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Background of Burundi

The Republic of Burundi is a landlocked country in the Great Lakes Region of Eastern Africa bordering Rwanda to the north, Tanzania to the east and south and the Democratic Republic of Congo to the west, with its south–western border adjacent to Lake Tanganyika. With a land area of 27,834 km², Burundi has an estimated population of 9.8 million and its capital city is Bujumbura.

 

While its origins date back to five centuries ago, the territory of modern day Burundi has been occupied by the Twa, Tutsi, and Hutu ethnic groups for centuries. Ruled as a kingdom by the Tutsi for over two hundred years, Burundi became a Belgian colony known as Ruanda–Urundi (encompassing today’s Rwanda) at the beginning of the twentieth century, which was indirectly ruled by the Tutsi–dominated aristocratic hierarchy. Since independence was achieved in 1962, Burundi has experienced four wars, the latest of which ended with the Arusha Peace Agreement in August 2000. Since then Burundi has made a successful transition to a multi–party government system from 2000 to 2005. In February 2005, a new constitution emphasizing power sharing and protection of minority rights was approved by referendum. Recently, Burundi completed the second communal, presidential, and parliamentary elections and a new government was sworn in at the end of August 2010.

 

Burundi has quota and duty–free access to major international markets (such as the EU and the US). Burundi also enjoys free access to regional African markets through its membership of various regional economic communities such as Economic Community of Central African States (ECCAS), the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC). Burundi is a member of various international organizations and fora such as the United Nations and the African Union, and has been and continues to be supported by the European Development Fund, World Bank, IMF, African Development Bank, and others. 

 

Burundi is densely populated, with substantial emigration. Cobalt and copper are among Burundi's natural resources. Some of Burundi's main exports include coffee and sugar. Burundi is divided into 17 provinces, 117 communes, and 2,638 collines (hills). Provincial governments are structured according to these boundaries. In 2000, the province encompassing Bujumbura was separated into two provinces, Bujumbura Rural and Bunjumbura Mairie. Burundi’s provinces include Bubanza, Bujumbura Mairie, Bujumbura Rural, Bururi, Cankuzo, Cibitoke, Gitega, Karuzi, Kayanza, Kirundo, Makamba, Muramvya, Muyinga, Mwaro, Ngozi, Rutana, Ruyigi.

 

The Presidential Decree No. 100/177 of October 19, 2009 originates the creation and organization of the Investment Promotion Authority. 

The agency in its definition is endowed with a legal status and its own financial patrimoine along with a financial and organizational autonomy.

 

Mission

General Missions

•Informing the investors on every aspect of the investment and the export promotion

•Provide assistance and support investors in general and the exporters specifically in obtaining the documents and complete the formalities required by the legislation

•Design the reforms required for the improvement of the business environment

•Intervene within the administration in case of non–compliance or incorrect application of any law or regulation in connection with investment and exports promotion

•Further to the improvement of the quality and the distribution of information necessary for the investors, the IPA is invited to exploit the strong potential for the development of sectors such as services, tourism, mining and agriculture

 

Specific Missions

•Ensure the proper and efficient application of the Investment Code provisions, as well as the fiscal and customs provisions in favour of investors fulfilling legal requirements;

•Without prejudice to Law n ° 1/24, dated September 10, 2008;and in pursuance to Burundian Investment Code provisions Articles 14 & 15; decide on the eligibility of the projects for the enterprises creation or extension under regimes provided for in these article

•Analyse the enterprises needs in relation with the authorities concerned, and the appropriated modifications in the administrative apparatus regulation to promote a favourable environment for the enterprise development

•Raise government awareness and suggest to the government the legal and institutional reforms to undertake in order to favor the implementation and the development of new enterprises and to improve the business environment in Burundi

•Contribute to facilitate the establishment of industrial, commercial and services enterprises within the Government economic and social development plan.

•Facilitate export–oriented production

•Ensure that companies make an environmental impact study before their implementation

•Ensure that enterprises comply with the town and country planning before their implementation

•Identify, acknowledge and promote investment opportunities in Burundi

•Promote enterprises development and direct or indirect support to the strengthening and modernization of entrepreneurship in Burundi

•Supply to investors technical and technological information, addresses of equipment and raw material suppliers

•Welcome, advice, guide and assist investors in order to facilitate their projects realization

•Collect and disseminate economic information to operators

•Promote exchanges and partnerships between private sector operators, being domestic or foreign

•Contribute to the realization of studies for the investment and exports promotion

•Contribute to the investors training and coaching in enterprises creation and management

•Support consulting companies and training enterprises in order to reinforce national expertise and consulting capabilities

•Contribute to the organization of fairs and other events designed to promote investment in Burundi

 

Management Staff

Board of Directors

The Agency is governed by a Board of Directors composed of representatives from the public and the private sector as follows : 

 

•A representative of the Ministry of Plan

•A representative of the Trade Ministry

•The director of the Burundian revenue Office

•Two representatives of the Office of the Federal Chamber of Commerce and Investment of Burundi

•A private sector representative who is not member of the Federal Chamber of Commerce and investment of Burundi

•The Director of the agency

 

The representative of the Ministry of Plan assumes the Council presidency and the representative of the Federal Chamber of Commerce and Investment assumes the Vice–presidency. 

 

The Director of the agency provides the Secretariat.

