ECOWAS Can Achieve Mass Employment Goal -George Wisner Says It Requires all Hands on Desk

By The Analyst News On Jun 18, 2025 14

MONROVIA: Clear fact is that ECOWAS countries combined do have an extremely enormous potential for growth and development, owing to their vast naturally endowed resources, including an explosive youth population. Sad fact is that the bulk of these resources are abused and corrupted, keeping the populations on the bare margin of life. Good news is that the situation can be made better, at least that’s what experts say, warning that it only requires sane, people-centered policies with all hands on desk. One of Liberia’s public policy experts, George G. Wisner, also shares those thoughts, as he articulated in a paper delivered at a regional meeting in Monrovia. See full Wisner’s statement below

PAPER PRESENTED BY GEORGE GYUDE WISNER II AT THE MEETING OF THE JOINT COMMITTEE ON ADMINISTRATION, FINANCE & BUDGET | PUBLIC ACCOUNTS | MACROECONOMIC POLICY & ECONOMIC RESEARCH | INDUSTRY AND PRIVATE SECTOR

MONROVIA, REPUBLIC OF LIBERIA, 16 – 20 JUNE 2025

TOPIC: “Investment Climate in the ECOWAS Sub-Region – Analyzing factors that influence investment, including regulatory frameworks, ease of doing business, and market conditions.”

Let me begin by stating the obvious. A business-friendly environment is essential for driving both domestic and foreign direct investment (FDI). The West African sub-region boasts a vast and diverse market of over 400 million people and abundant natural resources. However, FDI inflows to Economic Community of West African States (ECOWAS) have largely stagnated since a surge in 2008, with only a marginal increase in 2021 of 7% according to UNCTAD’s 20222 World Investment Forum Report. While no single factor can fully explain this trend, the investment climate of a country or region remains a key determinant of investment inflows. Today, investment decisions are not solely based on comparative advantage in international production but increasingly on the attractiveness of the domestic investment climate.

The sub-region’s investment climate faces challenges from a complex interplay of factors, including fragmented regulatory regimes, inadequate infrastructure, limited human capital, and unattractive market conditions. These issues are deeply interconnected, creating obstacles that make cross-border business operations cumbersome.

Despite these challenges, steps have been taken to improve the investment climate, primarily through enhanced regional cooperation. The ECOWAS Investment Policy, partly modeled after the Organization for Economic Co-operation and Development (OECD) Policy Framework for Investment, seeks to establish harmonized investment policies across the region. Meanwhile, the ECOWAS Supplementary Investment Act and the ECOWAS Common Investment Code provide a legal framework for aligning member states into a single economic space—the ECOWAS Common Investment Market (ECIM).

However, the pace of implementation has been modest and somewhat misaligned with rapidly evolving global economic trends. Nevertheless, these frameworks remain critical in addressing investment climate challenges, particularly in regulatory reforms, ease of doing business, and market accessibility.

LEGAL AND REGULATORY REGIMES

All ECOWAS member states have legal frameworks governing both domestic and foreign investments, though the scope and structure of these laws vary across the sub-region. Nearly all investment laws operate on two tiers:

A domestic regime, which regulates market activities and is often supplemented by an Investment Act or Investment Law.
A system of international treaties, offering specific protections for foreign investors. These treaties can be bilateral, regional, or plurilateral, including Free Trade Agreements.

Investment laws regulating domestic markets tend to have a broader scope, covering regulations for investment admission, incentives, and investor protections. However, when innovativeprovisions are introduced at the regional level, they may spill over into national policies. Despite this interplay, most national investment laws impose obligations on investors to comply with domestic regulations, but lack reciprocal provisions obligating the State to address critical sustainable development concerns such as environmental protection, labor standards, human rights, and corruption.

This gap was highlighted in the ECOWAS-OECD dialogue on “Unlocking Investment for Sustainable Development in ECOWAS” (May 11–12, 2023, Lomé, Togo), which noted that protection clauses and state commitments related to sustainable development are relatively weak in ECOWAS laws. Furthermore, while 13 out of 15 member states have signed the ECOWAS Common Investment Code, only a small fraction have fully incorporated it into legislation or are actively implementing its provisions.

Arbitration in ECOWAS Investment Laws

All ECOWAS investment laws refer to arbitration for resolving disputes involving foreign—and, in some cases, domestic—investors. However, they adopt different approaches to arbitration, creating varying levels of certainty for investors. One set of laws provides advance government consent to arbitration, while another does not, although it allows for arbitration under certain conditions or agreements.

