Key leaders from the Ghana Netherlands Business and Culture Council (GNBCC), and the European Chamber of Commerce have affirmed Ghana’s position as the leading destination for FDI and trade with the highest competitiveness score in West Africa. They however noted that Senegal and Ivory Coast were fast gaining ground and Ghana had to redouble her efforts to remain competitive.
These points were made by Mr. Tjalling Wiarda, General Manager of the Ghana Netherlands Business and Culture Council and Mr. Nicholas Gebara, Executive Director of the European Chamber of Commerce during an expert panel webinar to mark European Union Day at the Institute of International Affairs, Ghana (GhIIA.org).
The webinar organized by the International Economics and Trade Observatory (IETO) at the GhIIA.org was moderated by the coordinating fellow of the IETO, Mr. Fred Amissah. In setting the tone and establishing the premise for the discussion, Mr Amissah stated that the Institute’s position on trade is premised on the Ricardian concept of comparative advantage. Flowing from this, the Institute was of the view that international trade based on leveraging Ghana’s advantage was key to the country’s development.
The webinar had thus been organized as part of the celebrations to mark European Day, and in recognition of the long period of trade relations that has existed between Europe and Ghana/ West Africa. He further noted that the webinar was an attempt to tap into the knowledge of the European Chambers of Commerce on how Ghana was competing in attracting European businesses and investments compared to its peers in sub-Saharan Africa.
The panelists were emphatic that despite major challenges, Ghana remained an oasis of peace and security in ECOWAS and thus continued to be preferred. They all agreed that the establishment of the African Continental Free Trade Area (AfCFTA) and the siting of the AfCFTA office in Accra presents a bullish opportunity for growth in the economy. Mr. Gebara said “any European company is looking for ease of access to large markets in Africa. So, if I can trade with Ghana, and through that gain access to the 300 million ECOWAS market as well, it will definitely be attractive.”
Mr. Wiarda however noted that Ghana had to do more to become more attractive with the AfCFTA framework, otherwise companies would move their bases to other African countries as entrepots. He noted for instance that more had to be done to bring to life the free zones concept as the current feedback from prospective companies indicated that the costs of setting up were a bit higher compared to other markets.
He further noted that Senegal and Ivory-Coast were making great strides in attracting business, and indeed the port of Abidjan was becoming preferred for trade to the Sahelian region. He further stressed that the cost of doing business in Ghana is very high. This was on the basis that, a foreigner requires US$200,000 as capital before set-up a business in Ghana as compared to Nigeria which is US$50,000.
Mr. Wiarda of GNBCC, responding to a question on Ghana’s transport infrastructure in the role of competitiveness, indicated that Kotoka is at the moment the most expensive airport for airlines to land in Africa, and the fifth most expensive in the world. Therefore, more is needed to be done if Ghana wished to put in place an airbridge for produce, as Kenya had achieved for Naivasha to Europe.
However, Mr Nicholas Gebara of the European Chamber of Commerce highlighted that the modification and the implementation of the companies act along with the introduction of the Insolvency Law and the Bankruptcy Law is an indication of efforts to streamline the regulatory framework which is essential for any business entity registered and operating in Ghana. He however noted that consultations could be deepened to ensure that the business community is carried along.
Both Mr. Gebara and Mr. Wiarda were emphatic that European partners and participation delivered the quality that was key to the growth of the Ghanaian economy. They noted that even though other countries seem to have lax regimes and were thus inching up in the volume of trade, it was becoming evident that their lack of standards on issues like human rights, quality standards and climate issues were in the long-term leading to unsustainable growth.
Mr. Wiarda said, “For example, because of the high EU standards necessary to export from a Ghanaian farm into the EU, produce here will be of high quality and be excellent for local consumption. Also because of this high standard, these farms can then export this produce at a premium into other high-value markets like the USA or Britain, ultimately delivering more revenue to the farmer.”
In response to a question on which countries could serve as a template for Ghana becoming more competitive, both panelists indicated that Ghana could take very useful lessons from countries like Vietnam, Rwanda, Suriname, and Morocco on the needed reforms to boost competitiveness.
The graduate attache in charge of research at the Institute, Mr. Prince Asante in closing the event noted that the insights gleaned were useful and added to the body of research that will be put together into a policy recommendation brief to Parliament. He also noted that the full recording of the webinar was available on the institute’s social media handles and invited the public to upcoming seminars from the Institute.