There is the need to balance the debate around whether the country should rely more on local investment or foreign direct investment, especially as indigenous companies do not have the requisite financial muscle to drive socio-economic growth, CEO of the Ghana Investment Promotion Centre (GIPC), Yofi Grant, has stated.
“We cannot grow the economy on our own and government does not have much to spend. That is why we need to rely on and/or increase foreign direct investments.
Local content/participation is good but it’s about how you apply it and at what point you need to do it,” he said at a business meeting on the theme: “Foreign Direct Investments; Making Ghana a Preferred Option in Africa”, organised by the Institute of Directors (IoD) in Accra.
FDIs into the Ghanaian economy average between US$2.5 billion and US$3 billion annually, according to figures from the country’s investments promoter.
Against a US$5 billion FDI target this year, a total of US$4.4 billion has been realised as at the end of September; only US$600 million shy of the target, with fourth quarter statistics yet to be captured.
The GIPC boss argued that FDIs remain a critical tool for economic development and for that matter having the public and private sectors working together will result in economic gains.
He said it will be proper to give foreign investors the leeway to pick their partners, and not have it imposed on them, because investors want an environment that will grow their money and yield the needed results.
“How about getting foreign investors to find their own partners and binding them to procure all tax-based raw materials locally?” he said.
For Ghanaian businesses, he said: “There could be alternative ways of growing Ghanaian capital, including granting them incentives that will make them more competitive.”
The bi-monthly business meeting of the Institute of Directors, Ghana, brings together seasoned personalities to brainstorm desirable corporate governance practices that should be embraced by the government to boost the country’s public and private sectors.
President of the institute, Dr. Fredrick Ofosu Darko, highlighted the need for a strong corporate governance structure that will entice investors.
“We can only make Ghana the preferred destination for FDIs if businesses pay attention to good corporate governance,” he said.