Burundi: Investing

FDI in Figures

According to UNCTAD’s World Investment Report 2023, FDI inflows into Burundi, although still limited, increased from USD 10 million in 2021 to 13 million in 2022. At the end of the same period, the total FDI stock stood at USD 255 million, or around 6.5% of the country’s GDP. Regarding the sectors that receive FDI in Burundi, agriculture is the main one, followed by mining and services. According to UNCTAD, the agriculture sector attracted 60% of the total FDI stock in Burundi, while the mining sector received 16%, and the services sector 12%. The main countries investing in Burundi are Belgium (mainly in the mining sector), France (agriculture, energy, and telecommunications sectors), and China (construction of infrastructure). The ongoing construction of hydroelectric dams, international support in the country's agricultural policy, and the development of rare earth production should attract foreign investment. However, disputes around contract renegotiations that lead to the suspension of foreign mining companies’ operations in April 2021 (including UK-based Rainbow Rare Earths) could dampen future investment (Coface). A new mining code was finally approved in mid-2023.

In recent years, the government has made progress in terms of improving the business climate (notably through the adoption of a new investment law). Foreign investors enjoy the same rights as domestic ones and can engage in all forms of activities. There are no general limits on foreign ownership or control, and foreign investments are not subject to any screening mechanism. However, in the mining sector, at least 10% of the shares must be owned by the government, and the investment code was revised in 2021, raising the minimum investment amounts to be eligible for certain benefits from USD 50,000 to USD 500,000 for all investors. Foreign investment in arms, ammunition, and other military and paramilitary activities are subject to restrictions. However, political instability, high cost of public services, ambiguous trade policies, poor infrastructure, corruption, low-skilled labor, limited privatization program, and lack of foreign exchange are all factors limiting the influx of FDI into the country. Burundi’s geographical position makes it a regional commercial hub but the country has not taken advantage of it so far. The country also has large deposits of copper, cobalt, and nickel, largely untapped. Overall, Burundi has a poor investment climate and ranks 130th among the 132 economies on the Global Innovation Index 2023 and 117th out of 184 countries on the latest Index of Economic Freedom.

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Latest Update: May 2024