2007, The Consumer Protection Act of 2014, and The Essential Commodities Act of 2015. No major investment related laws, regulations, or judicial decisions have been finalized in the past year.
Competition and Anti-Trust Laws
GCCPC is a commercial watchdog that reviews transactions for competition-related concerns and ensures the protection of consumers from unfair and misleading market practices and administers the prohibition of illegal business practices.
Expropriation and Compensation
The Constitution of The Gambia provides the legal framework for the protection of private ownership of property and only provides for compulsory acquisition by the state if this is found necessary for defense, public safety, public order, public morality, public health, or town and country planning. During President Jammeh’s 22 years in office, state paramilitary officials were known to arrive unannounced on private property and tear down any standing structures on the property in question. Claimants alleged a lack of due process and compensation stemming from these incidents under President Jammeh. Reports indicate this practice has ceased since the January 2017 departure of former President Jammeh, although the legacy of land disputes he caused has not yet been unwound.
The Gambia is a member of the International Center for the Settlement of Investment Disputes (ICSID), but there is no specific legislation providing for enforcement of ICSID awards. The Gambia is not a signatory to the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards.
Investor-State Dispute Settlement
The Gambia is a signatory to the 1975 ECOWAS Treaty, revised in 1993, that led to the establishment of a Community Investment Code to harmonize investment rules. The Gambia does not have any BITs or FTAs with the United States.
The local courts recognize and enforce foreign arbitral awards issued against the government. Local courts did not enforce foreign arbitral awards issued against the government during the Jammeh regime due to executive interference.
In June 2013, the government announced a ban on the importation of frozen poultry parts, which constituted the largest U.S. export to The Gambia, worth over USD 7 million a year.
The ban was lifted in November 2013, but a statement issued by the Ministry of Trade imposed a new condition that all shipments of poultry products entering the country require the Society Générale de Surveillance (SGS) to certify that they are hormone-free. Separately, a U.S. financial group purchased a banking group with bank locations in several West African countries, including The Gambia, in 2016. However, the previous owner of the bank refused to acknowledge the new ownership leading to a litigation in Gambian courts against the U.S. financial group starting in 2017. Only after several years and numerous engagements with U.S. officials was the dispute resolved, with the U.S. financial group finally obtaining clear title and license to operate in The Gambia.
A groundnut processing plant at Denton Bridge is the biggest industrial complex in the country. The government seized the plant in 1999 sparking a protracted legal battle. The plant is still not in operation today, partly as a result of that dispute.
The last major dispute with foreign investors was with the Swiss group, Alimenta, over the assets of The Gambia Groundnut Corporation in 1998.
International Commercial Arbitration and Foreign Courts
The Gambia is a member of the International Center for the Settlement of Investment Disputes (ICSID), but there is no specific legislation providing for enforcement of ICSID awards. However, there is an Alternative Dispute Resolution (ADR) mechanism as a means for settling disputes between private parties.
Arbitration is governed by the Alternative Dispute Resolution Act of 2005 and is generally based on the UNCITRAL Model Law with some provisions adapted from the UNCITRAL Rules. The Gambian Chamber of Commerce and Industry (GCCI) is currently engaged in setting up a Dispute Resolution Center. Local courts recognize and can enforce foreign arbitral awards; however, executive directives and interference have prevented them from ably enforcing the awards in the past. There have been reports of complaints about the court processes during former President Jammeh’s regime because rulings tended to overwhelmingly favor the GOTG. For the past year, Gambian SOE’s have not been involved in investment disputes that were determined by domestic courts.
Bankruptcy is covered by the Bankruptcy and Insolvency Act of 1992. Creditors, equity shareholders, and holders of other financial contracts may file for both liquidation and reorganization.
4. Industrial Policies
With a minimum investment threshold of USD 100,000 and USD 250,000, the following incentives are offered to domestic investors and foreign investors respectively:
Tax Holiday: A newly established investment enterprise that falls within any priority investment category is granted a tax holiday with respect to its corporate or turnover tax and depreciation allowance.
Tariff and Import VAT Incentives: A newly established investment enterprise that falls within any priority investment category is granted an import VAT waiver on imported specific goods as per the agreed list of items.
