HomeReportsBureau of Economic and Business Affairs2020 Investment Climate Statements…Mali

# 					2020 Investment Climate Statements: Mali			

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													EXECUTIVE SUMMARY											

                -  EXECUTIVE SUMMARY 
                -  1. Openness To, and Restrictions Upon, Foreign Investment   
                -  2. Bilateral Investment and Taxation Treaties   
                -  3. Legal Regime   
                -  4. Industrial Policies   
                -  5. Protection of Property Rights   
                -  6. Financial Sector   
                -  7. State-Owned Enterprises   
                -  8. Responsible Business Conduct   
                -  9. Corruption   
                -  10. Political and Security Environment   
                -  11. Labor Policies and Practices   
                -  12. U.S. International Development Finance Corporation (DFC) and Other Investment Insurance Programs   
                -  13. Foreign Direct Investment and Foreign Portfolio Investment Statistics   
                -  14. Contact for More Information   

## EXECUTIVE SUMMARY

Despite promising opportunities for U.S. firms and enthusiasm for U.S. investment, there are significant obstacles to investment in Mali, including poor infrastructure, corruption, and ongoing insecurity in many parts of the country.  Terrorism, drug trafficking, and smuggling, primarily in the northern and central conflict-affected portions of the country, inhibit investment.  In addition, business contacts report that both Malian and foreign businesses face corruption in procurement, customs procedures, tax payment, and land administration.  Mali’s low ranking (148th out of 190 countries) in the World Bank’s 2020 Doing Business Report reflects the myriad challenges foreign investors can face.

Insecurity and political instability stemming from Mali’s 2012 coup d’état are ongoing and exacerbate the already difficult investment climate.  The U.S. Department of State maintains a “Level 4: Do Not Travel” travel advisory for Mali due to crime, terrorism, and kidnapping.

Continued instability in northern and central Mali and the minimal presence of the Malian government in many areas have permitted terrorist groups to conduct attacks against Western targets and Malian security forces.  Intercommunal violence stemming from conflict between livestock herders and crop farmers in central Mali further contributes to instability.

Mali has experienced strong annual economic growth (near or exceeding five percent) since 2014 despite ongoing insecurity.  The Malian government projected in an April 2020 report, however, that the COVID-19 pandemic would have significant negative effects on the country’s economic situation.  While the Government of Mali had projected a five percent economic growth rate for 2020, it revised projected economic growth to 0.9 percent due to the economic impact of COVID-19.  The Government of Mali also projected that inflation could reach 4.9 percent in 2020 in response to challenges importing goods due to COVID-19-related restrictions.

Mali continues to depend on bilateral donors and multilateral financial institutions, including the World Bank, International Monetary Fund (IMF), and African Development Bank, to fund major development projects, particularly in health, infrastructure, education, and agriculture.  The investment climate benefits from the financial and economic reform processes, such as efforts to improve fiscal transparency and address corruption, that accompany this institutional lending.

The United States and Mali enjoy a strong bilateral relationship.  Malian businesses generally view U.S. products favorably and openly search for new partnerships with U.S. firms, particularly in the infrastructure, energy, mining, and agricultural sectors.  The Government of Mali remains committed to reforming the economy, including through improving public financial management practices, increasing tax revenues, and the ongoing privatization of several state-owned enterprises.  Efforts to strengthen revenue collection agencies (particularly customs) are ongoing, following significant revenue shortfalls in 2018 that the IMF attributed to corruption, weak taxpayer compliance, and fraud.

Investors may consult the website of Mali’s Investment Promotion Agency (API-Mali) at https://apimali.gov.ml/ for information on opportunities, incentives, and procedures for foreign investment.

							1. Openness To, and Restrictions Upon, Foreign Investment					

**Policies Towards Foreign Direct Investment**

The Government of Mali encourages foreign investment.  In general, the law treats foreign and domestic investment equally.  In practice, U.S. investors report facing many of the same challenges as other foreign investors do, including allegedly unfair application of tax collection laws, difficulties clearing goods through customs, and requests for bribes.  Corruption in the judiciary is common and foreign companies may find themselves at a disadvantage vis-à-vis Malian investors in enforcing contracts and competing for public procurement tenders.

The Malian government has instituted policies promoting direct investment and export-oriented businesses.  Foreign investors go through the same screening process as domestic investors.  Criteria for authorizing an investment under Mali’s 2012 investment code include the size of the proposed capital investment, the use of locally produced raw materials, and the level of job creation.

Mali’s Investment Promotion Agency (API-Mali) serves as a one-stop shop for prospective investors and serves both Malian and foreign enterprises of all sizes.  API-Mali’s website (https://apimali.gov.ml/) provides information on business registration, investment opportunities, tax incentives, and other topics relevant to prospective investors.

Mali maintains an office in charge of business climate reform (*Cellule Technique des Réformes du Climat des Affaires* or CTRCA).  Since 2015, Mali has also had a committee for monitoring business environment reforms that includes both government and private sector members.  Mali adopted a law governing public-private partnerships (PPPs) in 2016 and has a dedicated PPP unit charged with reviewing and facilitating implementation of PPP projects in a multitude of sectors.

**Limits on Foreign Control and Right to Private Ownership and Establishment**

Foreign and domestic private entities have the right to establish and own business enterprises with no restriction to forms of remunerative activities.  There are some specific limits on ownership in the mining and media sector:  Malian law requires that the owners and primary shareholders of media companies be Malian nationals.  Foreign investors in the mining sector can own up to 90 percent of a mining company.  The West African Economic and Monetary Union (WAEMU), of which Mali is a member, requires Malian and foreign companies to report if they will hold foreign currency reserves in their Malian business accounts and to receive approval from the Ministry of Economy and Finances and from the Central Bank for West African States (BCEAO).

