The ECOWAS Common Investment Market Vision: A Conceptual Preview

Abstract

In 2009 the Economic Community of West African States (ECOWAS) launched a vision to create a Common Investment Market (CIM). The main objective of the CIM is to harmonize investment codes of all ECOWAS member states in order to boost factor movement and, ultimately, promote trade and investments. However, more than a decade after the launch, the CIM vision is yet to materialize. This paper discusses the progress that has been made so far and the inhibitions that have slowed the process. The trend of the analysis shows that even though the region has successfully created a free trade area (with the implementation of the ECOWAS Trade Liberalization Scheme) and a customs union (with the implementation of the Common External Tariff), some of the countries still operate national investment laws that are hugely at variance with some critical protocols of the Community. A typical example includes the fact that the three biggest economies, Nigeria, Ghana and Cote d’Ivoire continue to implement rules that are inimical to trade and investment. This is to the extent that whilst Nigeria maintains a “prohibition list” that bans the importation of certain category of goods, Ghana operates an investment regime which requires all foreigners (including ECOWAS nationals) to bring in a minimum capital of $1,000,000 before they can trade in the country’s retail sector. Meanwhile, Cote d’Ivoire’s national investment laws also create “exceptions” that are no-go-areas for foreigners, including ECOWAS nationals. The paper concludes with some recommendations based on a conceptualization of how the CIM can be attained through the formulation of policy frameworks, promotion of free movement of persons and goods; development of infrastructural networks, integration of financial systems, participation of the private sector and the attraction of Foreign Direct Investments (FDI) into the region.