Description
The country is drained by a large number of streams and rivers.
Doing Business in
Ghana
2
This publication is for informational purposes only and
is meant to be purely educaitonal. While our objective is
to provide useful, general information, KPMG and other
participants to this publicaiton make no representationns
or assurances as to the accuracy, completeness, or
timeliness of the information.The information is provided
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as investment, tax or legal advice. Before making any
decision or taking any action, you should consult a
professional advisor who has been informed of all facts
relevant to your particular circumstances
DISCLAIMER
3
Preface
We are pleased to present you with our publication Doing Business in Ghana which presents a succinct guide Doing Business in Ghana Doing Business in Ghana
for investors coming into the country, and a glimpse of Ghana for the local entrepreneur and our international
clients.
As an investor, you are interested in clear and concise information. You have in this document current
information that will be of interest to anyone who wants to invest in a growing economy, like ours. In this
guide, the potential investor is given specifics about Ghana’s infrastructure, political and economic climate,
potential areas of interest for investors, business start-ups in Ghana, including helpful information ranging from
procedures to follow to permits that are required, as well as information on ways to obtain them. There is also
an important section on the Ghana tax system which includes many tax incentives the Government of Ghana
extends to investors.
We hope you enjoy reading our guide and find it most useful . If you have any questions please contact us at
[email protected]. We also encourage you to visit our website: www.kpmg.com.gh where you will find all this
information and much more.
KPMG
13 Yiyiwa Drive
Abelenkpe
P.O. Box GP 242
Accra
July 2012
4
Sources
Africa Research Bulletin
African Development Bank
AngloGold Ashanti Annual Report
Bank of Ghana – Central Bank
Bloomberg
Business and Financial Times
Business Monitor International
Central Intelligence Agency – The World Fact Book
Daily Graphic
Engineering and Mining Journal
European Commission
First Group Website 2012 Trading Economics
Ghana Business News
Ghana Investment Promotion Centre
Ghana National Communications Authority
Ghana News Agency
Ghana Revenue Authority
Ghana Stock Exchange
Ghana Tourist Board
Ghana Web
Government of Ghana Website
IMF World Economic Outlook Database
International Monetary Fund
International Telecommunication Union
Reuters
Standard & Poor’s
The Economist
The Ghanaian Times
The Wall Street Journal
UNCTAD World Investment Report
US Department of State
US Geological Survey
USAID
Wikipedia
World Bank Website
5
Contents
About Ghana 2
Location 2
Climate 2
Vegetation 2
Drainage 2
Population 3
Ethnic Groups 3
Education 3
Government 3
Judiciary 4
Membership with other organizations 5
The Economy 6
The Macroeconomic Environment 6
Employment 7
Foreign Direct Investment 8
Inflation and Interest Rates 9
Infrastructure 9
Transport 9
Energy 10
Mobile Telephones 10
Television and Radio Stations 10
Markets for Investors 11
Export Earnings 11
Export Partners 12
Imports 12
International Reserves 12
Sector Information 13
Agriculture, Agro-processing, Forestry and Fishing 13
Banking and Finance 15
Minimum Capital Requirement 16
National Switch 16
Bills of Exchange Act 17
National Biometric Switch 17
Automatic Clearing House 17
Central Securities Depository 17
Ghana Interbank Payment and Settlement System 17
Credit Reporting Act 18
Other Key Issues 18
Capital Markets 18
Demutualization 18
Automation 18
Energy Sector 19
Power Generation 20
Hydropower 20
Renewables 20
Thermal Power 21
Osagyefo Power Barge 22
Private Sector Initiatives in the Energy Sector 22
Upstream Oil and Gas Prospects 22
Downstream Developments 23
Institutional Development: Establishment of Petroleum Regulatory Authority 23
Investments In The Energy Sector 23
Information Communication and Technology 24
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Sector Overview 24
The Market 24
Market Trends 25
Investment Opportunities 25
Real Estate Development 26
Industry Structure 26
Residential Properties 27
Affordable Housing Project 27
Commercial Properties 27
Industrial Properties 28
Recreational Properties 28
Construction Finance 28
Home Purchase Finance (Mortgage Market) 28
Tourism 28
Festivals 29
Forts and Castles 29
Museums and other Attractions 29
Beaches and Lake Resorts 29
Water Falls 30
National Parks and Gardens 30
Other Tourist Attractions 31
Lodges and Hotels 31
Potentials of the Ten (10) Regions 32
The Ashanti Region 32
The Eastern Region 32
The Brong Ahafo Region 32
The Central Region 33
The Greater Accra Region 33
The Northern Region 34
The Upper East Region 35
The Upper West Region 35
The Volta Region 36
The Western Region 36
Investment and Legal Framework 37
Why Do Business in Ghana ? 37
Starting a Business in Ghana- Process, Time and Cost 37
Domestic Laws 37
Investment Legislation 38
Investment Procedures 38
Registrar General’s Department 38
Ghana Investment Promotion Centre (GIPC) 38
Ghana Immigration Service 39
Ghana Revenue Authority (GRA) 39
Environmental Protection Agency (EPA)
Free Zones Act 39
Petroleum Commission 40
Ghana National Petroleum Corporation (GNPC) 40
Investment Procedure 41
Expatriates 41
Ghana’s Tax System 43
Corporate Tax 43
Withholding tax 43
Capital Gains Tax 43
Value Added Tax /National Health Insurance Levy 43
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Customs Duty 44
Domestic Tax 44
Taxation of Individuals 44
Location Incentives 46
Capital Allowances 46
Carry Forward Losses 48
Insurance Against Non-Commercial Risks 48
International Agreements 48
Double Taxation Agreements 48
Investment Promotion and Protection Agreements 48
African Growth Opportunities Act (AGOA) 48
Financial Services 49
Free Zone Export 49
Incentives 49
Import and Export Rules 49
Exports 49
Imports 50
Duty Drawback 50
Temporary Importation of Goods 51
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8
Ghana in Brief
Official name: Republic of Ghana
Capital: Accra
Form of government: Multi party democracy
Head of State and government: Prof. John Evans Atta Mills
Location: West Africa with Gulf of Guinea coastline of 539km
Area total: 239,460 sq km; land: 230,940 sq km; water: 8,520 sq km
Natural resources: Gold, timber, industrial diamonds, bauxite, manganese,
fish, rubber, hydropower, petroleum, silver, salt, lime-
stone
Population (2010 Provisional Census Results) 24.6 million; Religions: Christian 68.8% (Pentecostal/
Charismatic 24.1%, Protestant 18.6%, Catholic 15.1%,
other 11%), Muslim 15.9%, traditional 8.5%, other 0.7%,
none 6.1% (2000 census)
Official language: English
Climate: Tropical: Warm and comparatively dry along southeast coast; hot
and humid in southwest; hot and dry in north
Terrain: Mostly low plains with dissected plateau in south-central
area
GDP (Projected - 2011 Budget Statement): 12.3%
Exchange Rate: US$1: GH¢1.96
Time Zone: GMT
:
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About Ghana
10
G
hana lies at the heart of a
region which has been leading
sub-Saharan African culture since
the first millennium BC in metal-
working, mining, sculpture and
agriculture. In 1951, the Gold Coast
became the first British colony in
Africa to achieve self-government.
and upon attaining political
independence in 1957, it became
known as Ghana.
Location
Modern Ghana takes its name from the ancient kingdom
of Ghana which was situated some 800 km, (500 miles)
to the north of present-day Accra, which flourished up
to the eleventh century AD. Ghana lies on Latitude 5
degrees, 36 minutes north and Longitude 0 degrees, 10
minutes east. To the west of Ghana lies Côte d’Ivoire, to
the east Togo, to the north Burkina Faso and to the south
is the Gulf of Guinea. The Greenwich Meridian passes
through Tema near Accra making Ghana geographically
the closest to the center of the world, that is, the no-
tional point of intersection between the equator and
longitude zero degree (0 degree) which is located in the
Atlantic Ocean at about 614km from Accra.
Climate
The climate is mainly tropical. There are two main
seasons; the wet and the dry seasons. Northern Ghana
experiences its rainy season from March to November
while the south, including the capital Accra, experiences
the season from April to mid-November.
Vegetation
Ghana has tropical vegetation of dense tropical rain forest
in the southern middle belt. The vegetal cover is ever- in the southern middle belt. The vegetal cover is ever in the southern middle belt. The vegetal cover is ever
green forest with semi deciduous forest at the northern
and southern fringes. Towards the north is savannah
grassland and towards the coast is the coastal savannah.
There are a few mountains and several hills rising to a
height of 900 meters and above. Mount Afadzato is the
highest mountain and lies 1,500 meters above sea level.
Drainage
The country is drained by a large number of streams and
rivers. The Volta and its tributaries drain more than two-
thirds of the country. All the major rivers in the country
flow into the Gulf of Guinea directly or as tributaries to
other major rivers. The Akosombo Dam, which was built
on the Volta River in 1965, provides hydro-electricity for
Ghana and some of its neighboring countries.
The Volta Lake formed after damming the river is naviga-
ble for a distance of about 400 km and motorized vessels
now ply its waters carrying passengers and goods from
the south of the country to the north and vice versa.
There are several rivers in the country and the most
important is the Volta dammed at Akosombo, Akuse and
Bui (situated on the Black Volta) for hydro-electric power
generation plants.
Other rivers are the Pra, Ankobra and Tano. Among the
smaller rivers are the Densu and Ayensu which provide
Winneba and parts of the capital, Accra, with pipe-
borne water. The largest natural lake in the country is
Bosomtwi with a total area of 48 square kilometres and
reaches depths of 72 meters in some parts.
Population
Ghana has a population of about 24.65 million people
and is one of the most populous countries in West
Africa, second only to Nigeria. Since achieving political
independence in 1957, its population has nearly tripled in
size, from about 6 million to 24.6 million in 2010, and is
expected to increase to 27 million by 2020.
The past rapid growth of Ghana’s population is an out-
come of high fertility, which until recently remained fairly
constant, and declining mortality. This combination of
high fertility and declining mortality is also the cause for
the young age structure of the Ghanaian population with
43 percent under 15 years of age and over 65 years.
However, Ghana’s age structure is changing, a conse-
quence of falling fertility.
It is estimated that the declining proportion of children
and the increasing share of the working age group,
between now and 2020 the number of children under 15
(now nearly eight million) will remain virtually constant
while the 15 to 64 year age group will nearly double to 18
million. It is estimated that there will also be a substantial
increase in the elderly population (65 and over), to over
one million, but their share of the total population will still
be small.
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Ethnic Groups
Ghana is home to more than 100 different ethnic groups.
The official language is English; however, most Ghanaians
also speak at least one local language.
The ethnic groups in Ghana are the Akan (the Fante,
Akyem, Ashanti, Kwahu, Akuapem, Nzema, Bono,
Akwamu, Ahanta and others) 49.3 %; Mole-Dagbani
15.2%; Ewe 11.7 %; Ga-Dangme ( Ga and Dangme)
7.3%; Guan 4%; Gurma 3.6%; Gurunsi 2.6%; Mande-
Busanga1%; other tribes 1.4%; other (Hausa, Zabarema,
Fulani) 1.8% (2000 census). The religious distribution is
as follows: Christian 68.8% (Pentecostal/Charismatic
24.1%, Protestant 18.6%, Catholic 15.1%, other 11%),
Muslim 15.9%, traditional 8.5%, and other 0.7%, none
6.1% (2000 census).
Education
Ghana has approximately 18,530 primary schools,
8,850 junior secondary schools, 900 senior secondary
schools, 28 training colleges, 20 technical institutions,
four diploma-awarding institutions, six public universities
and over forty private universities. Most Ghanaians
have relatively easy access to primary and secondary
education. Ghana’s spending on education has varied
between 28 and 40 percent of its annual budget in the
past decade. All teaching is done in English, Ghana’s
official language.
Ghana has a six-year primary education system
beginning at the age of six. Under the educational
reforms implemented in 1987, after the six year primary
education, the students pass on to a three-year junior
secondary system, all making up the basic education
and this is followed by a three year senior high school
system.
At the end of the third year of Junior High School, (JHS),
there is a Basic Education Certificate Examination
(BECE). Those continuing must complete the three-
year Senior High School (SHS) program and take the
West African Senior Secondary Cerificate Examination
(WASSCE) to enter university.
Government
The system of government practiced in Ghana is
parliamentary democracy with separation of powers
among the Executive, the Legislature and the Judiciary
guaranteed under the constitution. The press enjoys a
great deal of freedom which has nurtured it into one of
the most vibrant in Africa. The 1992 constitution provides
checks and balances which limit the powers of each of
the Legislature, the Executive and the Judiciary.
The constitution also provides a Council of State, made
up of experienced elders with proven character, to
advise the President on national issues. The constitution
has also established a number of autonomous
institutions such as the Commission for Human Rights
and Administrative Justice (CHRAJ), the Electoral
Commission (EC) and Economic and Orgranized Crime
office (EOCO). These institutions are there to facilitate
good governance.
The Government is elected by universal suffrage. There
have been five democratically elected presidents and
parliaments since 1992 and the next presidential and
parliamentary elections are due in December 2012.
Ghana has 10 Administrative regions and 169 district
assemblies. Decentralization of governmental powers to
the District Assemblies has been vigorously pursued for
some time now and the process still continues.