Laws That Provide Advance Consent to Arbitration

Even those Countries which do provide for advance consent to arbitration, the line is not often straightforward: Example, within this group:

Nigeria, Liberia, and The Gambia explicitly provide for arbitration without imposing additional conditions.
Cabo Verde states that disputes shall be settled by arbitration unless another route has been agreed upon. However, if both parties agree, the case can be referred to domestic courts.
Benin, Guinea-Bissau, and Burkina Faso offer investors a choice between domestic courts and arbitration. Notably, the initiation of arbitration suspends domestic court proceedings, preventing parallel litigation.
Niger authorizes arbitration but restricts its application to disputes concerning the validity, interpretation, application, or revision of specific clauses in an investment certificate.

Laws That Do Not Provide Advance Consent to Arbitration

Similarly, for that group of Countries that seemingly do not provide consent, the rules are not homogeneous. Example, in this group:

Senegal requires dispute resolution to follow conciliation and arbitration procedures set out in agreements between the investor and the state, or in treaties on investment protection. This suggests arbitration is only available if such agreements exist.
Sierra Leone and Ghana permit arbitration but set procedural limitations. In Sierra Leone, if arbitration is not an option under contracts or legal instruments, the dispute is referred to the relevant legal authority. In Ghana, if there is no pre-existing agreement on dispute resolution methods, the case goes to mediation under the Alternative Dispute Resolution Act, 2010.
Guinea and Togo mandate dispute settlement through domestic or regional courts unless both parties mutually agree to arbitration.
Côte d’Ivoire applies UNCITRAL conciliation rules to disputes, allowing parties to opt for arbitration under the Common Court of Justice and Arbitration of OHADA. The investor must notify the investment promotion agency of the chosen method, renouncing the use of any other arbitration center for state-related disputes.

Impact of Diverse Arbitration Approaches

Differences in arbitration provisions across ECOWAS member states impact investors’ confidence and the predictability of dispute resolution. Uncertainty in jurisdictions with less developed investor-state dispute settlement (ISDS) mechanisms can deter investment. In contrast, countries with strong arbitration frameworks offer more security for investors.

Need for Harmonization in ECOWAS Arbitration Laws

A common framework for arbitration based on best practices could enhance consistency across ECOWAS. One possible solution is expanding the jurisdiction and efficiency of the ECOWAS Court of Justice, allowing it to serve as a reliable mechanism for regional investment dispute resolution.

Summary of Legal & Regulatory Regimes

A review of ECOWAS legal and regulatory frameworks reveals that, despite efforts to enhance the investment climate, challenges remain due to fragmentation, inconsistencies, and lack ofharmonization. National investment laws often fail to fully incorporate innovations introduced at the regional level, leading to a disjointed legal landscape that complicates cross-border business operations.

Key challenges include:

Diversity in national regulations, preventing a unified approach.
Limited harmonization, creating gaps between domestic and regional policies.
Partial implementation of the ECOWAS Investment Policy, weakening its intended impact.

The lack of harmonization and inconsistent enforcement further increases transaction costs for investors, making risk management unpredictable and business operations more complex.

EASE OF DOING BUSINESS

While streamlining, regionalization, and integration of the legal and administrative business environment are essential, they alone are insufficient to attract sustainable investments. The emphasis is on sustainable investment to highlight the fruit of such investment on the environment and holistic well-being of the peoples of the host country. The ease of doing business in the ECOWAS region is further impacted by several critical factors, including:

Regional disparities, leading to uneven business opportunities.
Limited access to essential infrastructure, restricting efficient operations.
Poor governance, creating uncertainty and instability.
Human capital shortages, limiting workforce quality and productivity.

These challenges increase transaction and production costs for extra-regional, intra-regional, and domestic investments, affecting both time efficiency and financial viability. Addressing these structural issues is key to fostering a more predictable, cost-effective, and investor-friendly environment.

Infrastructure Deficits in ECOWAS

Regional disparities within ECOWAS are exacerbated by significant infrastructure deficits, particularly in both hard and soft trade facilitation infrastructures. These challenges are further compounded by economic divergence among member states and varying regulatory environments.

Hard trade infrastructure includes ports and harbors, road and rail networks, airports, border posts, customs facilities, Special Economic Zones (SEZs), industrial parks, and energy infrastructure.
Soft infrastructure encompasses payment systems, financial services, and information and communication technology (ICT).

The scale of the infrastructure deficit is difficult to quantify, but broader estimates underscore its severity. According to the African Development Bank (AfDB, 2023):

Energy costs for manufacturing in Africa are four times higher than in the U.S.
Road freight tariffs are twice as high as in American markets.
Travel times along critical corridors are three times longer than in Asia.
Telecommunications costs are four times higher than in South Asia.

The Afrobarometer (2024) ranks Africa among the lowest globally in access to electricity, improved sanitation, and clean water. Beyond cost, the quality of these services remains subpar. Furthermore, the African Union (2023) estimates that poor infrastructure results in:

A 40% loss in productivity in African countries.
Up to a 2% annual reduction in national economic growth.

