Investing

flag Guinea-Bissau Guinea-Bissau: Investing

FDI in Figures

In recent years, Guinea-Bissau had been able to attract relatively large amounts of foreign investment; but unfortunately FDI inflows to the country declined considerably following 2020 due to the crisis induced by the COVID-19 pandemic. According to UNCTAD's 2022 World Investment Report, FDI inflows totalled USD 24 million in 2021, up by 13.5% year-on-year but still below the level recorded before the pandemic (USD 72 million). The total stock of FDI stood at USD 316 million as of 2021, representing around 19.4% of the country’s GDP. Offshore oil exploration attracts most foreign investors. The tourism sector is also developing and receiving increasing investment (particularly in the Bijagos Islands). The main investing countries are China, the United States, Portugal and India.

Foreign Direct Investment in Guinea Bissau has been historically low due to its small market size, underdeveloped infrastructure, and political instability. In recent years, the government of Guinea Bissau has taken steps to attract foreign investment by enacting investment-friendly laws and establishing a "one-stop shop" to streamline the process of setting up a business in the country. In addition, the government has signed several bilateral investment treaties with other countries, including China and Portugal, to provide greater protection for foreign investors. The national government implemented policies to diversify the economy, prioritizing the attraction of foreign investment in the agriculture and energy sectors, which are two key drivers of the economy. The country’s natural resources are other positive factors. Chinese investment in Guinea-Bissau has been increasing in the last decade. As such, a canning factory, as well as a fish distribution network, were developed with the support of the China International Fisheries Corporation (CONAPEMAC). Additionally, the Kaleba hydroelectric dam, funded by the China International Water & Electric Corp. for USD 536 million, entered into service in 2015. Chinese companies are also investing in real estate as well as in bauxite. Despite a return to political stability, the main weakness of the country consists of the large number of Latin American drug traffickers who have set up their bases to ship drugs into the European market. The poor condition of infrastructure, a weak legal system, political instability and the high cost of energy are also hindrances to investment. Formally, the law treats foreign and domestic investment equally. Nevertheless, the judicial system remains vulnerable to political interference, and corruption is widespread. The overall regulatory framework is not conducive to starting businesses and discourages broad-based employment growth. The Guinea-Bissau National Investment Agency is the government body in charge of encouraging and facilitating investment. Guinea Bissau ranks 165th out of 176 countries in the 2023 Index of Economic Freedom and 164th out of 180 in the 2022 Corruption Perception Index.

 

Country Comparison For the Protection of Investors

  Guinea-Bissau Sub-Saharan Africa United States Germany
Index of Transaction Transparency* 7.0 5.5 7.0 5.0
Index of Manager’s Responsibility** 1.0 3.5 9.0 5.0
Index of Shareholders’ Power*** 6.0 5.5 9.0 5.0

Source: Doing Business - Latest available data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.

 
Foreign Direct Investment 202020212022
FDI Inward Flow (million USD) 211922
FDI Stock (million USD) 317.4310.7314.9
Number of Greenfield Investments* 0.00.00.0
Value of Greenfield Investments (million USD) 000

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.

 

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Tax Rates

Value added tax (VAT)
The standard rate of general sales tax is 17%, while a rate of 20% applies on luxury goods.
Exports are zero-rated.
Company Tax
25%
Withholding Taxes
Dividends: 15%, Interests: 15% (residents)/10% (non-residents), Royalties: 15%.
Social Security Contributions Paid By Employers
14%
Other Domestic Resources
National Investment Agency
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
 
 

Individual Taxes

Income tax Progressive rates with a maximum of 40%
Up to XOF 500,000 1%
From XOF 500,000 to 1,000,000 6%
From XOF 1,000,000 to 2,500,000 8%
From XOF 2,500,000 to 3,600,000 10%
XOF 3,600,000 and above 12%
 
 

Country Comparison For Corporate Taxation

  Guinea-Bissau Sub-Saharan Africa United States Germany
Number of Payments of Taxes per Year 46.0 36.6 10.6 9.0
Time Taken For Administrative Formalities (Hours) 218.0 284.8 175.0 218.0
Total Share of Taxes (% of Profit) 45.5 47.3 36.6 48.8

Source: Doing Business - Latest available data.

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Investment Opportunities

Tenders, Projects and Public Procurement
Fontier Market Network, Tenders in Africa
African Tenders
DgMarket, Tenders Worldwide
Setting Up a Company
Consult Doing Business Website, to know about procedures to start a Business in Guinea-Bissau.
Useful Resources
Economic Developments and Prospects in Guinea Bissau - African Economic Outlook
Business Portal for Africa
 

Business Setup Procedures

Setting Up a Company Guinea-Bissau Sub-Saharan Africa
Procedures (number) 9.00 7.51
Time (days) 8.50 21.30

Source: Doing Business.

 
 
 

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Latest Update: December 2023