Where it all began and ICF’s legacy
November 30, 2016
When ICF was started in 2007, business faced real challenges when trying to operate in Africa. Despite the increased awareness among international business communities of the investment potential that African countries had to offer, much cynicism remained about whether things will ever really change in Africa. It was therefore fundamental to further enable business, as a means of creating wealth, employment and opportunities, ultimately resulting in better livelihoods and the increased well-being of communities across the continent.
The Commission for Africa, in its 2005 report ‘Our Common Interest’ highlighted the critical importance of the investment climate as a key driver of economic growth. The Commission called for a renewed commitment to promoting growth and prosperity on the continent and called attention to a proposal for the establishment of an investment climate facility to address barriers to investment in Africa.
This initiative was also endorsed by the G8 at a summit hosted by the British Prime Minister in 2005. Following this Gleneagles Summit, a series of countries and corporations pledged to provide financial support to an Investment Climate Facility for Africa for a seven-year term. These included countries like the UK, Germany and South Africa, and corporations like Coca-Cola, Standard Bank and Unilever. The Government of Tanzania agreed to incorporate the facility in Dar es Salaam.
And so in April 2007 ICF began its operations with its first project, a partnership with the Government of Rwanda to improve business registration, commercial justice, and land registration.
Nine years later ICF has completed the mandate set out at the Gleneagles Summit. Looking at some of the results we have achieved over the years, we are extremely proud to announce that we have been able to achieve the objectives that were set out at that Summit.
Here are some the results highlights from our eight priority areas:
Facilitating improvements to the continent’s commercial justice systems is highly beneficial to the investment climate and was therefore a key focus for ICF.
ICF completed 19 commercial justice projects in 10 countries and two regional blocks including Mauritius, Togo, Zambia and Tanzania. In Mauritius, we helped establish a Fast Track in the Commercial Division of the Supreme Court which has reduced the time from trial to judgement to just 36 days for commercial cases.
We also established mechanisms for alternative dispute resolution like mediation, arbitration and adjudication. This included helping to set up the Kigali International Arbitration Court and the Lagos Arbitration Court, as well as promoting Ivory Coast’s Court of Arbitration.
Business Registration and Licensing
Businesses need a simple, transparent, efficient and cost effective way of formalising their enterprises. ICF interventions assisted African governments to create simplified electronic business registration and licensing systems to improve access to these services.
ICF helped to set up business registration and licensing systems in 8 countries, including Burkina Faso, Cape Verde, Liberia and Mozambique. In Cape Verde, country-wide extended business registration services enables business to be registered in just one day. In Burkina Faso, it used to take 40 days to register a business, but following ICF interventions it now only takes five days. The set-up of one-stop-shops for business registration in Liberia saw a steady increase of business registrations and enabled Liberia to move from the 141st place to 35th place in the World Bank’s Doing Business Report ranking for starting a business, within a period of four years.
Ease of starting a business will stimulate the increase of new businesses, positively affect job creation, income wealth distribution and economic growth.
Cargo delays at African ports create major restrictions to trade and is a major stumbling block for economic development. ICF worked with seven countries to implement single window systems for trade that led to a reduction in cargo dwell time by eliminating manual and inefficient processes. These countries include Senegal, Burkina Faso, Kenya, Sao Tome & Principe and Tanzania. The new electronic systems and procedures are faster, cost effective and more transparent. The time and cost to move goods through cargo clearance has been lowered considerably.
For example, in Senegal, cargo dwell time for imports was reduced significantly from 17 days to just three. In Sao Tome & Principe, the number of days to import and export went down from 28 days to 16 days, according to the World Bank’s Doing Business methodology.
ICF interventions in this area focussed on simplifying and streamlining tax procedures and creating online systems for processing and paying taxes in eight countries, including Ethiopia, Rwanda, Zambia, Senegal and Cape Verde. Modernised revenue operations will lead to efficient tax collection systems to benefit both the private sector and Governments.
In Rwanda, our support has reduced the time to process income, pay as you earn, and value added taxes from 23.5 days to instantaneous due to a new online system. In Zambia, we helped to reduce the time to file, process and pay income tax from 10 days to one.
With our projects we aimed to create an enabling environment and regulatory framework for private sector participation in public infrastructure and also to strengthen the capacity of African governments to bridge infrastructure deficiency and meet the basic service needs of citizens. We have worked with several countries including Cape Verde, Sierra Leone, Rwanda, Tanzania and Seychelles.
In Sierra Leone, we implemented a project that was specifically aimed at easing the burden of transport between the capital city and the international airport, and ICF resultantly established an airport transfer unit that is responsible for licensing, monitoring and regulating transport in the private sector. Clear lines of responsibility and accountability were also established through an airport transfer regulatory framework.
In Rwanda, our initiatives were focussed on the energy and power sector. We built the capacity of the Ministry of Infrastructure and related energy institutions to create bids, negotiate and contract with the private sector.
Procedures that govern land tenure in many African countries tend to be complex, uncertain and opaque which makes it difficult to know who owns or has occupancy rights to land. ICF interventions in the property rights sector assisted governments to establish electronic land registries with the aim of decreasing time and financial cost (for both the client and the authorities). Our interventions focused on countries like Rwanda, Burkina Faso and Sierra Leone.
In Burkina Faso it now only takes 21 days to register a property, compared to the 182 days required before. There are now only five procedures involved for transferring property, instead of the previous eight. In Rwanda, our support helped to reduce the number of days it takes to register property from 371 days to 2 days; the computerization of the land registry also helped to pave the way for an electronic mortgage registration system.
ICF focused on strengthening African financial markets by widening geographical coverage, increasing the scope of services offered and strengthening capacities in Ethiopia, Tunisia and Seychelles. This was done in an effort to foster investor participation and encourage knowledge sharing across the continent to unlock Africa’s potential.
In Ethiopia, our project was aimed at improving the Ethiopia Commodity Exchange (ECX) through the introduction of an electronic trading system. As a result, the ECX’s trading capacity was greatly increased from 200 transactions per day to 10,000 per hour, creating room for many more commodities to be traded.
In Tunisia, our support helped the Tunisia Stock Exchange to increase stock literacy in the country and the region. In Seychelles, our intervention provided a foundation for the Government to widen the scope and variety of financial services available in the country.
Capacity is a major challenge in Africa and many companies, including small enterprises, struggle to find employees with the appropriate skill set and knowledge for their business. A long-term solution to curb capacity challenges in Africa requires structural changes to education systems across the continent, but inroads can be made through simple and inexpensive initiatives.
ICF worked with South Africa, Tanzania and the Common Market for Eastern and Southern Africa (COMESA) to help increase the capacities of local governments and small enterprises. In South Africa, our support helped to improve the capacities of five municipal councils in providing better services to their communities, resulting in the reduction of the number of service provision complaints, petitions and service delivery protests.
In Tanzania, our SME capacity building project saw 1,024 individuals trained on business management skills – including business owners and employees. In the COMESA region, a pilot project trained 480 local producers from six countries on food safety standards so they can supply to multinational supermarkets and hotels.
Results for the continent
From 2005 to 2015 Sub-Sahara Africa experienced sustained growth, with its Gross Domestic Product increasing by an annually average of 5-6%. ICF is proud to be part of this incredible transformation through its collaboration with African governments and the African private sector.
We are confident that our legacy, the blueprint for public-private partnership that we leave behind in Africa, will allow others to build their own success long after ICF’s departure.