Export Promotion Incentives: An investment enterprise located outside the export processing zone that exports at least 30% of its output is entitled to the following:
10% corporate or turnover tax concession for 5 years.
Financial planning services and advice.
Participation in training courses, seminars, and workshops.
Export market research.
Advertisement and publicity campaigns in foreign markets.
Product design and consultancy
Zone Investor Incentives: An investor operating in an Export Processing Zone and exports at least 80% of its outputs is exempt from payment of numerous duties and taxes, including import VAT waiver on imported goods/items, excise duty, import duty on capital equipment, corporate or turnover tax, municipal tax and depreciation allocation.
SME Support: SMEs are entitled to the following facilities:
Support for research and development.
Income tax deposit waiver.
Market survey and research support.
Foreign Trade Zones/Free Ports/Trade Facilitation
The GIEPA Act provides for Export Processing Zones (EPZ) to be established in separate selected areas to which special customs territory status shall be conferred as well as for the establishment of single factory EPZs for which GIEPA will be the regulator.
An investor operating within an export processing zone that exports at least eighty percent of its output is exempted from the payment of:
Import or excise duty and sales tax on goods produced within or imported into an export processing zone unless the goods are entered for consumption into the customs territory.
Import duty on capital equipment.
Corporate or turnover tax; and
An investment enterprise located outside an export-processing zone that exports at least thirty percent of its output is entitled to the following incentives: a ten percent corporate or turnover tax concession for five years;
a ten percent corporate or turnover tax concession for five years;
participation in training courses, symposia, seminars and workshops on export promotion.
financial planning services and advice.
export market research.
advertisement and publicity campaigns in foreign markets; and
product design and consultancy.
Incentives for investors in the EPZ are valid for maximum period of ten years. Foreign-owned firms have the same investment opportunities as local companies.
Performance and Data Localization Requirements
The government mandates local employment. There is no legislation that applies this scheme to senior management and boards of directors. Foreigners can only represent up to 20 percent of the total number of employees of a company, with no distinction between management personnel and workers.
It is not difficult to obtain visas, residence and work permits or other requirements restricting the mobility of foreign investors and their employees. The recruitment of foreigners is subject to annually renewed applications and payment of an expatriate quota tax, which varies for West African and non-West African employees. The Government of The Gambia restricts the ability of foreigners to invest in The Gambia to the extent that the GIEPA Act states that “a person shall not invest in or operate an investment enterprise which is prejudicial to national security, detrimental to the natural environment, public health, or public morality, or which contravenes the laws of The Gambia.” Those restrictions also apply to Gambians.
There is no known legislation in the investment policy of The Gambia that follows “forced localization” production methods nor are there enforcement procedures for performance requirements. The Consumer Protection Act of 2014 prevents companies from freely transmitting customer or other business-related data outside The Gambia.
There are no known laws that require foreign IT providers to turn over source code and/or provide access to encryption to the local government. As mandated by the Competition Act of 2007 and the Consumer Protection Act of 2014, the GCCPC is the agency responsible for the enforcement of rules on local data storage within the country/economy. It also undertakes critical review of the Competition Act; subsidiary legislation and the GCCPC guidelines; performs all in-house legal advisory work required in the execution of GCCPC’s functions and represents GCCPC in all court and appeal proceedings. The GCCPC enforcement committee provides the agency with all the legal expertise necessary for it to champion competition for growth and choice. Specifically, the Legal Committee Division takes the lead in enforcement action and applies rigorous legal analysis in all investigations and notifications under the Competition Act.
5. Protection of Property Rights
Property rights and interests exist in the laws of The Gambia. Unreliable record keeping and fraudulent transactions undermine fair and predictable enforcement of property rights. The Department of Lands and Regional Government issues title deeds, although parties complain of slow processing. Other bodies—including local governmental and tribal authorities—sometimes issue land titles that conflict with the central government’s records, leading to disputes that often take years to resolve. Property rights and interests, though clearly protected under the laws, were not enforced under the Jammeh regime. Mortgages and liens exist but are largely unused. Many property owners do not have clear title to their land and have no clear means to acquire a clear title.
In 2013, the Land Governance Assessment Framework (LGAF) was launched in The Gambia to assess the number of lands without clear title, but to date, the LGAF implementation has been practically non-existent. Legal owners normally allow squatters to occupy empty lands until they are ready to begin construction, at which time disputes often result in the squatters and “other owners” being evicted by informal means.
