According to the World Investment Report 2022 published by UNCTAD, FDI inflows into Burkina Faso recovered to USD 137 million in 2021, after negative net FDI inflows of USD -102 million in 2020. The total stock of FDI stood at USD 2.67 billion in 2021. According to UNCTAD’s Investment Trends Monitor, global FDI momentum weakened in 2022 in the context of the war in Ukraine, rising food and energy prices, financial turmoil and debt pressures. The mining sector attracts most of the investments and the exploration of new deposits has been increasing. The country's soils contain gold as well as zinc and manganese. The main investing countries are Canada, France, Ivory Coast, Mali and Morocco (IMF). The creation of three new growth centres, after the success of the Bagré Reservoir, is expected to spur new activities and attract investment. The government is interested in exploring areas that are potentially suitable for oil extraction. After the Houndé and Netiana mines, the country is looking to exploit the Tambao deposit (worth USD 1 billion, currently the largest in the world reserve of manganese, with an estimated 55 million ton), which should bring in significant foreign investment.
Burkina Faso encourages FDI and offers tax and legal incentives, such as the possibility for a foreign company to own 100% of shares in a local company. However, investments in sectors such as mining, telecommunications, financial services and electricity are subject to restrictions. The country's economy is favourable to trade, and the condition of its infrastructure is considered satisfactory. However, its lack of access to the sea and agricultural resources, and its industrial sector is weak. The business climate is still poor compared to international standards. Political instability, as well as insecurity and violence linked to the jihadi insurgency are negatively affecting business climate.
|Foreign Direct Investment||2020||2021||2022|
|FDI Inward Flow (million USD)||-102||-80||121|
|FDI Stock (million USD)||2,750||2,462||2,441|
|Number of Greenfield Investments*||5||4||2|
|Value of Greenfield Investments (million USD)||342||90||89|
Source: UNCTAD - Latest available data.
Note: * Greenfield 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.
The strong points of the Burkinabé economy include:
The main challenges for foreign investors include:
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Latest Update: September 2023