Ghana is considered a beacon of hope for black Africa as
it continues to champion the course of good governance
as well as pursuing sound economic management.
Judiciary
The legal system is based on the English common law,
and customary law of Ghana. The court system is made
up of the Supreme Court of Ghana, Court of Appeal, and
the High Court of Justice which constitute the superior
courts. Below these are the Circuit Courts, District
Courts, and family tribunals which constitute the lower
courts. The traditional rulers also settle disputes among
their subjects but such decisions do not constitute judg-
ment of a court of competent jurisdiction. The 1992 Con-
stitution which is the basic law of the land guarantees an
independent judiciary. The tribunals which use to be part
of the court system are being phased out.
Membership with other organizations
Ghana is a member of the South Atlantic Peace Coopera-
tion zone, The Commonwealth of Nations, the Economic
Community of West African States, the African Union,
and an Associate Member of La Francophonie.
In 2000, Ghana was one of the 189 countries that signed
up to the 2015 Millennium Development Goals Declara-
tion by the United Nations. Ghana has made substantial
progress towards reaching a number of these goals such
as eradicating extreme poverty, achieving universal pri-
mary education and reducing maternal mortality.
12
The Economy
13
L
ate in 2010, Ghana was
upgraded to a lower middle
income economy status.
With vast reserves of natural
resources, Ghana has twice the
per capita output of the poorer
countries in West Africa and is one
of the world’s top gold and cocoa
producers. Other exports such as
petroleum oil, timber, electricity,
diamond, bauxite, manganese
and individual remittances are
major sources of foreign exchange
earnings. World Bank projections
indicate that Ghana, which began
exporting oil in 2011, will have the
fastest growth rate on the continent
estimated at 13.4% in 2011 and
10.4% in 2012 (World Bank Global
Economic prospects 2011).
Agriculture has long been an important sector of the
economy, employing about 50% of the labor force and
contributing around 43% of GDP in 2007. Cocoa is the
major export crop, followed by timber and non-traditional
products such as horticulture, fish/seafoods and pine-
apple.
Cocoa, timber and other tree crops are grown in the
southern forest belt of the Ashanti, Brong-Ahafo, Eastern
and Western regions. Most of the cocoa crop is exported
as beans, although there are some cocoa-processing
plants, and more are under construction.
The Ghanaian economy revolves around the services sec-
tor, which accounted for approximately 50% of GDP in
2010 and employs majority of Ghanaians.
Ghana’s labour force in 2010 was estimated at 10.5
million people. The economy continues to rely heavily
on agriculture which accounts for 30.2% of GDP and
provides employment for 56% of the work force mainly
small landholders.
The Macroeconomic Environment
Ghana’s macroeconomic performance has been positive
in recent times. This level of performance has been
stimulated by the prevalence of relative peace coupled
with private sector competitiveness; human resource
development; good governance and civic responsibility.
The sound macro-economic management along with high
prices for gold and cocoa helped sustain GDP growth in
2008 and 2009.
For 2010, GDP growth was 4.1%, and the economy
continues on its path of recovery, mainly backed by
government’s expenditure in infrastructure and FDIs.
The Government Statistician put provisional per capita
GDP for 2010 at GH¢1,872.07 ($1,318.36) compared with
GH¢1,069.89 ($753) under the old series, moving the
country into the lower middle income bracket. The new
series places Ghana as the third largest in ranking of GDP
per person in the ECOWAS sub-region behind Cape Verde
and Nigeria, and 21st in Africa.
On sectoral performance, the share of the agricultural
sector in GDP under the new series saw agriculture,
the dominant sector, now making up to 30.2% of the
economy, lagging behind the services sector, which
accounts for 51%. The industrial sector accounts for
18.6%. (Source: GNA 5 November 2010).
The economy is seeing significant progress which
is underlined by the relative political stability and
macroeconomic reforms. The improvement in the
economy has brought about an influx of foreign
investments of various forms as well as a gradual
increase in middle-class professionals.
Summary of macroeconomic
indicators
Employment
According to the latest population census (2010) Ghana’s
population is estimated at 24.65 million. Constituted in
this is an economically active population of about 10.33
million. (Source: IMF, World Economic Outlook Database).
The current minimum wage stands at GH¢ 4.48 per day
and took effect from 9 February 2012.
Government has embarked on a wage policy reform by
14
Summary of Macro
Economic Factors
2006 2007 2008 2009 2010
Gross Domestic Product
(GDP)
GDP at constant prices
(GH¢)
18,705
19,913
21,592
22,598
24,094
GDP at current prices
(GH¢)
18,705
23,154
30,179
36,867
44,799
GDP real growth
6.5 8.4 4.7 6.6
Sectoral Growths
Services (%)
7.7 8 6.8 8.2
Agriculture (%)
-1.7 7.4 7.6 4.8
Industry (%)
6.1 15.1 4.5 6
Population (million)
22.4 22.9 23.3 23.8 24.6
which all civil and public servants were expected to have
be fully migrated by the end of June 2011 to the Single
Spine Pay Policy. However, the process is still ongoing
and a number of civil servants are yet to be migrated on
to the scheme. The single spine pay policy, implemented
by the Fair Wages and Salaries Commission, is a unified
salary structure that places all public sector employees
on one vertical structure, making sure that, jobs within
the same job value range are placed within the same pay
range. It is hoped that the policy would help to make
the public services pay competitive for the attraction and
retention of highly-skilled labor force.
Ghana has a strong and vibrant labor movement that is
very effective in articulating the demands of workers.
The various sectors of the economy are represented
by sector labor unions that are affiliated to the national
umbrella labor union called the Trades Union Congress
(TUC). It is the TUC that negotiates with the Ghana
government and employers association over wages on
behalf of the workers.
Foreign Direct Investment
According to UNCTAD (World Investment Report 26 July
2011), Ghana was the 7th largest recipient of foreign
direct investments (FDIs) in Africa at the end of 2010.
Investors brought into the country, an amount of $2.5
billion, representing about 5% of total FDI inflows to
developing countries.
In the first quarter of 2012, the Ghana Investment
Promotion Centre recorded a total of 95 new projects
with a total estimated value of US$1.18 billion. The
estimated value represents an increase of 67.98%
compared to the value recorded in the same quarter of
2011.
The FDI component of the estimated value of the newly
registered projects was US$979.85 million. This is a
significant increase of about 178% over the recorded FDI
value in the corresponding quarter of 2011. The USA with
an FDI value of US$407.21 million ranks first and China
remains the top source of FDI to Ghana in terms of the
number of projects (Ghana Investment Promotion Press
Release 10 May 2012)
2
number of projects (Ghana Investment Promotion Press number of projects (Ghana Investment Promotion Press
.
Inflation and Interest Rates
Inflation has been on a downward trend since it peaked
at 20.7% in June 2009. This fall in inflation, according to
the Monetary Policy Committee of the Bank of Ghana,
has been driven by both non-food and food inflation.
Inflation as at May 2012 was 9.3%. A single digit inflation
rate of 9.44 %was achieved at the end of August 2010,
which led to a corresponding drop in the prime rate by
the Bank of Ghana to 13.5%. By February 2011, inflation
which was at 8.58% in December of 2010 has fallen
further to 8.39% as of July 2011.
The cedi has slipped against the dollar by 19% and has
been fluctuating against major currencies since the
beginning of 2012. It is currently experiencing some
depreciation against major trading currencies, and the
1
.
The United States as one of Ghana’s major trading partners has an active American Chamber
of Commerce in Accra.
15
2. In the area of investment, Britain remains the main source of FDI inflows (excluding mining) in terms of value of investment, accounting for about 37% of total FDI to Ghana between 1994 and
2009, followed by the United States, the United Arab Emirates, Nigeria, Malaysia and China in that order. China, however, leads in the number of registered projects with 415 projects mainly in
manufacturing and general trade. India comes next with 388 projects, mainly in the area of manufacturing, followed by Lebanon with 291 projects.
Ghana’s economic co-operation with the East, particularly China, has grown remarkably in recent times. Over the past decade aid inflows to Ghana from China have increased considerably. The
largest single aid inflow has been in the energy sector and involved USD 562 million for the construction of the Bui hydroelectric dam. Other significant aid from China includes a USD 99 million
interest-free loan for the construction of landing sites for fishing communities and a USD 30 million concessional loan for the first phase of a national fiber optic and e-government project extended
in 2007 and 2008.
India is one of the top five foreign direct investors in Ghana. In 2010 Indian investments in Ghana included over 46 projects with an estimated total value of USD 277 million. Indian investments
are found mostly in the agricultural and manufacturing sectors of the economy. In addition, within the health sector, Ghanaian pharmaceutical companies manufacture drugs in collaboration with
Indian firms. In 2010 the Indian Bank of Baroda opened a branch in Ghana. Ghana’s information and communications technology (ICT) sector also has a significant Indian presence. The Electronic
and Computer Software Export Promotion Council of India regularly invites Ghanaians to its exhibitions in India to share ideas on new technologies. Furthermore, under its Technical and Economic
Cooperation (ITEC) program, India awards annual scholarships to Ghanaians for both graduate and post-graduate programs in ICT.
exchange rate is GH¢1.96: US$1. Expectations are that
the local currency will appreciate against the major
foreign currencies and this would improve foreign
exchange risk for companies in Ghana.
Infrastructure
Transport
Road transport is by far the dominant carrier of freight
and passengers in Ghana’s land transport system. It
carries over 95% of all passenger and freight traffic. Most
communities, including the rural areas are accessible
by road transport. The roads are classified under three
categories: trunk roads, urban roads, and feeder roads.
The Ghana Highway Authority, established in 1974 is
tasked with developing and maintaining the country’s
trunk road network totaling 13,367 km, which makes
up 33% of Ghana’s total road network of 40,186 km.
The railway connects Accra, Kumasi, and Takoradi, and
the major mining areas, to the sea ports. The railway
network also provides passenger services from the
interior of Ghana to the main sea ports at Tema (near
Accra) and Takoradi. There is a commuter line which links
Accra and Tema.
The main waterways include the Volta, Ankobra, and Tano
Rivers, which provide 168 kilometers (104 miles) of year-
round navigation, and Lake Volta, which provides 1,125
kilometers (699 miles) of arterial and feeder waterways.
The two seaports of Ghana at Tema and Takoradi
handle most of the country’s imports and exports. The
turnaround time for ships at Ghanaian ports is now one of
the quickest in West Africa and the tonnage managed has
also increased significantly.
There are six airports in Accra, Kumasi, Takoradi, Sunyani,
Tamale, and Wa. The international airport, Kotoka is in
Accra. A number of major international airlines that
fly there regularly include British Airways, Delta, KLM,
Brussels Airways, Lufthansa, Alitalia, South African,
Air Namibia, Air Maroc, and Egypt Air Emirates. Three
airlines, Citylink, Starbow and Antrak connect Accra to
Tamale, Kumasi and Takoradi.
Energy
Hydroelectricity is the primary source of Ghana’s power.
It is generated at the Akosombo and Kpong power plants.
The $700-million, Bui hydroelectric project located on the
Black Volta would have a generation capacity of 400 MW
when completed. There are thermal facilities located at
Tema and Takoradi. In addition to increasing the domestic
electricity supply, power generated from Bui could be
exported to Burkina Faso, Mali and Cote d’Ivoire in
addition to current exports of power to Benin and Togo.
The Electricity Company of Ghana (ECG) is responsible
for electricity distribution to the Ashanti, Western,
Central, Eastern, Greater Accra and Volta regions. The
Volta River Authority (VRA) is responsible for generation
and for the distribution of electricity in the Brong Ahafo,
Northern, Upper East and Upper West regions. When
the West Africa Gas Pipeline (WAGP) is completed, VRA
plans to convert oil-fired facilities at Takoradi and Tema to
natural gas.
Mobile Telephones
Mobile telephony is one of the fastest growing industries
in Ghana. There are six current operational service
providers which include MTN (Scancom), Tigo (Millicom),
Airtel (Bharti Airtel), Vodafone,Expresso and Globacom.
There are over 12 million mobile phone subscribers.
The introduction of 3 Generation services has led to an
increase in the range of services provided by cellular
operators.
Television and Radio Stations
There are 143 FM radio stations and 10 television
broadcast stations. There are also cable TV channels.
16
Markets for Investors
17
T
he domestic market in
Ghana is relatively small
but is growing. There is a
regional market provided by the
15 members of the Economic
Community of West African States
(ECOWAS) though integration of
the individual countries is yet to be
achieved. The free trade among
the ECOWAS member countries
creates an opportunity for an
expanded market for players in the
sub-region.
The government, sponsored by
the World Bank is also striving
to make Ghana the gateway to
West Africa by positioning the
country as a hub for import, export,
storage, assembly, distribution, and
manufacturing, transshipment of
goods, services and passengers.
The key institutions in Ghana that play various roles in
facilitating the activities of investors include the following:
The Ghana Immigration Service (GIS) •
The Ghana Ports and Harbors Authority (GHAPOHA) •
Ghana Investment and Promotion Council (GIPC) •
Free Trade Zones Board •
Ghana Revenue Authority(GRA) •
Ghana is not eligible under the European Union’s
Everything but Arms Initiative as it is not a Least
Developed Country. However, it is an ACP country and
enjoys the preferences the European Union affords
other ACP countries (this is now being revised under an
Economic Partnership Agreement). It also qualifies under
the generalized system of preferences which gives it
preferential access not only to the European Union but
to other rich markets as well.