The daily management of the agency is assumed by the Director assisted by head of departments and support personnel. The agency has the following departments :

 

•Investment promotion and communication department

•The export promotion department

•The support and assistance to investors department

•The Administrative and Finance department

 

The IPA operational mode

The Agency is under the administrative supervision of the Ministry of Plan.

The Board of Directors holds complete authority on the administration of the Agency. This authority encompasses :

 

•Define the IPA orientations

•Approve the agency budget

•Approve the IPA internal operation regulations

•Control the execution of its decisions by the agency management

•Ensure the proper application of the Investment Code provisions regarding the Investment Code guarantees and advantages, as well as the fiscal and customs incentives

•Set the employment conditions of the agency’s personnel

•Approve the annual accounts and the agency annual activity report

 

The Director is the legal agency representative, is in charge of the execution of the Council decisions, and coordinates and supervises the application of the heads of department assignments.

 

The investment promotion and communication department Investment promotion unit

The Investment Promotion Unit is assigned the following daily tasks :

 

•Through the Ministry of Plan, raise awareness and suggest to the government the legal and institutional reforms to undertake in order to favor the implementation and the development of new enterprises and to improve the business environment in Burundi

•Provide advice to the Government on policies and programs aimed at improving the investment climate in the country and to promote the export of goods and services from Burundi

•Ensure the effective implementation of the Investments Code

•Keep a register of all certificates of approval, as well as other documents concerning facilities and incentives granted to enterprises

•Identify, promote and foster investment opportunities in Burundi

 

Communication unit

The Communication unit is on a daily base, in charge of : 

 

•Collect, process, produce, all economic, legal, fiscal, administrative and statistical information both in Burundi and abroad

•Inform and distribute information on investment opportunities available to investors as well as on legal, fiscal incentives and so on

•Publish periodical business promotion magazines

•Contribute to organization of fairs and other key events likely to promote Investments in Burundi

 

Export Promotion Department

The Export Service Promotion is on a daily basis in charge of : 

 

•Inform and raise awareness on anything regarding Export

•Provide assistance and Support the exports

 

Assistance and Support to Investors Department

The Assistance and Support department is assigned to stimulate an active support to investors on good application of the Code of Investments, in particular the access to the guarantees and advantages of the Code of Investments and advantages of the free Zone Scheme

 

It is responsible for :

•Contribute and facilitate the establishment of industrial, commercial and services enterprises within the framework of the government economic and social development plan

•Contribute to the training and the monitoring of young business enterprises promoters in matters related to the establishment and the management of their enterprises

•Participate to the organization of enhancement training sessions of the investment promotion actors

•Participating in the organization of regular meetings between agency’s executives and civil servants of ministries and departments concerned in order to assist the enterprises in the obtention of approvals, certificates, work permits and land necessary for the implementation of their projects

•Assist domestic and foreign investors to find solutions to their problems within their relations with the administration

•Evaluate ideas of promoters and convert them in projects

 

Administrative and Financial Department

The administrative and financial department is in charge on a daily basis of the financial, administrative and accounting management, in accordance with the internal regulations, financial and accounting professional standards as well as the agency procedure manual.

 

Reasons to invest in Burundi

Burundi is member of economic communities CEPGL, COMESA, EAC totalling more than 20 countries and 450 million consumers. Since 2008, the process is started for the integration of these three communities into a single regional community, (AEC) African Economic Community

 

The attractiveness of Burundi as a place to invest relies on the improvement of the business environment by the Government. The efforts in improving the latter are focused on increasing the competitiveness of the economy in order to enable the Burundian Economy to take advantage of the opportunities offered by open markets. 

 

Indeed, the integration of Burundi in the Eastern African Community (EAC) and in the Common Market for Eastern and Southern Africa (COMESA) represents an opportunity in terms of direct foreign investment. The EAC increases the size of the market accessible to Burundian products and stimulates the diversification of local production. On the other hand, the country will be the focal point of the trade within the regional, link up the central Africa, the oriental Africa and the southern Africa. 

 

Indeed, if the infrastructures of transportation are developed further, countries such as Rwanda and Uganda will make the choice of transiting their their goods through the port of Bujumbura for their commercial exchanges with Southern Africa via Tanganyika Lake. The same applies to the exchanges between the east of the Democratic Republic of Congo and Oriental Africa. Burundi could represent a strategic position for foreign investors wishing to invest in the region and to penetrate neighbouring markets. 

 

The opportunities and challenges currently facing Burundi are strongly linked to regional integration that forecast the creation of new realities for the direct foreign investments in the country.

 

Capital transfer advantages include :

•Free transfer of foreign capital and income after payment of taxes

•Transferring unused professional income by foreign employees

•The transfer of capital remuneration in the form of dividends, in full for enterprises with foreign capital

•Protection of private property

•Non–nationalization and non–expropriation of investments implemented in its territory as well as any measures of equivalent scope

 

All new investments are automatically entitled to :

•Waiving of mutation on the acquisition of property rights and land

•Deduction of 37% as tax credit on the amount of depreciable invested good

•No refund to the fiscal administration with disposed assets that raised tax credit for a period of five years

•Tax credit during the implementation of investments for new businesses or for the extension of existing businesses

•Reduction of 2 and 5% in the rate of tax credit on the profits of companies that respectively employ between 50–200 employees and over 200 employees

 

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