9 minute read
Henri Saoue will be happy
AFRICA NEWS AGENCY
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HENRI SAOUE, Founder and CEO, IVOS
IF THE AFCFTA CAN BREAK DOWN SOME OF THE ADMINISTRATIVE BARRIERS IN THE FIRST INSTANCE, WE WILL BE HAPPY”
In which sector and in which countries does your company operate - in Africa and globally?
Ivoire Oilfi eld Services (IVOS) is a company specializing in the provision of environmental services, especially for the extractive industries and the oil exploration and production sector - our client portfolio includes companies such as CNR International, Total Exploration Production, Schlumberger, Halliburton, PETROCI, CI-11...
In a nutshell, we offer environmentally responsible solutions to manage our clients’ waste - because waste can be waste for the one who produces it, but it can also be a raw material for another player in another industry. We focus on the circular economy in all our waste management activities. Our main services include waste treatment, tank cleaning, site maintenance, equipment supply, capacity building in our area of expertise and engineering studies. The waste we deal with is mainly industrial waste.
We are based in Côte d’Ivoire and Senegal. However, we operate in countries such as Mauritania and Guinea Conakry.
What do your investment plans look like - on short, mid, and long term?
We have several investment projects indeed. In the short term, our objective is to build another waste treatment center in Yamoussoukro in central Côte d’Ivoire. This facility will handle industrial waste from the central, northern, and north-western areas of Côte d’Ivoire. Our ambition is also to leve-
Henri Saoue, founder and CEO of IVOS-
Photo credit RR
rage this center to treat industrial waste from neighboring countries such as Mali and Burkina Faso, which have a growing mining industry, and even from Niger. In the mid-term, we aim to fully complete the installation in Senegal of our waste management facility which is mainly focusing on waste generated by the oil industry. This center will be equipped with a high temperature incinerator with a treatment capacity of 10 tons per day. This incinerator will also be equipped with a fume scrubber to avoid any form of atmospheric pollution. In the long term, we want to have our own facilities in countries where we currently only conduct operations, namely Guinea-Conakry, Cameroon, and Mauritania.
What type of constraints are you confronted with, in your countries or regions of operation?
Like most entrepreneurs, we are, indeed, confronted to issues in our daily operations.
First, there are administrative issues as we often must go through complex and long procedures. Some business practices, in particular those aimed to promote local or national content, can be diffi cult to implement. Thus, granting a majority in the capital of a structure to a local partner simply because this partner is from the host country can sometimes be a challenge in highly technical sectors such as ours, in which leadership must also rely on specifi c competences that are not always present in the countries of operation. The principle of local content is good and should be maintained but aligned with the freedom of establishment which is the subject of one of the other AfCFTA protocols. This could lead to new and more effective ways of implementing this principle, such as granting blocking minorities to host country partners with an obligation, for those entering the market, to carry out an effective
AFRICA NEWS AGENCY
Henri Saoue affi rms: Africa is the continent of opportunity, but efforts must be made to promote investments - Photo credit RR
transfer of skills within a given period. With the AfCFTA, it is in fact the promotion of ‘African content’ that must be guaranteed - for products as well as for skills - and it is necessary to ensure schemes and approaches that encourage partnerships and joint ventures between countries of the continent.
There are also fi nancial issues. During the fi rst years of IVOS’ existence, no fi nancial institution wanted to trust us by providing the fi nancing required for investments and for our operations. However, almost two years ago, as we started to be recognized as serious players and as our young company demonstrated its resilience, two banks decided to support us. And this is going well. For start-ups, it is almost impossible to provide the guarantees that the banks require. This is perhaps the heart of the matter. As a solution, we would suggest for guarantee funds for the development of entrepreneurship to be set up at state or even sub-regional level. While these funds already exist in some cases, it would be interesting to speak more about them to make them more accessible. As far as traditional commercial banks are concerned, it is also perhaps time for them to ease, without compromising their existence, their conditions to support SMEs. The development of our African states will be achieved through an active private sector, in which entrepreneurial approaches could be supported.
