The executive director of the Ghana Investment Promotion Centre (GIPC) Mr. Kwasi Ahwoi last week criticised the World Investment Report 2000 that was launched in Accra. He believes that Ghana was not treated well in the rankings as contained in the United Nations sponsored document.
Mr. Ahwoi received an advance copy of the book, flipped through its pages, in the hope that the UN document would recognise his investment initiatives. His expectations is that the centre's self-acclaimed success in investment drives for the nation and the so-called Gateway project that is supposed to make Ghana the most ideal investment destination in the West Coast would attract the attention of the authors of the report. He sooner than later realised that statistics count more than rhetoric.
One sure way to measure the country's success at investment is to compare Ghana's case with that of other countries in Africa and this is the case that paints the bigger picture of where we stand.
Launching the book, Mr. Ahwoi registered his anger obliquely. "If we consider that South Africa was placed fourth in the top 10 African countries in terms of FDI inflows, and Ghana was even not in the list, then that statement becomes rather uncomfortable as it stands," he said. South Africa attracted FDI inflows of $156 million in 1998 and $1.3 billion in 1999.
Mr. Ahwoi was however happy that the report mentioned Ghana among countries that had increased in FDI and observed that "such sloppy throws must be avoided".
He also criticised the authors of the document and said it left room for much criticism. This he said was because the 21% response from companies contacted undermined the credibility and validity of the African findings, and urged UNCTAD to conduct a more credible survey in the future.
Mr. Ahwoi claimed that FDI inflows to Ghana in 1999 totaled $278.3 million, and questioned the validity of the data the report published on Ghana, even though he did not dispute the generality of the findings
Dr. Joe Abbey, Director for Centre for Policy Analysis (CEPA), in his presentation agreed with what the report contains but this drew another sharp criticism from Mr. Ahwoi. Dr. Abbey felt that Mr. Ahwoi's statements and comments were more or less horse hockey, emphasizing that he thought the report was at least 95% accurate.
The revelations that Ghana attracted FDI of $115 million in 1999 shows that the country's performance is far below what Gabon a tiny state had in 1998 ($211 million). Observers say it is now clear that the GIPC has woefully failed the nation and may be facing credibility problems because taxpayers could ask the centre to justify the huge spending in recent times for foreign travels and advertisements in the foreign and local media to attract investment.
About 70% of total 1999 FDI to Africa was concentrated in just five countries, namely war-torn Angola, Egypt, Nigeria, South Africa and Morocco, all of which have experienced some form of political problems, terrorism or civil disobedience. Ghana in peacetime cannot march any of them especially Nigeria, an oil economy that is recuperating from economic mismanagement, years of military rule and international isolation.
Privatisation was the main focal point that attracted FDI to Africa during the 1990s than in previous decades. South Africa had the largest share of privatisation between 1990 and 1998. It had a total of $1.4 billion. Ghana, Nigeria, Zambia, and Cote d'Ivoire had $709 million, $500 million, $420 million and $373 million respectively.
FDI flows to Africa rose from $8 billion in 1998 to $10 billion in 1999, a performance that economic experts say is not impressive.
Some politicians and fund managers believe that Ghana's chances of attracting FDI in the year 2000 may not be much better than what was received last year because of the unstable political atmosphere especially when the country is on the last lap of President Jerry John Rawlings' political career.
Political and Economic analysts contend that no matter which political party takes up the reign of power after President Rawlings ends his term of office, FDI inflows to the country would improve remarkably. If this view holds true in a post Rawlings era, then the talk that the sitting President is an investment President would be far from the truth and that the nation could have done well even without the numerous investment tours by the presidency.
Mr. Stephen Kyeremanteng, an investment analyst at tmi Consulting said the country's failure to find a position on the league table of FDI recipients stems from the fact that the country's investment laws have outlived their usefulness. He explained that the laws did not fully address the safety and security of foreign investors, the prevalence of corruption and the importance of contacts.
Some analysts are also calling for a close examination of the operation of the legal system, domestic payment system, the exchange rate and risk of asset expropriation as a way to maximise the chances of attracting more investment.
