Ghana, rich in agricultural resources, timber, gold and other valuable minerals, abundant with educated skilled and enterprising people, blessed with a stable form of government and dedicated to the principles of free enterprise, has long been seen as one of Africa’s most promising countries.
The main exports - gold, cocoa, diamonds, timber, manganese and bauxite - known as “traditional” items, are now increasingly supplemented by processed and semi-processed industrial and agricultural products with tourism as the third largest foreign currency earner after cocoa and gold.
Ghana's economy has been strengthened by years of relatively sound management, a competitive business environment, and sustained programmes to reduce poverty levels. Ghana is well endowed with natural resources and agriculture accounts for roughly one-quarter of GDP and employs more than half of the workforce, mainly small landholders. The services sector accounts for 50% of GDP.
Gold and cocoa production and individual remittances are major sources of foreign exchange. Oil production at Ghana's offshore Jubilee field began in mid-December, 2010, and is expected to boost economic growth. Estimated oil reserves have jumped to almost 700 million barrels.
In 2009 Ghana signed a three-year Poverty Reduction and Growth Facility with the IMF to improve macroeconomic stability, private sector competitiveness, human resource development, and good governance and civic responsibility. Sound macro-economic management along with high prices for gold and cocoa helped sustain GDP growth in 2008-11.
Ghana’s fiscal consolidation programme, which started in late 2014, is on track, as the fiscal deficit narrowed more than the budget projections in June 2015. The primary balance, estimated at 0.6% of GDP (against the target 0.6% deficit), represents a significant improvement from the 1.4% deficit in June 2014, while the overall fiscal deficit was reduced to 2.2% of GDP from 4.3% during the same period. The current account deficit narrowed to 2.6% of GDP in June 2015 from 5.2% for the same period of 2014. Ghana’s long-term growth prospects are positive.
Various Economic Opportunities
There are 11 main sectors that have been identified as priority areas for foreign direct investment. Ghana has comparative advantage in these areas and intends to capitalize on this advantage to attract investment into the country.
Information and Communication Technology (ICT)
Ghana has the potential for the development of ICT. Currently there are various institutions offering training in different aspects of ICT. Thus Ghana offers a steady stream of young professionals with marketable skills in ICT. ICT enabling infrastructure is being developed which will in turn lead to the creation of more Information Technology Enabling Services (ITES) in the country. Ghana is taking advantage of its status as an English speaking country to attract business processing orders and outsourcing/back office jobs from the USA and Europe.
Ghana has benefited from the African Growth and Opportunity Act (AGOA) initiative and still enjoys the extension of this advantage for another 10 years during which time the USA market can be accessed easily on a quota/duty free status. The Textile & Garment industry has therefore become a lucrative investment area with unimpeded quota/duty free access to the US market. Ghana is maximizing this advantage by the creation of a 178-acre Textile and Garment village located within the Tema Export Processing Zone. This Textile & Garment village is located close to the port city of Tema and Ghana’s international airport thus providing easy access for the import of raw material and export of finished products to the USA and Europe. The textile village also has facilities like electricity, water and ready factory shells for investors who wish to re-locate their industries in Ghana to take advantage of the duty and quota free access that the country enjoys.
Ghana has a wide range of agro-products that are currently exported in their raw state. Opportunities therefore exist in the agro-food processing sector for manufacturing industries to add value to local agricultural products e.g. cocoa, cashew, tropical fruits and vegetables. With the emphasis shifting from raw exports to processed exports, the investment opportunities are endless.
The seafood processing sub-sector is emerging as one of the attractive sectors for investment. The free zone can currently boast of one of the major fish processing firms in West Africa, processing about 170 tons of seafood (tuna) a day. There is in fact a large volume of tuna, available all year round, in the coastal seas of Ghana. The processing of tuna and many other marine species therefore presents a great opportunity to any investor interested in seafood processing.
The jewelry sector is one of the potential areas for investment. Ghana’s position as a major exporter of gold affords investors the opportunity to refine the gold and produce jewellery for export. Ghana currently exports unrefined gold. Investments in this sector, which will lead to value addition to the unrefined gold, will yield great returns for business.
Metal/Hand Tool Fabrication
Opportunities exist in the metal/hand tool fabrication industry for investment. There is an untapped pool of skilled labour in the tool manufacturing industry. The introduction of new technology in this sector will enhance the skills base of Ghanaians and will facilitate production of tools for export.
Opportunities exist for the exportation of cut tropical flowers for export. There is also availability of land in the cool mountainous areas of the Eastern and Volta regions where a wider variety of flowers can be cultivated. The country can boast of cool storage at both sea and airports for the provision of a seamless chain of reliable cool storage. There is also reliable cool storage transportation to ensure fresh delivery of the flowers to the export market.
Light Industry/Assembling Plant
The economy of Ghana is developing and the emphasis on small-scale agriculture is shifting to large scale farming and manufacturing. There is therefore the opportunity for investment in assembling plants and light industry to assemble semi-finished imported goods for the sub-regional market.
Ceramic Tiles Manufacturing
Opportunities exist in the ceramics sector for the production of building and household ceramic products. There is a ready supply of raw materials for this industry.
The current trend for low cost and effective drugs poses a great opportunity for pharmaceutical companies to locate in Ghana and take advantage of the competitive cost of labour to produce drugs at a relatively lower cost for the sub-region and other developing economies.