Multinational companies and governments around the world are increasingly looking to Africa as a new business destination. Africa's economy has grown at a rate of around 5.3% per year over the last decade and six of the world's ten fastest growing economies are located here. These countries have a fast-growing middle class that contributes to rapid urbanization that is increasing faster than their cities' infrastructure can keep up. It is a common misconception that many economies in Africa are heavily dependent on energy production. In reality, the oil and gas sector accounted for only 11% of Nigeria's GDP in 2014, while the construction sector accounted for 20%.
When considering doing business in Africa, it is not a matter of choosing just one country or all 54; A regional approach makes more sense. Sub-Saharan Africa, for example, refers to sub-Saharan countries such as Angola, Kenya, South Africa and Nigeria. Many companies already doing business in Africa are separating their businesses in North Africa and Sub-Saharan Africa due to the stark economic, linguistic and cultural differences between the two regions. Here are our top 5 African countries for doing business:
Mauritius Mauritius is known for offering an extremely favorable business environment for investment and business growth. The process of incorporating a company and starting new business activities in Mauritius is believed to be straightforward and relatively easy. Mauritius' economy is mainly based on textiles, tourism, sugar and financial services, although recently other sectors such as renewable energy and information technology are expanding rapidly. The World Bank ranked Mauritius 49th in its Doing Business 2017 ranking, largely due to its pro-business approach to dealing with building permits, enforcing contracts and protecting minority investors. Another ranking of African countries places Mauritius first based on factors such as law and security, economy, human development and human rights.
Rwanda Despite nearly a decade of Rwanda's civil war, the country's leaders and citizens alike have worked to achieve a healthy business climate and a strong overall economy. According to the World Bank, Rwanda is the second easiest place to do business in Africa and ranks 56th in the Doing Business ranking. This is because the procedures for registering a property, obtaining credit and trading across borders have been greatly simplified. Tourism is currently the fastest growing sector in Rwanda. According to our research, businesses can be incorporated and operating in as little as three days.
Botswana Since gaining independence, Botswana has had one of the fastest per capita economic growth rates in the world. As the government works to diversify the country's profitable industries, the mining of diamonds and other precious metals is currently the main contributor to the country's economy. Recently, Botswana has managed to reduce the time it takes for various processes including import and export and business formation procedures. In addition, technological upgrades have reduced the average court length for commercial disputes to 625 days (from 987 days in 2008). Thanks to these improvements, Botswana ranks 71st in the World Bank's Doing Business 2017 ranking.
South Africa South Africa's key industries are automobile manufacturing, tourism, mining and information and communication technologies. South Africa has managed to simplify its import and export procedures, resulting in less time and fewer documents required. In addition, the South African authorities have simplified tax legislation, reducing the number of hours required to prepare tax reports. The World Bank ranked South Africa 74th for ease of doing business in 2017.
Kenya Another country to keep an eye on is Kenya, which is currently making huge investments in sectors such as telecom, transport and energy. With a tech-savvy workforce and high-speed internet, Kenya stands out as one of the top countries in Africa for tech startups, while its diversified economy, strong ownership rights, excellent tourism sector and improving infrastructure make it a great location for general start a new company. If you have further questions about company formation or banking in Africa. Please contact us now.
The monthly minimum wage in Hong Kong is USD 720. Hong Kong has a public debt equivalent to 19.3% of the country's gross domestic product (GDP), estimated in 2013. In terms of consumer prices, Hong Kong's inflation rate is 4.4%. The currency of Hong Kong is the Hong Kong Dollar. The plural form of the word Hong Kong dollar is dollars. The symbol used for this currency is $ and is abbreviated as HKD. The Hong Kong dollar is divided into cents; there are 100 in a dollar. Every year, consumers spend around $181,089 million. The ratio of consumer spending to GDP in Hong Kong is 0.07%, and the ratio of consumer spending to world consumer market is 42%. Hong Kong corporate income tax is 16.5%. Personal income tax ranges from 0% to 15% depending on your specific situation and income level. VAT in Hong Kong is 0%.