**Other Investment Policy Reviews**

The World Trade Organization (WTO) reviewed the trade and investment policies of WAEMU members, including Mali, in 2017.  The review can be accessed at https://www.wto.org/english/tratop_e/tpr_e/tp462_e.htm.

**Business Facilitation**

Mali’s Investment Promotion Agency, API-Mali (https://apimali.gov.ml/), serves as a one-stop shop to facilitate both foreign and local investment.  In 2020, the World Bank’s Doing Business Report ranked Mali 124th out of 190 countries for ease of starting a business (a separate indicator that feeds into the overall ease of doing business ranking).  The 2020 Doing Business Report estimates that it takes an average of 11 days and five separate administrative procedures to register a firm.  There is no discrimination based on gender, age, or ethnicity in the process of business registration.

Foreign companies wishing to register in Mali may receive tax and customs benefits depending on the size of investment.  Small and medium-sized enterprises (for which there is no common definition across Government of Mali entities) are also eligible for some fiscal advantages.

**Outward Investment**

The Government of Mali has no policy to promote outward investment.

							2. Bilateral Investment and Taxation Treaties					

Mali does not have a bilateral investment or taxation treaty with the United States.  According to the United Nations Conference on Trade and Development (UNCTAD), Mali has signed 22 bilateral investment treaties (BITs), of which eight are currently in force.  Mali has BITs in force with Canada (2014), Morocco (2014), China (2009), the Netherlands (2003), Egypt (1998), Algeria (1996), Switzerland (1978), and Germany (1977).

There are no bilateral trade agreements between Mali and the United States; however, as of fiscal year (FY) 2020, Mali is eligible for the African Growth and Opportunity Act (AGOA).  Signed into law as Title 1 of the Trade and Development Act of 2000, AGOA offers tangible incentives for sub-Saharan African countries to continue their efforts to open their economies and build free markets.  Very few Malian exporters are able to meet AGOA’s technical requirements and phytosanitary standards for goods, leading few Malian exporters to take advantage of AGOA.

Mali is a member of WAEMU and of the Economic Community of West African States (ECOWAS), which aim to reduce trade barriers and create a common market.  In February 2019, Mali ratified the African Continental Free Trade Area agreement, a step toward a continent-wide liberalized market for goods and services.

							3. Legal Regime					

**Transparency of the Regulatory System**

As reflected in agreements with the IMF and World Bank, the Government of Mali has adopted a generally transparent regulatory policy and laws to foster competition.  Mali’s laws related to commerce, labor, and competition are designed to meet the requirements of fair competition, ease bureaucratic procedures, and facilitate the hiring and firing of employees.  In practice, however, many international firms complain of lack of transparency in the regulatory system and challenges in enforcing regulatory requirements to the detriment of business prospects.  There is no public comment period or other opportunity for citizens or businesses to comment upon proposed laws.

Mali is a member of UNCTAD’s international network of transparent investment procedures.  Mali is also a member of the African Organization for the Harmonization of Business Law (OHADA) and implements the Accounting System of West African States (SYSCOA), which harmonizes business practices among several African countries consistent with international norms.  There are no informal regulatory processes managed by nongovernmental organizations or associations.

Mali’s Public Procurement Regulatory Authority (*Autorité de régulation des marchés publics* or ARMDS) is tasked with ensuring transparency in public procurement projects and may receive complaints from businesses on public procurement-related issues.  ARMDS publishes information about its decisions in disputes as well as key laws relating to public procurement on its website at http://www.armds.ml/.

The Government of Mali regularly reviews regulations in order to adapt them to the current national context or to international standards or commitments.  A new mining code that will apply to future mining projects was announced in 2019 but has yet to be formally adopted as law.  Reforms to the tax code, the investment code, and petroleum product pricing are ongoing.

Mali makes public finance documents, including the budgets for all government ministries and offices, available on the Ministry of Economy and Finances’ website at https://www.finances.gouv.ml/lois-des-finances.  Mali’s national budget provides details on the expenditures of government entities (including the Presidency and Prime Minister’s office) and the revenues of tax collection authorities, including customs, the public debt directorate, the land administration directorate, and the treasury and public accounting directorate.  The budget also includes information on public debt, as well as government subsidies to petroleum products and to the state-owned utility company (*Energie du Mali* or EDM).  The Government of Mali also publishes a simplified version of the budget known as the citizen’s budget.

The Government of Mali has multiple audit institutions tasked with monitoring public spending.  The Accounts Section of the Supreme Court is responsible for reviewing and approving the financial statements of all Government of Mali departments.  The Office of the Auditor General (*Bureau du Verificateur General*or BVG) is authorized to audit the accounts of all government entities as well as private companies or other entities that receive public funds.  Its reports are made public and can be accessed at http://www.bvg-mali.org/.  The Government of Mali has other auditing institutions, including the Office to Fight against Illicit Enrichment (*Office central de Lutte contre l’Enrichissement illicite* or OCLEI), the General Comptroller of Public Services (*Contrôle Général des Services Publics* or CGSP), and the Support Unit for Administrative Auditing Bodies (*Cellule d’Appui aux Structures de Contrôle de l’Administration* or CASCA).  Despite the existence of multiple audit institutions, management of public funds remains opaque and subject to corrupt practices, particularly in public procurements.  In 2019, the Department of State determined that Mali did not meet the minimum requirements of fiscal transparency.

**International Regulatory Considerations**

As a member of WAEMU and ECOWAS, Mali applies WAEMU and ECOWAS directives.

Mali is a member of the WTO.  Mali has not notified the WTO of any measures concerning investments related to trade in goods that are inconsistent with the requirements of Trade Related Investment Measures.  Information on other notifications from Mali to the WTO can be found at https://www.wto.org/english/thewto_e/countries_e/mali_e.htm under the “Notifications from Mali” section.

**Legal System and Judicial Independence**

Mali’s legal system is based on French civil law.  Mali uses its investment code, mining code, commerce code, labor code, and code on competition and price to govern disputes.  Disputes occasionally arise between the government or state-owned enterprises and foreign companies.  Some investors report that certain cases involve wrongdoing on the part of corrupt government officials.

