Economic Overview
French Guiana has a developing market economy, patterned on that of metropolitan France and sustained by aid and technical assistance from France.
A French rocket-launching base at Kourou, used by the European Space Agency, is of great importance to the economy of French Guiana, accounting for about one-fourth of the country’s annual GDP (Gross Domestic Product).
The GNI (Gross National Income) per capita is among the highest in South America.
Services and trades generate three quarters of the economy’s wealth; other important contributors to GDP are fishing and forestry.
Machinery, food and agricultural products, and refined petroleum dominate imports, whereas motor vehicles and their parts, gold, electrical machinery and electronics, fish and shrimps are the leading exports.
In French Guiana unemployment represents a serious problem, especially among young people.
Main sectors in French Guiana
Fishing
The fishing industry, which includes an industrial section, focuses on shrimps and is one of the most important economic sectors in French Guiana’s economy.
Forestry
90% of the country is covered with forest and woodland. There are large reserves of unexploited tropical hard woods that provide opportunity for the expanding sawmill industry which is export-oriented. In 2016, the Forestry Sector contribute 2.27% to Guyana’s GDP.
The area is also an asset to the tourism industry and efforts are being made to ensure proper preservation and enhancement of the natural resources.
Agriculture
Most of the crops are cultivated on the coastal area where the population is concentrated. Rice and manioc are the ones mainly grown. Agriculture represents a significant portion of Guyana’s domestic production (approximately 19.4% GDP in 2016).
Services
The services sector is growing steadily and has been making an increasing contribution to the overall economic performance in recent years. The information and communication sector is projected to expand by 4.5% while the construction industry is targeted to grow by 10%.
Tourism
Efforts are being made to improve tourism especially with respect to accommodation (hotels, bed and breakfast, lodges), entertainment (eco – tourism, scientific tourism, river rides, forest walks) and safety. In addition, the international airport in Cayenne – Rochambeau – is being expanded.
Taxes in French Guiana
French Guiana, like the other French Overseas Departments, is not considered part of the European Community territory with respect to the harmonized rules on Value Added Tax (VAT); therefore French Guiana does not apply a local VAT system.
It, however, applies a Consumption Tax known as “dock dues”, on products imported from outside the DOMs (Overseas France; France D’Outre-Mer in French); this tax is also applied to some locally manufactured products.
Each Regional Council in the French Overseas Departments decides the rates, which fluctuate according to the tariff classification of the goods. There are exemptions for some products used for local production and for companies with a turnover below € 550,000.
An added tax to the Consumption Tax (D.A.O.M) is imposed at a rate of 2.5%. Then there is a Tax on Fuel, used to promote investment in road works.
Investing in French Guiana
French Guyana’s investment policy is motivated by the need to grow the economy and to protect the environment.
There is a local-created investment program which focuses on tax relief for individuals and companies: individuals benefit from tax cuts on income while companies receive cuts in corporation taxes.
Top reasons why to invest in French Guiana:
- Dynamic business opportunities across multiple sectors of the economy thanks to the many natural resources;
- Guyana’s unique geographic position and its socio-political heritage puts it at the gateway of South America and the Caribbean;
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Through a combination of regional, bilateral and preferential agreements, about 75% of Guyana’s exports enter destination markets duty free, with many
others receiving duty-reduced access;
- Guyana is a member of CARICOM, which provides duty-free access to the 15-nation CARICOM market;
- CARICOM agreements with the Dominican Republic, Colombia, Costa Rica, Cuba and Venezuela, partial scope agreements with Brazil and Venezuela,and bilateral agreements with Argentina, China and Turkey;
- Guyana is the only English-speaking nation in South America;
- The labor force is well educated, with literacy estimated at close to 99%, and is regarded as trainable and hard working;
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Both public and private sector leaders have declared Guyana ‘open for business’. Foreign investors receive the same treatment as domestic investors.