Export Earnings
Ghana earned $3.8 billion from merchandize exports, per
the preliminary estimates of total exports for the first
three months of 2012. The earnings represent a year-on-
year growth of 22.8 percent and the growth in export
earnings was driven by gold, cocoa beans and crude oil.
Exports of gold amounted to $1.5 billion, cocoa beans
$939.8 million and crude oil $689.6 million. Other ex- $939.8 million and crude oil $689.6 million. Other ex $939.8 million and crude oil $689.6 million. Other ex
ports, including non-traditional exports, amounted to
$675.2 million during this period.
Giving a breakdown, the Bank of Ghana comments that
total non-oil imports amounted to $3.6 billion of which
capital imports was $781.2 million, intermediate imports
$1.7 billion, consumption imports $775.8 million and oth-
ers US$251.8 million.
However, the Bank reports that total merchandise
imports provisionally amounted to $4 billion in the first
quarter of 2012, representing a year-on-year growth of
19.8 per cent. Oil imports, including crude, gas and re-
fined products amounted to $457.2 million compared with
$692.2 million for the same period of 2011.
Export Partners
Ghana exports were worth 3,339 million USD in the third
quarter of 2011. Historically, from 2003 until 2011, Ghana’s
exports averaged 1,272.8700 million USD reaching an all
time high of 3,345.0000 million USD in June of 2011 and
a record low of 265.1000 million USD in March of 2003.
Ghana’s main exports are gold, petroleum, cocoa beans
and timber products. Others include tuna, aluminum,
manganese ore, diamonds and horticulture. It’s main
exports partners are the Netherlands, Burkina Faso,
South Africa and United Kingdom (First Group Website.
2012 Trading Economics).
Imports
Ghana imports were worth 4,046 million USD in the third
quarter of 2011. Historically, from 2003 until 2011, Ghana’s
imports averaged 1,937.70 million USD reaching an all
time high of 4,120.00 million USD in June of 2011 and
a record low of 692.80 million USD in March of 2003.
Ghana imports are mostly industrial supplies, capital
and consumer goods and foodstuffs. Our main import
partners are China, United States, Belgium, United
Kingdom, South Africa and France.
International Reserves
The Gross International Reserves of Bank of Ghana (BoG)
declined to $4.3 billion as at June 2012 from $5.4 bil-
lion in December 2011. This is equivalent to 2.5 months
18
imports cover of goods and services.
For the first quarter of 2012, the Balance of Payments
recorded a deficit of $1.3 billion, compared to a deficit of
only $154.2 million in the same period of 2011. Provisional
data from Bank of Ghana for the first five months of 2012
showed that total revenue and grants recorded a year-
on-year growth of 34.5 per cent, amounting to GH¢5.1
billion.
Total tax revenue was GH¢4.4 billion, 46.3 per cent
higher than the out-turn of GH¢3.0 billion recorded during
the corresponding period in 2011. Total merchandize ex- the corresponding period in 2011. Total merchandize ex the corresponding period in 2011. Total merchandize ex
ports were $6.6 billion over the first five months of 2012,
representing a year-on-year growth of 24.6 per cent.
There were higher receipts from gold, cocoa beans and
crude oil exports as commodity prices increased during
the period.
Export receipts from gold amounted to $2.7 billion,
cocoa beans were $1.6 billion, while crude oil was $1.2
billion during the period. Other exports, including non-
traditional products, amounted to $768.2 million. Total
merchandize imports were $7.5 billion during the five
months, indicating a growth of 27.9 per cent on a year-on-
year basis. (Bank of Ghana).
19
Sector Information
20
Agriculture, Agro-processing, Forestry
and Fishing
Ministry of Food and Agriculture
P.O. Box M37
Ministries
Accra
Tel: +233 302 687223
Email: [email protected]
Website: www.mofa.gov.gh
Ghana Investment Promotion Centre
Post: P. O. Box M193, Accra-Ghana
Tel: +233 302 665 125-9
Fax: +233 302 663 801/663655
Email: [email protected]
As Ghana’s most important economic sector employing
more than half the population, agriculture in Ghana is an
unexploited investment opportunity. The major strengths
of this sector include a diversity of commodities, well-
endowed drainage basin, a well-established agricultural
research system and relative proximity to the European
market. Ghana has a big share of the African quota of the
EU market in fruits and vegetables export.
Ghana has a total land area of 23.9 million hectares
with 57 percent suitable for agricultural purposes.
Agriculture’s contribution to GDP over the years has
shown a steady reduction and the growth rate of the
sector does not show any clear trend (GIPC). However,
there are indications that Ghana has the potential for
agricultural business to develop into a multi-billion dollar
industry. Cocoa is the main export crop and demand for
the crop is growing as China now imports 80-90 percent
of Ghana’s total cocoa production. Ghana is the second
largest exporter of cocoa in the world. Agricultural crops,
including yams, grains, cocoa, oil palms, kola nuts, and
timber, form the base of Ghana’s economy. Leading
processed agricultural export products include processed
tuna, cut fresh pineapples, other prepared fish and
tomato paste.
The country may be classified into three main agriculture
zones. The forest vegetation zone: consists of parts
of Western, Eastern, Ashanti, Brong-Ahafo and Volta
Regions. The northern savannah vegetation zone: the
Upper East, Upper West and Northern Region; the
coastal savannah: includes the Central, Greater Accra and
parts of Volta Region.
The northern savannah zone is the largest agriculture
zone. Most of the nation’s supply of rice, millet, sorghum,
yam, tomatoes, cattle, sheep, goats and cotton are
grown in the region. In recent times, mango and ostrich
commercial farms are also gaining footholds in the
northern zone.
The coastal savannah is known for rice, maize, cassava,
vegetables, sugar cane, mangoes and coconut, as well
as livestock. Sweet potato and soya bean crops thrive in
this area under irrigation. The lower part of this zone is
drained by River Volta. Together with other streams and
lagoons, these water resources present opportunities for
fish farming or aquaculture
In the forest zone where there is abundant rainfall, cocoa,
coffee, oil palm, cashew, and rubber as well as plantain,
banana and citrus crops are grown.
Major stakeholders and government are looking for ways
to partner with investors outside the country to improve
agri-business through modern technology, to ensure food
security in meeting international requirements. An added
advantage is that over two thirds of the land in Ghana is
fertile, and needs little or no fertilizers/chemical to grow
crops in large quantities.
Investment Opportunities
Provision of agricultural inputs such as improved •
seeds and agrochemicals including fertilizers,
pesticides and herbicides. Veterinary drugs, vaccines
and chemicals; animal feed and feed ingredients are
also required.
Opportunities exist in the processing of agricultural •
products such as cereals (maize, rice, millet) starchy
crops (yam, cassava. Sweet potato, plantain),
legumes (carrots, cabbage, garden eggs, tomato),
fruits (pineapple, pawpaw, banana, mango), industrial
crops (rubber, sugarcane, cotton, oil palm, coconut,
cocoa, coffee), livestock (cattle, pigs, poultry, sheep)
and fisheries (tuna, tilapia, catfish). Rearing of silk
worm for the production of raw silk.
Dairy products: processing of the products as well •
as the supply of machinery to establish hatcheries for
day-old chicks.
Floriculture offers a lot of opportunities as Ghana’s •
climate and topography make the country suitable for
the cultivation of a number of exotic flowers. Species
such as heliconia, caribea, celosia, curcuma, gladioli,
hibiscus, roses, ornamental palms and ferns perform
well under natural conditions. There is potential in the
21
national, regional and European Union markets
Processing of farm produce such as to add value, •
reduce post-harvest losses, promote price stability
and expand demand for local agricultural produce.
For example, with the canning of tomatoes, and
processing fruits into fruit juices.
Developing irrigable land through irrigation is another •
key area. While Ghana has a potential irrigable area
of 346,000 hectares, only 10,000 hectares have been
developed.
Technological and support services also require •
investment. Key areas are in the supply and
installation of cold chain equipment, packaging and
factory building technology
In the distribution field, companies are required •
to provide post-production services in transport,
packaging and cold vans.
There are further opportunities in standards, training •
and certification; capacity building for management
and market-oriented enterprises; market intelligence
research and in the development of agricultural
finance and insurance.
Investment opportunities exist in the production of •
agricultural inputs such as fertilizers, pesticides and
fungicides.
Technology and services in the agricultural sector •
which include irrigation, heavy equipment hiring (i.e.
hiring of tractors, ploughs, harrows and combine
harvesters etc) provide investment opportunities.
Investment opportunity also exists in the storage •
industry. Inadequate and inappropriate storage
facilities are constraints to agricultural production
thereby contributing to high post-harvest losses and
low returns for farmers and processors.
Banking and Finance
Bank of Ghana
Head Office
One Thorpe Road
P.O. Box GP 2674
Accra
Tel:+233-30-2666174 - 6
+233-30-2666361 - 5
+233-30-2666902 - 8
+233-30-2666921 – 5
Email:[email protected]
In line with the country’s goal of achieving middle income
status by 2015, Ghana has been undergoing a process
of financial sector restructuring and transformation as an
integral part of its Vision 2015 strategy.
Prior to 2003, the Bank of Ghana operated a three-
pillar banking model with all banks licensed as either
development, merchant and commercial banking. In
February 2003, the Bank of Ghana introduced Universal
Banking which allowed the banks to undertake
commercial, development, merchant or investment
banking without requiring separate licenses. This has
leveled the playing field, and opened up the banking
system to competition, product innovation and entry.
To operate under the Universal Banking License(UBL),
existing banks must have a minimum net worth of
GH¢7.0 million (excluding statutory reserves), and new
banks should have a paid-up capital of GH¢7.0 million.
Banks are required to hold 9% of the cedi and forex
deposit base with BOG on daily basis as primary reserves
and 35% of their deposit base in cedi denominated
assets as secondary reserves.
The Government of Ghana Index-Linked Bonds (GGILBs)
was introduced in 2001, which as part of the reserve
requirements converted Government of Ghana (GoG)
short-term liabilities into long-term loans. BoG requires
banks to hold 15% of their total deposits in GGILBs. The
GGILB is now being phased out by the new 2nd and 3rd
year fixed or floating bonds.
Currently, there are 26 banks operating in the formal
banking sector. They are regulated by the Bank of Ghana,
Ghana’s central bank.
Liberalizing entry and encouraging foreign banks and
investors in the financial services industry has increased
competition in the banking industry as well as the
introduction of strong business practices, technology,
products, and risk management systems.
The current licensing policy of the Bank of Ghana is to
limit entry of foreign banks to truly internationally active
financial institutions.
Minimum Capital Requirement
The Bank of Ghana has proposed an increase in the
minimum capital requirements of banks from GH¢7.0
million to GH¢60 million. The proposed minimum capital
requirements for deposit taking non-banking financial
institutions (NBFIs) and finance houses is an increase
from GH¢1 million to between GH¢5-8 million.
Banks and deposit taking NBIFs were expected to submit
22
capitalization plans by the end of June 2008. Submission
of capitalization plans would guarantee continued access
to the settlement and primary dealership systems. After
December 2008, participation in the settlement system
will be restricted to institutions that have met the capital
requirements.
To ensure an orderly consolidation, the banking system
would allow for lower tier banks after December 2008.
Banks that do not meet the capital requirements will
belong to the lower tier. Banks and NBFIs granted
licenses or provisional licenses within the last six
months to date are required to meet the new capital
requirements within two years from the date of
operation. New licenses for banks, deposit-taking NBFIs
and Finance Houses would henceforth only be issued to
banks that meet the new minimum capital requirements.
The Bank of Ghana intends to continue with its current
policy of issuing bank licenses only to internationally
active banks.
National Switch
The Bank of Ghana has established a National Switch
(e-ZWICH) to allow the establishment of a common
platform for all payment transactions in the country.
This would result in the integration of all existing bank
switches and allow banks that do not have switches
(e.g. ARB Apex Bank) to join the common switch at
significantly reduced costs. It would also allow the
interoperability of all ATMs and the settlement of
payment transactions by customers of different banks at
Points of Sale (POS).
The national Switch has the capability to deal
with transactions that take place online (in places
with telecommunications) and offline (i.e. where
telecommunications are not present, e.g. in some rural
areas). This is a major departure from existing systems
and has been made possible by the Universal Electronic
Payments (UEPS) technology.
Bills of Exchange Act
Ghana is essentially a cash-based economy with
embedded high transaction costs. In recognition of
this, the Bank of Ghana is undertaking reforms in the
legal, institutional, and infrastructural framework of
the payment system to make the Ghanaian financial
system modern and competitive. A draft bill known as
the Bills and Cheques Bill is now before Parliament and
is expected to replace the Bills of Exchange Act when
passed. The draft bill provides for electronic presentment
of cheques and amends various sections of the Bills of
Exchange Act to bring it in line with current business
trends and practices.
National Biometric Switch
The Bank of Ghana has introducied a National Biometric
Smartcard (The E-ZWICH card). This is expected to
address the shortcomings of existing debit cards which
cater for only a small fraction of the population because
of its features of accessibility; low transaction costs;
limited infrastructure needs; personal safety; security;
convenience; and simplicity.