Although Mali’s judicial system is independent, many companies have noted that it is subject to political influence.  Numerous business complaints are awaiting an outcome in the courts.  The Minister of Justice wields influence over the career paths of judges and prosecutors, which may compromise their independence.  Corruption in the judicial system is common, leading to what foreign investors have characterized as flawed decisions.

An independent commercial court was established in 1991 with the encouragement of the U.S. government to expedite the handling of business litigation.  Commercial courts, located in Bamako, Kayes, and Mopti, can hear intellectual property rights cases.  In areas where there is no commercial court, the local Courts of First Instance have the jurisdiction to hear business disputes.  The Courts of First Instance’s decisions are appealable in the Court of Appeal and/or in the Supreme Court.  Since its inception, the commercial court has handled cases involving foreign companies.  The court is staffed by magistrates and is assisted by elected Malian Chamber of Commerce and Industry representatives.  Teams composed of one magistrate and two Chamber of Commerce and Industry representatives conduct hearings.  The magistrate’s role is to ensure that the court renders decisions in accordance with applicable commercial laws, including internationally recognized bankruptcy laws, and that court decisions are enforced under Malian law.

**Laws and Regulations on Foreign Direct Investment**

Mali’s investment code gives the same incentives to both domestic and foreign companies for licensing, procurement, tax and customs duty deferrals, export and import policies, and export zone status if the firm exports at least 80 percent of production.  Incentives include exemptions from duties on imported equipment and machinery.  Investors may also receive tax exemptions on the use of local raw materials.  In addition, foreign companies can negotiate specific incentives on a case-by-case basis.  The Government of Mali has reduced or eliminated many export taxes and import duties as part of ongoing economic reforms; however, export taxes remain for gold and cotton, Mali’s two primary exports.  The government applies price controls to petroleum products and cotton, and occasionally to other commodities (such as rice) on a case-by-case basis.

In most cases, foreign investors may own 100 percent of any business they create, except in the mining and media sectors.  Foreign investors may also purchase shares in parastatal companies.  Foreign companies may also start joint-venture operations with Malian enterprises.  The repatriation of capital and profit is guaranteed.

Despite having a generally favorable investment regime on paper, foreign investors have complained of facing challenges in practice, including limited access to financing, high levels of corruption, poor infrastructure (including inconsistent electricity access), a non-transparent judicial system, and the lack of an educated workforce.

The following websites provide additional information relating to investments in Mali:

Investment Promotion Agency:  https://apimali.gov.ml/ and http://mali.eregulations.org/Mali Trade Portal:  https://tradeportal.ml/National Council of Employers:  http://www.cnpmali.org/index.php/lois-et-reglements/codesNiger River Authority (*Officer du Niger*):  https://www.on-mali.org/on/Chamber of Commerce and Industry:  http://www.cci.mlMinistry of Economy and Finances:  http://www.finances.gouv.mlPublic Procurement Regulatory Authority:  http://www.armds.ml/

**Competition and Anti-Trust Laws**

The Ministry of Commerce and Industry is responsible for reviewing free competition in the Malian market place.  Mali’s national competition law (Order 2007, Decree 2008) and the WAEMU 2002 anti-trust rules are the primary judicial documents that govern competition in Mali.  The commercial court (*Tribunal of Commerce*) and ARMDS are the primary judicial bodies that oversee competition-related concerns.

Mali’s Organization of Industrial Entrepreneurs (*Organisation Patronal des Industriels* or OPI) has criticized corruption and smuggling as significant hurdles to fair competition.  Contacts report that Mali struggles to limit illegal imports of products such as sodas, juices, tobacco, medicines, and textiles (including fabrics).  The General Directorate of Customs, the National Directorate for Commerce and Competition, and the Agency for the Sanitary Security of Foods occasionally intervene to address the import and commercialization of smuggled goods but have limited capacity to effectively address the problem.

**Expropriation and Compensation**

Expropriation of private property other than land for public purposes is rare.  The Malian government has not unfairly targeted U.S. firms for expropriation.  By Malian law, the expropriation process should be public and transparent and follow the principles of international law.  Compensation based on market value is awarded by court decision.

The government may exercise eminent domain in various situations, including when undertaking large-scale public projects, in cases of bankrupt companies that had a government guarantee for their financing, or when a company has not complied with the requirements of an investment agreement with the government.

In cases of illegal expropriations, Malian law affords claimants due process in principle.  However, given reported corruption in the land administration sector, impartial adjudication of court cases involving land disputes is rare.

**Dispute Settlement**

*ICSID Convention and New York Convention*

Mali is a member of the International Center for the Settlement of Investment Disputes (ICSID).  Malian law (Decree No. 09/P-CMLN promulgating Order No. 77-63/CMLN of November 11, 1977 and Order No. 77-63/CMLN) authorizes implementation of the ICSID Convention.  Mali is also a signatory of the Convention on the Recognition and Enforcement of Arbitral Awards (the New York Convention).

*Investor-State Dispute Settlement*

Investors engaged in disputes with the state are supposed to undertake amicable negotiations before engaging Mali’s Public Procurement Regulatory Authority (ARMDS) or the courts.  Failure to reach an out-of-court agreement will lead to the case being transferred to the Court of First Instance, the commercial court, or international arbitration.  The decisions of foreign courts are enforced as long as specified and recognized by Malian law.

Mali’s investment code allows a foreign company that has a signed agreement with the government to refer to international arbitration any case that the local courts are unable to resolve.  Mali’s 2019 mining code (which has yet to be fully adopted as law) specifies that if there is a disagreement between the Malian government and a mining company related to application of the mining code, the disagreement may be referred to Malian courts, regional courts, and international courts.

