TRADE AND INVESTMENT
www.togoinvest.tg
www.togoembassylondon.com
TOP TEN REASONS FOR INVESTING IN TOGO
1. Togo’s huge economic an human potential
2. Investor-friendly environment
3. A stable currency
4. Peace, political stability and good geographical location
5. Membership of regional economic organizations such as WAEMU and ECOWAS
6. Port and airport infrastructures
7. Modern administration
8. Availability of skilled labour
9. Availability of ICT companies
10. Availability of nationwide optical fibre to interconnect businesses locally and internationally
FOREIGN DIRECT INVESTMENT
Despite gradual opening of Togo to the global market, FDI is only allowed in certain sectors. According to the UNCTAD's World Investment Report 2020, FDI inflows increased to USD 133 million in 2019, a turnaround from USD -183 million in 2018, caused by growing intracompany loans and record-high reinvested earnings. The FDI stock amounted to USD 1.6 billion in 2019. Foreign ownership of land is restricted and capital transactions are subject to government control or approval. Improving the business environment and launching power plant construction projects should facilitate an increase in FDI in the coming years. Togo has a free trade zone, which has attracted so far over 60 companies and employs more than 12,000 people. In addition, the country adopted a new mining code in February 2017, which aligns local standards with those of UEMOA (Economic and Monetary Union of Central Africa). The French group Bolloré has invested in the construction of a third wharf in the port of Lomé. The sectors that attract most foreign investment are phosphates, cotton, infrastructure, coffee and cocoa. France, Canada and Brazil are the main investors.
The country was ranked 97th worldwide, for the ease of doing business in the 2020 edition of the World Bank's Doing Business Report. This represents a significant improvement from 2019 edition when the country was ranked 137th. Starting a business, dealing with construction permits, getting electricity, registering property, and obtaining credit are the main subcategories of the ranking where Togo has made major improvements. This strong performance is the result of various reforms set to attract investments. Most investments target the primary sector (phosphate, cotton, etc.) and the tertiary sector (port infrastructure). Togo has implemented a strategy to digitise and automate tax payment and business creation procedures. Reforms also include the implementation of a single window for investment, reduction of the minimum capital for the creation of a company and as well as the reduction of the costs of obtaining building permit. The country has improved the monitoring and regulation of power outages by recording data on the annual Average System Outage Duration Index (SAIDI) and the System Average Interruption Frequency Index (SAIFI). Electricity cost has also been reduced through lower amount charged by the utility for outdoor work and the security deposit for a new connection. However, many efforts remain to be made to attract Foreign Direct Investments in more sectors.The country has improved access to loans by creating a credit bureau, but in this area there is still room for improvement. Togo, if it wants to gain positions in the World Bank's ranking and improve its business climate, must also focus on the protection of minority investors, the execution of contracts, the resolution of problems related to insolvency and the simplification of system of payment of taxes. Access to property and construction permits are often long and costly.