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Conditions for Doing Business in Benin

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Benin: flow of FDI in 2018 - 207,5 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 https://www.acbf-pact.org/) 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.
Benin ACI 2019 Rank 12 Score 58.4
Cluster 1 Policy environment for capacity development 96.7
Cluster 2 Processes for implementation 34.8
Cluster 3 Development results at country level 100.0
Cluster 4 Capacity development outcomes 51.7

Agency of promotion of investments and exports
Agence de Promotion des Investissements et des Exportations
http://gufebenin.org/

Incentives and Guarantees for foreign investors
In Benin there are two main lows which regulate foreign investments juridically – The Investment code (French – Code des investissements) (1990), Markets code (French – Code des marches) (2009). Besides these two codes, economic activity for foreign investors is determined in regulatory enactments on corresponding areas.
According to the article 11 of the Investment Code the provisions relating to investments in Benin encompass a treatment under the general law, as well as preferential and special treatments which give national and foreign enterprises customs and fiscal advantages: treatment A covering small and medium-scale enterprises; treatment B for large-scale enterprises; treatment C or tax-flattering out treatment. According to the articles 15 and 57 the Investment Code the special treatment covers artisanal and following enterprises: service-providing enterprises belonging to the sectors of health, education and public works, the investment amount of which shall be at least equal to 20 million CFA francs (it is equal to 30490 euro) and in some other activities relevant to the objectives of the National Plan of Social and Economic Development, the investment amount of which range between 5 and 20 million CFA francs (it is equal to 7623 and 30490 euro). Above-mentioned enterprises will enjoy from their establishment a reduction of 75% in import duties and taxes, barring highway maintenance tax and statistical tax on: machineries, equipment and implements meant for production or operation, spares parts specific to such equipment imported within the limit of an amount equal to 15% of the CIF value of the equipment (art. 58 of the Investment Code).

The Investment code is brought in accordance with the legislation of Organization on harmonization in Africa of economic right - OHADA (French - Organisation pour l'Harmonisation en Afrique du Droit des Affaires), Benin is member of OHADA.
With the purpose of foreign investments’ advancement in July 1998 in Benin was created Center of investments’ advancement (French - Centre de Promotion des Investissements).

After the widespread programme of nationalization in the years following the independence, Benin started to liberalize its economy in 1989 as a means to increase private sector activities and FDI. By 2005, the Government of Benin had privatized or liquidated more than one hundred and fifty stateowned companies in such industries as cement, textiles, brewing and tobacco. The government is also committed to strengthening transparency in public administration and public procurement, and ending corruption [UNCTAD. World investment directory. Volume X. Africa. United Nations. N.Y. and Geneva. – 2008, p. 87].

Long late in interconnection and cellular phone, Benin has implemented a determinate policy to modernize its equipment and liberalize the telecommunications sector. With the allocation by the government of five GSM licenses, the mobile telephony sector is on a growing fame. Agreements of "Roaming" are under negotiation and already concluded with some operators (Libercom and Itinéris in France for example). Formerly called Office of Post and Telecommunications, the sole and traditional operator is split into two large entities BENIN TELECOMS SA and THE POST. The telecommunication branch is on process to privatization, what should help to speed up the boosting of this sector
Benin signed to the Convention on the Settlement of Investment Disputes between State and Nationals of other States on September 10, 1965 and is a member of the West African Economic and Monetary Union which imposes a common external tariff.

Benin was also a founding member of the Economic Community of West African States and is engaged in a convergence programme for regional integration in the West African Franc Zone, the Union Economique et Monetaire Ouest-Africaine. Monetary policy is controlled by the regional central bank, BCEAO. Membership of the franc zone limits government borrowing and money creation, while the BCEAO sets interest rates. Benin is a member of the African Union, New Partnership for Africa's Development and is eligible for the United States' market access initiative for African countries – the African Growth and Opportunity Act, the European Union (EU) initiatives - Everything But Arms and the Cotonou Agreement for renegotiating the African, Caribbean and Pacific countries' partnership treaty with the EU. It is also eligible for all the market access under the generalized system of preferences schemes available to the least developed countries and a member of the World Trade Organization [UNCTAD. World investment directory. Volume X. Africa. United Nations. N.Y. and Geneva. – 2008, p. 87].

Prospects for economic cooperation with Benin:
- agroindustry;
- processing of foodstuff;
- mining;
- fishing;
- manufacturing;
- construction;
- energy;
- transportation;
- education;
- scientific cooperation on oceanography and agroindustry;
- tourism.