Investors have reported that the dispute resolution process is often unfair, cumbersome, and time-consuming.  Dispute resolution can take multiple years and is reportedly often fraught with corruption, political influence, and demands for payments to facilitate the legal process.

*International Commercial Arbitration and Foreign Courts*

Mali is a member of the African Organization for the Harmonization of Business Law (OHADA) and has ratified the 1993 treaty creating the Common Court of Justice and Arbitration.  OHADA has a provision allowing litigation between foreign companies and domestic companies or with the government to be tried in an appellate court outside of Mali.

**Bankruptcy Regulations**

Mali’s bankruptcy law is found in its commerce code, which does not criminalize bankruptcy.   According to the World Bank’s 2020 Doing Business Report, resolving insolvency takes 3.6 years on average and costs 18 percent of the debtor’s estate.  Generally, a bankrupt company will be sold piecemeal.  The average recovery rate is 28.3 cents on the dollar.

							4. Industrial Policies					

**Investment Incentives**

Mali’s investment, mining, commerce, and labor codes aim to encourage investment and attract foreign investors.  By law, there is no discrimination between foreign-owned firms and Malian entities with regard to investment opportunities.  The investment code offers incentives to companies that reinvest profits to expand existing businesses or diversify into another relevant sector.  The code also encourages the use of locally sourced inputs, which can offer tax exemptions.  Companies that use at least 60 percent locally produced raw materials in their products are eligible for certain tax exemptions.  Companies that invest at least five percent of their turnover in supporting local research and development are eligible for a reduction of payroll taxes for Malian employees.

Companies (domestic or foreign) that export at least 80 percent of their production are entitled to tax-free status.  As such, they benefit from duty free-status on all equipment and other inputs needed for their operations.  The Government of Mali encourages investment in the cultural sector by reducing taxes on imports of cultural goods.  In March 2020, the Government of Mali adopted an order exempting renewable energy equipment from VAT and import taxes.  The Government of Mali may also provide short-term tax exemptions on certain essential products (such as rice, cooking oil, milk, and sugar) when the prices of those goods are unusually high.

Most businesses are located in the capital city of Bamako.  The investment code encourages the establishment of new businesses in other areas through incentives such as income tax exemptions for five- to eight-year periods, reduced energy prices, and the installation of water, electric power, and telecommunication lines in areas lacking public utilities.

The Government of Mali has identified several priority sectors for furthering economic development.  Special incentives are offered for investment in the following areas:  agribusiness, fishing and fish processing, livestock and forestry, mining and metallurgical industries, water and energy, tourism and hospitality industries, communications, housing development, transportation, human and animal health, vocational and technical training, and cultural promotion.

**Foreign Trade Zones/Free Ports/Trade Facilitation**

To date, there are no dedicated free trade zones in Mali.  Mali, Cote d’Ivoire, and Burkina Faso have planned to establish a special economic zone involving the agricultural areas of Sikasso in Mali, Korogho in Cote d’Ivoire, and Bobo-Dioulasso in Burkina Faso, but the zone is not yet operational.  The Government of Mali is currently drafting a law to create special economic zones in the regions of Sikasso, Segou, and Mopti, as well as an inland port in Kayes.  The investment code states that companies operating in special economic zones will benefit from reductions of taxes on profits and of corporate taxes to 25 percent over a period of seven years.

**Performance and Data Localization Requirements**

The 2019 mining code requires large mining companies (for which there is no precise definition in the mining code) to recruit Malian nationals who possess the requisite skills and experience.  Mining companies must also progressively replace foreign employees with Malian nationals who possess the requisite skills and experience.  Feasibility studies for large mines must incorporate a plan to replace foreign employees with Malian employees.  There is no requirement that foreign investment or foreign equity in a mine be reduced over time.

							5. Protection of Property Rights					

**Real Property**

Property rights are protected under Malian law.  Ownership of property is defined by the use, the profitability, and the ability of the owner to sell or donate the property.  According to the World Bank’s 2020 Doing Business Report, registering property in Mali requires five steps, takes 29 days, and costs 11.1 percent of the property value on average.  Mali scored 8 (against 8.8 for other Sub-Saharan African countries and 23 for OECD countries) on the quality of land administration index (with 0 being the worst score and 30 the best).

The Government of Mali established the Malian Center for the Promotion of Industrial Property to implement property rights protection laws, including the WTO TRIPS agreements.  The Malian Center for the Promotion of Industrial Property is a member of the African Property Rights Organization and works with international agencies recognized by the United Nations Industrial Development Organization.  Patents, copyrights, and trademarks are covered under property rights protection laws.  These structures notwithstanding, property rights are not always adequately protected in practice.

Mali’s National Land Agency (*Direction Nationale des Domaines et du Cadastre* or DNDC) defines three types of land property classifications in Mali:  1. a land title (*le titre foncier*), which gives full property ownership to an individual; 2. an occupancy permit (*permis d’occuper*) that can be obtained by paying a fee and does not grant full ownership; and 3. farming rights granted to rural agricultural communities.  All non-registered land belongs to the state.  Various government officials, including prefects, mayors, governors, and officials from the Ministry of Lands, are able to grant land ownership status.

Mali currently lacks a nationwide land registry, and different government structures at the local, regional, and national level are involved in land administration.  As a result, there are often competing claims for land.  In March 2020, as part of efforts to improve land management, the Government of Mali began the process of adopting a new law to create a one-stop shop for land registration, eliminate rural land titles (*concession rurale*), reinforce traditional land rights (*droit coutumier*), and enable the Minister of Lands to cancel the attribution or confiscation of public properties.