The Gambia ranks 132nd on the 2018 World Bank Rankings for Registering Property and 21st for Dealing with Construction Permits. There are specific regulations regarding land lease or acquisition by foreign and/or non-resident investors. In 2007, the Ministry of Lands and Regional Government established the Lands Commission Act:
Section 14 of the act provides for the following functions: “A” The Commission shall:
advise the Secretary of State on political matters relating to land administration to ensure strict adherence to those policies and transparency in land allocations;
investigate disputes on land ownership and occupation in any area in The Gambia;
assess land rent and premium for properties within any area in The Gambia;
monitor the registration of properties and inspect land registers and records;
be responsible for all matters relating to national boundaries, including monitoring and reporting to the Secretary of State; and
perform such other functions as the Secretary of State may assign.
Intellectual Property Rights
The Gambia is a signatory to both the Paris Convention for the Protection of Industrial Property and the Berne Convention for the Protection of Literary and Artistic Works. However, due to a lack of intellectual property rights (IPR) experts, the legal structure for IPR protection is largely weak. Thus, there is a history of IPR infringement in The Gambia. According to the Gambia Police Force (GPF), almost no IPR crimes are reported.
Cabinet approved the intellectual property (IP) policy 2018-2023 in 2019 and the implementation process is ongoing. The policy is the basis for The Gambia acceding to relevant international IP agreements as well as the enactment of the IP act 2020. The AfCFTA was also ratified by the National Assembly and has intellectual property components.
The implementation process of The Gambia Intellectual Property Policy and Strategy 2018-2023, under the auspices of the Office of Registrar General, Ministry of Justice, is ongoing. The National Intellectual Property Council (NIPC) is comprised of the key intellectual property stakeholders in The Gambia; namely, the Ministry of Justice, National Centre for Arts and Culture, Judiciary of The Gambia, Gambia Investment and Export Promotion Agency, Ministry of Higher Education, Research, Science and Technology, Gambia Competition and Consumer Protection Commission, Gambia Technical Training Institute, Gambia Police Force, and Gambia Armed Forces. NIPC is tasked with implementing and monitoring the five-year policy. The NIPC is supported by World Intellectual Property Organization (WIPO) and ARIPO in this endeavor.
The Gambia Police Force (GPF) established an Anti-Intellectual Property Crime Unit at the Police Headquarters in Banjul. The Gambia does keep track of seizures of counterfeit goods. However, there have been no recent reports of the government seizing counterfeit goods, despite the prevalence of counterfeit goods such as pirated movies, music CDs, beauty products, and cigarettes imported from China. The Gambia does not prosecute IPR violations.
The Gambia is not listed in the United States Trade Representative (USTR)’s Special 301 report, nor is it listed in the Notorious Market List.
6. Financial Sector
Capital Markets and Portfolio Investment
Banks and policymakers alike would like to see the exposure ratio return to the long-run average over time, if the emergence of lending opportunities, both large-scale investment projects and retail credit, can be supported by the banks without compromising their financial soundness and overall financial stability. Gambian banks are trying to return to a more balanced portfolio structure in the medium run following the decline in private sector lending relative to investment in government securities. Central Bank of the The Gambia staff contend that the decline in the ratio was delayed by foreign banks entering the local market with an aggressive lending strategy to capture market share.
The country does not have its own stock market. Sufficient liquidity does not exist in the markets to enter and exit sizeable positions. There is no effective regulatory system to encourage and facilitate portfolio investment, or policies to facilitate the free flow of financial resources into the products and factor markets. Credit is allocated on market terms. Personal loans remain rare among Gambians; interest rates exceeding 25% mean that few loans are economically rational. Foreign investors are able to get credit on the local market. The private sector has access to a variety of credit instruments. GoTG respects the IMF Article obligations for member countries and refrains from restrictions on payments and transfers for current international transactions.
Money and Banking System
Total assets of the banking industry increased by 15.6 in 2020, going from D50.88 billion (USD 993 million) to D58.82 billion (USD 1.2 million). In 2019 asset quality improved significantly with a non-performing loan ratio of 3.3%, lower than 7.2% in 2018.
