By Joshua Worlasi AMLANU
The 2025 budget should introduce tax reliefs on aviation and hospitality, expand agribusiness investments and strengthen local participation in the oil and gas sector, according to Dela Agbo, Chief Executive Officer-EcoCapital Investment.
Ahead of this month’s budget presentation, Mr. Agbo outlined key policy recommendations that he believes will drive economic growth and improve competitiveness.
One of his primary concerns is the high cost of air travel to and from Ghana, which he argues undermines the country’s tourism sector.
“Flying to Ghana is expensive and flying out is equally costly. If we want to promote tourism, we need to address these taxes,” he said.
According to the World Travel & Tourism Council (WTTC), tourism contributed approximately US$3.5billion to Ghana’s GDP in 2022 – representing about 5.5 percent of the total economy. The sector has shown resilience and growth recovering from the COVID-19 pandemic, which severely impacted global travel.
In 2023 the Ghana Tourism Authority reported a 30 percent increase in international tourist arrivals compared to the previous year, with over 1.3 million visitors entering the country.
Tourism also plays a vital role in generating foreign exchange. In 2023, the sector earned Ghana an estimated US$3.81billion in foreign exchange, making it one of the top non-traditional export earners. This revenue is crucial for stabilising the country’s balance of payments and supporting the local currency.
He also stressed the burden on the hospitality industry whereby hotels face high operational costs, leading to exorbitant room rates. Mr. Agbo urged government to introduce tax incentives that help hotels adopt solar energy, thereby reducing energy costs and making pricing more competitive.
“Hotel rates in Ghana are unreasonably high. You can find better hotels in other countries at significantly lower prices. Part of the problem is that many materials used for construction are imported and priced in dollars. Government support through tax incentives and energy cost reductions would make a huge difference,” he explained.
Beyond tourism, Mr. Agbo sees agriculture and agribusiness as critical areas for government investment. He called for increased funding in irrigation, subsidies for farm inputs and greater support for agro-processing to curb post-harvest losses.
“It doesn’t make sense that we import tomatoes from Burkina Faso when we have vast irrigation infrastructure lying dormant. There are areas near the Volta Lake where irrigation channels exist, but they remain unused. Government should revitalise these projects and ensure year-round tomato farming,” he explained.
Agriculture and agribusiness are pivotal to Ghana’s economy, contributing approximately 22.7 percent to the Gross Domestic Product (GDP) in 2023 and employing a significant portion of the population – especially in rural areas. In 2022, the sector generated substantial economic value, with cocoa exports alone earning US$2.5billion and solidifying Ghana’s position as the world’s second-largest cocoa producer. Despite these contributions, challenges such as low mechanisation – only about 10% of farmers utilise modern equipment – climate change and limited access to finance continue to hinder growth.
Mr. Agbo also highlighted the oil and gas sector, advocating for stronger local participation. While Ghana’s local content laws provide some support, he believes government intervention is necessary to ensure indigenous businesses can compete with foreign firms.
“Opportunity in the oil and gas sector is huge, but local companies struggle to participate because they lack financial backing. Banks are unwilling to finance these ventures, so government must step in to support local players,” he noted.
On the mining front, Mr. Agbo welcomed government’s decision to establish a Gold Board but stressed the importance of refining gold domestically before export.
“We keep shipping raw gold and that’s not the best for us. If the Gold Board is properly structured, it should focus on refining a portion of our gold before export. This will create value and attract foreign direct investment,” he said.
Addressing the real estate sector, Agbo called for a renewed focus on public-private partnerships (PPPs) to bridge Ghana’s two-million-unit housing deficit.
He proposed that government provide land access to private investors for the development of truly affordable housing.
“In Ghana, ‘affordable housing’ is often not affordable. We need a system where a middle-income earner with GH¢100,000 can buy a two-bedroom home. Government should facilitate PPPs to develop housing units in places like Shai Hills with supporting infrastructure,” he suggested.
