Table of Contents

  • The Cotonou Partnership Agreement (CPA) endorses both the goal and strategy of develop ment of the West African and other African, Caribbean and Pacific (ACP) countries, and provides for co-operation in the form of support for investment and the enhance - ment of private sector development in these countries. The Agreement only sets the stage for co-operation; its precise framework and the forms it will take will be the subject of negotia tions for economic partnership agreements (EPAs) between the European Union (EU) and ACP regional sub-groups. These negotiations will determine the specific forms of co-operation in the areas of investment and private sector support, as well as how such co-operation will be incorporated into the EPAs. The ACP regional groups obviously have an interest in ensuring that the investment and private enterprise component of the negotiated EPAs will promote, protect and guarantee the flow of domestic and foreign direct investment (FDI) to ACP countries.

  • Partly as a result of the poor economic growth performance of many West African countries since the late 1970s and partly as a reflection of the range of economic reforms that have been embarked upon in these countries since the mid-1980s, poverty eradication has become the overarching goal of economic development strategy across the region. The reforms generally focus on rapid and sustainable economic growth as the primary vehicle for poverty alleviation, and they also presume that the required growth will essentially be led by the private sector. Thus both the development goal and the strategy to which West African countries subscribe place considerable emphasis on investment promotion and the enhancement of private enterprise.

  • This chapter examines the characteristics of ECOWAS countries in terms of the growth and structure of their economies, and the growth, structure and financing of investment. The analysis follows the basic classification of ECOWAS countries into developing and least developed countries, with Nigeria, Ghana and Côte d’Ivoire regarded as developing countries.

  • The domestic investment framework of each country in West Africa has been shaped, in large measure, by the evolution of its policies towards investment, both local and foreign. From the early 1960s, policy-makers in many West African countries showed considerable ambivalence towards foreign investment, as well as bias against the private sector generally. As a result, they placed general restrictions on the types of economic activities in which the private sector could participate and, more specifically, on the range of activities in which foreign investors could engage, as well as on the share of particular enterprises that they could own. This policy stance obviously created space for increasing the role of the state in the economy.

  • Bilateral and regional investment agreements are important instruments for driving free and appreciable flows of foreign investment among countries and regions. Investment treaties contain a plethora of regulatory structures that are meant to define the terms of relationships between host countries and the investors concerned in conformity with speci fic international standard norms. An investment agreement states the obligations of each side involved in the agreement.

  • As an integral part of the paradigm shift in development thought which has become increasingly apparent, particularly since the 1990s, many multilateral and regional development agencies and financial institutions have embraced enterprise development and a focus on the private sector as an important means of promoting economic growth and poverty reduction in the developing countries. This shift of emphasis applies not only generally, but also to the development support activities of these international institu tions in West Africa. This chapter examines the enterprise development mandate of relevant international development institutions and reviews the instruments which they deploy to fulfil it. The private sector investment and related support services of these organisations in West Africa are analysed within the framework of their mandates and in terms of their relevance and effectiveness. The focus of the analysis then shifts to a review of the extent of competition and/or complementarity in the enterprise development investment and other support activities provided by the international institutions. Finally, the analysis suggests a number of options for extending the reach and enhancing the effectiveness of various ACP-EU instruments for invest ment promotion, protection and guarantee.

  • This chapter examines the negotiation issues, the resolution of which will contribute to the character of the agreement on investment under the West Africa-EU EPA. Such an agreement should be influenced by a set of important considerations drawn from past experience and perhaps by the potential for increasing investment flows between the parties to the EPA. At least six factors should be considered in predicting the nature and form of the envisaged investment component of the West Africa-EU EPA.

  • This chapter sets outs the conclusions and recommendations that emerge from the analysis in chapters 2–6.