EU gives green light to Africa's first investment facilitation agreement
On October 9 of this year, the Council of the European Union adopted a decision regarding the signing of the Sustainable Investment Facilitation Agreement (SIFA / AFCS) between the European Union (EU) and Angola. This agreement aims to facilitate the attraction and expansion of investments while simultaneously incorporating commitments related to the environment and labor rights in the EU-Angola relationship.
The Council's decision to initiate negotiations for an investment facilitation agreement with the Republic of Angola is dated May 26, 2021. Negotiations were concluded on November 18, 2022, and on June 16, 2023, the Commission sent proposals to the Council regarding the signing and conclusion of the agreement.
SIFA (as the English acronym stands for) represents the EU's commitment to providing technical support to Angola and its interest in mutual growth and prosperity. There is a significant likelihood that SIFA could serve as a model for other agreements the EU may establish with other African countries, realizing the "Global Gateway - EU" initiative, which aims to maximize the economic potential of African nations through sustainable investments.
This agreement, which has a dual focus on investment and sustainability, is primarily intended to strengthen EU partnerships with the African continent, provide Angola with the opportunity to diversify its economic model beyond the extraction of raw materials and energy resources, and enhance the attractiveness of the domestic market to both Angolan and foreign investors.
Key elements and benefits of SIFA:
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Covers all economic sectors to encourage diversification into new areas, such as the export of food products, manufacturing, and services.
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Provides greater legal certainty with transparent and clear rules for the benefit of investors.
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Ensures cooperation and regulation policies between the parties.
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Enhances accountability of government agencies and public officials.
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Promotes dialogue and ensures greater involvement of civil society.
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Introduces reciprocal commitments for investors from both sides.
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Ensures compliance with environmental and labor standards, which should not be weakened to attract investments.
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Promotes corporate social responsibility and responsible business practices.
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Strengthens bilateral cooperation on investment-related aspects of climate change and gender equality.
At this time, the signing of both parties and the notification of the completion of their respective internal procedures, including approval by the European Parliament in the case of the EU, are still pending.