Automatic Clearing House
The Bank of Ghana is introducing Codeline Cheque
Truncation to allow very fast cheque clearing as well as
the Automated Clearing House (ACH) for the clearing
of electronic debits and credits. The process of direct
debit does not exist presently in Ghana because of the
absence of an ACH.
Central Securities Depository
The Bank of Ghana has established a Central Securities
Depository (CSD). The CSD makes it possible for records
of ownership of individual securities to be maintained
centrally as well as at the respective primary dealers.
This should reduce the risks to investors that arise from
possible poor record-keeping or any dealer malfeasance.
Ghana Interbank Payment and Settle-
ment System
The Ghana Interbank Payments and Settlement System
(GHIPSS) is a limited liability company set up to
bring all the various aspects of the payments system
infrastructure under a single entity. This is to allow more
efficient and coherent management and oversight. The
business of GHIPSS includes the following:
National Switch and Smart Card Services •
Cheque Clearing •
Codeline Cheque Truncation •
Real Time Gross Settlement System (RTGS) •
Central Securities Depository(CSD) •
Automated Clearing House (ACH) •
All banks are required to be members of GHIPSS either
directly or through member banks. This means that all
banks have to be members of the national switch and
smartcard, ACH, RTGS, etc.
23
Credit Reporting Act
The Credit Reporting Act (Act 726) has been enacted in
2007 to enhance credit risk management by the banking
system. The purpose of the Act is to provide a legal and
regulatory framework for credit reporting in Ghana. As at
the end of 2009, two credit bureaus had been licensed to
begin operation.
Other Key Issues
Several bills have already been passed or are in the
process of being prepared. These include the Anti-
Money Laundering Bill, the Credit Union Bill, the
Insurance Bill, and a new Insolvency Bill (Bankruptcy
law). Work is also ongoing regarding the Borrowers and
Lenders bill and a new Non-Bank Financial Intermediaries
(NBFI) bill which were expected to be passed in 2008.
These reforms when implemented would represent a
major transformation of the financial services sector. The
Passage of the Banking Amendment Act, 2007 resulted
in the issue of the first offshore banking license to
Barclays Bank.
Capital Markets
Investor confidence in Ghana’s capital market has been
on the rise over the past decade. Currently, there are
about 27 listed companies, 10 brokerage firms, 5 mutual
funds and 1 unit trust company on the Ghana Stock
Exchange (GSE). A level playing ground has been set
by the Securities and Exchange Commission (SEC) to
protect the interest of investors and all other parties.
Demutualization
The objective to demutualize the Ghana Stock Exchange
(GSE) stems from the current structural constraints that
are faced by the GSE as a non-profit organization.
Demutualizing GSE is aimed at fostering greater diversity
of ownership which will allow for an enhanced public
representation in the governance of the Exchange as well
as remain competitive and responsive to the demands of
its market constituents.
The strategic plan for the demutualization of the
GSE was completed in 2009 and the final report was
submitted to GSE for review and finalization.
Automation
Activities towards automation commenced in 2007. In
this light, the GSE Securities Depository Company
Limited was incorporated and commenced operation
in November 2008. About 37,000 accounts had been
opened in the depository as at the end of 2009 and
migration of shares is still ongoing.
With the GSE now resourced, ATS, the Electronic
Clearing/Settlement and the Depository system which
went live in November 2008, dealers now have access
to trading from the Exchange’s Trading Floor; the offices
of Dealers; and through a secured internet facility at any
location.
The automation of the trading platform has huge
prospect in enhancing the liquidity on the market as well
as improve trading on the Exchange. Also it is expected
that the automation system will also enhance the bond
market which is gradually gathering momentum as well
as GSE’s move to develop a program that will help lure
SMEs to list on the Exchange.
Energy Sector
MInistry of Energy
P. O. Box T40
Stadium Post Office
Accra-Ghana
Energy Commission
Location
FREMA House Plot 40, Spintex Rd.
P.M. B. Ministries, Accra - Ghana
Telephone: (+233) 302 813 756/7
E-mail: [email protected]
The energy sector plays a pivotal role in the development
agenda of the country. With the advent of the post-
colonial era, the energy sector was envisioned to be a
major driving force in the transformation of the economy
from one largely sustained on the wheels of subsistence
farming to one that is fully industrialized. This began with
the construction of the hydro-electric dam at Akosombo,
a major initiative by the then CPP government which
opened up the economy and the energy sector in
particular to the exploitation of the power-generating
potential of the country. Subsequently, other forms of
energy have been tapped including renewable, nuclear
energy and fossil fuels.
In this light, government’s overall goal for the sector
has been to develop and sustain an efficient and viable
energy sector that provides secure, safe and reliable
supply of energy to meet Ghana’s development needs
in a competitive manner. This is to assure a universal
access and choice of modern energy forms to all
24
Ghanaians without exception thereby contributing
significantly to national revenue and economic growth
by becoming a net exporter of oil and power by 2012 and
2013 respectively.
Thus, Ghana’s energy sector can be classified into power
and petroleum sub-sectors.
Power Generation
Traditionally, wood fuel continues to provide a significant
source of energy to many households in Ghana,
consisting of about 70% of Ghana’s energy consumption.
This consumption level has engendered the creation of
sustainable energy development in the country through
proper management and the use of an alternative to
wood charcoal through the use of bamboo. However,
Ghana’s power supply sources are mainly from hydro-
electricity, thermal from light crude oil and a small
percentage of photo-voltaic solar.
The objective of the Government is to achieve a target
of 5,000 MW of installed power generation capacity
by 2015. This level of capacity would enable Ghana to
supply adequate electric power to meet the growth in
national electricity demand and also for export to our
neighboring countries.
In this light, Government’s outlook for 2010 is focused
on upgrading the transmission and distribution systems
while scaling up rural electrification to help ensure
increasing access to electricity by household and industry
(2010 Budget Statement).
Hydropower
Ghana has made significant strides in maximizing
its hydropower potential which is pegged at about
4,000 megawatts. Aside of the construction works
on the 400 megawatts Bui Hydroelectric Project, the
Government of Ghana has also signed a Memorandum
of Understanding (MOU) with the Brazilian Government
for the development of Juale River and Pwalugu hydro
power plants at the cost of US$555 million with a
generating capacity of 87MW and 48 MW respectively.
The construction of the hydro-dams forms part of the
planned system generation expansion under the Energy
Commission’s Strategic National Energy Plan-SNEP-
covering the period between 2006 and 2020. This also
includes the construction of the 93MW Hemang
hydroelectric power dam which is expected to be
completed by 2015.
Upon completion of all the power plants under
construction, the country’s total installed power
generation capacity would reach 3,500 megawatts by
2013. Currently, electricity consumption in the country
is estimated at 7,095 billion kilowatt hours (kWh), while
production capacity is pegged at 6,489 billion kWh.
The demand for power consumption in the country is
expected to grow at 7.6% over the next five years.
The policy objectives of the expansion program are to
ensure security of electricity supply, minimum negative
environmental impacts in electricity supply and to ensure
universal access to affordable electricity service.
Renewables
Ghana has a huge potential for electricity generation from
renewable energy sources such as solar, wind, biomass
and small hydro. To maximize this, steps are being
taken by Government to provide the necessary legal
basis for the rapid development of renewable energy
in the national energy mix by establishing a Renewable
Energy Law as part of meeting the objective of security
of supply of energy. Also, a combination of technical
and regulatory instruments will be enshrined in the law
to compel utility companies to procure a predetermined
percentage of their electricity supplies from renewable
energy sources. To consolidate its search for strategic
energy solutions, government facilitated the preparation
of a training manual for Solar PV testing, installation and
maintenance.
To further build capacity, Government also facilitated the
development of training and testing materials and testing
facilities in Tamale Polytechnic and Kwame Nkrumah
University of Science and Technology (KNUST) for human
resource development in Solar PV.
In addition, Government played a major role in the
signing of a protocol on off-grid solar electrification
for security outposts, schools and health centers. An
operational manual for providing matching grants to
support renewable services by the private sector was
also developed and Solar PV systems installed in 75 rural
health posts.
Going forward, the Government of Ghana envisions to
further promote renewable energy technologies (solar,
wind and mini hydro), solar electrification project in
schools, security service and health centers. In addition,
Government will continue training on solar PV systems
as well as implement grid-connected solar PV and wind
systems, rehabilitate grid-connected solar system and
develop licensing and monitoring framework for the
electricity industry.
25
Thermal Power
The inclusion of thermal power in Ghana’s energy mix has
been further boosted with two new plants in Tema. The
126 megawatts Tema Thermal 1 Power Project (TT1PP)
is now fully operational after being commissioned in
2009. Other ongoing activities include the installation of
49.5 megawatts Tema Thermal 2 Power Project (TT2PP)
which is 95% complete. This adds to TAPCO- Takoradi I
(330MW) and TICO- Takoradi II (220KW).
In January 2010, expansion works commenced on the
Takoradi Thermal Power Plant at Aboadze in the Shama
District of the Western Region. The 132-megawatt
capacity combined cycle plant will consist of four gas
turbines, four heat recovery steam generators and two
steam turbines. The gas turbines will run on light oil,
diesel oil and natural gas.
Also, a Memorandum of Understanding has been
concluded with TAQA to carry out the expansion of the
Takoradi International Company (TICO) power plant from
220 MW simple- cycle plant to a combined-cycle plant of
330 MW.
The 80 megawatt Mines Reserve Power Plant, which was
constructed at a cost of more than US$45 million in June
2007, has been made available to the VRA to supplement
any energy generation shortfalls in the country. This was
previously used by four mining companies (Newmont
Ghana Limited, Goldfields Ghana, Anglogold-Ashanti, and
Golden Star Resources) only in load-shedding situations.
The 126MW Emergency Diesel Power Units which were
purchased by Government were largely unused owing
to high cost of operation. Additionally, work is soon to
commence on the 132MW combined-cycle power project
which will be sited near the VRA Thermal Power Plant in
Aboadze.
Osagyefo Power Barge
The refurbished Osagyefo Power Barge adds to energy
generation mix of the country. This was carried out
by Balkan Energy Company LLC, a US-based Energy
Company which partnered the Government of Ghana to
operationalize the Osagyefo power barge. Balkan Energy
entered into a 20-year agreement with the government
of Ghana to run the barge and it is expected that Balkan
Energy would convert the barge into a combined cycle
power plant with an incremental capacity of 60MW at a
cost of about $100 million. The company would also pay
the Government of Ghana a yearly lease of $10 million
from the beginning of the 6th year to the 12th year. The
agreement will be reviewed every five years.
This project aims to augment the Akosombo and Kpong
Hydro-electric Power Plants as well as the Aboadze
Power Plant and a few others as a means to address the
power challenges of the country. The barge, which is
expected to generate 185 megawatts of power, is a dual
fired unit which can operate on diesel as well as natural
gas.
Private Sector Initiatives in the Energy
Sector
The current regime of power production is receiving an
active involvement of Independent Power Producers
(IPP). The Asogli Power Plant, for instance, which is a full
private sector financed power plant of 200 MW capacity,
has been completed and awaiting the availability of
natural gas to commence operation. On the expansion
of Tema Thermal Power Plant, VRA has concluded an
agreement with Tema Osonor Power Company, an
Independent Power Producer (IPP) to expand the plant
by 126 MW and ultimately into a combined-cycle facility
with a total capacity of about 330 MW.
Beyond the existing plants, a total of 1,611.5 MW of
capacity is currently under construction by Government
and Independent Power Producers while other plans have
been initiated to increase power generation capacity in
the country.
Upstream Oil and Gas Prospects
Ghana’s oil and gas prospects are significant. It is
believed that Ghana’s oil and gas resources stretches
across the country’s shoreline from the west (Cape Three
Points) to the east (Keta). Similarly, the Voltain Basin,
which covers over 40% of the country’s land mass,
is believed to have oil and gas reserves. This Voltain
Basin is yet to be fully explored and will be given priority
attention during the medium period.
Recent appraisals completed on three of the discoveries
in the Jubilee Field, which is made up of two blocs,
indicate that the field contains expected recoverable
reserves of about 800 million barrels of light crude oil,
with an upside potential of about 3 billion barrels.
The Jubilee Field will be developed in phases with
the aim of ensuring that gas is not flared. The first
oil production was started in 2011 and is driven by a
production philosophy of maximizing the value of the
resource. Tullow oil an operator of the Jubilee Field
26
projected prodcution of 120 barrels per day will be
reached in early 2013. Up till May 2012, the field had
produced 33 million barrels of oil.
The discoveries have elicited great interests in Ghana’s oil
and Gas prospects. Currently, there are eleven Petroleum
Agreements operating in the country at different stages
of exploration or development. Several other prospective
oil companies have expressed interest to explore Ghana’s
sedimentary basins.
Government intends to accelerate the process of
acquisition of blocks in the Ghana sedimentary basins in
order to fully and speedily delineate the country’s oil and
gas potential.
Downstream Developments
It is the Government of Ghana’s intention to ensure
increased local refining capacity to meet both domestic
demand and exports. Currently, about 60% of domestic
demand can be met by the Tema Oil Refinery (TOR). To
bring refining capacity to acceptable levels, there is the
need to expand the capacity of TOR and also improve
its operations. About US$300 million is needed to be
invested in TOR to increase its capacity by about 100,000
barrels per stream day from its current level of 45,000
BSPD.
