The country needs to overhaul its investment laws if it is to retain its position as the continent’s top destination for foreign direct investments (FDIs), two leading business associations have proposed.
While they agreed opportunities indeed abound across the length and breadth of Ghana, they bemoaned that complicated investment policies and duplication of duties and policies remain major sources of frustration for investors.
For instance, Tjalling Yme Wiarda, General Manager at the Ghana Netherlands Business and Culture Council, explained that there have been instances when investors – acting in accordance with the Ghana Investment Promotion Centre (GIPC) Act and its provisions – are approached by a different state agency with totally dissimilar terms to that of GIPC. This situation, he lamented, is not only frustrating but is casting dark shadows over the country’s position as a preferred destination for doing business in Africa.
“It is just like playing a soccer or a football match, and halfway through the game the rules change. Investors do not like that because they make their calculations on the investment and what they are going to earn.
“When investors assess this situation, they deem it too risky to invest in our country. Consequently, Ghana is losing out on investment to countries like Cote d’Ivoire, where business-friendly policies prevail,” Mr. Wiarda said in response to a question on the prevailing domestic investment climate.
Apart from this, he said corruption, lack of coordination among relevant state agencies and an apparent lack of genuine commitment to improve the investment and business climate are dimming the once bright light that shone on the country.
He said this at a networking cocktail event organised by the Ghana South Africa Business Chamber at the Dutch Ambassador’s residence in Accra.
While calling for an amendment of the GIPC Act to streamline investment rules and policies, remove duplication of duty and make them relevant to the ever-changing investor needs, he strongly urged government to be more proactive in addressing issues related to foreign investments.
“Unfortunately, no one listens to us; but I would ask government to stop the lip-service – pretending they are engaging the business community. We are very concerned by the lack of interest shown by government and the relevant agencies who don’t see any sense of urgency with the situation; it is deterring new investors,” a passionate Mr. Wiarda fumed.
Meanwhile, commenting on the current economic crisis that the country finds itself in, he said: “We see that things are worsening in Ghana as compared globally. Some of it [economic challenges] are global in nature, but I think the major part is self-inflicted.
“As a business chamber and part of the International community, we are all saying the same thing to the government: stop pretending to listen!”
Similarly, Grant Webber, President-Ghana South Africa Business Chamber, shared his disappointment regarding the current economic crisis and unfavourable investment atmosphere in the country at the same event.
Just like Mr. Wiarda, he pointed out that the investment climate has been affected by a lack of clarity and poor coordination between the Ghana Revenue Authority (GRA), Ghana Investment Promotion Centre (GIPC) and investment laws.
Furthermore, he shared his dissatisfaction regarding lack of measures to enhance the investment atmosphere.
“Interest payments to the banks are very high, corruption levels are off the charts, dealing with Ghana Revenue Authority (GRA) is impossible; there are no returns made, just a very business-unfriendly environment,” he bemoaned.
He also complained that there are conflicting conditions between local content laws and the Ghana Investment and Promotion Centre Act – which are forcing foreign companies in the country’s extractive space to choose between disinvesting, selling their company, or exploring alternative business opportunities.
Left with no option, he said, some companies are even deciding to disinvest since they are unlikely to recover their capital.