Benin: Investing

FDI in Figures

Most of the FDI in Benin, since 1990, were done through the acquisition of interests in privatized companies. Many infrastructure projects are funded by grants or loans from the World Bank or other international development banks. Due to the economic crisis, FDI in-flow, which had been increasing in recent years, has slowed down since 2008 and remains weak.

Unmotivated and corrupt officials, poor infrastructures and problems related to the electricity supply limit the country's potential attractiveness.

Benin's strong points are its strategic location near a potential market of 200 million inhabitants, its role as a trade hub for second-hand vehicles imported from Europe and resold in all Western Africa, and the fact that it is one of the most democratic nations in the African continent. Benin has taken several initiatives to attract foreign investment (particularly in the electricity generation sector), such as creating a Presidential Investment Council.

Benin's main foreign investing countries are France and other European countries, as well as Canada.

Country Comparison For the Protection of Investors

	Benin	Sub-Saharan Africa	United States	Germany
Index of Transaction Transparency*	6.0	4.8	7.0	5.0
Index of Manager’s Responsibility**	1.0	3.4	9.0	5.0
Index of Shareholders’ Power***	3.0	5.0	9.0	5.0
Index of Investor Protection****	3.3	4.4	8.3	5.0

Source: Doing Business - Last 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 Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment	2008	2009	2010
FDI Inward Flow (million USD)	174	135	111
FDI Stock (million USD)	602.4	738.5	849.5
Performance Index*, Ranking on 141 Economies	93	99	-
Potential Index**, Ranking on 141 Economies	138	-	-
Number of Greenfield Investments***	1.0	-	-
FDI Inwards (in % of GFCF****)	12.9	6.4	-
FDI Stock (in % of GDP)	9.1	10.5	-

Source: UNCTAD - Last Available Data

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field 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. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

Tax Rates

VAT: 18%
Exports of goods and services are zero-rated.
Company Tax: 30%
Withholding Taxes: Dividends: 10/18%, Interest: 15%, Royalties: 15.2%
Bilateral Agreement: Benin and Lebanon are not bound by a Double Taxation Agreement.
Social Security Contributions Paid By Employers: 15.4% + 1 to 4% of industrial injury insurance, depending on the degree of risk in the employment.

Country Comparison For Corporate Taxation

	Benin	Sub-Saharan Africa	United States	Germany
Number of Payments of Taxes per Year	55.0	37.3	11.0	16.0
Time Taken For Administrative Formalities (Hours)	270.0	315.1	187.0	215.0
Total Share of Taxes (% of Profit)	66.0	68.0	46.8	48.2

Source: Doing Business - Last Available Data.

Investment Opportunities

Tenders, Projects and Public Procurement: Tradeinvest Africa, Tenders in Africa
African Tenders
DgMarket, Tenders Worldwide
Setting Up a Company: Consult Doing Business Website, to know about procedures to start a Business in Benin.
Useful Resources: Promotion of development centre (CPI)
Economic Developments and Prospects in Benin - African Economic Outlook

Business Setup Procedures

Setting Up a Company	Benin	Sub-Saharan Africa
Procedures (number)	7.00	8.90
Time (days)	31.00	45.20

Source: Doing Business.

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