**Intellectual Property Rights**

Mali is a member of the World Intellectual Property Organization (WIPO).  Mali has ratified a number of international treaties related to intellectual property rights (IPR).  There are two primary agencies involved with the protection of IPR in Mali:  the Malian Office of the Rights of the Author (*Bureau Malien du Droit d’Auteur* or BUMDA) and the Malian Center for the Promotion of Intellectual Property (*Centre Malien de Promotion de la Propriété Intellectuelle* or CEMAPI).  CEMAPI is the primary agency for patents and for industrial property rights violation claims, while BUMDA covers artistic and cultural works.  In addition to registering copyrights, BUMDA conducts random searches during which it seizes and destroys counterfeit products.  Mali’s Agency for the Sanitary Security of Foods, the National Directorate of Agriculture, and the National Directorate for Commerce and Competition are also charged with enforcing laws related to fair trade, fair competition, and IPR.

In general, however, the government has limited capacity to combat IPR violations or to seize counterfeit goods.  There is a significant number of reported IPR violations in the artistic sector as well as in the pharmaceutical sector.  According to the Malian National Pharmaceutical Association, nearly 50 percent of pharmaceuticals sold in Mali are counterfeit.  Many CDs, movies, and books are reported to be pirated.  Several companies have noted that children are often involved in selling counterfeit products such as clothes, CDs, and books.  In the past, counterfeit products were typically imported from foreign cities, including Guangzhou and Dubai.  However, BUMDA has reported that counterfeit products increasingly originate in Mali and Nigeria.

Mali is not included in the United States Trade Representative (USTR) Special 301 Report or the Notorious Markets List.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/.

							6. Financial Sector					

**Capital Markets and Portfolio Investment**

Portfolio investment is not a current practice in Mali.  In 1994, the government instituted a system of treasury bonds available for purchase by individuals or companies.  The payment of dividends or the repurchase of bonds may be done through a compensation procedure offsetting corporate income taxes or other sums due to the government.

The WAEMU stock exchange program based in Abidjan has a branch in each WAEMU country, including Mali.  One Malian company is quoted in the stock exchange.  The planned privatization of Mali’s state-run electricity company (EDM), telecommunications entity (*Societé des Telecommunications du Mali* or SOTELMA), cotton ginning company (*Compagnie malienne pour le développement du textile* or CMDT), and Bamako-Senou Airport offer prospects for some companies to be listed on the WAEMU stock exchange.

**Money and Banking System**

WAEMU statutes and the BCEAO govern the banking system and monetary policy in Mali.  Commercial banks in Mali enjoy considerable liquidity.  The majority of banks’ loanable funds, however, do not come from deposits, but rather from other liabilities, such as lines of credit from the BCEAO and North African and European banks.  Despite having sufficient loanable funds, commercial banks in Mali tend to have highly conservative lending practices.  Bank loans generally support short-term activities, such as letters of credit to support export-import activities and short-term lines of credit and bridge loans for established businesses.  Small- and medium-sized businesses have reportedly had difficulty obtaining access to credit.  The Government of Mali created a National Directorate of Small and Medium Enterprises (SMEs) in 2020 in part to address the challenges SMEs face in accessing financing.

In order to improve the business environment and soundness of the financial system, the BCEAO adopted a uniform law regarding credit reference bureaus.   The Government of Mali aligned its legislation with this regional requirement by authorizing a credit reference bureau in Mali to collect and process information from financial institutions, public sources, water and electricity companies, and other entities to create credit records for clients.  The credit rating system aims to increase the solvency of borrowers and improve access to credit.

Mali’s microfinance sector has grown rapidly.  Despite this growth, microfinance institutions suffer from poor governance and management of resources and have not put in place all government regulations or regional best practices to ensure sufficient financial controls and transparency.

Money laundering and terrorist financing are concerns in Mali.  Although Mali’s anti-money laundering law designates a number of reporting entities, companies have noted that very few comply with their legal obligations.  While businesses are technically required to report cash transactions over approximately USD 10,000, most reportedly do not.  Despite the operation of a number of al-Qaeda-linked terrorist and armed groups in northern and central Mali, the country’s financial intelligence unit, the National Financial Information Processing Unit (CENTIF), receives relatively few suspicious transaction reports concerning possible cases of terrorist financing.  With the exception of casinos, designated non-financial businesses and professions are not subject to customer due diligence requirements.

Mali is a member of the Inter-Governmental Action Group Against Money Laundering in West Africa (GIABA), a Financial Action Task Force (FATF)-style regional body.  Mali’s most recent mutual evaluation report completed November 2019 can be found at http://www.giaba.org/reports/mutual-evaluation/Mali.html.

**Foreign Exchange and Remittances**

*Foreign Exchange*

As one of the eight WAEMU countries, Mali uses the CFA franc—issued by the BCEAO—as its currency.  The CFA franc is pegged to the euro and supported by the French treasury, which ensures a fixed rate of exchange.  The Malian investment code allows the foreign transfer and conversion of funds associated with investments, including profits.  Local currency exchanges are available at Malian banks.

There are no limits on the inflow or outflow of funds for repatriation of profits, debt service, capital, or capital gains.  In the CFA franc zone, there is no limit on the export of capital provided that an exporter has adequate documentation to support a transaction and the exporter meets the domiciliation requirement.  Most commercial banks have direct investments in western capital markets.

Article 12 of Mali’s 2012 investment code states that foreign investors may transfer abroad, without prior authorization, all payments relating to business operations in Mali (including net profits, interest, dividends, income, allowances, savings of expatriated salaried employees).  Capital and financial transactions (such as buying and selling stocks, assets, and compensation from expropriation) are free to transfer abroad but are subject to declaration requirements to the Ministry of Economy and Finances.  These transfers must be done through authorized intermediaries such as banks or financial institutions.

*Remittance Policies*

The Government of Mali does not have a specific policy for remittances.  According to the World Bank, personal remittances from Mali’s diaspora represented around six percent of GDP in 2018.

**Sovereign Wealth Funds**

Mali does not have a sovereign wealth fund.

