To support industrial and economic development, the government has adopted a multipronged approach: a public investment programme to rebuild and improve infrastructure; mobilisation of private sector investment through public-private partnerships; improvements to the business environment to stimulate private sector investment more broadly; and promotion of the transformation of raw materials prior to export (see Economy chapter).
GOVERNMENT INITIATIVES: In a joint survey put out by the Ministry of Economy and Finance and the General Confederation of Businesses of Côte d’Ivoire (Confédération Générale des Entreprises de Côte d’Ivoire, CGECI), 64% of senior managers across all sectors responded that they were somewhat happy with the government’s policies, 11% were completely happy, while the remaining respondents were not at all happy. Only a quarter of managers reported being satisfied with the government’s actions in the areas of taxation and the judiciary.
Recognising the imperative to stimulate private investment to complement and ensure the success of its ambitious public investment programme, the government has adopted and begun to implement a reform agenda that is aimed at improving the business environment and developing the country’s industrial base. One of the flagship pieces of legislation was the new Investment Code (see Economy chapter), adopted in 2012, which sets out more comprehensively the rights and responsibilities of investors, foreign and domestic alike.
It is not uncommon for senior government ministers to meet with potential investors. The government is actively courting foreign investment in the agro-processing sector, as well as construction materials, recycling (of plastic packaging, glass and paper), perfume production, cultural development, food supplements, pharmaceuticals, extraction of essential oils for medical purposes and the production of sulphuric acid, among other areas. It also invites investment in the mining sector, projects that will improve quality control and standards, and ventures that will increase the availability of primary products.
FREE ZONES: Export processing zones (EPZs) are an economic development model that has been successfully implemented in many countries. Typically, areas of a country are designated specifically for industrial use and made subject to a special, more attractive regulatory regime.
In 2007, the then-president laid the foundations for a free zone in Grand Bassam. It was to be dedicated to biotechnology and ICT. The initial aim was to attract 100 firms and create more than 20,000 jobs by 2015, supported by investment of CFA200bn (€300m). Among the incentives were exemptions from duties on imported raw materials and exemptions from paying corporation tax for a period of five years. Reduced corporate tax and royalties would become payable in the sixth year of operation.
While employment restrictions were not to be placed on firms, a further 50% reduction in taxes payable could be sought if at least 75% of workers were Ivoirian nationals. The project has been a moderate success, attracting 50 firms by early 2013. A second free trade zone was planned for the port of San Pédro, but it never became fully operational.
WAY FORWARD: Firms complain that it can be difficult to obtain information from the authorities relevant to the operation of the zones. The authorities are reportedly in the process of reappraising the zones with a view to expanding the range of sectors to which they apply, and making it easier for business to locate there. More needs to be done to ensure that the free zones are well connected to the country’s infrastructure networks, particularly in places where road quality has deteriorated. The 2012 Investment Code also introduced a selection of fiscal and other incentives for investors to locate in the country, with the incentives increasing in line with their distance from the commercial capital, Abidjan.
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