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Conditions for Doing Business in Burkina Faso


Burkina Faso: flow of FDI in 2018 - 480 mln US Dollars (at current prices, UNCTAD)
FDI - Foreign Direct Invetsment

Africa Capacity Index (ACI) 2019
Since 2011, the African Capacity Building Foundation (ACBF – specialized agency of the AU, located in Harara, Zimbabwe publishes an annual Africa Capacity Report (ACR).
The ACR measures and examines the capacity of African countries to pursue their development agenda, focusing on key determinants and components of capacity for development. ACBF defines capacity as the “ability of people, organizations, and society as a whole to manage their affairs successfully” and capacity development as the process by which “people, organizations, and society as a whole unleash, strengthen, create, adapt, and maintain capacity over time.
Capacity of African countries, examined in ACR, is reflected by Africa Capacity Index (ACI). The ACI - is a composite index computed from a quantitative and qualitative assessment of four sub-indices or indicator “clusters” on a specially designed questionnaire. “The policy environment cluster” considers the conditions that must be in place to make transformational change and development possible. “The processes for implementation cluster” assesses the extent to which countries are prepared to deliver results and outcomes. “The development results at country level cluster” refers to tangible outputs that encourage development. And “the capacity development outcomes cluster” measures change in the human condition.
Burkina Faso ACI 2019 Rank 2 Score 67.0
Cluster 1 Policy environment for capacity development 96.1
Cluster 2 Processes for implementation 69.5
Cluster 3 Development results at country level 100.0
Cluster 4 Capacity development outcomes 40.2

Incentives and Guarantees for foreign investors
In Burkina Faso the main low which regulates foreign investments juridically is The Investment code (French – Code des investissements) of 14th of December 1995. Besides this code, economic activity for foreign investors is determined in regulatory enactments in corresponding areas.
The Ministry of Industry, Commerce and Mines approves new foreign investments, based on the recommendations of the National Investment Commission. The commission's main criterion is the investment's direct value added. The investment code established three incentive schedules. Schedule 'A' is for investments of less than FCFA 200 million (it is equal to 304898,04 euro) and grants companies with an exemption from most taxes for the first five years of its existence. A tax credit is granted for the ensuing five-year period. Moreover, companies in schedule "A" are permitted to stagger payment of Burkina Faso's registration tax over a four-year period. The registration tax is equal to 3% of the capital invested. Schedule "B" is for investment over FCFA 200 million (it is equal to 304898,04 euro) and grants companies with an eight-year tax exemption from most Burkinabe taxes. It also enables a company to spread the payment of the registration tax over a five-year period.

Also, all schedule "A" and "B" investments outside the country's two major cities – Ouagadougou and Bobodioulassou receive the above benefits for five extra years. Schedule "'C' only applies to export companies and grants permanent exemption from all Burkinabe taxes. In 2005, Burkina Faso halved the fee for registering new contracts and commercial agreements, and reduced the import tax on basic goods from 2% to 1% for formal-sector businesses. The government also made effort to ease business registration through the setting up of a one-stop shop for investors in Ouagadougou—Centre de formation des enterprises (Cefore), officially launched in May 2006, and the simplification of administrative procedures.

Burkina Faso signed to the Convention on the Settlement of Investment Disputes between State and Nationals of other States on September 16, 1965, is a member of several regional and international organizations and has fostered international investment agreements with developing and developed countries. For instance, Burkina Faso is a member of the West African Monetary and Economic Union, BCEAO, Economic Community of West African States, New Partnership for Africa's Development and African Union. It signed a cooperation treaty with France, a trade, investment protection and technical cooperation agreement with Switzerland and the Cotonou Agreement for renegotiating the trade partnership agreement between African, Caribbean and Pacific countries with the European Union (EU). Burkina Faso is eligible for the African Growth and Opportunity Act, and the EU's Everything But Arms market access initiative. The country is a member of the World Intellectual Property Organization and the World Trade Organization. [UNCTAD. World investment directory. Volume X. Africa. United Nations. N.Y. and Geneva. – 2008, p. 109].

Prospects for economic cooperation with Burkina Faso:
- agroindustry;
- processing of foodstuff;
- mining;
- machine building;
- manufacturing
- construction;
- energy;
- transportation
- education;
- tourism.