Burkina Faso: Investing

FDI in Figures

Burkina Faso encourages FDI and offers tax and legal benefits, such as the possibility for a foreign company to own 100% shares in a local company. However, investments in sectors like mining, telecommunications, financial services and electricity are subject to regulations.

Important reforms are being undertaken to facilitate the return of investors into the country. Burkina Faso is eligible for the Millennium Challenge Account subvention, which could increase investments in the country's human capital.

The country has an economy which is favorable to trade and the condition of its infrastructures are considered satisfactory. However, it lacks access to the sea, it also lacks natural resources and the weakness of its industrial sector constitute major hindrances to investors.

The mining sector draws most of the investments. The main investing countries are Lebanon, Libya and France. France accounts for 70% of FDI.

Country Comparison For the Protection of Investors

	Burkina Faso	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***	4.0	5.0	9.0	5.0
Index of Investor Protection****	3.7	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)	137	171	37
FDI Stock (million USD)	696.6	868.0	905.1
Performance Index*, Ranking on 141 Economies	111	72	-
Potential Index**, Ranking on 141 Economies	129	-	-
Number of Greenfield Investments***	2.0	1.0	-
FDI Inwards (in % of GFCF****)	8.2	16.4	-
FDI Stock (in % of GDP)	8.8	11.2	-

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%
Company Tax: 30%
Withholding Taxes: Interests: 25%, Dividends: 12.5%, Royalties: 20%.
Bilateral Agreement: Burkina Faso and Lebanon are not bound by a Double Taxation Agreement.
Social Security Contributions Paid By Employers: 16%

Country Comparison For Corporate Taxation

	Burkina Faso	Sub-Saharan Africa	United States	Germany
Number of Payments of Taxes per Year	46.0	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)	44.9	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
African Development Bank Group, Public Oversight Body
DgMarket, Tenders Worldwide
Setting Up a Company: Consult Doing Business Website, to know about procedures to start a Business in Burkina Faso.
Useful Resources: Trade point, The national office for foreign trade (only in french)
Economic Developments and Prospects in Burkina Faso - African Economic Outlook

Business Setup Procedures

Setting Up a Company	Burkina Faso	Sub-Saharan Africa
Procedures (number)	4.00	8.90
Time (days)	14.00	45.20

Source: Doing Business.

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