FREQUENTLY
ASKED QUESTIONS
1
Frequently
Asked Questions
What is COMESA?
The Common Market for Eastern and Southern Africa,
Imports (2015,
COMESA, was launched in 1994, and with its 19 Member 183.5
billions of USD)
States, is Africa’s largest Regional Economic Community.
Its objective is to create a fully integrated, internationally Petroleum oils and oils;
competitive and unified regional economic community in Maize; Medicaments;
which goods, services, capital and persons move freely, for Main Imports (2015) Electrical energy; Soya oil;
the sustainable economic development of the region. Rice; Motor vehicles for
goods; Wheat
Overview South Africa; USA; Turkey,
Main Import Partners
France; South Korea; Japan;
(2015)
COMESA % Africa Brazil; Switzerland
Population (2015, millions) 505.4 44.5% Exports (2015,
74.7
billions of USD)
Population Projections
721.7 43.0%
(2030, millions) Tobacco; Gold; Nickel; Vanilla;
Main Exports (2015) Cloves; Ferro-chromium;
Surface Area (km²) 10,972,876 36.5% Diamonds; Shrimp
GDP (2015, current, billions South Africa; USA; France;
742.4 32.6%
of USD) Main Export Partners
Turkey; South Korea; Canada;
(2015)
Real GDP Growth (2015, Switzerland; Japan
3.3 N/A
annual %)
Languages English, French and Arabic
FDI (2015, billions of USD) 19.3 35.8%
Sources: UNPD Department of Economic and Social Affairs, World Bank Open Data, AfDB
Data Portal, IMF World Economic Outlook, UNCTAD World Investment Report, COMESA
Sources: UNPD Department of Economic and Social Affairs, World Bank Open Data, AfDB Online Portal, and ITC Trade Statistics.
Data Portal, IMF World Economic Outlook, UNCTAD World Investment Report, COMESA
Online Portal, and ITC Trade Statistics.
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Who are the COMESA Member States? What is COMESA RIA?
COMESA’s 19 Member States are: The COMESA Regional Investment Agency (COMESA RIA)
is an institution of the Common Market for Eastern and
Burundi Malawi
Southern Africa (COMESA) which was launched in Cairo,
Comoros Mauritius Egypt, in 2006 to:
DR Congo Rwanda
Djibouti Seychelles • Make COMESA one of the major destinations
for regional and international investors while
Egypt Sudan simultaneously enhancing national investment.
Eritrea Swaziland • Carry-out other activities in investment
Ethiopia Uganda promotion, facilitation and advocacy.
Kenya Zambia
In conformity with the COMESA treaty through its various
Libya Zimbabwe activities, RIA provides a platform for private sector to
Madagascar interact with COMESA Governments and serves as an
information hub through which it can promote the COMESA
region, detailed information on legislation and policies
affecting the business environment, cost of doing business,
investment incentives, investment procedures, investment
opportunities and projects, major events affecting
investment and other relevant information. In doing so, RIA
works closely with Member States’ Investment Promotion
Agencies (IPAs) to promote the COMESA region as a
common investment area, and in building a positive image
of the region and of its Member States for a worldwide
audience.
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How can businesses benefit from the COMESA
What is COMESA RIA? Free Trade Area?
RIA works to improve the business and investment climate The COMESA Free trade Area has been in operation since
of Member States namely through development support November 2000 and now comprises the following Member
and capacity-building activities targeting their IPAs and States: Burundi, Comoros, Djibouti, Egypt, Kenya, Libya,
other relevant Government Officials. As such, RIA improves Madagascar, Malawi, Mauritius, Rwanda, Seychelles,
Member States’ ability to facilitate and retain investments, Sudan, Uganda, Zambia and Zimbabwe. Among them, these
and to promote themselves and the COMESA region, hence, countries trade duty free and quota free for originating
to attract investment. goods. Eritrea has reduced tariffs for trade in COMESA
originating goods by 80%, Ethiopia by 10% and Swaziland
Some of RIA’s achievements include: is under derogation to reduce tariffs for COMESA trade. D
R Congo has undertaken to reduce tariffs in three yearly
• 32 Regional Workshops and Trainings with total of phases of 40%, 30% and 30% to become a Free Trade Area
640 participants; member.
