Burkina Faso: Invertir a Burkina Faso
According to the World Investment Report 2021 by the UNCTAD, FDI inflows into Burkina Faso declined slightly from USD 163 million in 2019 to USD 149 million in 2020. The total stock of FDI stood at USD 3 billion in 2020. In 2021, global FDI flows rebounded strongly, but FDI flows to African countries (excluding South Africa) rose only moderately (UNCTAD’ Investment Trends Monitor). The mining sector attracts most of the investments and the exploration of new deposits has been increasing. The country's soils contain gold as well as zinc and manganese. The main investing countries are Lebanon and France (70% of FDI). The creation of three new growth centres, after the success of the Bagré Reservoir, is expected to spur new activities and attract investment. The government is interested in exploring areas that are potentially suitable for oil extraction. Two new mines became operational in 2017 (Houndé and Netiana) and the country is looking to exploit the Tambao deposit (worth USD 1 billion, currently the largest in the world reserve of manganese, with an estimated 55 million ton), which should bring in significant foreign investment.
Burkina Faso encourages FDI and offers tax and legal incentives, such as the possibility for a foreign company to own 100% of shares in a local company. However, investments in sectors such as mining, telecommunications, financial services and electricity are subject to restrictions. The country's economy is favourable to trade, and the condition of its infrastructure is considered satisfactory. However, its lack of access to the sea and agricultural resources, as well as the weakness of its industrial sector, constitute major hindrances to investments. The business climate is still poor compared to international standards. In World Bank's 2020 Doing Business Report, the country has been ranked 151st worldwide, for the ease of doing business. The country remained at this same ranking from the 2019 edition. While improving access to credit information, the country needs to work on access to electricity, protecting minority investors, resolving insolvency issues and strengthening contracts. Political instability, as well as insecurity and violence linked to the jihadi insurgency are negatively affecting business climate.
Foreign Direct Investment | 2019 | 2020 | 2021 |
FDI Inward Flow (million USD) | 163 | -102 | 137 |
FDI Stock (million USD) | 2,618 | 2,750 | 2,670 |
Number of Greenfield Investments* | 6 | 5 | 4 |
Value of Greenfield Investments (million USD) | 530 | 325 | 90 |
Source: UNCTAD, Latest available data
Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.
Country Comparison For the Protection of Investors | Burkina Faso | Sub-Saharan Africa | United States | Germany |
Index of Transaction Transparency* | 7.0 | 5.5 | 7.0 | 5.0 |
Index of Manager’s Responsibility** | 1.0 | 3.5 | 9.0 | 5.0 |
Index of Shareholders’ Power*** | 5.0 | 5.5 | 9.0 | 5.0 |
Source: Doing Business, Latest available data
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.
The strong points of the Burkinabé economy include:
The main challenges for foreign investors include:
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Actualitzacions: March 2023