UNCTAD calls for actions to restore investor confidence

The Unite Nations (UN) Conference on Trade and Development (UNCTAD) said on Thursday that Ghana could once again become an attractive destination for Foreign Direct Investment (FDI) in Africa if several actions were taken to restore investor confidence.

These include restoration of macro-economic stability, strengthening infrastructure, increasing productivity and securing local business partners. It also called for a sustained sterling economic performance and removal of causes of the prolonged economic crisis of the past to enable the nation to recover lost grounds in FDI.

These were the main conclusions of the United Nations Conference on Trade and Development Report on Ghana's Investment Policy Review, which is being examined at a day's investment forum in Accra on Thursday.

Various stakeholders are looking at the Review to enable them to formulate programmes that would enhance investment flow into the country. The UNCTAD Investment Policy Reviews are intended to help countries improve their investment policies and to familiarise governments and the international private sector with the investment environment in those countries.

The Investment Policy Review on Ghana was initiated at the request of Ghana Investment and Promotion Centre (GIPC) and the Ministry of Foreign Affairs. According to the Report, although the investment framework was generally sound and non-discriminatory to investors, some of the provisions crafted in the last 10 years were no longer relevant to new investment concerns.

It, therefore, recommended a review of some of the provisions of the Investment code, with the view to easing restrictions on establishment and ownership of companies. The report said there was the need to place the tax system on an equal footing with international standards, particularly withholding tax, tax auditing and tax administration.

It advocated for the establishment of a task force to reform land laws and establishment of land banks to facilitate foreign and domestic freehold or leasehold ownership.

The report also recommended the launch of a booster programme to revive investment by domestic and established foreign investors to encourage expansion of existing businesses and re-investment by investors in new projects.

"The booster programme should address issues that can be reviewed and implemented within six months to one year, with concrete results envisaged over a three-year time frame," the Report said.

It recommended that a task force should be established to review the tariff structure and remove inconsistencies, especially in the structure of import duty that discriminated against local assemblers and manufacturers.

"Encourage existing manufacturers to expand and diversify," the report said, adding, "All new investments in production capacity could get accelerated depreciation allowance that allows write-off within three years."