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ComorosComoros is an archipelago in the Indian Ocean, off the coast of Africa. It is located between Mozambique and the island nation of Madagascar. According to the World Bank, the most recent survey of households in Comoros, conducted in 2014, showed about 18 percent of the population living below the poverty line.

Improving access to finance is one way to boost economic activity and lift people out of poverty. Looking at recent changes in credit access in Comoros offers clues as to where the country’s economy is headed.

Business Reforms in Comoros

Over the past few years, the government of Comoros has instituted several reforms that make doing business easier. These reforms have made it easier to start a business by reducing the minimum capital requirement. In turn, this has made resolving insolvency easier for small companies and made trading across borders easier with an automated customs data management system.

The International Finance Corporation reports that these reforms have reduced the number of procedures and days needed to start a business. Comoros has also improved its investment potential by offering political risk insurance to foreign investors, which may mitigate fears over Comoros’ recent decades of instability.

Credit Access in Comoros: Looking Ahead

At the 21st session of the Intergovernmental Committee of Experts, in November 2017, participants adopted the final report of best practices and research results for catalyzing growth in East Africa. It clears a path for more cooperation between the United Nations Economic Commission for Africa and member states, like Comoros.

Topics emphasized included investment in infrastructure and renewable energy, as well as the need to improve credit access in Comoros, which will support the private sector. The goal is to make Comoros an emerging country by the year 2030, if not sooner.

The Takeaway on Financing in Comoros

Comoros is finally beginning to establish political calm after decades of political strife and coups, initially ushered in by its vote for independence from France in 1974. Time will tell whether peace lasts, but, if it does, business activity and good credit in Comoros will likely continue to grow.

With a better business environment, Comoros will have the funds to address poverty factors like hunger and malnutrition, and, hopefully, it will continue to make gains in the U.N.’s Human Development Index.

– Chuck Hasenauer

Photo: Flickr

Infrastructure in ComorosComoros is an archipelago of islands in the Indian Ocean, off the coast of Eastern Africa and home to a population of about 734,900 people. It is a nation that has struggled with political instability and poverty despite its picturesque beaches and natural beauty. The issues of poverty can be partially attributed to the poor state of infrastructure in Comoros.

In a worldwide comparison, Comoros ranked 198th, theoretically attributing 1.11 meters of infrastructure for each of the estimated 790,000 inhabitants currently residing in the country. Transport systems are particularly limited in Comoros, with only 673 km of the total 880 km of roads having been paved. Additionally, there are no railway systems of any nature available to its citizens.

The economy and infrastructure have been tied to each other for many years. This has been demonstrated in the fact that the weak infrastructure in Comoros and the business climate have severely hampered economic activity. It is currently ranked 153rd out of 190 countries in the World Banks’ most recent report, dropping one place since the previous assessment.

With these apparent issues in the infrastructure and economy of Comoros, there must be improvements made to these aspects of the country. Some work that has already been undertaken has come in the form of Public-Private Partnerships (PPP). These aim to create long-term contracts between a private party and a government entity, in which a public asset or service is provided, and bear all risk and management responsibilities.

One of these projects was established in 1998, called Comorienne de d’eau et de l’electricite (CEE), but it was cancelled soon after. There was an additional project in 2003, Mutsamudu Port, which received $500,000 in funding.

Other programs include the Infrastructure, Water, and Environment Project for the Comoros, which was established to support the objective of improving living conditions and stimulating economic growth. It aims to do this, while also protecting the environment, through investments to the basic infrastructure in Comoros.

The component of transport to the program is extremely important, as it assists Comoros with improving road maintenance, safety and management. Management improvements are achieved through three subcomponents: national and regional roads periodic maintenance, roads safety and institutional strengthening.

These subcomponents will rehabilitate earthworks, including pothole repair, local reinforcement, resurfacing and resealing. They will also maintain and repair road shoulders, finance the installation of traffic signals and strengthen the capacity of the executing agency, among other things.

The urban water supply is another component of importance that will rehabilitate and extend the urban water infrastructure. This will support technical assistance to strengthen the management and operation of urban water utilities.

With more efforts like these, improvements to the infrastructure in Comoros can make the fight against poverty achievable.

– Drew Fox

Photo: Flickr