CORRUPTION AND OBSTACLES FOR CONDUCTING BUSINESS IN FORMER FRENCH WEST AFRICA

Abstract

This study examines the extent of corruption and obstacles to conducting business in some former French West Africa countries.

Methodology: This study uses business owner’s and mangers perceptions about the use of gifts or informal payments and obstacles to conducting business in five African countries.  Data comes from the World Bank Institute and the European Bank for Reconstruction and Development’s Business Environment and Economic Performance study.  Data from Benin, Burkina Faso, Niger, Senegal, and Togo were examined.  Univariate general linear analysis was used to discover statistical differences between factors by country.

Main Findings: Results show Senegalese managers and owners perceived the lowest obstacles to conducting business among the five countries.  Togo business managers and owners are slightly less positive about obstacles they face in their businesses.  Businesses in the five countries on average pay about eight percent of their annual sales as gifts/informal payments.

Limitations: The study uses data that is about ten years old.  The political and economic environment may have changed in these countries since data collection.

Social Implications: The significant level of obstacles business faces in these countries may significantly reduce foreign direct investment in these countries.  Electricity is an obstacle in most of these countries reducing the ability if not the interest in conducting business.

Originality/Novelty of the Study: The French strategy in this region for three hundred years was to rule through the military not the development of economic systems.  The results of this strategy may still be apparent in the number and degree of obstacles facing business only 50 years after independence.