BUSINESS OPPORTUNITIES IN GHANA

1
BUSINESS OPPORTUNITIES IN GHANA

PARTNERS IN BUSINESS

• PRESENTED BY DR PETER ANKRAH
• DIRECTOR, GIPC

2
GHANAS LOCATION

• English Speaking Country
• Strategically located on West Coast of Africa

3
GHANAS LOCATION
4
ECONOMIC INDICATORS

• Population 19.89 Million (2001)
• Area 238,537 Sq Kms
• Currency Cedis 100 Pesewas
• GDP US5.06 B illion (2001)
• Average Annual Growth 4.5
• Inflation 13.1 (2002 Dec)

5
ECONOMIC INDICATORS

• Main Exports
• Gold, Cocoa, timber,bauxite,Aluminum,
• Manganese, diamonds, Processed foods
• Main Imports
• Capital equipment, Petroleum, foodstuffs
• Exports to Malaysia
• High Premium grade cocoa beans
• Imports From Malaysia
• Electrical goods, Motor Vehicle parts
  accessories, Machinery Equipment

6
INVESTMENT CLIMATE

• The GIPC is the Agency of the Government of Ghana
  charged with the responsibility of encouraging,
  promoting and coordinating investment in the
  Ghanaian economy and providing support services
  to both existing and prospective investors.

7
INVESTMENT CLIMATE

•   The GIPC has jurisdiction over all sectors of
  the economy except
• Minerals and mining which are governed by the
  Minerals and Mining Amendment Act, 1994 Act
  475 and administered by the Minerals Commission
• Petroleum exploration and production which is
  governed by the Petroleum Law, 1984 PNDCL 84
  and administered by the Ghana National Petroleum
  Corporation GNPC
• It should be noted that all services relating to
  mining and petroleum are, however, handled by the
  GIPC.
• Free Zone activities, which is governed by the
  Ghana Free Zones Act, 1995 Act 504 and
  administered by the Ghana Free Zones Board
  GFZB.
• Portfolio investment, which is governed by the
  Ghana Stock Exchange Act, 1991 Act 384 and
  administered by the Ghana Stock Exchange GSE.
• Divestiture of state-owned enterprises which is
  governed by the Divestiture of State interest
  (Implementation) Law 1993, PNDCL326 and
  administered by the Divestiture Implementation
  Committee DIC.

8
INVESTMENT CLIMATE

• Ghana welcomes foreign investors
• joint ventures.
• other forms of mutually collaborative
  arrangements
• Since September, 1994 when we started
  implementing the current Investment Act ie GIPC
  Act 478 to December 2002, the GIPC alone
  registered 1,393 projects comprising
•  
• 410 in the Service Sector
• 387 in Manufacturing
• 165 in Tourism
• 111 in Building and Construction
• 116 in Agriculture
• 112 in General Trade
• 92 in Export Trade
•  
•      

9
INVESTMENT CLIMATE

• Leading the major sources of FDI into Ghana in
  terms of of projects is
• 1st - Britain - 146 projects
• 2nd - India - 131 projects
• 3rd - China - 128 projects
• 4th - USA - 107 projects
• 5th - Lebanon - 102 projects
• 6th - Germany - 90 projects
• It may interest you to know that
• although Malaysia is the number 22nd on the
  list with 12 projects it is by far the largest
  investor in terms of investment capital.

10
INVESTMENT CLIMATE

•       The 12 projects from Malaysia are made
• up of
• 8 in the Service sector
• 1 in Manufacturing
• 3 Liaison offices

11
INVESTMENT CLIMATE

• Some of the major companies from Malaysia include
  Metropolitan and Allied Bank, International
  Commercial bank, Gama Media Group, Business Focus
  Group, Penang Shipbuilding and Construction Ltd.
  Just to mention a few.
• Host Countrys Capabilities
• We believe that given Malaysias vast
  resources and technological advancement, she
  could be the leading source of FDI into Ghana in
  terms of both number of projects and capital
  outlay, if Malaysian investors are made aware of
  the numerous investment opportunities and
  incentives in Ghana, and that is precisely why I
  am here.

