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, unfortunately FDI inflows to Guinea-Bissau declined considerably in 2020 due to the crisis induced by the COVID-19 pandemic. According to UNCTAD's 2021 World Investment Report, FDI inflows declined from USD 72 million in 2019 to USD 20 million in 2020. In the same year, the stock of FDI rose to USD 317 million. In 2021, global FDI flows rebounded strongly, but FDI flows to African countries (excluding South Africa) rose only moderately (UNCTAD’ Investment Trends Monitor). 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.

In the latest available Doing Business report released by the World Bank, Guinea Bissau ranked 174th worldwide, gaining one position from the previous year. Monetary mass growth and low interest rates helped attract investments. Also, the government’s efforts to diversify the economy and the country’s natural resources are other positive factors. The priority of the government is to increase foreign investment in the agriculture and energy sectors, which are two key drivers of the economy. 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 base 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.

 

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 201920202021
FDI Inward Flow (million USD) 722124
FDI Stock (million USD) 269.9317.4315.8
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: October 2022

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