The banking system had been adequately capitalized, liquid, and profitable with a capital adequacy ratio of 32.6 percent in December 2020. The ratio of liquid assets to total assets calculated at 63.8% and the ratio of non-performing loans to total loans at calculated at 6.82%. The three largest banks accounted for D30.97 billion (USD 604 Million) and totaled 53.62% of the industry’s total assets.
At the last Monetary Policy Committee meeting in March 2021, amid fears of the continuous impact of COVID-19, the Central Bank reduced the policy rate to 10%. Net foreign assets of the banking system stood at D16.8 billion (USD 329 million) in December 2019 compared with D10.4 billion (USD 204 million) in 2018. Net domestic assets of the banking system stood at D26.1 billion (USD 512 million) in December 2019 representing an increase of 11.8% from last year. Foreign banks or branches can establish operations in The Gambia but are subject to the country’s banking regulations. One U.S. bank struggled to obtain the necessary approvals to begin operations in the country, but it eventually secured all the necessary permits. All correspondent banking relationships have been maintained for the past three years. There are no restrictions on foreigners opening a bank account.
Foreign Exchange and Remittances
There are no restrictions on foreign investors converting or repatriating funds in The Gambia.
Funds associated with any form of investment can be freely converted into any world currency. The Dalasi (GMD) has a floating exchange rate that is determined by market forces.
The domestic foreign exchange market is stabilized and supported by improved foreign exchange liquidity conditions, together with market confidence in the government and economy. The performance of the external sector, coupled with improved transparency in the exchange rate policy, are major contributing factors to the stability of the exchange rate of the dalasi. The volume of transactions in the foreign market measured by aggregate purchases and sales of foreign currency in the year December 2018 increased to USD 1.96 billion from USD 1.35 billion in December 2017.
Purchase of foreign currency, indicating supply, increased from USD 679.6 million in 2017 to USD 975.7 million in 2018, representing an increase of 43.6%. Improved private remittance inflows, growth in foreign direct investment flows, and project disbursements are contributing factors to the improvement of supply conditions in the market.
The Bank limited its intervention on the domestic foreign exchange market to moves building foreign reserves. In 2018, the Central Bank’s purchases of foreign currencies amounted to USD 31.2 million, all of which went to the foreign currency reserve fund.
There have been no recent changes or plans to change investment remittance policies in The Gambia. Currently there are no time limitations on remittances and investors may repatriate profits and dividends through commercial banks or licensed money transfer agencies at prevailing exchange rates. There are no plans to tighten access to foreign exchange for investment remittances. Remittance and capital transfers stood at USD 588 million in 2020, a 78% rise compared with 2019, leading to a positive balance of payments overall.
Sovereign Wealth Funds
Neither the host government nor a government-affiliate maintains a Sovereign Wealth Fund.
7. State-Owned Enterprises
The Gambia has majority ownership in 13 State-Owned Enterprises that operate in key economic sectors such as agriculture, power generation, energy, and gas. SOEs can also be found in the information and telecommunications, aviation, and finance industries. SOE revenues are not projected in budget documents. Audits of the public sector and SOEs are conducted by the Gambia’s Supreme Audit Institution. The following is a list of 13 SOEs.
Assets Management & Recovery Corporation (AMRC)
Gambia Civil Aviation Authority (GCAA)
Gambia Groundnut Corporation (GCC)
Gambia International Airlines (GIA)
Gambia National Petroleum Company (GNPC)
Gambia Ports Authority (GPA)
Gambia Postal Services (GAMPOSTS)
Gambia Public Printing Cooperation (GPPC)
Gambia Radio & Television Services (GRTS)
Gambia Telecommunication Cellular Company (GAMCEL)
Gambia Telecommunication Company (GAMTEL)
National Water and Electricity Corporation (NAWEC)
Social Security Housing & Finance Corporation (SSHFC)
The Gambia’s government imposed an embargo on state-owned enterprises (SOEs) borrowing from each other in June 2020, according to the Minister of Finance and Economic Affairs during a National Assembly session. SOEs in the past had defaulted in their payments to Social Security.