12
WHY CHOOSE GHANA?

• You may be wondering by now why you should join
  your brothers and sisters who have already
  discovered Ghana and invested in the economy
• It will interest you to know that Ghana has
  unique qualities and advantages, some of which
  are
• stable political environment for over 2 decades
  with Multi-Party Democracy since 1992
• Economic Stability (average GDP Growth Rate of
  4.5 p.a for past decade).

13
WHY CHOOSE GHANA?

• Commitment to market liberalization policies
• Commitment to private sector initiative
  (privatization programme, PEF)
• Active member of ECOWAS (regional grouping of 16
  countries with population of about 250 million)
• Fairly good and ever improving physical
  infrastructure such as roads, telecommunication,
  electricity, ports etc

14
WHY CHOOSE GHANA?

• Availability of skilled and trainable labour
  force.
• Competitive labour cost
• Preferential access to USA ( AGOA) EU Markets.
• Proximity to EU Markets
• Fast developing financial Infrastructure (GSE,
  SDH, Leasing Co. Banks)
• High degree of personal safety

15
WHY CHOOSE GHANA?

• Warm and friendly people
• Fairly high quality of life (recreational
  facilities such as golf courses, tennis courts
  etc)
• An investor friendly, liberalized and transparent
  investment law which was promulgated in 1994 and
  it is currently being reviewed to make it even
  more investor- friendly

16
THE INVESTMENT ACT, GIPC ACT,1994 (ACT 478)

• How does the investor go about establishing a
  business venture after deciding to invest in any
  business activity of his/her choice?
• Under the Act, investment procedures have been
  streamlined. If you want to do business in
  Ghana, the procedural steps are to
• Register a company or corporate entity at the
  Registrar Generals Department 5 days.
• Bring in your capital/machinery and equipment to
  establish the business no prior approval
  required for establishment.

17
THE INVESTMENT ACT, GIPC ACT,1994 (ACT 478)

• Register your investment with GIPC to be accorded
  investor status if there is foreign participation
  ie 100 foreign owned enterprises or
  Ghanaian-foreign joint-venture enterprises 5
  days.
• Wholly Ghanaian owned enterprises do not need to
  register with the GIPC.
• The minimum equity capital that non-Ghanaians
  will have to invest in the country to be accorded
  investor status are
• Joint ventures - US10,000
• 100 foreign owned - US50,000
• Trading buy sell - US300,000
  10 Ghanaian
• 
  employees
• 
  
  

18
THE INVESTMENT ACT, GIPC ACT,1994 (ACT 478)

• Minimum equity capital exemption export
  trading, external companies liaison offices
  portfolio investment.
• The minimum foreign equity capital can be in
  the form of either
• a cash through the banking system or
• b investment goods such as machinery and
• equipment
• Reason for higher equity capital for trading
  activities

19
THE INVESTMENT ACT, GIPC ACT,1994 (ACT 478)

• 4 areas reserved for Ghanaians
• 1 Petty trading or hawking small scale
  trading
• 2 Operation of Taxi Service and Car hire
  service.
• A non-Ghanaian may undertake this service
• Provided he/she has a fleet of 10 new vehicles
• 3 All aspects of Pool Betting Business and
  Lotteries except Football Pools and Casinos
• 4 Operation of Beauty Salons and Barber shops.

20
INVESTMENT OPPORTUNITIES IN GHANA

• Under the Investment Act, investors are at
  liberty to invest in any area of their choice
  except the four 4 specified activities reserved
  for Ghanaians which were mentioned earlier.
• The national socio- economic goal and investment
  drive are strategically focused on encouraging
• enterprises which add value to our local raw
  material
• export oriented enterprises and
• enterprises which create employment
  opportunities for Ghanaians especially in the
  rural areas.

21
INVESTMENT OPPORTUNITIES IN GHANA

• Specific investment areas listed among the
  Governments priority areas are
• Infrastructure with emphasize on roads, ports
  modernization, energy and ICT.
• Modernization of Agriculture to add value to raw
  materials and promote Agro-business.
• Improvement of social services especially in the
  areas of health and education.