							7. State-Owned Enterprises					

Mali has privatized or reduced government involvement in a number of state-owned enterprises (SOEs).  However, there are still 48 state-owned or partially state-owned companies in Mali, including 12 mining companies, the national electricity company (EDM), a telecommunications entity (SOTELMA), a cotton ginning company (CMDT), a cigarette company (SONATAM), sugar companies (SUKALA and N-SUKALA), and the Bamako-Senou Airport.  The government no longer has shares in two banks, BSIC-Mali and Coris Bank International-Mali, in which it had respectively 25 and 10 percent shares as of December 2017.  The government also reduced its shares in the Malian Development Bank (BDM) and Malian Solidarity Bank (BMS).

More details on SOEs are available at https://www.finances.gouv.ml/documents/situation-des-participations-de-l%C3%A9tat-dans-les-soci%C3%A9t%C3%A9s-%C3%A0-la-date-du-31-d%C3%A9cembre-2019.

Private and public enterprises compete under the same terms and conditions.  No preferential treatment is given to SOEs, although they can be at a competitive disadvantage due to the limited flexibility they have in their management decision-making process.  Malian law guarantees equal treatment for financing, land access, tax burden, tax rebate, and access to raw materials for private firms and SOEs.

The Government of Mali is active in the agricultural sector.  The parastatal Niger River Authority (*Office du Niger*) controls much of the irrigated rice fields and vegetable production in the Niger River inland delta, although some private operators have been granted plots of land to develop.  The *Office du Niger* encourages both national and foreign private investment to develop the farmlands it manages.  Under an MCC-funded irrigation project, Mali granted titles to small private farmers, including women; an adjacent tranche developed with MCC was to have been open to large-scale private investment through a public tender process.  However, all MCC projects were suspended as a result of the coup d’état of March 2012 and discontinued when the projects reached the end of their implementation deadline.  The national cotton production company, CMDT, which is yet to be privatized, provides financing for fertilizers and inputs to cotton farmers, sets cotton prices, purchases cotton from producers, and exports cotton fiber via ports in neighboring countries.

The Government of Mali is still active in the banking sector.  The state owns shares in five of the 14 banks in Mali:  BDM (19.5 percent share), BIM (10.5 percent), BNDA (36.5 percent), BMS (13.8 percent), and BCS (3.3 percent).  While the government no longer has a majority stake in BDM, it has significant influence over its management, including the privilege to appoint the head of the Board of Directors.

Senior government officials from different ministries make up the boards of SOEs.  Major procurement decisions or equity raising decisions are referred to the Council of Ministers.  Government powers remain in the hands of ministries or government agencies reporting to the ministries.  No SOE has delegated powers from the government.

SOEs are required by law to publish an annual report.  They hold a mandatory annual board of directors meeting to discuss financial statements prepared by a certified accountant and certified by an outside auditor in accordance with domestic standards (which are comparable to international financial reporting standards).  Mali’s independent Auditor General conducts an annual review of public spending, which may result in the prosecution of cases of corruption.  Audits of several state-owned mining companies have revealed significant irregularities.

**Privatization Program**

The government’s privatization program for state enterprises provides investment opportunities through a process of open international bidding.  Foreign companies have responded successfully to calls for bids in several cases.  The government publishes announcements for bids in the government-owned daily newspaper, *L’Essor*.  The process is non-discriminatory in principle; however, there have been many allegations of corruption in public procurement.

							8. Responsible Business Conduct					

There is no general awareness or defined standard of responsible business conduct in Mali among producers or consumers.  Despite the creation of the Malian Agency for Normalization and Quality Promotion (*Agence Malienne de Normalisation et de Promotion de la Qualité* or AMANORM) and the National Agency for the Sanitary Security of Foods (*Agence Nationale pour la Securité Sanitaire des Aliments* or ANSSA), some report that Mali continues to produce, import, and export dangerous products and products of poor quality.  Allegations of violations of hygiene and quality standards are common in the food-processing industry and investors have reported there is no general awareness about the dangers of unsafe and toxic chemical products in food production.

Labor rights are not generally respected given Mali’s large and unregulated informal sector.  Even formal businesses often hire workers informally, such that employees do not always receive social security, retirement, or other related benefits.  The Government of Mali has various laws intended to prevent child and forced labor as well as business practices harmful to the environment and local communities.  Despite these laws, there are frequent reported cases of child labor and forced labor in the mining, agricultural, service, and industrial sectors.  The mining code requires owners of mining and exploitation permits to present local development plans to mitigate the health, security, hygiene, environment, and cultural heritage impacts of their mining activities.  Conflicts between local artisanal mining communities and foreign mining companies over land ownership rights are frequent.  Local communities have also voiced concern with the significant environmental impacts of mine closures because of the lack of government-enforced measures to restore and rehabilitate the environment.  Foreign mining and oil exploration companies sometimes provide schools and health clinics to communities in proximity of their activities as a form of corporate social responsibility.  These activities are not done in accordance with the OECD Guidelines for Multinational Enterprises, but are rather the result of individual negotiations between the company and the leaders of neighboring communities.

Mali is an active member of the Extractive Industries Transparency Initiative (EITI) and since 2011 has been designated as a “compliant country.”  The latest EITI decision available at https://eiti.org/board-decision/2019-47 notes that Mali made “meaningful progress with considerable improvements in implementing the 2016 EITI Standard.”

							9. Corruption					

Many companies claim that corruption is the greatest obstacle for foreign investment and economic development in Mali.  While corruption is a crime punishable under the penal code, bribery is frequently reported in many large contracts and investment projects.  Some investors report that government officials often solicit bribes in order to complete otherwise routine procedures.  The Government of Mali passed a law against illicit enrichment in 2014.  The law, however, does not force members of parliament or the executive to declare their assets.  The government has pledged to update the law.  In 2019, Transparency International’s global corruption ranking for Mali deteriorated to 130th of 180 ranked countries (from 120th of 180 in 2018).  Mali’s perceived public corruption score from Transparency International was 29 out of 100 in 2019 (with 0 being “highly corrupt” and 100 being “very clean”).  Relative to other developing countries, Mali was rated at the 67th percentile for control of corruption on the FY2020 MCC Scorecard (based on World Bank and Brookings Worldwide Governance Indicators reports).