Infrastructure deficits reduce output, increase operational costs, and hinder intra-regional trade and investment, stalling economic growth across the ECOWAS region. Small and Medium Enterprises (SMEs) are particularly hard hit due to limited financial resources and restricted access to funding.

The ECOWAS Commissioner on Infrastructure, Energy, and Digitalization estimates that addressing the sub-region’s infrastructure deficit will require an annual investment of approximately $5.2 billion USD. In response, several initiatives have been launched, including:

The ECOWAS Fund for the Development and Financing of the Transport and Energy Sectors (FODETE).
The West African Power Pool (WAPP).
The Regional Electricity Regulatory Authority (ERERA).
The Center for Renewable Energy and Energy Efficiency (ECREEE).
The West African Gas Pipeline Authority (WAGPA).

Additional efforts include Public-Private Partnerships (PPPs) in infrastructure development and collaboration with multilateral financing institutions. We also recommend that member nations could also allocate a fraction of GDP or national budgets to address the infrastructure crisis. The ECOWAS Parliament—representing the region’s peoples—could play a catalytic role in advancing these solutions.

Human Capital Constraints in ECOWAS Countries

The availability of skilled human capital in ECOWAS countries significantly impacts market conditions and the overall investment climate. Human capital has a direct relationship with output, production costs, and economic competitiveness. A shortage of skilled workers leads to higher labor costs, as investors must offer higher wages to attract and retain employees with the necessary expertise. This increased cost of production can make the region less competitive and deter investment. The main constraints affecting human capital development in ECOWAS include:

Limited opportunities for young people due to inadequate education and vocational training.
High unemployment rates, particularly among youth.
Widespread illiteracy, restricting access to skilled jobs.
Restricted access to basic social services, including healthcare and education.
Gender inequality, disproportionately affecting women’s participation in the workforce.

According to the African Population and Health Research Center (APHRC), by the end of this year, West Africa will join Central Africa as one of the two regions with the highest number of young people globally. It will also be the only sub-region in the world where the population continues to grow. The African Union Charter defines youth as individuals between 15 and 25 years old, and this group constitutes 53% of West Africa’s population, which is approximately 412.5 million people. This number is expected to double by 2050.

Human capital constraints negatively affect investment flows in the ECOWAS region, hindering economic growth and sustainable development. These challenges—characterized by a shortage of skilled labor, inadequate education and training, and poor healthcare—reduce the region’s attractiveness to both domestic and foreign investors. Without a skilled workforce, businesses struggle to operate efficiently, limiting productivity and innovation.

To enhance human capital and attract investment, ECOWAS must prioritize:

Education and skills development: Expanding access to quality education and vocational training programs.
Healthcare improvements: Strengthening healthcare systems to ensure a healthy and productive workforce.
Entrepreneurship and financial inclusion: Encouraging business development and access to financial resources.
Gender equality initiatives: Promoting policies that empower women and increase their participation in the labor market.

ECOWAS has recognized the importance of human capital development and has launched the ECOWAS Human Capital Development 2030 Strategy. This initiative focuses on health, education, labor participation, entrepreneurship, and financial inclusion to improve human capital outcomes across member states. By investing in these areas, ECOWAS can create a more skilled and productive workforce, attracting both domestic and foreign investment. This, in turn, can lead to higher productivity, innovation, and increased economic output, ultimately boosting investment flows and economic growth.

Conclusion

We sincerely appreciate the opportunity to contribute to your deliberations as you assess the efforts of the ECOWAS sub-region in fostering growth, development, and employment opportunities. The region holds enormous untapped potential, with vast opportunities across various sectors waiting to be leveraged.

To fully realize this potential, enhanced regional cooperation is essential. By bringing together state and non-state actors, civil society, and development partners, we can collectively address challenges and create a more conducive environment for investment. Strengthening collaboration across key sectors such as infrastructure, energy, agriculture, digital innovation, and trade will be instrumental in positioning ECOWAS as a prime destination for extra-regional, intra-regional, and domestic investment flows.

ECOWAS has already taken significant steps toward improving its investment climate, including initiatives such as the ECOWAS Investment Forum and the ECOWAS Common Investment Code and Policy. These frameworks aim to harmonize investment policies, enhance competitiveness, and attract sustainable investments that drive economic growth.

By fostering inclusive economic policies, improving human capital development, and ensuring financial accessibility, ECOWAS can unlock new opportunities for businesses and investors. With strategic partnerships and a commitment to sustainable development, the region can overcome existing barriers and emerge as a thriving economic hub.

We remain optimistic that, through collective action and shared vision, ECOWAS will continue to advance toward a future of prosperity, innovation, and inclusive growth.