Private enterprises can compete with public enterprises under the same terms and conditions with respect to access to markets, credit, and other business operations, such as licenses and supplies. Foreign telecommunications companies are subject to GAMTEL regulations, which inherently favor the government entity. There is a published list of SOEs on The Ministry of Finance website. The Public Private Partnership Unit at the Ministry of Finance monitors the SOEs.
The Government of The Gambia is currently not engaged in any forms of privatization programs.
8. Responsible Business Conduct
The notion of corporate social responsibility is not well known in The Gambia and only some state-owned enterprises and some private companies, such as banks and mobile phone companies, adopt Responsible Business Conduct (RBC) as a policy.
Gambian laws generally contain a provision that ensures social and environmental protection of its citizens, regardless of activity and its potential for income for the country. There have been no recent high profile, controversial instances of private sector impact on human rights or resolution of such cases. Currently no national action plan on RBC has been enacted. Agencies that promote or enforce RBC include the Public Utilities Regulatory Agency (PURA), The Gambia Competition and Consumer Protection Commission (GCCPC), The Gambia Investment and Export Promotion Agency (GIEPA), The Gambia Chamber of Commerce and Industry (GCCI), the Standards Bureau, and the Gambia Revenue Authority.
Any project with potential environmental impact is subject to an Environmental Impact Assessment (EIA) conducted by the National Environment Agency (NEA) before a license or permit is granted. These projects include hotels, roads, bridges, mining, large-scale agricultural projects, processing and manufacturing industries, fish processing, waste disposal, and installation of electrical lines. Despite its efforts to enforce domestic laws, the NEA is heavily underfunded and short of resources to implement adequate environmental protections. The Gambia has adopted several measures to support environmental protection and reduce the impact of environmental damage.
According to the GIEPA Act, “the Government shall take all necessary measures to protect investments and the property of investors in accordance with the laws of The Gambia and the bilateral investment Treaties.” In most cases, the understanding of RBC is limited to the allocation of funds to charitable causes such as supporting schools and health projects, disaster relief, and environment enhancement. Banks and mobile phone companies often use such donations for publicity and marketing. The Gambian public often views these firms favorably.
Foreign and local enterprises are encouraged to follow RBC principles such as the OECD Guidelines for Multinational Enterprises and the United Nations Guiding Principles on Business and Human Rights. Areas where natural resources are extracted are not subject to conflict. GoTG does not specifically promote the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Afflicted and High-Risk Areas. The Gambia does have a substantial extractives industry, but GoTG does not participate in the Extractive Industries Transparency Initiative (EITI) Standards or the Voluntary Principles on Security and Human Rights. There are no domestic transparency measures requiring the disclosure of payments made to government and/or of RBC/BHR policies or practices.
There are laws in place to combat corruption by public officials in The Gambia. These laws are ineffective because the committees, which are commissioned to enforce them, are yet to be fully established. In cases when trials are conducted, they are conducted in a non-discriminatory manner. The anti-corruption laws of The Gambia extend to family members of officials and political parties alike. The anti-corruption laws of The Gambia contain laws or regulations that counter conflict-of-interest in awarding contracts or government procurement. Low-level corruption is prevalent, and high-level corruption is likely common but remains underreported. Companies importing goods through Banjul Port report regularly being solicited for bribes.
The Gambian Government encourages private companies to establish internal codes of conduct that prohibit bribery of public officials. The constitution of The Gambia calls for internal codes of conduct (Section 222), as do the OECD Guidelines on Corporate Governance to which The Gambia is a signatory. Private companies use internal controls and other programs to detect and prevent bribery of government officials. Private companies use internal controls and other programs to detect and prevent bribery of government officials.
The Gambia has signed and ratified the African Union Convention on Preventing and Combating Corruption and Related Offences but has not ratified the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. In May 2014, The Gambia ratified the UN Anticorruption Convention. During former President Jammeh’s rule, the GOTG did not provide protections to NGOs involved in investigating corruption. However, such protections are likely to be part of the new administration’s pledge to act regarding the African Union Convention on Preventing and Combatting Corruption.