Corruption is reportedly common in government procurement and dispute settlement.  The government has addressed this issue by requiring procurement contracts to be inspected by the Directorate General for Public Procurement, which determines whether the procedure meets fairness, price competitiveness, and quality standards.  However, there are allegations of significant political interference in procurement.  In addition, both foreign and domestic companies complain about harassment and requests for bribes from officials involved in tax collection.  Mali’s international donor community has been working with the government to reduce corruption.

Investors have found the judicial sector to be neither independent nor transparent.  Questionable judgments in commercial cases have occasionally been successfully overturned at the Supreme Court’s Court of Appeal.  However, there is a general perception among the populace that while prosecution of minor economic crimes is routine, official corruption, particularly at the higher levels, goes largely unpunished.

The President of Mali created the Office of the Auditor General (*Bureau du Verificateur General* or BVG) in 2004 as an independent agency tasked with auditing public spending.  Since its inception, the BVG has uncovered several significant cases of corruption, including in the customs directorate.  However, few findings of corruption have resulted in prosecutions.

Growing pressure from international donors for more transparency in public resource management led to changing the appointment process of the Directors of Finance and Equipment.  As a result, in March 2017, the Minister of Economy and Finances dismissed 15 Directors of Finance and Equipment.  Eighteen others were moved to other ministries.  The Government of Mali opened a new office in 2017, the Office to Combat Illicit Enrichment (*Office central de Lutte contre l’Enrichissement illicite* or OCLEI), to combat illicit enrichment by government officials.  The OCLEI has the authority to collect asset declarations from public servants, to conduct investigations of government officials suspected of corruption, and to refer cases for prosecution if sufficient evidence is gathered against the defendant.  However, the OCLEI’s operations were temporarily suspended following civil servants’ union protests against asset declaration requirements.  Negotiations between the unions, the Government of Mali, and donors eventually yielded a satisfactory solution that enabled the office to resume operations, and the office has begun registering asset declarations for certain categories of civil servants.  According to its 2017-2018 report, the OCLEI received asset declarations from approximately 1,000 civil servants (nearly 70 percent of all civil servants in Mali) over 2017-2018 and referred three suspected cases of corruption to the justice system.

Following a cabinet reshuffle in 2019, the newly appointed Minister of Justice took measures to address corruption by appointing a new prosecutor in the Economic and Financial Specialized Judicial Office of Bamako, a court in charge of prosecution of corruption.  Since these changes, many high-profile businesspeople and political leaders have been arrested due to corruption allegations.  Mali’s Auditor General also increased the pace of its reporting in 2019 and 2020, releasing 11 financial audits reports, four performance audits reports, four reports of conformity, and seven reports on the level of implementation of recommendations it made in previous audits reports.  The Auditor General refers cases of fraud or other unlawful practices to the Economic and Financial Specialized Judicial Office of Bamako.

*Resources to Report Corruption*

Mamoudou KassogueHead ProsecutorEconomic and Financial Specialized Judicial Office (*Pole Economique et Financier de Bamako*)Tel. (+223) 20 29 71 34

Samba Alhamdou BabyChief AuditorOffice of the Auditor General (*Bureau du Verificateur General*)Tel. (+223) 20 29 70 25

Mama SinintaChief ProsecutorAccounts Chamber of the Supreme Court (*Section des Comptes de la Cour Supreme*)Tel. (+223) 20 22 15 02

Konate Salimata DiakiteComptrollerComptroller of Public Services (*Controleur General des Services Publics*)Tel. (+223) 20 22 58 15

							10. Political and Security Environment					

The U.S. Department of State’s Fact Sheet on Mali is available at https://www.state.gov/u-s-relations-with-mali/.  The current Travel Advisory for Mali is available at https://travel.state.gov/content/travel/en/traveladvisories/traveladvisories/mali-travel-advisory.html.

Throughout nearly three decades of multi-party democracy, Mali has consistently encouraged private enterprise and investment.  However, the destabilizing effects of Mali’s 2012 coup d’état led to a deterioration of the economic situation and uncertainty in the investment climate.  Mali continues to face significant political and security challenges amidst slow implementation of a peace agreement signed in 2015 that aims to resolve the ongoing conflict in northern Mali.  A disparate group of politically-motivated armed groups, militias, bandits, and extremist groups continue to exert influence in wide swathes of Mali’s largely ungoverned northern areas as well as central Mali.  Furthermore, terrorist groups have increased the frequency and range of their attacks—particularly against the base camps of the UN peacekeeping mission (MINUSMA) and the Malian Armed Forces in northern and central Mali—in an effort to destabilize the country.  The situation in central Mali—namely in the Segou and Mopti regions—is increasingly unstable due to intercommunal conflict, localized political violence, and the incursion of extremist groups into the region.

Terrorist groups with varying degrees of allegiance to al-Qaeda and the Islamic State of Iraq and the Levant (ISIS) operate in Mali, and often pursue local agendas complementary to these global extremist movements.  Groups linked with al-Qaeda in the Islamic Maghreb (AQIM), which have merged under the banner of Jama’at Nusrat al-Islam wal-Muslimin (JNIM), continued to conduct terrorist attacks throughout 2019, primarily targeting international and Malian military forces.  These groups have claimed responsibility for recent gun and improvised explosives attacks, kidnappings, and other violent actions in northern and central Mali.

In addition to MINUSMA’s peacekeeping presence, French troops are deployed in the country and conduct offensive counterterrorism operations in collaboration with Malian security forces that target extremist elements.  However, their presence is not sufficient to counter every threat.  Extremist groups have attacked UN peacekeepers’ northern base camps in Timbuktu, Gao, and Kidal.  Attacks by violent extremist groups have moved beyond the traditional conflict zone in the North to central and southern Mali.  The area along the border with Burkina Faso, and some remote parts of southern Mali, are increasingly under threat of attack.

