Minister of Finance Kemi Adeosun, Stock Exchange CEO Oscar Onyema…
Interview with R Yofi Grant, CEO, Ghana Investment Promotion Centre
What reforms are currently under way to improve Ghana’s competitiveness?
R YOFI GRANT: Building credibility for the new administration has been the priority. The debt-to-GDP ratio of 72% at the end of 2016 is one of the biggest challenges being tackled. We project lowering this to 68% by the end of 2017 and to 65% later on. The fiscal policy has been revised and some expenses have been capped. This has allowed for additional fiscal manoeuvre room, eliminating 15 taxes and reducing others, bringing GHS1bn ($239.4m) back to the economy. In this context, GIPC has a major responsibility. It has actively promoted the reduction of front-end expenses investors face when coming to Ghana, such as capital limits. The government would only act as a facilitator, but the mindset is that the private sector and academia will join forces to encourage constructive and dynamic development. Besides capital limits, GIPC is looking to have special incentives for foreign direct investment that partners local enterprise and further creates opportunity in their global value chain. The country is also moving towards the execution of the one-stop shop concept, where companies can register and seek licences online. Strengthening the National Single Window – having many government agencies on one platform – while reducing barriers to trade are also key priorities that will drive competitiveness and the ease of doing business.
How can Ghana leverage its membership in ECOWAS to help improve its attractiveness?
GRANT: ECOWAS has a population of more than 350m, while Ghana has 28m. Nevertheless, based on its central location, resources and track record of stability, it has the potential to be become a centre for finance, aviation and tourism, logistics and manufacturing in the long run. In order to achieve this, creating a strong manufacturing base supported by an efficient integrated transportation network of roads, railway, air and water transport is essential. Another element is to create an integrated aluminium industry based on the significant bauxite deposits in the eastern region that will support other industries such as construction, real estate and automotive. Establishing tax holidays for international companies willing to establish their West Africa headquarters in Ghana – provided that they generate local employment opportunities – is another suggestion to be considered. Ghana also has the potential to become an aviation hub, which would bring additional business and trade opportunities. The administration is taking firm steps in that direction, and a new airport city to support 20m passengers is being planned. There are many challenges to transportation and movement in Africa, but we prefer to see these as opportunities for increased integration. For example, there is a strong push for some 4007 km of new rail, which will make all regions of Ghana accessible and open up new entries into West Africa.
What can Ghana do to encourage investment outside of the country’s primary urban centres?
GRANT: Rural development is essential to economic growth, and the current focus is to leverage Ghana’s natural resources in a process-driven manner, with value addition at the centre. Agro-processing and the modernisation of agriculture is going to be essential. It is estimated that over 55% of our population is engaged in agriculture all through its value chain and there are opportunities almost anywhere in the country. There is interest in the sugar industry and cassava, oil palm, which is driven by export markets demand in the sub region. Some $1m per constituency has been made available to each districts to support development initiatives, infrastructure building or partnering with the private sector under the One District, One Factory programme. To achieve this Ghana is focusing on skills building and technical education to support and incorporate more mechanisation into agro-processing, and then industrialisation, leading to higher-value jobs.
This information was originally published by Oxford Business Group (OBG), the global publishing, research and consultancy firm, appearing in The Report: Ghana 2018. Copyright Oxford Business Group 2018. Published under permission by OBG. For economic news about Ghana and other countries covered by OBG, please visit: http://www.oxfordbusinessgroup.com/economic-news-updates
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