Post has received reports that foreign companies from certain countries routinely use inducements equating to bribery to secure Gambian government and para-statal contracts
President Barrow pledged to introduce a bill in the National Assembly by December 2019 to create an anti-corruption commission, but no progress has been made. Since President Barrow took office in 2017, the government has turned a blind eye to corruption and no one has been convicted of corruption. President Barrow promised during his presidential campaign that his government would be transparent and accountable to the Gambian people, and that cabinet ministers would publicly declare their assets. However, after taking office, he backtracked on his promise. Cabinet ministers will only have to disclose their assets to the Ombudsman’s Office. Some ministers have yet to declare their assets, according to the report, but have declined to reveal their identities. Such declarations also do not include assets belonging to spouses and other immediate family members.
No international, regional, or local NGO operating as “watchdog” organizations monitoring corruption are known to exist in the country.
Resources to Report Corruption
Commanding Officer, Fraud & Commercial Crime Unit
Gambia Police Force
The Gambia (+220) 4223015 / 4222307
10. Political and Security Environment
Public protests, demonstrations, and strikes occasionally occur, and theoretically require a police permit before hosting such activities. Political rallies are likely to occur in the months leading up to the December 2021 elections. Americans are advised to avoid large political gatherings, as peaceful gatherings can potentially turn violent quickly. Opposition parties may or may not be issued permits, potentially resulting in unapproved rallies. Public protests or demonstrations sometimes result in moderate property damage.
11. Labor Policies and Practices
As of 2020 the total labor force in The Gambia stood at 774,759, according to the World Bank collection of development indicators. In 2019, the labor force participation rate is 60.75%. The Gambia suffers from high unemployment and underemployment, compounded by a shortage of skilled workers and trained professionals. About 59% of the individuals in the labor force have no formal education. Many of the skilled workers in the construction and mechanical industries are foreigners from neighboring countries. However, many Gambians are now taking up these trades and the government is eager to increase primary and secondary school enrollment.
Several government policies require the hiring of nationals, including The Labor Act of 2007, The Payroll Tax Act of 2008, and the social security act. The Labor Act of 2007 and its regulations provide the legal framework for labor relations in The Gambia. The Ministry of Trade, Regional Integration and Employment enforces the Act. It covers most conditions of employment, including dismissals, recruitment and hiring, registration and training, protection of wages, registration of trade unions and employees’ organizations, and industrial relations in general. The Act also contains procedures for the settlement of disputes, including an industrial tribunal. Minimum wages and working hours are established through six joint industrial councils: commerce, artisans, transport, port operations, agriculture, and fisheries. Private-sector employees receive between 14 and 30 days of paid annual leave, depending on length of service. Depending on how the person’s wage is paid, one or two months’ notice or a week to two weeks’ notice is required (Section 55 of the Labor Act 2007). In Gambia, there is no unemployment insurance. Although laid-off workers are entitled to a portion of their social security contributions. There are no additional/different labor law provisions in special economic zones, foreign trade zones, or free ports concerning the economy. No new labor related laws were enacted during the last year. Most Gambians work in the informal sector, and receive none of the protections provided by law.
In Gambia, collective bargaining is uncommon. Gambia has no organized trade unions.
According to statute, the Department of Labor (DOL) settles individual and collective conflicts by inviting parties to a meeting to conciliate or mediate with the goal of amicably settling the matter. If the matter is not resolved within a month, DOL refers it to the industrial tribunal for resolution. In reality, the DOL lacks sufficient funding to implement any of this procedure.
There were no strikes during the last year that posed an investment risk. There are no serious questions of compliance in law or practice with international labor standards that may pose a reputational risk to investors.
The International Labor Organization reported potential gaps in law or practice with respect to international labor standards, including reporting on Gambia’s ratified Fundamental Conventions. Every three years, report must be submitted on the implementation of these Conventions.
12. U.S. International Development Finance Corporation (DFC) and Other Investment Insurance or Development Finance Programs
The United States International Development Finance Corporation (DFC) has a limited presence in The Gambia. However, there is a program that will develop an integrated waste to energy and water purification plant for the GOTG to sustainably fund essential services – clean water, renewable energy and environment clean-up. There is potential in the following sectors: Agriculture (Rice, Processing Fruits), Energy (Oil Exploitation, Renewable Energies) Fisheries, Infrastructure (ICT, Light Manufacturing, roads) and Tourism. A DFC agreement exists between The Gambia and the United States. 13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
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
Host Country Gross Domestic Product (GDP) ($M USD)