Business & Investments
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- Published: Sunday, 03 May 2015 15:25
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Subsequently years of conflict and political turmoil, Chad has regained peace and stability it emerges today as a stable nation and a key peace broker. On the economic side, the Government undertook numerous actions and measures to revitalize its economy. Early 2015, the country achieved the heavily indebted poor Countries initiative with the World Bank and the lMF, an achievement owed in large part to government crackdown on corruption and an increase of foreign direct investments in the oil sector.
With this achievement, Chad positions itself as a financially secure and credible business destination. Strong reforms were made to stabilize the macro-economic situation and to improve fiscal and budgetary management. ln fact, Chad is rich in natural resources for the most part, yet to be explored. Additionally, bordered by six countries, with numerous and good infrastructures, the prospects for business expansion from Chad to regional markets are great.
Among the country's list of abundant resources are: oil, salt, copper mines, sand, gum Arabic, sesame, natron and spiruline (blue algae). Chad has for a long time been a turning point for the commercial trans-Saharan routes. Since 2003, the discovery and exploitation of crude oil deposits in the southern region (Doba region) of the country has set Chad as an oil exporting country and member of OPEC.
Chad’s proven crude oil reserves are over a billion barrel and exported through a pipeline from Doba region to the terminal of Kribi (Cameroon) on the Atlantic coast. The oil exploration in the deposits of Doba and pipeline construction project have been achieved through arrangements with a consortium of Oil companies, initially composed by ExxonMobil, Chevron, and Petronas, with nearly 3.7 billion US dollar worth of investment mainly financed by World Bank Group, (IBRD and l.F'C')' oils accounts for a large portion of Chad's revenues and boosted national budget. It has obviously allowed the government to strengthen its political and socio-economic agenda and to revitalize the country's prominent economy.
Improvements in many areas and sectors have been achieved since the country's launch of an economic reform program. ln 2004, GDP growth reached an all-time high of 5-6 per cent. Keen on eliminating obstacles hindering economic growth, the Chadian government implemented reforms including a liberalization plan, a solid fiscal investment guide, and closer ties with financial institutions including the World Bank, lMF, and AFDB.
Business in Chad
Among the sectors that offer the best market outlet to Canadian and American enterprises are hydrocarbon, infrastructure, mining, agriculture, livestock, tourism, transport, and telecommunications Chad constitutes a first order market for a number of business services ranging in fields from building trade administration, education, health, computer science, information technology to financial services.
Possible business opportunities ANCL partners Business environment peace, security and stability have been the Chadian government's political-commitment and achievement
in the past years. Today, as these are noticeable, Chad positions itself again as a regional economic hub and an attractive foreign direct investments destination. Chadian businesses as well as foreign enterprises coexist in a reformed economy that favors business alliances joint ventures, capital flow and income repatriation.
As a member state of the 37- millions populated Economic and Monetary Community of
Central Africa (CEMAC), Chad shares a common currency, called CFA. The CFA franc with five other states (Cameroon, Central African Republic, Republic of the Congo, Gabon and Equatorial Guinea), which from the business perspective reduces many financial risks and facilitates transactions between enterprises located within the Community.
Moreover, this regional integration has been a unique potential to growth,
and Chad is constantly solidifying cooperation with international institutions and foreign governments to be an attractive host country to businesses of all kind.
Industrial sector while being a country that is abundantly rich in natural resources, Chad still lacks a strong industrial sector.
Aside from the development of oil deposits, many resources are still to be brought to the market for the consumption. There is a real need to enlarge the country's production base in order to be able to cater products manufactured in Chad to regional and international markets. Sectors that currently are trending include agricultural products, cotton, Arabic gum, livestock and fishery.
Education Training and Work
Chad is home to nearly 12.5 million people, and with this in mind the government's goal is to offer a quality education to its youth and to those who will become the tomorrow's leaders. The Human being is in the center of education, because Human capital is key to enhancement and to development.
Everything has to be conceived and ventured within range of self-perfection and civil needs. Chad is committed to training its citizens as per the requirements of globalization and the modern job market. The education sector in Chad has seen an increased number of Universities and other higher education institutions. Significant reforms were implemented in the past years, including free enrolment in public schools and nationwide expansion of post-secondary institutions and trade schools.
With investments and human resources flowing -in from abroad and local dispersion of endowments, a new chapter of an educated and skilled nation is visible.
Small and medium-sized business (SMBI
Small and medium-sized businesses play a preponderant role in the economic development of Chad. These businesses account for the majority of jobs creation, gross domestic product, valorization of local products and contribute to regional integration and development. Chadians in rural areas are self employed
in a large number. Commonly known as open markets these trading platforms are an essential factor in the daily life of many Chadians.
Energy is a truly essential factor to the Chadian economy and to the needs of its growing population. It really lacks, but since the exploration of oil deposits in 2003, some improvements in living standards have been noticeable. However, electricity for many Chadians, in particular populations in suburbs remains a luxurious item. current government and private needs with regard to the energy sector include partnership for the development of mechanisms for solar, wind, and gas energy. The utilization of
alternative and environmentally friendly energy sources will notably have beneficial results in the regeneration process of forests actually undertaken by the government.
Communication and Telecommunication
In Chad communication and telecommunication include radio, television, regular and mobile telephones and the internet. Infrastructures supporting this sector remain fragile in light of the size as well as the immense needs of the country.
There are few public televisions and radio stations' Most of the country's radio stations are privately owned and demographically constrained to major cities. This context offers a wide range of business opportunities to foreign investors. As can be noticed, mobile cellular and internet access over this medium has greatly increased in recent years, from roughly 200,000 lines in 2005 to over 4 million in 2012. The Chadian constitution provides freedom of opinion, expression and press, thus creating a favorable environment to individuals and businesses targeting this sector with a good regulatory framework.
Banking System and Micro-Finance
As a member of the Economic and Monetary Community of Central Africa, Chad's banking system is regionally integrated. Nevertheless, the country enjoys great flexibility in mobilization of financial resources and economic planning. Major and internationalized financial institutions throughout the country offer savings, lending and investments options directly to consumers and businesses. Recent trends in the Chadian banking system include a move to online and mobile banking, increase in the number of microfinance institutions, and expansion to rural areas where a growing population is
attracting both local and foreign businesses. Among the foremost needs of chad in this sector is an enhancement through commercial banking to increase the money supply and thus leading to an even more flourishing economy.
Link to the Ministry of Finance and Budget: www.finances.gouv.td