About US$683.5 million is to be injected into the
operations of the Bulk Oil Storage and Transportation
Company Limited (BOST), in the medium term period
up to 2015, to improve bulk transportation of petroleum
products especially to the northern parts of the country.
Government intends to encourage the Oil Marketing
Companies (OMCs) to increase the number of petroleum
products service stations to ensure improved access
to petroleum products in the country. The current
administration of Premix fuel is being reviewed.
Government will continue to encourage the development
of bio-fuels, as an alternative transportation fuel.
Institutional Development:
Establishment of Petroleum
Regulatory Authority
The draft Bill to regulate the upstream petroleum industry
is being reviewed with the view to reducing redundancies
and further giving effect to the intention to consolidate
the activities of the numerous regulatory agencies
existing in the energy sector. It is believed that a smaller
number of regulatory agencies is needed to manage
the sector in order to ensure efficient and coordinated
operation and enforcement of regulations.
Investments in the Energy Sector
It is estimated that, about US$9.0 Billion is required in
the next five years to finance the numerous initiatives in
the energy sector, including oil and gas activities which
alone require over US$5.5 Billion. While Government will
continue to inject funding into the sector, when available,
a major policy shift is to encourage the energy sector
institutions to raise a substantial portion of their capital
investment requirements on their own without recourse
to Government. Government has therefore requested the
sector agencies, particularly VRA, Ghana Grid Company
(GRIDCO), Electricity Company of Ghana (ECG) and Tema
Oil Refinery, to raise financing from commercial loans
and other private sector financing arrangements and also
via the Ghana Stock Exchange.
Information Communication and
Technology (ICT)
Sector Overview
The ICT Industry comprises telecommunications
operators, internet service providers, VSAT data
operators, software manufacturers, broadcast
institutions, ICT education providers, internet cafés,
etc. Generally, the Ministry of Communications and
the National Communications Authority (NCA) oversee
activities in the sector which have established the
necessary legal and regulatory framework which
guarantees the safety of investments in the ICT industry.
Accra lies at the heart of the ICT industry as it hosts
the headquarters and branches of the ICT companies
associated infrastructure and support companies.
Ghana has been recognized as an attractive destination
for Business Processing Outsourcing (BPO) and was
ranked the No. 1 destination in Sub-Saharan Africa (ahead
of Mauritius and Senegal) and No. 15 globally out of
50 countries by the 2009 A.T. Kearney Global Services
Location Index (GSLI).
The infrastructural base of the sector includes licensed
gateway operators, SAT-3 Access, Private Licensed VSAT
Systems, Fixed Wired Line Networks, Wireless Mobile
Operators, Public telephones systems, Telecentres,
Dedicated Transmission Networks, Public Distribution
Networks (cable, TV, DSL, etc), Internet Service
Providers, Internet Backbone Connectivity throughout
27
the Country and Public Access Point and Broadcasting
Systems. As an initiative to support emerging
technologies, the Ministry of Communications is also
facilitating the establishment of Science and Technology
Parks.
The Market
As at December 2011, the telecommunications sub-
sector had 2 fixed line operators plus 6 mobile cellular
operators authorized to operate. Out of 165 Internet
Services Providers (ISPs) authorized, 29 were in
operation. The Sector also witnessed 13 DTH satellite
Service providers, 176 Data Operators, 99 Public/
Corporate Data operators, 140 FM stations and 32 TV
Stations having authorizations to operate with 8, 29,
25, 84 and 13 of them respectively actually being in
operation.
No. of authorized operators
Source: GIPC
Market Trends
Ghana is set to be a major player in the African ICT sector
in the next five years, according to a survey conducted
by the Africa Business Panel. The survey ranks Ghana at
number 4 on the continent after South Africa, Nigeria and
Kenya.
The market continues to grow aggressively in all
segments, particularly in the telephony sector with
mobile penetration rate increasing rapidly. Internet usage
has also increased though connectivity is expensive.
Investment Opportunities
There are considerable investment opportunities in
the ICT sector. The sector requires service providers in
connecting international voice calls to the local public
network. Internet Service Providers are also required to
offer internet access to the public especially the rural
areas at less cost and broadcasting operators to establish
Radio and Television broadcasting in the country.
There is also a lack of ICT facilities and Infrastructure on
a broad scale across the nation. Investments are needed
in the provision of software for the country, extension of
the broadband network to reach the whole country and
to provide computer access to rural students.
Technological and other support related services such as
the supply of quality telecommunications equipment, ICT
Equipment and Office and Network Equipment present
opportunities to an investor. There are also opportunities
in the following areas:
Education in the area of software development, •
networking, VSAT, telecommunication and IT
Engineering
Provision of Business Solutions (software and •
networking services)
Business Processing Outsourcing •
Supply of High-Tech Telecommunication Equipment •
Back Office Operations ( especially for the Financial •
Institutions)
Provision of Broadband Facilities and Services •
Internet Service Provision Service •
Transaction Processing •
Manufacturing, assembling and supply of computers •
and accessories
VSAT services •
E-commerce and Legal Database Services •
Logistics Management Services and Medical •
Transcription Services
Real Estate Development
Real Estate and Construction
Ministry of Water Resources, Works and Housing
P. O. Box M43, Ministries
Accra, Ghana
Tel.: +233 302 673701
Fax: +233 302 673882
Email: [email protected]
Website: www.water-mwrwh.com
Ghana Real Estate Developers Association
Post: P. O. Box TF 113
Trade Fair Site
Accra - Ghana
Tel.: +233 302 782 531, +233 24 4318288,
Email: [email protected]
Website: www.gredaghana.org
The Ghanaian real estate market has seen significant
28
expansion due to the rapid growth of the Ghanaian
economy and the influx of foreign investors into the
country. Demand for various types of properties is on
the increase and there are high prospects for companies
already operating in the industry as well as those seeking
to enter the industry. Immense opportunities exist in
the construction of residential houses, industrial and
commercial houses as well as shopping centers, hotels
and hostels for tertiary institutions.
Industry Structure
The real estate industry consists of residential,
commercial, industrial and recreational properties.
Commercial properties include hotels, office buildings,
conference facilities, and retail space. The industry is
currently dominated by residential and commercial
properties with the residential property market being
the most active. The industrial property market is
significantly smaller in size than the commercial propety
market, while recreational properties are the smallest
segment. The residential and commercial markets are
dominated by private companies, which control over 90%
of property holdings.
Residential Properties
Formal housing supply has traditionally been the role of
the Government of Ghana through major competitive
providers like State Housing Corporation (SHC), Tema
Development Corporation (TDC) and Social Security and
National Insurance Trust (SSNIT). SHC and SSNIT have
concentrated on providing blocks of flats in regional
capitals such as Accra, Cape Coast and Takoradi. TDC
is basically involved in site servicing and facilitating
residential development.
In seeking to boost housing supply, the Government
of Ghana is pursuing various programs such as the
affordable housing program initiated in 2005, to build over
100,000 thousand units of affordable housing through
Private, Public Partnerships (PPP) across the country.
Government’s efforts are being complemented by
individual households and real estate developers that are
providing residential housing to meet the high demand.
The government has also entered into a public-private
partnership arrangement with HFC Bank Limited to
construct 200,000 low-income housing units nation-wide
over the next five years.
Affordable Housing Project
The demand for housing units is mostly concentrated
within the Accra-Tema metropolis. The development
of new housing estates is being spearheaded by the
Ghana Real Estate Developers Association (GREDA),
an umbrella organization of loosely associated private
real estate developers. The top five GREDA companies
that account for roughly 75% of the group’s residential
property development are Regimanuel Gray, Parakuo
Estates, NTHC Properties Ltd, ACP Estates Ltd, and
Manet Housing Company Ltd.
The priority of the government in the housing sector is
the provision of affordable houses for the middle and
lower income earners who form a greater percentage
of those in need of houses. This policy is evidenced by
the 2011 National Budget which abolished the five (5)
years tax exemption hitherto granted to those in the real
estate development and now limiting it to only those
who partner with the Ministry of Works and Housing to
provide affordable houses.
Commercial Properties
Demand for commercial properties in Ghana has
increased substantially over the past decade due to the
growing presence of foreign and multinational companies
seeking investment opportunities in the country.
Estate developers are actively building multi-purpose
commercial properties to meet the ever-growing demand.
Many owners of residential property in prime areas of
Accra are converting or remodeling their properties into
new commercial developments. Prime commercial areas
and streets in Accra are Accra Central Business District,
Airport Commercial Area, Asylum Down, Osu, Kwame
Nkrumah Avenue, Kojo-Thompson Road, Independence
Avenue, Spintex Road, Liberation Road, Ring Road
Central, and Cantonments Road (Oxford Street). There
is also demand for property in Takoradi in the Western
Region as interested stakeholders in the oil industry seek
accommodation for residential and office purposes.
Industrial Properties
The development of the industrial property market
in Ghana has been slow as there is a decline in
manufacturing and an increase in importation of finished
products into the country. The industrial property market
consists mainly of factories and warehouses for rent or
sale and is restricted to the North and South Industrial
areas in Kaneshie, Spintex Industrial area, and Tema
Industrial area.
29
Recreational Properties
Recreational developments are built by private
entrepreneurs interested in running the complex
themselves. The Government of Ghana also owns
cultural properties in all the regions to promote tourism.
Predominant amongst these properties are the Accra Art
Centre and the Centers for National Culture.
Construction Finance
With the stable economic environment, there is now
easy access to debt finance for construction in Ghana.
Financial institutions involved in construction finance
have no standardized lending conditions for applicants.
Each development is considered on its own merit and
depending on the risks associated with the project, the
institution grants the terms of lending. Barclays Bank
Ghana, National Investment Bank, Bank of Africa and
HFC Bank are some of the banks offering construction
finance in Ghana.
Home Purchase Finance (Mortgage
Market)
The stable macroeconomic environment in Ghana
has resulted in the gradually growth in the mortgage
market in the country. Funds are now available at
competitive cost and pricing, enabling people to afford
decent housing. Most prominent mortgage lenders in
the country include HFC Bank and Ghana Home Loans,
although other universal banks like Fidelity Bank, Barclays
Bank, UBA and Ecobank are also offering such products.
Tourism
Ghana Tourism Authority
Head Office
No. 2 2nd Avenue
South Ridge
P.O. Box GP3106
Accra
Tel: +233 302 682601/682607/682608
Fax: +233 302 682510
Ghana is fast becoming a leading destination for tourists
in Africa and tourism is rated as one of the highest
foreign exchange earners in the country. Efforts are
under way by the government through the Ministry of
Tourism and the Ghana Tourist Board to develop and
support the effective management of the industry to
become a major source of foreign exchange and revenue
for the development of the country.
The country boasts of historical sites, including forts
and castles, cultural monuments, craft villages, beautiful
nature parks and gardens, and sandy beaches that make
it a unique destination for the international tourists to
Africa. Ghana’s greatest asset is its people who are
renowned the world over for their warmth, cheerfulness,
and hospitality.
Festivals
Each year, festivals and durbars are held in various parts
of Ghana, to celebrate the heritage and culture of the
people. Several rites and rituals are performed and
most of the celebrations are attended by entire villages
and are strictly observed by the traditional elders of the
respective ethic groups. Some major festivals include
Akwasidae by the Ashantis, Homowo by the Gas,
Hogbetsotso by the Ewes, Damba by the Northerners
and Aboakyir by the people of Winneba.
Forts and Castles
Forts and castles dotted along Ghana’s coastlines were
built and occupied at different times by the traders from
Europe, Portugal, Spain, Denmark, Sweden, Holland,
Germany and date back to the 15th Century. Most of the
castles and forts have been restored and are open to the
public. The major ones include Cape Coast and Elmina
Castles in the Central Region, Christianborg and Fort
Castle in Accra.
Museums and other Attractions
Ghana is home to various art and craft centers and
museums. Among the attractions are the National
Museum which has a display of exhibits that reflect the
heritage of the country, the National Theatre with its
distinct modern architecture, the Independence Square,
the Kwame Nkrumah Mausoleum which is the final
resting place of the first president of Ghana, Dr. Kwame
Nkrumah, the Accra International Conference Centre,
Ghana Academy of Arts and Science and the National
Archives of Ghana.
Beaches and Lake Resorts
Ghana faces the Atlantic Ocean and has hundreds of
kilometers of fascinating beaches in the Greater Accra,
Central, Volta and Western Regions. Most beaches in
the country are open to the general public and with their
tropical climate and beautiful environmental conditions,
30
they are ideal for tourists to relax. Major beach
destinations include Labadi Beach, Coco Beach and the
Kokrobite Beach, in Accra; Winneba Beach, Elmina Beach,
Anomabo Beach and Gumoa Fetteh Beach in the Central
region, Busua Pleasure beach, Princess town Beach
and Miami Beach in the Western region; Keta Beach
in the Volta region and Ada Beach in the Greater Accra
region. Some of the popular beach resorts in Ghana are
Coconut Grove Beach Resort, Biriwa Beach resort, Next
Door Beach Resort, White Sands Beach Resort, Tills No 1
Beach resort and Ada Manta Paradise Beach resort.
