Conditions for Doing Business in the Gambia
Gambia: flow of FDI in 2018 - 29,2 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.
Gambia ACI 2019 Rank 34 Score 43.9
Cluster 1 Policy environment for capacity development 90.1
Cluster 2 Processes for implementation 34.8
Cluster 3 Development results at country level 50.0
Cluster 4 Capacity development outcomes 32.0
Incentives and Guarantees for foreign investors
In Gambia there are two main lows which regulate foreign investments juridically – The Gambia Investment Promotion Act (2001) and The Gambia Free Zones Act (2001). Besides these two codes, economic activity for foreign investors is determined in regulatory enactments on corresponding areas.
In 2001 government created The Gambia Investment Promotion and Free Zones Agency (GIPFZA) – Is the Government agency mandated to promote foreign investment. GIPFZA serves as the link between investors and national authorities connected with business registration, administration of incentive and other support facilities associated with investing in The Gambia. The Agency has instituted a one-stop-shop service to provide all the information and help investors at the first stage of establishment and to continue rendering assistance to ensure the smooth functioning and sustainability of such business ventures.
In The Gambia, there are two separate but complementary environments for FDI: the free zones and outside the free zones. Separate and different activities take place in these two environments and the activities are governed by respective rules. Different incentives and responsibilities go with each environment. Investment activities in the free zones may include: warehousing, bulk breaking, labeling and packaging, financial and offshore services. Investments here should contribute positively to domestic capital formation and about 70% of the output of companies here should be for export markets. Investment outside the free zones should aim to set up companies and partnership under the laws of The Gambia and in the priority sectors such as agriculture, fisheries, tourism and manufacturing. Outside free zones, investment in The Gambia require at least US $100,000 in fixed assets.
Incentives for investment are different in or out of the free zones. But all foreign investment in The Gambia benefit from exemptions from withholding tax and tax on dividends, exemption from customs duty on imported capital equipment, machinery and approved quantities of semi-finished products. They may or may not be exempted from sales taxation.
The Gambia signed to the Convention on the Settlement of Investment Disputes between State and Nationals of other States on 1 October 1974 and has membership of several international bodies and organizations which provide market-cushion for the outputs of international investors. The Gambia is a member of the Economic Community of West African States, New Partnership for Africa's Development and the African Union.
The country is an eligible member of the United States' market access initiative for African countries – the African Growth and Opportunity Act, the Cotonou Agreement for renegotiating the trade links between the European Union (EU) and the African, Caribbean and Pacific countries and the EU's Everything But Arms initiative. The Gambia is also among the thirty-four African least developed countries that have the option of entering the EU generalized system of preferences and is a member of the World Trade Organization [UNCTAD. World investment directory. Volume X. Africa. United Nations. N.Y. and Geneva. – 2008, p. 283].
Prospects for economic cooperation with Gambia:
- agroindustry;
- processing of foodstuff;
- mining;
- fishing;
- manufacturing;
- construction;
- energy;
- transportation;
- education;
- tourism.
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