• Collaboration and partnership with the promotion of
30+ International Conferences & Seminars; To be able to access the COMESA market duty-free,
• 7 Investment Forums (1 in Belgium, 3 in Egypt, 2 in businesses must abide by any one of the following rules
UAE, and 1 in Rwanda) with participants reaching of origin:
3000 delegates;
• 9 websites for COMESA Investment Promotion • Wholly Produced Rule: The goods should be
Agencies (IPAs); produced totally in the exporting Member State
such that there are no foreign materials added to
• 4 Investors’ Tracking Systems;
the manufacturing process. Such goods are live
• More than 22 publications, resources and studies animals, agricultural produce e.g. maize, cotton,
published; minerals, etc.
• 12 Practical Guides for Doing Business in COMESA • Material Content Rule: Goods that are made with
Member States; some foreign materials added to the manufacturing
• 7 Investment Teaser with an approximate of 400 process and the C.I.F. (Cost, Insurance and
projects promoted per edition; Freight) value of those foreign materials should not
• And various Roadshows and investment missions. be over than 60% of the total value of the materials
used in making that product;
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What is the Tripartite Free Trade Area (TFTA)?
• Value Addition Rule: Goods made with foreign The COMESA-EAC-SADC Tripartite Free Trade Area was
raw materials, in the course of the manufacturing officially launched in June 2015, setting the stage for the
process and the value added should be at least 35% establishment of a single market for the 26 African countries
of the ex-factory cost of the product; in the Eastern and Southern African Region. TFTA countries
• Change in Tariff Heading Rule or CTH: Goods that include: Angola, Botswana, Burundi, Comoros, DR Congo,
are made with foreign materials such that the Tariff Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Lesotho, Libya,
heading of the final product should be different from Madagascar, Malawi, Mauritius, Mozambique, Namibia,
the tariff headings of the foreign materials used or Rwanda, Seychelles, South Africa, Sudan, Swaziland,
satisfy the workings and processing defined for that
Tanzania, Uganda, Zambia and Zimbabwe.
chapter or heading under the COMESA Rules; and;
• Goods of Particular Economic Importance Rule:
Following the signing, the countries will proceed to initiate
These are goods that are on the list approved by the
Ministers in Charge of Trade in COMESA Member the ratification process through their legislative assemblies.
States (also called the Council of Ministers) which The Agreement will come into force once ratification is
are regarded as very important in the economic attained by three quarters of the Member States, upon
development of economies of COMESA Member which the free trade area will enter into force.
States and that, in the process of manufacturing
where foreign materials are used, the value added The establishment of a Tripartite FTA is expected to bolster
should be at least 25% of the ex-factory cost of the intra-regional trade by creating a wider market, increase
product; Examples of goods on the list are: mini- investment flows, enhance competitiveness and encourage
buses that are assembled in some Member States; regional infrastructure development as well as pioneer the
cement; fridges and freezers; insecticides; dental,
integration of the African continent.
medical, surgical and veterinary instruments; and
agricultural equipment.
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Is it risky to invest in the COMESA Region?
Ernst and Young compare on a yearly basis the perception MIGA and ICSID
of businesses established in Africa versus those not
established in Africa with regards to the attractiveness of Likewise, all COMESA Member States are members of the
the continent, as far as investment goes. It comes as no Multilateral Investment Guarantee Agency (MIGA) and most
surprise that those already established in Africa not only of the International Centre for Settlement of Investment
consistently perceive it to be more attractive than those who Disputes (ICSID), both members of the World Bank Group.
are not, but also think it is the best investment destination
in the world. MIGA provides political risk insurance guarantees to private
sector investors and lenders. MIGA’s guarantees protect
While economies are liberalizing and diversifying, investments against-non-commercial risks and can help
opportunities are multiplying, and risks are diminishing investors obtain access to funding sources with improved
too. Various institutions are now insuring business against financial terms and conditions. Since our inception in 1988,
a large array of risks. MIGA has issued more than USD 28 billion in political risk
insurance for projects in a wide variety of sectors, covering
all regions of the world. ICSID on the other hand provides
ATI
for settlement of disputes by conciliation, arbitration or
The African Trade Insurance Agency (ATI) is a COMESA fact-finding. More than 600 cases have been administered
Institution and Africa’s export credit agency. It provides by ICSID to date.