National Parks and Gardens
Ghana boasts of a number of national parks and gardens
which are a store of spectacular wildlife and exotic plant
life. The most visited ones which include The Kakum
National Park in Cape Coast has a canopy walkway for
obtaining a delightful view of the surrounding tropical
rainforest, elephants, monkeys and other tropical
species. The Aburi Gardens on the Akwapim ridge in the
Eastern region is a peaceful and fascinating place with
a diverse range of plant species. The Mole National
Park at Damongo in the Northern Region provides
an adventurous environment for visitors. It is home
to a large number of different elephants, antelopes,
waterbucks, hartebeests, buffalo, amphibians, reptiles
and bird species, Digya National Park on the central
shores of the Volta Lake, is largely savannah woodland
and it is home to mammals including elephant, buffalo,
water buck, hartebeest, bush pig, baboons, crocodiles
and five other species of monkeys.
Other Tourist Attractions
Other popular tourist attractions include Boabeng-Fiema
Monkey Sanctuary in the Brong Ahafo region with
more than 500 mona and 200 geoffrey’s pied columbus
monkeys which live with the people of the area, Tafi
Monkey Sanctuary, in the Volta region, where the tropical
forest is home to endangered, playful mona and patas
monkeys.
One of the frequently visited tourist attractions in Ghana
is the Larabanga Mosque in Tamale. It is believed to
be one of the oldest mosques in West Africa and is the
oldest mosque in Ghana.
Lodges and Hotels
Ghana has several forms of accommodation, ranging
from five star hotels to homestays. These are of good
quality and can be located in all capitals, districts and
towns in the country. Five star, four star and three star
hotels can be located in the Airport area, Osu, Roman
Ridge, Labadi and Central Accra. Accommodation
facilites of international standards can be found at popular
beach destinations such as Ada Foah, Gomoa Fetteh,
Elmina, Axim and Busua.
Water Falls
Ghana has scenic waterfalls in attractive rural and forest
settings along the coastal regions of the country. These
waterfalls are covered by green vegetation and provide
scenes of the beauty of nature. Some of the waterfalls
have cages forming at their sides whiles other falls
consist of series of falls and provide ideal ground for
picnics. There are also seasonal waterfalls at Alambo
and Likpe Todome in the Volta region. Some popular
waterfalls in Ghana and their location are listed below:
Name of Waterfall Location
Tagbo Falls Volta Region
Tsatsadu Falls Volta Region
Boti Falls Eastern Region
Begoro Waterfalls Eastern Region
Fuller Falls Brong Ahafo Region
Kintampo Waterfalls Brong Ahafo Region
Tsenku Waterfalls Eastern Region
Wli Falls Volta Region
Popular waterfalls in Ghana and their location
31
Potential of the 10 regions
32
The Ashanti Region
The dominant economic activity in the region is
agriculture. Other activities undertaken include mining,
timber processing and industry. Cocoa is the most
important export crop grown in the region and cotton
production is concentrated in the savanna and transitional
zones mainly around Ejura, Nsuta, Kwamang and
Afrancho. Bast fibre is produced in significant quantities
at Mampong, Ejura, Kofiase, Adidwan, Aframso and
Amanten. Oil palm is grown all over the southern sector
of the forest zone with concentrations in the Amansie,
Asante-Akim, Adansi and Ejisu - Juaben districts. Food
crops grown include maize, plantain, cocoyam, cassava,
yam, groundnuts and vegetables.
Gold, which is the next major foreign exchange earner
after cocoa, is mined at Obuasi which is the largest
and richest gold mine in the country. Although it has
been mined for several years, it is still believed to have
large reserves. Other deposits are found at Konongo-
Benemase, Attonsu, Kwakwakwa. Ntronang, Bilpraw and
Akrokerri- Mampamhwe. There are deposits of bauxite
at Nyinahin and diamonds and clay in various parts of the
region.
The Eastern Region
The dominant economic activity in this region is
agriculture. Other activities undertaken include petty
trading, inland fishing and mining. Crop and livestock
production are the main activities found in most rural
communities of the region. There are also commercial
farms producing pineapples, colanut, cocoa, coffee and
oil palm for large-scale for export. Towns and villages
dotted along the Volta Lake undertake canoe fishing for a
living.
Industrial establishments are located in various towns
in the region. The factories produce pharmaceutical
products, lumber, poultry feeds, alcoholic beverages,
furniture, textiles and other hardwares.
Diamond is mined at Akwatia in the Birim South district.
Diamond mining at Akwatia attracted many settlers to
Oda, Akwatia and the surrounding villages, a situation,
which has contributed to the rapid development of the
area. The consolidated Diamond Mines at Akwatia has
become a tourist attraction.
The Brong Ahafo Region
Agriculture is the main economic activity in the region.
The region has a total cultivable land area of 30,400
square kilometers out of which 3,706 square kilometers
is planted with cocoa. About 71% of the region’s
population is concentrated in farming. Crops grown
include plantain, oil palm, maize and oranges.
Industrialization is expanding with the extension of hydro-
electric power to the region. Presently, notable industries
include: Mim Timber Company and Scanstyle Limited
both based at Mim, which produce semi-processed wood
products for export; Wenchi Tomato Factory; a stone
quarry at Buoku; brick and tile factories at Adantia and
Tanoso; and numerous sawmills scattered all over the
region
The Central Region
The economy of the Central Region rests largely on a
small-holder, more or less traditional agriculture, inland
and small-scale fisheries and related activities along the
coast.
The United Nations Development Program’s (UNDP)
assistance was sought to accelerate the development
of the region and this led to a proposal for Tourism (as
lead sector), urban & rural environment and enterprise
development.
The tourism development component involves
investments in various areas of tourism development
including conservation of the region’s vast cultural
and historical assets and sites, i.e. conservation and
rehabilitation of forts, castles and monuments, the
establishment of a unique game park at Kakum and Assin
Attandanso that will conserve the tropical rain forest
environment and rare wildlife conservation for tourism
and travel industry development.
The development program includes the rehabilitation of
Elmina / Mumford Jetty and boat sanctuary, improved
facilities for fish handling, curing and processing, a
marine stock research centre at the University of Cape
Coast (UCC) and the construction of ice-making and
freezing facilities. Promotion of fishing and export of
exotic fish products and pilot scheme for shrimp, lobster
and squid farming are also aspects of the UNESCO
assisted development scheme.
Other projects include expansion of tree crop farming
(fruits for export and to support tourism industry, agro-
forestry), creation of farmers services companies and
small-holder salt production scheme.
The urban/rural renewal component covers improvements
33
to coastal and tourism towns and general rehabilitation
of basic services including waste management. Those
under enterprise development component involve
support for the region’s Intermediate Technology Transfer
Unit (ITTU) to support the expansion of the informal
sector’s chain of micro-entrepreneurs, small-scale salt
and allied chemical production, Kaolin and allied products,
small-scale gold mining and the establishment of palm
oil/kernel refinery.
Consequent to the approval of these proposals, the
Government and the UNDP have signed the projects
document and implementation of the development plan
will soon take off.
The Greater Accra Region
The location of Accra and Tema in the region has made
Greater Accra the industrial center of the country. The
region boasts of more than 200 major manufacturing
industrial establishments employing some 22,060
persons. Most of these establishments including an oil
refinery are located in Accra and Tema. For this reason,
the region consumes about 46.5% out of the total
electricity generated in the whole country. Accra and
Tema also are the largest market area for the country’s
manufactured products.
The location of the country’s largest port at Tema,
the relatively well developed infrastructure and good
industrial atmosphere within Accra and Tema have
undoubtedly helped to increase the growth of industrial
establishments in the region.
Fishing plays a major part in the region’s economy. There
are about 30,000 fishermen in the region a third of the
total number of fishermen in the country. Among the
main fishing villages are Ada, Loi , Pute, Azianya, Accra,
Teshie, Nungua, Tema, Kpone, Prampram, Bortianor,
Ningo and Ahwiam. The commonest fish in the region
are trigger, sole spade, cassava, burrito, sardine and
seabream.
Fishing is controlled by the small-scale canoe fishermen,
notwithstanding the construction of the fishing
harbor in Tema and the emergence of such big fishing
establishments as Mankoadze, State Fishing Corporation,
Ocean Fisheries, Kaleawo Enterprize and Afko Fisheries.
Farming is a major economic activity of the rural areas
of the region. Apart from the small-scale farms held by
individual families, there are some 20 commercial crop
farms and 25 livestock farms. The main crops grown in
the region are cassava, maize, groundnuts, vegetables,
beans, cowpeas, coconut, pineapples, onions and
shallots.
The region is among the few in the country where
livestock is reared because the vegetation is mainly
grassland and less infested by tsetse flies. Cattle is
,therefore, reared in settlements around Agortor, Dawa,
Afienya, Moble, Gbecheli, Katamanso, etc, in the central
part of the region. There are, however, a few commercial
ranches like the Bank of Ghana Cattle Ranch at Shai Hills
and Sam & Sam Farms. The breed mostly reared is West
African short-horn type which is small, hardy, resistant to
ticks and drought, but takes six years to reach maturity.
The rest of the livestock farming are mostly poultry,
sheep and goats.
The Northern Region
Farming is the main occupation of about 70% of the
people in the region. Among the crops grown are maize,
rice, sorghum, yams, tomatoes and cotton and tree
crops such as sheanut, and kapok. Rice is cultivated
mainly in Walewale, Tamale, Damongo, Salaga and
Yendi. Groundnut is cultivated extensively around
Tamale, Bimbilla, Yendi and Walewale. Guinea corn is
also grown extensively in the region. The cultivation of
rice and groundnut is mostly done on commercial basis.
Livestock rearing in the region forms an important part of
the economic activity of the area. Industry is agro-based
in the form of processing agricultural produce such as
groundnuts into edible oil and sheanut into shea-butter.
Several rice mills operate in the area. Non-agro industries
are minimal in the region, mainly due to the poor mineral
resource base of the area.
Feasibility studies indicate the availability of high
quality limestone deposits at Bog-Da near Gambaga
and Buipe which can be used in the manufacture of
Portland cement. Sheini in the Zabzugu-Tatale District
is also noted to have iron ore deposits. There are also
substantial deposits of clay at Kukuo, Yong, Nabari,
Kpaligu and Bewna. Bricks made from this clay are said
to be suitable for the climatic conditions of the north.
Places of interest abound in the Northern Region and so
are many customary and cultural practices. The Regional
Centre for National Culture at Tamale and its craft shops,
as well as the weaving industry at Jekarayili are some
of the attractions for tourists. Handicrafts are a popular
occupation of the people. Weaving, carving, tanning and
pottery are still done using age-old traditional methods.
The waterfalls of Dung and Nankpanduri are year-long
attractions while the Greenwich Meridian runs through
34
Yendi. The Mole –Game Reserve and the Larbanga
Mosque are some of the tourist attractions in the region.
The Upper East Region
The region is predominantly agricultural with about
70% of the economically active population engaged
in livestock rearing, farming or fishing. Food crops
cultivated are rice, millet, sorghum and groundnuts.
Areas with the greatest potential for agricultural
development are the Gbedemblisi and Wiesi valleys.
The valleys are the “rice bowl” of the region with high
potential also for the cultivation of cotton, groundnuts
and legumes.
The region has two big irrigation projects located at
Tono and Vea with developed areas covering 2,490
hectares and 850 hectares respectively. Crops grown
include paddy rice, tomatoes, onions, millet, groundnuts,
sorghum and maize. There are other 172 dams and
dugouts scattered over the region.
Having predominantly savanna vegetation, the region
possesses the basic natural requirements for livestock
and poultry production. The region produces about 25%
of the nation’s cattle herd and a sizeable percentage of
sheep and goats.
The three major manufacturing establishments in the
region are the Tomato Canning Factory at Pwalugu, the
Meat Processing Factory at Zuarungu and the Rice Mill in
Bolgatanga. There is also a stone quarry at Pwalugu and
a granite and marble factory at Tongo. On a smaller scale,
the inhabitants undertake smock weaving, leatherwork,
pottery, and sheabutter and groundnut oil extraction.
The Upper West Region
Over 80 % of the population is engaged in subsistence
agriculture with staples such as guinea-corn, millet, rice,
yams, beans, groundnuts, and cowpea.
At present, about 80% of total production is consumed
locally while guinea-corn and beans are exported to
other parts of the country. Cotton and sheanut mainly
produced by the peasant farmers constitute the major
cash crops of the region. The Upper West Region alone
produces 40% of the nation’s total cotton output whilst
in the sheanut industry; this region and the Northern
Region are the major producers of shea butter with over
22 purchasing centers. The savannah vegetation which
is congenial to animal husbandry places the region in a
good position to produce cattle, goats, sheep and poultry.
There are a number of local industries such as pottery,
shea butter processing, groundnut oil extraction, soap-
making, cloth and smock weaving.
The Volta Region
The economy of the region depends on agriculture which
provides employment for over 60% of the inhabitants.
The major food crops are cassava, maize, rice and yam.
The region leads in the production of cassava and is the
third largest producer of maize, next to Brong-Ahafo
and Ashanti. It is second to the Northern Region in yam
production, while remaining unrivalled in the production
of shallots.
Commercial crops are cocoa, coffee, cotton, sugar-cane,
citrus fruits and pineapple. The region contributes 13%
of Ghana’s marine catch and 75 % of fresh water catch.
Special catches for which the region is famous are
anchovies, shrimps and oysters.
