The interest of foreign business persons in the African continent is growing every year. Starting a business in Africa is an attractive offer for those who want to try their hand at such areas as:
- extraction of natural resources;
- processing and construction industry;
- the medicine;
- IT technologies;
- financial services.
Also, a notable feature of low barriers to market entry, a rapidly growing economy, increased loyalty to many Ukrainian brands, and high demand for foreign products.
If you are looking for new horizons to expand your own business or looking for a promising jurisdiction to launch a startup, then you should open a company in Africa.
The main evaluation criteria for entering the business in African countries
- Convenient geographical location; stable political environment;
- Significant reserves of minerals (oil, gas, precious metals and stones, ores);
- Availability of free trade zones (FIZ, SEZ) with favorable conditions for entrepreneurship;
- Loyal cost of hiring an affordable and skilled workforce;
- The most comfortable investment climate (profitable government programs);
- Availability of a flexible taxation system;
- Developed banking and financial system;
- Relatively simple and fast terms of incorporation.
Top 7 best countries in Africa to start a business.
Based on the criteria provided above, we have selected the 7 best countries in Africa where you could start your business.
Those who are going to register a company in Tunisia and open a bank account in Tunisia will find the most attractive conditions for doing business, especially when opening an export company, a free zone company (RDZ), or an agricultural enterprise. The tax rate instead of the standard 25% will be only 10% (the most loyal among African countries).
Besides, the key advantages of this jurisdiction are:
- the presence of considerable reserves of natural resources (oil, iron ore, phosphorites, lead),
- an established transport infrastructure,
- participation in the Arab GAFTA free trade zone,
- more than 35 DTA agreements,
- established trade with the USA, France, Germany, and other countries.
The most priority business areas in 2020, which are worth paying attention to those who wish to register a Tunisian company, are the chemical industry, mechanical engineering, food processing, printing, and pharmaceuticals.
Another advantage in terms of taxation will be the decision to register a company in Mauritius. The income tax rate in Mauritius is 15%. In the case of opening a company specializing in export operations, the tax rate is 3%.
Also, the main advantages of doing business in this state should include:
- 20th place in the Doing Business ranking for the ease of doing business among the countries of the world,
- the presence of a well-developed stock market,
- more than 40 countries with which DTA agreements are signed,
- lack of currency control,
- availability of a free export zone.
Those wishing to open a company in Mauritius should give preference to such business areas as services (finance and insurance), tourism, and the light industry.
Registration of a company in Botswana, in particular, specialized in manufacturing or providing financial services (IFSC), will reduce the already close to European standards, the corporate tax rate of 22% to 15%.
The main advantages of starting a business in this jurisdiction will be:
- no tax on dividends,
- significant reserves of minerals (nickel, copper, malachite, agate, diamonds),
- more than 12 DTA agreements,
- developed infrastructure and telecommunications system.
If you want to register a company in Botswana remotely, then you should opt for these business areas: tourism, construction, light and mining industries, and banking.
Entrepreneurs who decide to register a company in Egypt will face a loyal base income tax rate (22.5%).
- 1st place in the list of African countries with the best investment climate;
- large oil fields, participation in the free economic zone GAFTA;
- simple terms of staff recruitment, more than 10 DTA agreements.
If you plan to open a company in Egypt remotely, then you should choose these business areas: manufacturing, food, and chemical industries, tourism, and metallurgy.
Opening an Algerian company, first of all, will be beneficial due to flexible taxation (base rate 26%). Manufacturing enterprises are subject to income tax at a rate of 19%, construction, and travel companies at a rate of 23%.
Also, the main advantages of opening a medium or large business in this jurisdiction will be:
- participation in PAFTA, the Pan Arab Free Economic Zone;
- a high level of GDP,
- 15th place in the world in terms of the number of oil fields (large reserves of gas and iron ore),
- convenient search conditions and hiring workers.
Those who are going to register a company in Algeria and open a corporate account in a bank in Algeria should choose one of these business areas:
- production of lumber;
- extractive industry.
The South African Republic
The South African Republic is one of the most economically developed countries in the African region. Entrepreneurs planning to open a company in South Africa will be subject to income tax at a progressive rate depending on the volume of income – from 0% to 28%.
The main advantages of creating a business in this state will be:
- the presence of the richest deposits (coal, minerals, gold, platinum, diamonds);
- 2nd place in the ranking of African countries with the best investment climate.
Those who decide to register a company in South Africa remotely and open a bank account in South Africa should give preference to such industries as the mining and processing industry, IT-sphere, tourism, construction, and medicine.
Morocco ranks in the top 60 countries in the world for ease of doing business and is also the world’s largest exporter of phosphorites. As for the tax system, those wishing to register a company in Morocco will be required to pay income tax at a progressive rate depending on the amount of income – from 10% to 31% (37% for insurance companies and credit organizations).
The main advantages of starting a startup in a given country:
- high level of GDP;
- participation in the free economic zone GAFTA;
- more than 7 DTA agreements;
- developed transport infrastructure;
- established trade relations with more than 10 leading countries of Europe and Asia (USA, China, Germany).