Gross domestic product The total Gross Domestic Product (GDP) in Hong Kong, calculated as Purchasing Power Parity (PPP), is US$400.362 billion. Gross Domestic Product (GDP) per capita calculated in Purchasing Power Parity (PPP) in Hong Kong was last seen at $53,892,595. PPP in Hong Kong is considered very good compared to other countries. A very good PPP shows that citizens in this country find it easy to buy local goods. Local goods can include food, shelter, clothing, healthcare, personal hygiene, essential furnishings, transportation and communications, laundry, and various types of insurance. Countries with very good PPP are safe investment locations. The total gross domestic product (GDP) in Hong Kong is 274,027 billion. Based on this statistic, Hong Kong is considered as a large economy. Countries with large economies support a variety of industries and businesses and offer numerous opportunities for investment. Large economies support a significant financial sector, making it easy to organize investments and financial transactions. It should be very easy to find good investment opportunities in Hong Kong. Gross domestic product (GDP) per capita in Hong Kong was last seen at $36,886,683. The average Hong Kong citizen has very high net worth. Countries with very high per capita wealth have a longer life expectancy and a very high standard of living. Highly skilled labor can be found in many industries and labor is very expensive in these countries. Very wealthy countries offer safe investment opportunities as they are often backed by a diverse and thriving financial sector. The annual GDP growth rate in Hong Kong averaged 3% in 2014. According to this percentage, Hong Kong is currently experiencing modest growth. Modest growth countries offer safe investment opportunities; Their expanding economy suggests that businesses, jobs and incomes will increase accordingly.
Major industries in the country are electronics, telecommunications, automobile production, chemicals, shipbuilding, steel. The Industrial Production growth rate of South Korea is 12.1%.3.8% of population in the country are unemployed. The total number of unemployed people in South Korea is 1,944,249. South Korea produces 494,700 GW/h of electricity each year. South Korea emits 11.8 metric tons per capita of CO₂. On average, you would pay 1.55 USD for one liter of gasoline in South Korea. One liter of diesel would cost 1.06 USD.
Labour The total labor force of South Korea is 27,875,990 people, wherein 7% are working in agriculture, 24% are working in industry, and 69% are employed in services. People in South Korea speak the Korean language.
Given that within the European Union there are no withholding taxes on IP royalties between member states, we can suggest a number of countries where royalties are particularly advantageous.
CYPRUS The intellectual property royalties tax regime in Cyprus has changed as a result of the recommendations of the Organization for Economic Co-operation and Development (OECD) Action Report 5 and the Ecofin Council conclusions published on 8 December 2015. Legislation has been changed to limit the companies that can benefit from research and development (R&D) exemptions, but the tax rate in Cyprus is still one of the most favorable in the EU for foreign companies using Cyprus intellectual property want to license -resident companies (intermediaries), where this right is then sub-licensed to the end user. Overall, the effective tax on IP royalty income should be less than 2.5%.
IRELAND In 2015 Ireland introduced an effective corporation tax rate of 6.25% on intellectual property income based on an allowance for research and development costs borne by the company. By linking the two components in this way, Irish law encourages companies to conduct R&D directly within the EU - leading to the creation of intellectual property - while discouraging them from acquiring licenses without directly committing to R&D.
BELGIUM Belgium has introduced a tax system that favors those with income from acquired copyrights. This tax regime can have many different applications and can be used to protect artworks as well as a useful tax break for IT developers. Income from IP rights royalties is taxed at 15%. This income is not taken into account when calculating social security contributions. In addition, these taxes are reduced by 50% for imports due to the application of standard import costs. The first €15,000 that a copyright owner earns in a year is therefore taxed at 7.5%, and the next €15,000 at 11.25%. This tax system applies to people with a total annual income of up to 56,450 euros.
LUXEMBOURG In general, corporate tax in Luxembourg is 29.22%, but for IP licensing income it can be as low as 5.8%. This is due to an 80% corporate income tax exemption. Interestingly, this exemption also applies to companies that have registered a patent for use in connection with their own business, which then calculate a notional net income as if they had received the licensing income.
ITALY Italy is a larger market compared to the other countries discussed and can be a very attractive place for a company to invest in R&D since 2015 companies have been able to deduct intellectual property income from their taxable income base. The tax deduction was set at 30% in 2015, 40% in 2016 and 50% from 2017. Businesses will therefore enjoy a significant tax rebate by reducing their taxable income.
THE NETHERLANDS Since 2010, IP income has been taxed at only 5% in the Netherlands. Except for patents, there is no income limit. Patent holders can actually have access to this tax regime if their share of the expected revenue is between 30% and 70%, taking into account the total combined revenue from patents and other sources. These rates also apply to foreign companies owning intangible assets or companies that have received research and development accreditation from the Dutch Ministry of Economic Affairs if they are owners of software IP or trade secrets. The only other caveat to this favorable tax regime is that it doesn't apply to marketing and branding-related assets.
The Italian government introduced Value Added Tax (also known as Value Added Tax) back in 1972, which is called “Imposta sul Valore Aggiunto (IVA)” in Italian. Italian officials have also decided to introduce the VAT directives and other initiatives of the European Union, of which Italy is one of the founding members.
Italian VATItalian VAT regulations can be found in VAT laws and other legal acts, which are constantly backed up by precedents. The local tax office also develops and implements administrative doctrines containing various general guidelines for a day-to-day VAT application. The VAT system is overseen by the Italian Ministry of Finance.