Finally, there is the fi scal pressure. A company only really starts to take off after its fi rst two years of existence. It would be a good idea to reduce or even cancel the tax burden on companies during this period. In any case, what the States lose in taxes during these two years can be offset when the company starts to take off, thanks to the jobs it can create and the development it can bring. This tax effort will be the state’s share of the development investment.
Is the entry into force of the AfCFTA, which should favour investments in Africa, an opportunity for you and your company?
Look, if the AfCFTA, which is the ‘African Continental Free Trade Area’, can break down some of the administrative barriers in the fi rst instance, we will be happy.
A concrete example: IVOS has a water treatment unit manufactured in Côte d’Ivoire. This unit is used for our operations in Abidjan. We wanted to manufacture the same equipment and transport it to one of our countries of operation. The customs duties that we were told we should pay were so high that we had to back out and look for a company capable of manufacturing the same equipment in that country - and our search, although intense, was unsuccessful as there is, to date, a skills and technical capacity gap there. Meanwhile, there is a growing need in the relevant market. This is a reality that the AfCFTA could help to resolve. The fi rst objective of the AfCFTA as it stands is to facilitate the free movement of goods and encourage the manufacturing and trade of ‘Made in Africa’ products and equipment. This is of particular interest to us at IVOS because most of the equipment we need for our facilities is manufactured and assembled in Africa - in this case in Côte d’Ivoire and Senegal. The prospect of having lower tariffs in the future can make a difference for us. This is a fi rst step.
We also hope that with the AfCFTA, we will be able to have access to registers of standards for our activities, at least for the ECOWAS zone, and that the freedom of establishment, i.e. to create a company, will also be facilitated. Look, when the United Kingdom decided to leave the European Union, what was the big diffi culty? It was not the currency, because they already had their own currency. But it was above all to fi nd a solid agreement that would allow the United Kingdom to maintain smooth trading process with the European Union - and in fact, this example allows us to understand that if the general legal framework is important, we must also consider all the supporting enablers, such as common standards, certifi cation and mutual recognition of products, transport logistics for goods, clear information on the conditions to access the market and application of preferential tariffs.... With the AfCFTA today, we have a general legal framework, but there is still a long way to go on the rest. Apparently, discussions are underway but, surprisingly, information on the more concrete aspects is not widely disseminated to entrepreneurs. We do not know who to turn to in order to access this information.
What are your expectations regarding this agreement?
We hope that the AfCFTA will be a truly free trade area. With the global pandemic of COVID-19, it is observed that large regional groups outside of Africa are refocusing on their regions or origin to ensure their survival. This situation may provide an opportunity for the AfCFTA, by focusing on strengthening intra-African trade.
What are your fears…? Especially, do you expect that the AfCFTA will be more benefi cial to foreign private investors or african private investors - and why?
We hope that the AfCFTA will be more than just another treaty. That it is not just only about saying that we have created a free trade area, but which in reality it does not work. This is our fi rst fear - that states prefer to continue to apply existing national legislation or continue to favour certain bilateral partnerships that would limit, for the companies incorporated on their territory, access to opportunities across the entire Africa.
The AfCFTA could be an opportunity for African states to harmonize their policies on investment, job protection for nationals, and the implementation of ‘local content’ laws. With the AfCFTA, we could move towards ‘African content’ and ‘regional content’ without compromising the sovereignty of states in terms of job protection and the emergence of national or regional champions. This is the balance that needs to be found.
Do you have the feeling that, around you, your partners are receptive or informed about the AfCFTA? How are the Treaty and its impacts perceived?
To be honest, many people are not aware of the existence of this treaty. It would be good to communicate a little more about it, especially in the investor (entrepreneur) community. It was through television reports that we became aware of the existence of the AfCFTA.
As a conclusion, is now the time to invest in Africa? Why?
Africa is the future. It is the continent of opportunity. It is therefore the place for investment. The raw materials are there. The workforce is increasingly qualifi ed and young. The market is there. However, strong efforts (political stability, legal framework, etc.) must be made to attract these investments.
