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Investment environment
in Ghana
Paul Hare [email protected]
&
Felicia Owusu Fofie
[email protected]
Introduction

Why Ghana?
• Politically - Stability 4th republican
constitution in 1992. Hope of Africa? multi-party democracy
• Economically - progress towards
establishing a market-based economy
• Legally - rule of law to boost its trade
and investments and protecting
intellectual property rights.
Introduction continued

Why Ghana?
• Socially - combating corruption, producing
policies to reduce poverty, increasing avenues
for primary health care, providing better
educational opportunities, protection of human
rights and workers’ rights as well as trying to
limit certain child labour practices
• Culturally – it ascribes to certain informal rules
and norms with strong religious beliefs
Introduction continued


What in Ghana?
Chosen the manufacturing sector which
accounts for 69% of the Ghanaian
economy
• Wood and furniture industry which accounts
for 19 % of the manufacturing sector
• And the food processing industry which
accounts for 12% of the manufacturing sector
• Use empirical social research to investigate
how investments have been selected and
located
Introduction continued

From the map below it is easy to
classify Ghana as one of the
minorities of the developing
countries that are now at the
“bottom of the global economic
system” Collier (2007)
Introduction continued

Ghana and countries bordering it
have two or three of the
characteristics of a failing state
described by Paul Collier;
• Conflict trap
• Natural resource trap
• Landlocked with bad neighbours
• Bad governance
Efforts


It opted for debt relief under the Heavily
Indebted Poor Country (HIPC) programme
in 2002, and reached its ccompletion Point
in 2004.
It prepared and begun to implement a
comprehensive Growth and Poverty
Reduction Strategy (GPRS), maintain
macroeconomic stability and undertake
key structural reforms and social
measures.
Efforts continued

It has adopted a framework that
attracts most development partner
assistance which encompasses
• Private sector competitiveness
• Human resource development
• Good governance and civic responsibility
Attracted attention


Attracted the attention of IMF’s Multilateral Debt
Relief Initiative which approved 100 percent relief
on all debt incurred by Ghana to the IMF before
January 1, 2005 that remained outstanding.
This means a total of US$381 million, or US$316
million excluding remaining assistance under the
HIPC Initiative in debt relief become available in
early January in 2006 to allow Ghana to increase
spending in priority areas to reduce poverty,
promote growth, and to make progress towards
achieving the MDGs
Outcomes



In spite of its economic progress in the last
decade with high and sustained growth, it is
believed fiscal indicators have worsened sharply.
The IMF notes fiscal deficit, including grants of
about 5 percent of GDP, rose to just below 10
percent of GDP in 2007 and increased further in
2008.
This is coupled with a rise in Government debt
despite the recent debt relief that helped reduce
the debt burden from 77 percent of GDP in 2005
to below 40 percent of GDP in mid-2006
Our question




51 years into independence, are there
indications that Ghana is determined to
reach middle-income status?
What barriers or obstacles hold Ghana
back from performing even more strongly
on the road to middle-income status?
What kind of strategy and policy should
Ghana and its partners pursue to achieve
key development objectives?
Finally, where is Ghana expected to be in
2015 in terms of income, poverty
reduction, and progress towards fulfilling
the main MDG?
Answers

We hope to interview some
industrialists, firm owners, policy
makers and some elite politicians to
find answers to these questions!!!!!!!
References



Collier, P. 2007. The Bottom Billion: Why
the Poorest Countries are Failing and What
Can be Done About it Oxford: Oxford
University Press.
DFID 2004. UK welcomes Ghana's debt
relief. DFID - London. p. 1.
International Monetary Fund. 2008.
Ghana: 2008 Article IV Consultation-Staff
Report; Staff Supplement; Public
Information Notice on the Executive Board
Discussion; and Statement by the
Executive Director for Ghana. Washington:
International Monetary Fund.
References
World Bank. 1999. World
development Indicators. Washington
DC: World Bank.
 World Bank - Ghana. 2008. Country
Brief World Bank.
 World Bank. 2007. Background and
Ghana ’s Current Growth Context.
World Bank.