The Western Region
About 51.1% of the population in the region is engaged
in the agricultural sector where the soil types are suitable
for a wide range of crops notably cocoa, coffee, rubber,
oil palm, citrus, coconut, rice, cocoyam, plantain, cassava
and vegetables. The region is the leading producer of
cocoa in the country. Another agricultural activity in the
region is fishing, with an average annual total catch of
about 49 metric tons. Locating the oil rig off Cape Three
Points and the embargo on fishing within the confines of
the rig may have adverse effects on the fishing industry.
The concentration of high forest in the region is the basis
for the corresponding high production of timber and
timber products. Indeed, the region is the leader in the
timber industry, producing about 42% of Ghana’s annual
output.
The region is one of the three most industrialized, the
other two being Greater Accra and Ashanti. The industrial
capacity of the region is due to the two strong industrial
centers, namely Sekondi-Takoradi and the mining areas
around Tarkwa and Prestea.
The major industrial establishments, with only a few
exceptions process agricultural, forest and mineral
products. Most of the industries derive a greater part of
the raw materials from the region, with a small portion
coming from outside.
Prominent among the lines of production of the
industries are cocoa and tobacco products, edible and
35
industrial palm oil, paper products, rubber tire and
tubes, cement, flour, aluminum products, furniture and
corrugated iron sheets.
The recent discovery of oil off the coast of Ghana has
made Takoradi the fastest growing city in Ghana.
36
Investment and Legal Framework
37
Why Do Business in Ghana?
The government is committed to implementing policies
that reduce the general cost of doing business in Ghana
and to promote investor confidence in the country. With
a stable multi-party government that is committed to
market liberalization, Ghana has been ranked as one of
the most attractive locations for doing business in Africa.
Other factors that make Ghana a competitive investment
destination include:
A sound macroeconomic environment •
Immediate access to all markets of the Economic •
Community of West African States (ECOWAS)
100% foreign ownership is permitted •
On-going privatization in key economic sectors •
On-going infrastructure development •
Expanding stock market •
Competitive labor force •
Availability of skilled and trainable labor •
Quota-Free access to USA & European Union •
markets.
Export-free zones where goods traded with other •
countries are exempt from customs duties and laws
Fast developing financial infrastructure •
High degree of personal safety and •
Warm and friendly people •
Starting a Business in Ghana- Process,
Time and Cost
Domestic Laws
Laws governing the establishment of business in Ghana
are in accordance with the provisions made in the
following legal legislation:
The Companies Code, 1963 (Act 179) •
The Partnership Act, 1962 (Act 152) •
The Business Name Act, 1962 (Act 151) •
The investor, whether a Ghanaian or a foreigner, who
wants to establish a resident business entity has to
register with the Registrar General’s Department(RGD)
under one of the Acts named above except where the
entity is to operate in the country as a representative
of non –resident business entity. In that case it does
not go through the process of incorporation under Act
179 but simply submits the required documents to the
Registrar who registers them in the register of External
Companies.
Investment Legislation
The legal framework for investment in Ghana is regulated
by different agencies in the economy. These are:
Registrar General’s Department •
Ghana Investment Promotion Council (GIPC) •
Ghana Immigration Service (GIS) •
Ghana Revenue Authority(GRA) •
Environmental Protection Agency (EPA) •
Ghana Free Zones Board •
Petroleum Commission •
Investment Procedures
The first step for an investor wishing to invest in Ghana
is to register with the Registrar General’s Department.
The department charges a fee of 0.5% of the company’s
stated capital. The official processing time lies between
three to five days, after which the company will receive
the certificate of incorporation and certificate to
commence business.
After incorporation, companies that are partly or fully
owned by foreigners have to register with the GIPC.
Registration is completed after companies have met
the minimum equity requirements depending on their
structure.
The required equity can be brought into Ghana either in
money or kind (goods, plant and machinery, vehicles or
other tangible assets). Money can be brought in cash or
transferred into the account of the incorporated company
at a Ghanaian commercial bank. The bank must confirm
the transfer to the Bank of Ghana, which subsequently
informs the GIPC. Documents relating to equity in kind
such as bill of lading, invoices and others which are
confirmed by the Customs Division of GRA must be
presented to GIPC.
Registrar General’s Department
The Registrar General’s Department is the organization
that registers all companies, societies and institutions
in Ghana and issues certificates of incorporation
and commencement of business to newly formed
companies.
Ghana Investment Promotion Centre
(GIPC)
Ghana Investment Promotion Centre was set up to
initiate and maintain a favorable environment for both
Ghanaian and foreign investment in Ghana. The GIPC
was established under the GIPC Act as the government
agency responsible for overseeing investments in all
sectors of the economy except mining, petroleum,
free zones and portfolio investments. Investments in
the mining and petroleum sectors are licensed by the
38
Minerals Commission and the Ministry of Mines and
Energy respectively whiles that for Export Processing
Zone and portfolio investments are administered by the
Ghana Free Zones Board and Ghana Stock Exchange
respectively.
Ghana Immigration Service
Ghana Immigration Service is the governmental authority
that grants work and/or residence permit. It also handles
re-entry visas, extension of visitor’s permit and visa on
arrival to visitors in Ghana where there is no Ghanaian
Embassy or consulate abroad.
Ghana Revenue Authority (GRA)
The Internal Revenue Service, Value Added Service (VAT)
and the Customs Excise and Preventive Service which
were separate revenue agencies, until about the last
quarter of 2010 have been merged to form a single entity,
the Ghana Revenue Authority (GRA). The Ghana Revenue
Authority has three divisions: Domestic Tax Revenue
Division, Customs Division, and the Support Services
Division.
The Customs Division is responsible for collecting
customs duties and excise whereas the Domestic Tax
Revenue Division takes care of income tax and VAT/
NHIL. The Support Services Division is responsible for
all internal functions such as finance and administration,
legal, human resource etc. Each of the three divisions
is headed by a Commissioner who reports to the
Commissioner-General.
Any investor in Ghana will necessarily have to register at
one of the GRA offices to pay one tax type or another.
Environmental Protection Agency
(EPA)
Environmental Protection Agency is in charge of issuing
the necessary environmental permits to companies
operating in environment sensitive areas of various
fields. The investor will often be required to submit an
environmental impact assessment report.
Free Zones Act
Any investor who will be producing to export at least
70% of total output can take advantage of the Free
Zones Act to get located within the Free Zone Enclaves
at Tema or Sekondi. Boankra in the Ashanti region is
being developed as a third free zone enclave. This will
be after going through the registration processes already
described above and then making an application to the
Free Zones Board to be a free zone enterprises. Some of
the privileges for free zone enterprises are the exemption
from tax of import into the free zone as well as duty
and other taxes on exports to foreign countries by free
zone enterprizes. Free zone enterprises are exempt from
corporate tax for a period of 10 years, and thereafter the
corporate tax shall not exceed a maximum of 8% of the
profit.
Depending on the field of operation of the company,
additional registration may be necessary with other
regulatory bodies.
Ghana Investment Promotion Center keeps track of
all investments in the country whiles the Free Zones
Act regulates enterprises that export at least 70% of
their produce and have been registered as free zone
enterprises.
Petroleum Commission
This is a body set up by the Petroleum Commission
Act, Act 821, to regulate and manage the utilization of
petroleum resources and to co-ordinate the policies in
relation to them.
Among others, the Petroleum Commission is to:
Recommend to the Minister national policies related •
to petroleum activities
Monitor petroleum activities and carry out the •
necessary inspection and audit related to the
activities
Receive applications and issue permits for specific •
petroleum activities as required under petroleum
laws and regulations
Promote local content and local participation in •
petroleum activities as prescribed in the Petroleum
Exploration and Production Act 1984(PNDCL 84) and
other applicable laws and regulations to strengthen
national development.etc
Ghana National Petroleum
Corporation (GNPC)
The Ghana National Petroleum Corporation was
established by the Ghana National Petroleum Corporation
Act, 1983(PNDCL 64)
The Mandate
GNPC was established as a state-owned entity and
given legal backing “to undertake the exploration,
development, production and disposal of petroleum”. The
PNDC Law 84 establishes the legal framework governing
39
the contractual relationship between the State, GNPC
and the prospective investor in upstream petroleum
operations.
The corporation was established with the following
objects:
To accelerate the promotion of petroleum exploration •
activities to ensure early commercial discovery and
production
To undertake the appraisal of existing petroleum •
discoveries to ensure production to meet national
requirements
To ensure that Ghana obtains the greatest possible •
benefits from the development of its petroleum
resources
To obtain the effective transfer to Ghana of •
appropriate technology relating to petroleum
operations
To ensure the training of citizens of Ghana and the •
development of national capabilities in all aspects of
petroleum operations; and
To ensure that petroleum operations are conducted in •
such a manner as to prevent adverse effects on the
environment, resources and people of Ghana.
With establishment of the Petroleum Commission, GNPC
ceases to exercise any advisory functions in relation
to the regulation and management of the utilization of
petroleum resources and the coordination of policy in
relation to that function.
Expatriates
Foreign investors are given expatriate quota depending
on the equity capital each invested in the business.
However there is an opportunity to apply for an increase
in the number of the expatriate staff depending on
one’s circumstances. After registration with the GIPC,
companies can apply for residence permit for their
permanent expatriate staff.
Investment Incentives and Guarantees
Investment incentives are used by governments to
attract investors to sectors of the economy that require
stimulation to grow. Some geographical areas of the
country may also be targeted for investment in order
to generate employment. Such incentives are found
in various legislations such the GIPC Act, Free Zones
Act, and the Petroleum and Mining Laws. Investment
incentives can also be found in the revenue laws.
The GIPC Act protects the businesses of investors from
nationalization or appropriation by any government.
Where such step is to be taken, it can only be done
by law and should be in the national interest. In such
a case, adequate compensation will be paid. No
individual can also be compelled to cede his interest in
any investment to any other person. Transfer of profits,
interest or dividends arising from any investment are also
guaranteed by the GIPC Act.
Paid Up Capital and Related
Quota of Expatriate Staff
Paid Up Capital Required (US$) Quota of Expatriate
Staff
10,000- 100,000 1
100,000- 500,000 2
500,000+ 4
40
Ghana’s Tax System
41
Ghana Revenue Authority
The tax types in Ghana that investors will encounter are
Corporate Tax, Withholding Tax, Capital Gains Tax, Value
Added Tax/NHIL, Employment Tax, Dividend Tax and
Excise and CST.
Corporate Tax
Income tax incentives are provided under the Internal
Revenue Act, 2000 (Act 592), as amended. Depending
on the sector and location in which it operates, it is liable
to pay tax at rates lower than the general corporate tax
rates.
Withholding tax
All companies are obliged to withhold tax from specific
payments to other persons. The Withholding Tax is on
contract payments in excess of GH¢500. The rate varies
from 5% to 15% depending on whether the person is
resident or a non-resident, and on the type of transaction.
Capital Gains Tax
Capital gains tax of 15% is payable on gains from the
realization (disposal) of chargeable assets. This includes
business and business assets, buildings, lands, rights or
interests in stocks or shares, or other assets declared
as taxable for capital gains tax purposes. Gains from
agricultural land and securities of companies listed on the
Ghana Stock Exchange are nottaxable. However, the fol-
lowing are exemption from capital gain tax:
Gains with a scrap value of GH¢50 •
Gains derived by a company out of a merger, amalga- •
mation or re-organization where there is continuity of
underlying ownership in the asset of at least 25%
Gains resulting from transfers of ownership of asset •
to close relatives or to former spouses as part of a
divorce settlement or separation agreement and
Gains used to acquire asset of the same nature •
within one year.
Value Added tax /National Health In-
surance Levy
The Value Added Tax Service (VAT Service) is responsible
for the collection of VAT and National Insurance Levy
(NHIL). However, the Customs, Excise and Preventive
Service (CEPS), collects the tax on behalf of the VAT
Service on imported goods.
A VAT rate of 12.5% and NHIL rate of 2.5 % (15%) is
chargeable on all transactions that attract the tax.
Companies and exporters obliged to pay VAT must reg-
ister with the VAT Service. Registered companies are
obliged to file a tax return and pay VAT every month.
Goods and services exempted from VAT include:
Food produced in Ghana and brought in its raw state •
Petrol, diesel and kerosene •
Equipment for agriculture and fishing •
Housing (ownership and rental) •
Transport •
Customs Duty
Agricultural and industrial plant, machinery and equip-
ment imported for investment purposes are exempted
from customs import duty. All import duty-exempted
goods however, attract processing and/or other related
fees or levies ranging between 0.5% and 1.0%, with the
exception of goods imported specifically for the educa-
tional, health and agricultural sectors.
Commercial buses with seating capacity of above thirty
passengers, workshop vans, breakdown vehicles, mobile
showrooms, ambulances, hearse and motor bikes are
also exempted from the payment of import duty.
However, certain types of vehicles attract both import
duty and Value Added Tax and National Health Insurance
Levy at a combined rate of 15%, except ambulances.
Domestic Tax
Taxation of Individuals
Individuals pay tax on their income at the graduated rate
from 0 through 5%, 10%, 17.5% and 25%. Any income
above the 17.5% band is taxed at 25%. Sole Proprietor- above the 17.5% band is taxed at 25%. Sole Proprietor above the 17.5% band is taxed at 25%. Sole Proprietor
ships and partners of partnerships also pay tax at the
graduated rate.