political risk and trade credit risk insurance products
with the objective of reducing the business risk and cost Either investors seize the chance and adapt to the business
of doing business in Africa. Since 2003, ATI has supported culture or others will move in, the fastest emerging of
over USD 17 billion worth of trade and investments across which are African businesses. First-movers have already
the continent, secured an investment grade rating of ‘A’ been there for a long time.
from Standard & Poor’s, and expanded membership with
For more information, please visit www.ati-aca.org, www.miga.org,
plans to attract even more African member countries and and https://icsid.worldbank.org/en/
international financial institutions in the near term.
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Why should a business invest in the COMESA
Region?
According to UNCTAD World Investment Report 2016, 1. A growing urban consumer market is driving COMESA’s growth
FDI Inflows in COMESA region in 2015 increased by 10% giving rise to new opportunities. Investors have direct access
to record US$19.355bn compared to US$17.54bn in 2014. to 505.4 million consumers (2015) with an average population
Since 2002, FDI Inflows in COMESA grew by 600%. growth rate of 2.21% annually.
In addition, FDI stock in COMESA increased by 9% to record 2. Because of its truly strategic location on world trade routes
US$224bn in 2015, compared to US$205bn in the previous such as the Suez Canal, the Red Sea, the Mediterranean Sea,
year. FDI inward stock grew by 582% during the period and the Indian Ocean, COMESA offers global access to a large,
2000 – 2015. diversified, integrated and resilient market.
According to Financial Times, FDI markets 2016, During 3. COMESA has been experiencing real and sustainable growth
the period 2003 – 2016, Financial services sector attracted averaging 5% in the past five years, offering investors the
the highest number of FDI projects, followed by Business stability they need to commit to long-term plans.
Services, Communications, Coal, Oil and Natural Gas,
Metals, Software and IT Services, Food and Tobacco, 4. A growing, increasingly qualified and less dependent
Transportation, Real Estate, and Hotels and Tourism. workforce will provide better and cheaper human resources to
businesses over the coming decades.
5. COMESA offers a fully-functioning free trade area offering
duty-free access to 15 of its 19 Member States.
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What investment protection guarantees and How much does it cost to do business in the
incentives do COMESA Member States offer? COMESA Region?
Most COMESA Member States have in recent years In its Ease of Doing Business Report, the World Bank
revamped their investment code and now offer key continues to move COMESA Member States towards the
investment protection guarantees including equal top of the list: Mauritius is ranked 49th and Rwanda 56th,
treatment between domestic and foreign investors, the ahead of Luxembourg, Italy, Turkey, Chile and many others,
right to repatriate profits, protection against expropriation, and various COMESA Member States including Burundi,
and more. DR Congo, Djibouti, Egypt, Kenya, Rwanda, Uganda, and
Zambia have figured among the top 10 most improved in
As well, they offer very competitive fiscal and non-fiscal Doing Business in the past few years, which clearly reflects
incentives, as well as exemptions and allowances, subject the overall strength and stability of COMESA Member
to certain criteria. States.
In fact, in the 2015 Doing Business report, Africa accounted
for the largest number of regulatory reforms – 75 of the 230
worldwide.
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Where can investors find opportunities in Which companies currently invest in the
need of financing in the COMESA Region? COMESA Region?
COMESA RIA publishes on a yearly basis the COMESA Logistics
Investment Teaser, a compilation of hundreds of national
and regional investment projects and opportunities TransCentury, Kenya
promoted by Member States’ Investment Promotion Dubai World, UAE
Agencies. Bahrain Maritime and Mercantile International
Agility, Switzerland
It is possible to download the COMESA Investment Teaser Maersek, Denmark
from COMESA RIA’s website, as well as to browse through DHL, Germany
the database of projects and opportunities by sector and by Aramex, UAE
country on the same website.