While the Malian government, backed by MINUSMA and French forces, has taken steps to reassert control over most of the major cities, much of the North and Center remain unstable.  AQIM, long entrenched in northeastern Mali, remains a threat.  AQIM has demonstrated a pattern of kidnapping hostages for ransom and launching operations against neighboring Algeria, Mauritania, Burkina Faso, and Niger.  AQIM and its local affiliates have been involved in various terrorist attacks in Mali, including at a restaurant in Bamako in March 2015; at a hotel frequented by foreigners in Sevare in August 2015; against the Radisson Blu Hotel in Bamako in November 2015; and against the Campement de Kangaba hotel in June 2017.

While previous extremist attacks spared foreign companies except hotels and restaurants, some attacks have targeted infrastructure projects involving foreign companies.  In October 2017, extremists attacked a foreign company in charge of the construction of a road in Timbuktu and destroyed several vehicles.  In March 2018, terrorists attacked and destroyed a USD 66 million dam construction project in Djenne.  In addition, in April 2020, extremist groups carried out attacks in the southwestern region of Kayes, Mali’s goldmining region.

U.S. citizens living or traveling in Mali are encouraged to enroll in the Smart Traveler Enrollment Program (STEP) at https://step.state.gov/step to receive security messages and make it easier to be located in an emergency.

							11. Labor Policies and Practices					

Labor is widely available in Mali, but companies have reported that skilled labor is in short supply.  Reliable unemployment data is difficult to obtain.  While a 2017 Government of Mali survey found an unemployment rate of 9.1 percent, the actual figure is likely much higher.  The rate is generally higher for youth between the ages of 15-24, coming in at 21.9 percent according to the government’s 2017 survey.  Workers have the right to unionize.  Relations between labor and management are often contentious and strikes are common.  The government has ratified all International Labor Organization (ILO) conventions protecting the rights of workers.

Since June 2014, the Government of Mali has faced several strikes led by different unions, including the national union of workers (UNTM), the union of university and basic education professors, the union of workers from the tax office, the union of workers of the national radio and television company, the confederation of unions (CSTM), the union of judges, and the union of health workers.  The private sector also participates in strikes, as seen in 2015 and 2017 banking and financial sector strikes.  While employers and workers are often able to reach a resolution, strikes can significantly disrupt economic activities, particularly when they involve key sectors like transportation or the financial sector.

The labor code adopted in 1992 (amended in December 2011 and in June 2017) streamlined hiring and firing procedures.  Conflicts often arise when employers terminate contracts and fire employees.  Large Malian and international employers have had difficulty enforcing their rights in court, given that powerful and independent labor unions play an important role in supporting their members and in other national affairs.  Compensation plan negotiations and firing procedures are time-consuming and closely scrutinized by the Ministry of Labor and the judiciary.  Labor laws differentiate between layoffs and firing.  Employees who are laid off are not entitled to unemployment compensation but are entitled to other benefits, including one-month gross salary and compensation for untaken leave.  Employers are required to provide advance notice and a certificate to laid off employees.  Although not a requirement, it is advisable to have regular contacts with labor inspectors, especially when concluding new hiring contracts or considering terminations or reductions in force.

Child labor and trafficking in persons continue to be serious problems in Mali.  The ILO reports that over 46 percent of children in Mali engage in child labor, including the worst forms of child labor such as child soldiering and hazardous activities in the agriculture and gold mining sectors.  Cotton, artisanal gold, and rice are included on the U.S. government’s List of Goods Produced by Child Labor or Forced Labor.  Additionally, rice is included on the U.S. government’s Executive Order 13126 List of Goods Produced by Forced and Indentured Child Labor.  The government has action plans for monitoring child labor and unsafe working conditions.  Labor inspection entities, however, are underfunded and unable to regularly conduct inspections or provide support for victims of violations.  In June 2017, the Government of Mali amended the labor code to align Malian law on the minimum age of employment with the ILO standard, increasing the minimum age of employment from 14 up to 15.  The amended labor law bans discrimination based on religion, race, or gender.  It also requires equality in terms of remuneration and forbids forced and compulsory labor.

							12. U.S. International Development Finance Corporation (DFC) and Other Investment Insurance Programs					

As a low-income country, Mali is eligible for U.S. International Development Finance Corporation (DFC) programs.  In 1964, the United States and Mali signed a private investment guaranty agreement.  Mali has been a member of the World Bank’s Multilateral Investment Guarantee Agency (MIGA) since 1990.

							13. Foreign Direct Investment and Foreign Portfolio Investment Statistics					

*Source for Host Country Data:  BCEAO (rate: USD $1 = 589 FCFA)

**Table 4: Sources of Portfolio Investment**Data not available.

							14. Contact for More Information					

Economic and Commercial OfficeU.S. Embassy Bamako, MaliACI 2000, Rue 243, Porte 297+223 20 70 23 00BamakoEcon@state.gov

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### On This Page

                    -  EXECUTIVE SUMMARY 
                    -  1. Openness To, and Restrictions Upon, Foreign Investment   
                    -  2. Bilateral Investment and Taxation Treaties   
                    -  3. Legal Regime   
                    -  4. Industrial Policies   
                    -  5. Protection of Property Rights   
                    -  6. Financial Sector   
                    -  7. State-Owned Enterprises   
                    -  8. Responsible Business Conduct   
                    -  9. Corruption   
                    -  10. Political and Security Environment   
                    -  11. Labor Policies and Practices   
                    -  12. U.S. International Development Finance Corporation (DFC) and Other Investment Insurance Programs   
                    -  13. Foreign Direct Investment and Foreign Portfolio Investment Statistics   
                    -  14. Contact for More Information   

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