World Bank to back DRC’s planned special economic zone
By: Jonathan Faurie, 28th August 2009
The Investment Climate Advisory Services division of the World Bank has agreed to support the Democratic Republic of Congo’s (DRC’s) planned special economic zone (SEZ), aimed at encouraging investment and employment opportunities.
The World Bank will provide technical assistance on legal, institutional and regulatory issues, as well as on the planning of the zone, to support a secure and transparent environment for private-sector investors.
Owing to the potential offered by mining, the country is in the spotlight as developing countries increase their consumption of copper to roll out infrastructure projects. However, global credit advisory firm Sace reports that there is significant risk in investing in the DRC, citing violence, expropriation and operational risk as some of the major challenges.
An SEZ is a physical space that facilitates access to essential infrastructure and land, and provides simplified mechanisms for business registration and operation. The SEZ can be used as a platform for reforms that would later be extended to the rest of a country.
A cooperation agreement to undertake an SEZ feasibility study was signed by Inter-national Finance Corporation (IFC) director for Eastern and Southern Africa Jean Philippe Prosper and DRC Minister of Finance Athanase Matenda Kyelu. The IFC is a World Bank Group (WBG) member. The signing coincided with a two-day visit to the DRC by World Bank president Robert Zoellick.
“The Congolese are eager to encourage private-sector investment to see the benefits of the employment and other opportunities it will create. With this cooperation agreement, the WBG and the DRC government can establish sound foundations for the successful development of an SEZ in the DRC,” said Prosper.
In July, a pilot SEZ site at N’Sele, close to Kinshasa, was proposed by the government’s SEZ steering committee as suitable for the development of agribusiness operations that could supply the capital city with currently imported food products.
Investment Climate Advisory Services director Pierre Guislain said, “The creation of an SEZ will allow the DRC government to pursue options to improve the overall business environment in the country, and thus attract investments in sectors that have long been neglected.”
The WBG will aim to support the design of a legal, institutional and regulatory frame- work for SEZs in the country, and develop a master plan, based on a demand assess- ment. An international private SEZ operator is expected to be identified to manage and develop the site, in partnership with the Con-golese government.
The feasibility study will be supported by the IFC’s Conflict-Affected States in Africa initiative, a programme that is financed by Ireland, the Netherlands and Norway, and aims to support economic growth in African countries recovering from conflict. The initiative helps rebuild the private sector by improving the business environment, strengthening small and medium- sized enterprises, developing financial markets and increasing private-sector involvement in infrastructure development. The feasibility study is expected to cost $3-million.
The Investment Climate Advisory Services division of the World Bank has agreed to support the Democratic Republic of Congo’s (DRC’s) planned special economic zone (SEZ), aimed at encouraging investment and employment opportunities.
The World Bank will provide technical assistance on legal, institutional and regulatory issues, as well as on the planning of the zone, to support a secure and transparent environment for private-sector investors.
Owing to the potential offered by mining, the country is in the spotlight as developing countries increase their consumption of copper to roll out infrastructure projects. However, global credit advisory firm Sace reports that there is significant risk in investing in the DRC, citing violence, expropriation and operational risk as some of the major challenges.
An SEZ is a physical space that facilitates access to essential infrastructure and land, and provides simplified mechanisms for business registration and operation. The SEZ can be used as a platform for reforms that would later be extended to the rest of a country.
A cooperation agreement to undertake an SEZ feasibility study was signed by Inter-national Finance Corporation (IFC) director for Eastern and Southern Africa Jean Philippe Prosper and DRC Minister of Finance Athanase Matenda Kyelu. The IFC is a World Bank Group (WBG) member. The signing coincided with a two-day visit to the DRC by World Bank president Robert Zoellick.
“The Congolese are eager to encourage private-sector investment to see the benefits of the employment and other opportunities it will create. With this cooperation agreement, the WBG and the DRC government can establish sound foundations for the successful development of an SEZ in the DRC,” said Prosper.
In July, a pilot SEZ site at N’Sele, close to Kinshasa, was proposed by the government’s SEZ steering committee as suitable for the development of agribusiness operations that could supply the capital city with currently imported food products.
Investment Climate Advisory Services director Pierre Guislain said, “The creation of an SEZ will allow the DRC government to pursue options to improve the overall business environment in the country, and thus attract investments in sectors that have long been neglected.”
The WBG will aim to support the design of a legal, institutional and regulatory frame- work for SEZs in the country, and develop a master plan, based on a demand assess- ment. An international private SEZ operator is expected to be identified to manage and develop the site, in partnership with the Con-golese government.
The feasibility study will be supported by the IFC’s Conflict-Affected States in Africa initiative, a programme that is financed by Ireland, the Netherlands and Norway, and aims to support economic growth in African countries recovering from conflict. The initiative helps rebuild the private sector by improving the business environment, strengthening small and medium- sized enterprises, developing financial markets and increasing private-sector involvement in infrastructure development. The feasibility study is expected to cost $3-million.