Hinderances To Doing Business In Ghana
Once I decided to write on Ghanaian and African affairs, readers tend to send me e-mails to ask me to write a column on a matter of concern. Others either call on me, or make a phone call to provide information on issues of national interest, and then urge me to pen a column on those issues. I relish and cherish those moments. After all, every writer needs such feedback. It is a relief to know that people read, critique, and appreciate what one writes.
It is also a duty for those of us in the diaspora to be involved in national affairs. President Kuffour said as much when he met Ghanaians at our Embassy in Washington, last year. He encouraged Ghanaians in the diaspora to offer constructive ideas to his government to help in nation-building. After all, we have our properties, family members, and investments in Ghana. Out of sight should not mean out of mind. The Internet also bridges the gap. We listen to Ghana radio stations, and read news on Ghana, every moment on the Web!!
Further, because one is not tied down in the system in Ghana, one feels much freer to write opinions without any fear of retribution. Ensconced here in Washington, D.C., I can speak my mind freely on any national issue without thinking, "my boss will be angry at my opinions"; "I may not be considered for that job"; or "I may get fired over my opinions"! It is in this respect that I feel an obligation to comment on national affairs, to supplement and buttress what some of our dedicated journalists are doing on the home front. Though we live outside Ghana, we are merely ‘abroad at home"; to borrow the phrase of New York Times columnist Anthony Lewis.
So it was this morning, (January 25, 2001), when I received an "urgent" call from a longtime friend in Toronto, Canada. It would be presumptuous of me to say that it was akin to "Come over to Macedonia and help us" type of request! Suffice it to say that my friend was as determined as the Macedonians!!!
My friend's call was about the hindrances that have been put in his way, while attempting to open a ‘business' in Ghana. In order to ascertain that my friend was not just acting like an uppity, pretentious, "Aburokyire-been to" whiner; as some are wont to behave these days, I called six other Ghanaians who have established businesses in Ghana over the last two years. All of them corroborated the sentiments expressed by my friend; and then went on to provide a laundry list of depressing problems they faced in this "Golden Age of Business" in Ghana. Hence, I decided to make my friend's travails public, as he wanted me to.
President Kuffour announced a year ago that "Ghana is open for business"; and that his term in office will be known as the "Golden Age Of Business" in Ghana. These are fine and inspirational words to galvanize the private sector. It is a welcome relief to the NDC schizophrenic attitude towards private sector business.
Indeed, president Kuffour just opened a seminar on the above themes at Elmina in the Central Region to help translate his government's noble objectives into reality. One can only wish the government well in this endeavour.
However, the government's best intentions risk being jeopardized by corruption, antiquated laws and practices that can only be described as inimical to the themes that the president address.
What follows is a true story: I have known this friend for quite a long time, and I can only describe him as a true entrepreneur. Let me say frankly, that a lack of a post-elementary school education has not limited the areas of investment and businesses that interests him. He has what we call "Efie Nyansa" or as Albert Einstein was wont to say: "Education is what we have, when we forget about what we learnt at school"! I bring his lack of higher education up, just to put what I am writing in its proper perspective. He has a few other businesses in Ghana.
When I visited him in Toronto, October 2000, he intimated to me that he wanted to start an "Internet Caf?" in Kumasi. As we all know, the digital divide between the rich world and the poor world is presumed to be as destructive as the effects of real war. Knowledge is power; and in today's world, not being plugged into the Internet constitutes being left in the dark. An Internet Caf? provides a bridging of the gap between the haves and have-nots. Such Internet Caf? businesses have sprouted all over the world from Afghanistan to Zimbabwe.
I was a bit surprised though, at my friend's intention, because this guy can hardly navigate the Internet; and I am being charitable here. Nonetheless, I urged him on and explained to him some of the things he needed to get started. He took me to a warehouse and to my surprise, he had packed 20 brand new computers and all the equipment that go into making his business a reality. He wanted the business to be set up at Asuoyeboa near Kumasi, because as he put it; the students at the Technical Teachers College (TTC), and Yaa Asantewaa Secondary School located nearby would patronize it.
With his plans secured, off he went to Ghana in June 2001; to start his business. He called me from Ghana to inform me that he had decided to rather locate the business near the Mobil Petrol Station at Kwadaso, a teeming Kumase suburb because it offered better prospects for growth. Prempeh College is in that vicinity; as are offices of the Crops Research Institute and Soil Research Institute. Kwadaso Agricultural College, Yaa Asantewaa Secondary, and TTC are nearby. The prospect could only be described as promising.