Mining
Investors are invited as well to get in touch with COMESA
Tenke Fungurume Mining (Free Port McRoan), USA
RIA for further advice on individual countries and ways to
Kolwezi Copper Company, Switzerland
do business in the COMESA region. COMESA RIA is always
BHP BILITON, Switzerland
pleased to facilitate.
Rand Gold (Kibali Gold Mining), Canada
Mutanda Mining, Canada
Ashanti Gold, Canada
First Quantum Minerals, Canada
China Nonferrous Metals Mining, China
Vedanta Resources, UK
Agribusiness
Aico Africa, Zimbabwe
Zambia Sugar, Zambia
Cevital, Algeria
Brabanta, Belgium
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Nestlé, Switzerland Manufacturing
Kitoko Food, Israel
Coca-Cola, USA Dangote Cement, Nigeria
Nestle, Swaziland Elsewedy Electric (Elsewedy Cables), Egypt
Heinken, Netherlands Diamond Trust Bank, Kenya
Hatsun Agro Product, India Nissan, Japan
Swaziland Beverages, UK LG, South Korea
Rhodes Food Group, South Africa Toyota, Japan
Cadbury, UK Sony, Japan
Sumitomo Group, Japan
Tourism Tata Group, India
Arab Swiss Engineering Co (ASEC), Egypt
Hotel Properties, Singapore
Lafarge, France
InterContinental Hotels Group (IHG), UK
Tata Group, India
Accor, France
Four Seasons Hotel, Canada ICT
Fairmont Raffles Hotels, Canada
Thomas Cook, Germany MTN Group, South Africa
Safaricom, Kenya
Real Estate and Construction Seacom, Mauritius
Mobiserve Holdings, Egypt
Orascom Construction Industries, Egypt UST Global, Mauritius
The Arab Contractors, Egypt Ongair, Kenya
Murray & Roberts Holdings, South Africa Vodacom, South Africa
Emaar, UAE Etisalat, UAE
Qatari Diar, Qatar ZTE, China
Barwa Real Estate, Qatar Huawei Technologies, China
Cisco, US
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Google, US Retail
Airtel, India
Shoprite Holdings, South Africa
IBM, US
Nakumatt, Kenya
Zain, Bahrain
Imperial Holdings, South Africa
Siemens, Germany
Orange, France Energy
Financial Services Sonatrach, Algeria
Eskom, South Africa
Diamond Trust Bank, Kenya
Vivo Energy Maroc, Morocco
Global Trust Bank, Uganda
Total Maroc, Morocco
Commercial Bank of Africa, Kenya
Apache, USA
Equity Bank, Kenya
Eni SPA, Italy
KCB Bank Uganda, Uganda
Woodside Petroleum, Australia
Reinsurance Solutions Group, Mauritius
Royal Dutch Shell Plc, Netherlands
Misr Bank, Egypt
D1 Oils, UK
Sanlam, South Africa
Vanco Energy, USA
Banque Fédérale de Commerce, Kuwait
ExxonMobil, USA
BIC, France
Petronas, Malaysia
Commercial International Bank (CIB), Egypt
China National Petroleum, China
AlexBank, Italy
Total, France
Qatar National Bank (QNB), Qatar
Heritage Oil, UK
Abu Dhabi Islamic Bank (ADIB), UAE
PUMA Energy, Singapore
HSBC, UK
China Africa Sunlight Energy, China
Gulf Finance House, Bahrain
National Bank of Abu Dhabi, UAE
First Gulf Bank, UAE
Arab Insurance Company, Bahrain
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How can we contact COMESA National
NOTES
Investment Promotion Agencies?
COMESA RIA coordinates between investor/inquirer and
any member of the National Investment Promotion Agency
(IPA) of a specific Member State from the 19 countries.
The profile and mandate of the IPAs are available on RIA’s
website. RIA also coordinates missions and meetings with
COMESA IPAs.
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NOTES
COMESA Regional Investment Agency
3A, Salah Salem Road, Nasr City, Cairo, 11562, Egypt
General Authority for Investment BLDG
Tel.: (+202) 2405 5428 / Fax: (+202) 2405 5421
Email: info@comesaria.org / www.comesaria.org
