Ghana lags behind peers

Contrary to assertions that Ghana is a gateway to West Africa in terms of favourable business climate, a survey conducted by the World Bank from May through July on Investment Climate has put the country behind her peers in that regard.

The survey which was conducted among some 600 micro enterprises, SME’s and large enterprises in manufacturing, retail trade and other service sectors revealed that labour productivity in Ghana was the lowest compared to many other low income countries in Sub-Saharan Africa.

World Bank official Zeljko Bogetic who presented a preliminary report on the survey in a Country Economic Memorandum at a WB Development Dialogue Series in Accra said Ghana’s export volume of 30% as compared to her import volume of 70% is very low suggesting that firms are not competitive.

The survey showed that within the period, access to electricity and finance were the biggest challenges faced by firms in the country and appeared worse when compared with other Sub-Saharan countries that were faced with similar problems.

Mr Bogetic observed that issues such as low level of concern for worker skills might have accounted for the low capital intensity and productivity observed among firms in the country.

In summary, the survey indicated that energy was the most pressing need of the country and energy reliability imposed a significant burden on firms when compared to successful manufacturers in Sub-Saharan Africa.

Reacting to the survey findings, the Chief Executive of the Ghana Investment Promotion Centre (GIPC) Robert Ahomka-Lindsay said the country’s investment laws are currently under review to reflect modern trends of doing business.

Mr Ahomka-Lindsay said the current Foreign Direct Investment (FDI) of 300,000 dollars out of which 90% is concentrated in Accra is woefully inadequate. In view of this, the GIPC is working to open offices in Kumasi and Tamale to receive some of the FDI’s.

He observed that not many local investors are aware of incentives that the investment law has for them. He therefore assured investors that the GIPC will be proactive in educating local investors about the incentives the new law will have for them.