He secured a space for the Internet Caf? in a building and paid 25 million cedis to the owner. "In Ghana", my friend explained, that is ‘goodwill money' for the owner and the agent who secured the building for him. "It is normal", he volunteered, as if to assure me! The amount is higher at Adum and Bantama, both Kumase suburbs; and certainly much higher in Accra, the capital city. The owner then agreed to rent the property for 15 years at a monthly rate of 120,000 cedis. The owner would re-negotiate the lease every four years! Wisely, my friend got a lawyer to provide legal teeth to the transaction.
Acquiring the office space was the easy part. What followed was a true test of nerves for the aspiring businessman; and a true test as to wether Ghana is really open for business. His woes began when he had to register the business. Much to his chagrin, a business could not be registered in Kumasi or any part of the Asante Region for that matter. All registration have to be done in Accra. So, his papers were collected at an office he recalls as Ghana Business Administration Centre near the Museum at Adum. An agent had to take the documents to Accra to be registered. That required a greasing of the palm. Of course, he could have gone to Accra to register the business himself. However, if Ghana is "open for business', one would assume that the door would be widened so that in every region and district capital, a business could be registered to save the inconvenience. In the event, it took weeks to get the business registered!
With the registration number in hand, he went to the Ghana Electricity Corporation Offices to get electricity connected to the rented office space. Much to his chagrin, he was directed to an agent with whom he had to deal with. Accordingly, the agent went with him to the location. It was here that the agent explained to my friend about the debt on the ‘Code'. "What code", he wondered. The agent explained that each building was assigned a ‘Code', and since one of his neighbours had defaulted on payments, no new electricity meter could be assigned to a rented space in the building until the debt was repaid.
The Ghanaian system always seeks the easiest way out of managing problems, no matter how inconvenient. Rather than pursuing the debtor, the problem is transferred to a new tenant with the admonition: "If you want to get connected, then you have to settle the defaulted bill"! Of course, my friend was eager to have his business started, so he had to pay someone's defaulted 150,000 cedis debt in order to have electricity connected, and a meter provided.
With that done, he moved twenty-five computers and other office equipment into the room. All what was left, was to get telephone lines connected, and he would start providing Internet and computer service to customers. Again, he went to the telephone company offices at Adum, located at the Post Office building. He figured he was half-way home to opening his business. He had been in Ghana for about six weeks now! He had other work to do in Canada, but he wanted to set the business up and leave it to his younger brother to manage.
It was at the telephone company that he came face-to-face with a very antiquated requirement, a throwback to the presidency of Kwame Nkrumah. My friend was born after Nkrumah's overthrow! He was required to provide a photograph in order to get a telephone connection!! I had to check this story with a friend because it sounded rather absurd. It turns out that in the Nkrumah days it was a requirement that was copied from the Soviet Union as a way of checking who gets a telephone, in a rather bizarre twist to the security conscious dictator. This absurd requirement is still extant in Ghana.
After providing his passport photo, the telephone company told him ‘all lines in Kumasi are full". There were no open telephone lines to be assigned to him. Again, he had to seek an ‘agent' who managed to tell him there was an open line but the owner was in default of 2.7 million cedis debt. If he would pay off that debt, he could be assigned a line. My friend refused. He was then led to a ‘telephone contractor', who it turns out had bought several lines for a cell phone, with the full knowledge of the telephone company staff; and then resold the lines at exorbitant rate. If my friend would pay millions of cedis, perhaps he would get some lines open for his business. Again, he refused.
After waiting for telephone connection for three months, he returned to Canada, last August. His brother has made daily treks to the telephone office in Kumasi to check if there are some open line yet. It has been six months; and still, no open telephone lines in Oseikrom!. Meanwhile, my friend is paying monthly rent for the space as well as huge electric bill. The computers sit fallow gathering dust. My friend's hope springs eternal. He will go back to Ghana the coming June 2002, with additional computers and equipments, hoping to "open" his business!!
For our brethren in Ghana, I can hear the refrain "that is how we do things in Ghana", upon reading my friend's complain. But when did corruption, ineptitude, and antiquated laws become symbols of national celebration? There is a saying in the Twi language that "Se Wote Faako a, Wote W'adie So". It speaks to the need to adapt lessons that one has learnt through travel and education to better oneself. Customer service in Ghana is so disappointing to anyone who needs it. Services at our harbour; airport; offices; etc., leave much to be desired. Yet these are the main ingredients to assisting people who want to invest in Ghana.
President Kuffour and his government can lecture about a new investment regime from here to eternity. The problems bequeathed to the government is enormous. Without seriously addressing problems at the bottom as much as they are concerned about those at the top, the term ‘golden age for business' will remain a mere slogan. Business as usual can no longer be sustained in today's globalization mode.
In this regard, I suggest the setting up of a committee to embark on a nation-wide sector by sector review of our systems and procedures, with a view to streamlining and decentralizing the system; in order to eliminate institutionalized bottlenecks and roadblocks that breed corruption and hinder progress.