22
INVESTMENT OPPORTUNITIES IN GHANA

• Other suggested sectors, sub-sectors and
  activities with high potential for investment are
  listed on our website wwwgipc.org.gh and the
  promotional diskettes provided.
• I would like to highlight a few as follows
• AGRICULTURE AGRO-PROCESSING Food and
  industrial crops, floriculture, livestock and
  Poultry, Tuna fishing and Forestry
• MANUFACTURING (including) precious minerals
  jewellery, garment/textile, Salt, wood, ethnic
  beauty products, ceramics, hand-tools, packaging
  and pharmaceuticals

23
INVESTMENT OPPORTUNITIES IN GHANA

• PROPERTY DEVELOPMENT AND CONSTRUCTION
  (including) Residential, Commercial, Industrial
  houses
• INFRASTRUCTURE (including) Roads and Domestic
  Airports Air, Road, Lake Rail Transport
• TOURISM (including) Hotels, lodges and resorts
• FINANCIAL SERVICES (including) Insurance,
  Banking and other investment services
• HIGH TECH (including) ICT, Electrical and
  electronic Industries

24
INVESTMENT OPPORTUNITIES IN GHANA

• Portfolio of specific projects from Ghanaian
  Entrepreneurs looking for foreign collaboration
  and I will be ready to discuss them with
  interested Companies.
• Sectors
• Manufacturing----- 62 Projects
• Pharmaceuticals, electrical plugs sockets,
  wood, cooking utensils
• Agric. ---------------- 25
• Fruits, Fish, cassava starch, oil palm, shea
  butter
• Tourism------------- 23
• Star rated hotels, water sports and recreation
• Mining--------------- 15
• Salt, Jewellery, granite slabs and tiles
• BOO/BOOT-------- 15
• Others(eg Service)--- 8

25
INVESTMENT BENEFITS, INCENTIVES AND GUARANTEES

• Generous and attractive incentives are available
  for all these sectors. These include
• Customs duty exemption on machinery and equipment
• Accelerated depreciation machinery 2 yrs
  building 5yrs.
• Locational incentive for manufacturing
  industries 25-50 tax Rebate
• Tax Holidays Agric 5-10 yrs Real Estate 5
  yrs
• conversion of crops, fish or livestock produced
  in Ghana into edible,canned or other packaged
  products other than in their raw state 3 yrs
• Losses carried over for 5 yrs
• Corporate tax 32.5 for all sectors except
  hotels 25 and income from exports 8

26
INVESTMENT BENEFITS, INCENTIVES AND GUARANTEES

• Work and Residence Permits for foreign
  shareholders and employees are tied to the
  paid-up capital as follows 
• US10,000 paid up capital 1
  automatic quota
• US100,000gtUS500,000 paid up
  capital 2 automatic quota
• US500,000 and above paid up
  capital 4 automatic quota
• Special additional incentives exist for
  operators in the Ghana Export Processing Zone.

27
INVESTMENT BENEFITS, INCENTIVES AND GUARANTEES

•  
• Investment Guarantees
• Repatriation in freely convertible currency of
  profits, dividends, payments in respect of loans
  etc
• No expropriation of enterprises by Government
• Member of MIGA Insurance against non-commercial
  risks
• Investment Promotion and Protection Agreements
  (IPPA) signed with several countries including
  Malaysia 21 countries
• Ghana Arbitration Centre for amicable resolution
  of disputes.

28
CONCLUSION

• It is my sincere hope that by the time we leave
  the shores of Malaysia, we would have made very
  interesting business agreements with the
  Malaysian business community to form the basis
  for very fruitful, rewarding and lasting business
  relations.
• I would like to re-emphasize that tremendous
  investment opportunities exist in Ghana in
  various sectors as indicated in our promotional
  diskettes and portfolio of joint-venture projects.

29
CONCLUSION (Cont.)

• I would therefore like to officially invite you
  to Ghana, the home of the UN Secretary General,
  Kofi Annan, to explore these opportunities.
• The GIPC and the UNIDO-AAITPC are ever
  prepared to facilitate your visit and to assist
  you in the development of any specific projects
  you may wish to venture into now or in the near
  future in Ghana.
• I thank you for your attention and for taking
  sometime off your busy schedule to meet with us
• I also wish to thank UNIDO-AAITPC for making
  this seminar possible.
• Thank You.