Togo: Investing in Togo
According to UNCTAD's World Investment Report 2022, FDI flows to Togo rebounded to USD 130 million in 2021, after negative net FDI inflows of USD -59 million in 2020 in the context of the Covid-19 pandemic. The stock of FDI amounted to USD 1.91 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. In the second half of 2022, Togo attracted foreign investments (mainly Indian, Singaporean and Chinese) worth around XOF 150 billion, mainly in the sectors of textiles, wood, construction, agri-food, mechanics and services (Togo First). The sectors that traditionally attract the most foreign investment are phosphates, cotton, infrastructure, coffee and cocoa. South Africa, Qatar, the Netherlands, France and Germany are the main investors (IMF). Togo has a free trade zone, which has attracted so far over 60 companies and employs more than 12,000 people. The Adetikiopé industrial platform (PIA), which is focused on processing and exporting natural resources and which was opened in June 2021, could boost investments (Coface).
The Lomé Port is a major asset for Togo. It is one of the largest ports in the region, turning the country into a trade hub. Togo has implemented a strategy to digitise and automate tax payment and business creation procedures. Recent 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 a 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). However, efforts are still needed in terms of protection of minority investors, execution of contracts, resolution of problems related to insolvency and simplification of the system of payment of taxes. Foreign ownership of land is restricted and capital transactions are subject to government control or approval. Corruption, lack of skilled workforce, threat to maritime trade by Gulf of Guinea piracy and exposure to terrorist activity in the Sahel region are potential barriers to investments.
Foreign Direct Investment | 2019 | 2020 | 2021 |
FDI Inward Flow (million USD) | 346 | -59 | 130 |
FDI Stock (million USD) | 1,832 | 1,937 | 1,912 |
Number of Greenfield Investments* | 12 | 6 | 7 |
Value of Greenfield Investments (million USD) | 2,357 | 164 | 352 |
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.
Country Comparison For the Protection of Investors | Togo | 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*** | 5.0 | 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.
Togo has several assets that could make it an attractive destination for FDIs:
Several factors still hinder FDI inflows to Togo:
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Latest Update: May 2023