According to the European Union's common VAT regulation, all companies trading in the territory of Italy and supplying taxable goods or services must comply with local tax laws. The latter include the obligation to apply for the local VAT number, to comply with all requirements of Italian VAT regulations, and to regularly fill out and submit VAT reports and other declarations.
Cases where a company needs to register Italian VAT If a foreign, non-resident company sells goods or provides services, in this case it may face the legal obligation to apply to the tax office like a local taxpayer and obtain an Italian VAT number. A company may be required to acquire an Italian VAT number under the following circumstances:
Importing goods into Italy, but if the customer has an Italian VAT number – the supplier must not estimate local VAT; Buying and trading goods in the territory of Italy, provided that the supplier and customers are non-Italian companies with a local VAT number; Provision or receipt of intra-community deliveries or receipt of goods as acquisition from other member states of the European Union; The sale of goods to individual consumers via the internet is subject to the local distance selling registration threshold; Storage of goods in a consignment warehouse on the territory of Italy for the purpose of delivery in Italy or alternatively in the EU; Collection of entrance and entry fees to live events or exhibitions on Italian territory; E-commerce transactions where the goods are sold online to Italian consumers. As of 2010, there are almost no situations where registration of a non-resident VAT number is required to provide services on the territory of Italy. Instead, the Italian customer records the transaction using the reverse charge method.
Remember that according to the MOSS system, providers of digital, broadcasting or telecommunications services aimed directly at Italian consumers only have to apply for a VAT number in one of the member states of the European Union in order to make a single declaration for all 28 to submit to Member States.
Basic information on Italian VAT Below you will find basic information about Italian VAT.
Normal VAT rate: 22% Reduced VAT rate: 4%, 10% Distance selling registration threshold: €35,000 EU VAT number format: IT99999999999
VAT returns The annual VAT declaration and the annual notification of VAT data must be submitted to the local tax authority. There is no need to file monthly – quarterly sales tax returns. The annual notification of VAT data only has to be submitted digitally in February. The annual sales tax return must be submitted digitally by September 31st and submitted together with the corporate tax return.
B2B (Business-to-Business) Trading Company B2C (Business-to-Consumer) Trading Company B2B (Business-to-Business) Trading Company The most extensive use of trading companies is as intermediary trading companies or B2B companies. These businesses usually 1) specialise in a certain range of products or services, which they purchase from suppliers or merchants; 2) broker the products or services (i.e. add value and commission to the transaction); and 3) coordinate the logistics of delivering these products/services to the purchasing company (i.e. arranging the delivery and providing their own or affiliated transportation services).
B2C (Business-to-Consumer) Trading Company B2C refers to selling products or services to the end client, and so the final destination of the trading company’s goods is usually a shop.
A branch is a unit of a parent company incorporated in a foreign market or other location with the aim of doing business. A branch is not a separate entity in either a legal or functional sense – it is set up as an extension of the parent company, which is responsible for its liabilities and taxes.
Branch activities Because branches are sub-divisions of the parent company, they can be used to carry out the same activities, including but not limited to:
Sale of goods and services manufacture of products store products collect data Conducting market research launch advertising campaigns In other words, a branch office acts as a representative of the parent company even though it is physically separate from the main office. This aspect of physical presence in a foreign or otherwise distant market is the main benefit of having a branch office. It ensures a tangible presence and also acts as a base or hub in the logistics network of the parent company.
Another important task of a branch office is to act as a contact point for customers. In addition to selling a product or service, depending on what the company manufactures, a branch office can be used to make repairs, store goods for on-site transactions (i.e., act as a retail store), and generally serve as a customer support center .
In addition, a branch office is an important element in a company's market research and business expansion strategy. A branch may hire local people to gain insight into the culture and environment of a foreign market and to draw on knowledge of the market itself. The home office of the parent company cannot do this and would need mediators or advice from experts on the foreign market. Depending on the distance to the home office, a branch office can also be advantageous in responding to certain business events, since information is more likely to be received earlier.
Advantages of a branch A branch office has several advantages over other forms of corporate representation in a foreign market:
Scope of activities A branch office can perform the same activities as the home office while providing greater access to local resources and information. local presence A branch office can access local suppliers and customers without having to build a delivery and supply network, thereby increasing the overall effectiveness of the company's services and eliminating the effects of distance between the foreign market and the home office, which can discourage potential partners. Service adjustability Because a subsidiary is a separate structure, its activities can be adapted to meet the needs of a foreign market without overhauling the structure of the entire company - rather than the home office, location-specific products, types of services, etc. can be assigned to the subsidiary to manage .