Free registration is available for micro and small enterprises to benefit from a variety of incentives to create employment and reduce poverty
Free registration is available for micro and small enterprises to benefit from a variety of incentives to create employment and reduce poverty
COTONOU, May 5, 2015 –The Government of Benin, through the Ministry of Public Policy Evaluation, Promotion of Good Governance and Social Dialogue, in collaboration with the World Bank Group, launched today, the Entreprenant Status in Benin.
The “Entreprenant Status” is a new, simplified legal regime available free of charge for self-employed entrepreneurs operating in the civil, commercial, artisanal or agricultural sectors who would like to be recognized by the Business and Collateral Registry. The primary goal is to encourage economic operators in the informal sector to be registered which eases their integration in the formal economy and helps them gain access to banking and financial services. According to the results of the 2008 General Survey of Companies, 135,795 (ie 98.5 percent) of the enterprises that were surveyed are in the informal sector, leaving only 2,068 (ie 1.5 percent) in the formal sector. Furthermore, it is estimated that 90 percent of the population works in the informal sector, representing 60-70% of the country’s GDP.
“By simplifying procedures and making registration services free, the government wanted small enterprises in Benin, the vast majority of whom are in the informal sector, to benefit from incentives which will promote job-creation, increase their benefits while contributing significantly to wealth creation and poverty reduction,” said Mr. Antonin Dossou, the Minister in charge of the Evaluation of Public Policy, Promotion of Good Governance and Social Dialogue.
The official launch of the Entreprenant Status follows the evaluation of the successful pilot from April 2014 to March 2015. The pilot contrasted a sample group of 2,400 informal micro-enterprises in Cotonou with a control group of 1,200 enterprises. During the pilot phase, 424 enterprises were formally registered under the Entreprenant Status, where they benefited from various support services, notably training in accounting, business plan development, access to specific banking services and protection against administrative harassments. Soon, these enterprises will be beneficiaries of a simpler, fairer tax regime.
For Mr. Sebastien Gnonhoussou, a Cotonou tailor who participated in the pilot phase, registering his business has brought him a lot of advantages: “With the Entreprenant Status, I was trained in accounting, inventory and financial management. My management capacity has improved significantly and I can already see the benefits. Today, I have a bank account, I have a check book and I’ve really become a Big Boss. Furthermore, I now have some disposable income to pay for my children’s food, health and education.”
But Sebastien dreams for further achievements: “My dream is to be able to export the clothes I make to other African countries, and even as far as Europe!” he added, proving the axiom that “Today’s small businesses are tomorrow’s large firms”.
The success of the pilot phase was an important precursor for the roll-out of the Entreprenant Status across the country. Benin is therefore the first country in the OHADA region to implement this new status, which was adopted by the Organization for the Harmonization of Business Law in December 2010, and became effective in May 2011.
“Benin has just demonstrated to the other 16 OHADA members that through an appropriate policy, one can successfully integrate the millions of enterprises operating on the margins of the formal economy in order to make them more prosperous and employment creators. The support of the World Bank Group helped Benin to test and identify the best policies for this important segment of the economy for countries in the sub-region,” said Mr. Olivier Fremond, World Bank Country Manager for Benin.
In Benin, the World Bank Group is supporting the implementation of the Entreprenant Status through two initiatives: the FCFA12,5 billion (USD25 million) Competitiveness and Integrated Growth Project, which aims to promote entrepreurship, investment in high-growth potential value-chains and public private partnerships; and the Business Climate Improvement Project, which provide technical assistance supporting the government to improve the business environment and the implementation of the OHADA Acts.
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For more information, please contact:
For the World Bank Group :
For the Ministry for Public Policy Evaluation, Promotion of Good Governance and Social Dialogue:
For the Competitiveness and Integrated Growth Project :