Individuals enjoy tax reliefs such as child education
relief, old age relief, aged dependant relief, marriage or
responsibility relief, and disable relief. Individuals who
have life insurance policy get relief for the premium paid
for the policy. Those who pay social security and national
insurance trust contribution get relief for the amount
contributed. Employers also get relief for the additional
contribution they make on behalf of their employees.
42
The income tax of Ghana is based on the source principle
and that explains why persons are taxed on income
derived from Ghana or accrued in Ghana. In addition to
the source rule the individual should be resident in Ghana
to have income received in Ghana or brought into Ghana,
taxable in Ghana.
For purposes of payment of assessment of annual
income tax, an individual is resident in Ghana where
she/he has lived in Ghana for at least 183 days in any 12
month period. This residence criterion is varied in the
case of foreign employees who come into the country as
employees for less than the 183 days.
A. Corporate Tax
Resident companies in Ghana pay corporate tax at 25%.
on their profits. By the Internal Revenue Act, (ACT592)
a company is a resident company in Ghana for a year of
assessment if it is either incorporated under the laws of
Ghana, or has its management and control exercised in
Ghana at any time during the year of assessment.
After tax holidays, agro processing enterprises and
manufacturers of cocoa by-products attract different
corporate tax rates depending on their location as shown
below:
Accra and Tema- 20% •
Other Regional capitals except Northern, Upper East •
and Upper West- 10%
Northern, Upper East and Upper West- 0% •
Outside Other Regional Capitals- 0% •
Tax Holidays
First ten years of
operation.
Enterprises that pre-
finance real estate
First ten years of
operation
Tree Crops First ten years from
1st harvest
Livestock, Fish and Cash
Crops
First five years from
commencement
Cattle
First ten years from
commencement
Agro-Processing Business
established after 1/1/2004
First five years
Production of Cocoa
By-Products from cocoa
waste or substandard
cocoa beans
First five years
Companies processing
waste including recycling
of plastic and polythene
material for agriculture or
commercial purposes.
First seven years
Corporate Tax Rates
General 25%
Hotels 20%
Tax Rate for Non-traditional ex- Tax Rate for Non-traditional ex Tax Rate for Non-traditional ex
ports, Rural Banks after 10year tax
holiday, and Free Zone Enterprises
8%
Tax rate for income of financial
institutions from loans granted for
farming enterprise
20%
Petroleum Operations Not Ex- Not Ex Not Ex
ceeding
50%
B. Tax Incentives
Tax holidays
Companies operating in different sectors of the economy
are granted tax holidays as shown below.
43
Location Incentives
Companies operating in the manufacturing sector are
entitled to tax rebates, depending on their location.
The income tax rebate allowable to manufacturing busi-
ness operating in regional capitals other than Accra and
Tema is 25% of the applicable income tax rate of income
while those in other locations other than Accra and Tema
is 50% of the applicable tax rate.
Capital Allowances
Capital allowances are granted for depreciable assets
owned by a person at the end of its basis period. The as-
set pooling system is used in the computation of capital
allowance. Based on this system the assets are grouped
into six classes of depreciable assets. Each class of
assets has its own depreciation rate. Classes two and
four assets are depreciated on a reducing balance basis.
Classes three, five and six are depreciated on straight
line basis.
Capital Allowances
Class Qualifying Assets Depreciation Rate
1 Computers and data handling
equipment
40%
2 Motor vehicles, construction &
earth-moving equipment, heavy
duty trucks, manufacturing plant
and equipment, capital expenditure
on long term crop planting
30%
3 Mineral and petroleum exploration
and production rights, building and
structures used in connection with
2(i) above, plant and machinery
used in mining or petroleum opera-
tions
20% on straight line
basis
4 Railroad cars, locomotives and
equipment; water transportation
vessels and equipment; aircraft;
office furniture fixtures and equip-
ment
20%
5 Building structures and works of a
permanent nature
10%
6 Intangible assets
Petroleum
Capital
Allowances
Life of asset/10%
44
Taxpayers are obliged to notify the Commissioner of
Internal Revenue of any new assets acquired within
one month after the assets have been put to use in the
business. Unutilized capital allowances can be carried
forward indefinitely but cannot be transferred either
separately or together with a depreciable asset i.e. upon
the sale or transfer of the asset.
Carry Forward Losses
Losses from farming, mining, and manufacturing mainly
for export, agro – processing, tourism and ICT (Software
Development) can be carried forward for five years.
Insurance Against Non-Commercial
Risks
Ghana is a signatory to the World Bank’s Multilateral
Investment Guarantee Agency (MIGA) Convention. This
Convention guarantees coverage (insurance) against non-
commercial risks such as transfer restrictions, breach of
contract, expropriation, war and civil disobedience.
International Agreements
These international agreements are signed to promote
business transactions between Ghana and the other
parties to the agreements.
Double Taxation Agreements
Ghana has signed double taxation agreements (DTAs)
with some countries to facilitate cross- border trade
and investment and create an enabling environment
for foreign direct investment in flows to Ghana and the
respective countries. Currently, it has such agreements
with France, The United Kingdom (UK), Belgium, Italy,
Germany, South Africa, Switzerland and the Netherlands.
Investment Promotion and Protection
Agreements
Ghana has signed Bilateral Investment Protection Treaties
with twenty one countries. Currently, countries with
whom the agreements have been signed and ratified
are UK, China, The Netherlands, Denmark, Germany,
The Swiss Confederation and Malaysia. The countries
with whom agreements have been signed but awaiting
ratification are La Cote d’Ivoire, Egypt, The United States
of America (US), France, Zambia, Cuba, Yugoslavia,
Mauritania, Guinea, South Africa, Benin, India and
Burkina Faso.
Countries with agreements pending are South Korea,
Canada, Pakistan, Ethiopia, Israel, Turkey, Jamaica,
Nigeria, Belgium, Indonesia, Philippines, Mauritania, The
Czech Republic, Australia, Singapore, Morocco, Togo,
Finland and Spain.
African Growth Opportunities Act
(AGOA).
Ghana has signed up to AGOA as a means to promote
trade and investment between her and the US. The
Government of Ghana initiated measures to encourage
farmers and local exporters to take advantage of the
opportunities offered by AGOA. One of such initiatives
was the President’s Special Initiative (PSI) for cassava
industrial starch, textiles, garment and apparel production
for export. Small-scale businesses were resourced and
trained to link up with the PSI companies to produce
directly for the US.
Ghana’s main export to the US consist’s of forest
products, agricultural products, energy-related products,
minerals and metals, textiles and apparels, chemicals
and related products, footwear, machinery, transportation
equipment, and manufactured goods and electrical
products. Exports are gradually increasing after it had
declined in 2008 mainly due to the global economic
recession.
Financial Services
Free Zone Export
In line with government’s vision to boost economic
growth through the private sector, it set up the Free
Zones Program in 1996 to promote processing and
manufacturing of goods through the establishment of
Export Processing Zones (EPZs). Two export processing
zones (one in Tema near Accra and the other in Sekondi
near Takoradi, the capital of the Western Region) has
been established by the government of Ghana. A third
one in Boankra in the Ashanti Region is being developed.
The Ghana Free Zones Board (GFZB) was established
under the Free Zone Act 504 (1995), to promote,
facilitate, monitor and regulate investments under the
program.
Every company can apply for a status of a single free
zone company, provided it sells 30% of its products to
the local market and exports 70%.
45
Incentives
Companies in the Free Zone are totally exempted
from payment of duties and levies on all imports for
production and exports from free zones. There is also
an exemption of income tax for the first ten years of
operation and thereafter income tax rate is capped at 8
%. Furthermore, they are not required to obtain import
licenses and are totally exempted from payment of
withholding taxes from dividends and are relieved from
double taxation for foreign investors and employees.
Import and Export Rules
Exports
Procedures and requirements for exporting goods from
Ghana depends on the kind of goods exported. Exports
are categorized into traditional and non- traditional
exports. Traditional exports include cocoa, timber,
gold, minerals and electricity. Non- traditional exports
include agricultural products, fish, aluminium products
and textiles. Exporters are required to register their
companies with the Registrar General’s Department and
GIPC to obtain a number.
Exporters are also obliged to complete foreign exchange
forms from the Bank of Ghana, Customs Entry forms and
certificate of origin from CEPS. Permits or certificates
must also be obtained from relevant institutions like the
Ghana Standards Board.
Prohibited exports are narcotics, parrots and Ghanaian
currency in excess of GH¢ 5,000. There are also
restrictions on the export of antiques, precious minerals
and live plants. Permits to export these must be
obtained from the relevant regulatory agencies such
as the Museums and Monuments Boards, Precious
Minerals Marketing Corporations and Ministry of
Agriculture respectively. General documents required for
exports include:
Original Bill of Lading/Airway Bill •
Attested Invoice (Customs # C.61) •
Packing List •
Import Declaration and Valuation Report •
(FCVR)
Tax Clearance Certificate (Domestic Tax Divi •
sion of Ghana Revenue Authority)
Taxpayers Identification Number (TIN) •
Permit and License from Relevant •
Institutions
Imports
In Ghana, all imported goods attract an import duty
and import VAT. (See Domestic Tax System for details).
Goods like aircraft and aircraft parts, advertising materials,
infant food and machines or plant for agricultural purpose
are exempted from import duty.
Prohibited imports are narcotics, animals and dangerous
weapons. These are only allowed if the competent
Ghanaian authorities have issued the necessary permits
or certificates. For drugs, permit must be obtained from
the Ministry of Health; for animals, Ministry of Food
and Agriculture and for weapons, from the Ministry of
Interior.
Three additional fees and levies are paid on imported
goods. These are an inspection fee of 0.5% of the value
of the imported goods, a 1% ECOWAS levy, and a 0.5%
fee for the financing of the Ghanaian Export Development
and Investment Fund (EDIF).
Duty Drawback
This gives an exporter the opportunity to receive a refund
on import duties after he has re-exported previously
imported products (Same-state drawback) or import
duties paid on raw materials used in the production
of finished goods and exported (Material drawback).
The drawback process commences when goods have
been duly re-exported and a Ghana Customs export
document endorsed by the Customs authorities in both
the exporting and importing countries or a “landing
certificate” from the importing country (when required)
is produced. An application form must be accompanied
with the following documents:
Certified copies of the import documents •
Import duty payment receipts (certified •
copies)
Drawback Debenture Form (Form C3) •
Statement of Composition Form (Form C2A) in case •
of Material drawback
There is a twelve-month time frame beginning from the
date of the first export within which the duty drawback
can be claimed. It is advised that claims are put in
quarterly. The Government of Ghana has established
an escrow account with the Bank of Ghana into which
monies are paid for the purpose of satisfying the duty
drawback needs of exporters.
46
Temporary Importation of Goods
Certain goods imported into Ghana can be conditionally
relieved from the payment of import duties. Such goods
must be imported for a specific purpose and must be
intended for re-exportation within three months, either
in the state in which it was imported or after having
undergone specific processing or repair. Conditions to be
met for the tax relief on temporary importation of goods
include:
Goods must be declared at importation •
that they are imported only temporarily and
will be subsequently re-exported
A Form C59 must be filled •
A cash deposit or a bond to cover the •
potential duty and tax liabilities (if any) must
be given
Goods must be exported within three •
months or such further period as the Customs
Officer may allow
Goods must not be disposed of in the country •
without prior permission of the Commissioner
List of Items that Fall Under The Tem-
porary Importation Regime
Commercial travelers samples 1.
Goods for local exhibition or entertainment and stage 2.
properties.
Goods imported solely for repairs or renovation 3.
Motor vehicles including trailers or cycles without 4.
engines and their accessories.
Touring propaganda material, which are not prohibited 5.
Any goods imported by a tourist and intended for his 6.
use, convenience or comfort while in the country but
not for his consumption while in the country.
doc_311087960.pdf
The country is drained by a large number of streams and rivers.
Doing Business in
Ghana
2
This publication is for informational purposes only and
is meant to be purely educaitonal. While our objective is
to provide useful, general information, KPMG and other
participants to this publicaiton make no representationns
or assurances as to the accuracy, completeness, or
timeliness of the information.The information is provided
without warranty of any kind, express or implied. This
publicaiton does not constitute an offer, solicitation,
or recommendation for the sale or purchase of any
security, product, or service. information, opinions and
views contained in this publication should not be treated
as investment, tax or legal advice. Before making any
decision or taking any action, you should consult a
professional advisor who has been informed of all facts
relevant to your particular circumstances
DISCLAIMER
3
Preface
We are pleased to present you with our publication Doing Business in Ghana which presents a succinct guide Doing Business in Ghana Doing Business in Ghana
for investors coming into the country, and a glimpse of Ghana for the local entrepreneur and our international
clients.
As an investor, you are interested in clear and concise information. You have in this document current
information that will be of interest to anyone who wants to invest in a growing economy, like ours. In this
guide, the potential investor is given specifics about Ghana’s infrastructure, political and economic climate,
potential areas of interest for investors, business start-ups in Ghana, including helpful information ranging from
procedures to follow to permits that are required, as well as information on ways to obtain them. There is also
an important section on the Ghana tax system which includes many tax incentives the Government of Ghana
extends to investors.
We hope you enjoy reading our guide and find it most useful . If you have any questions please contact us at
[email protected]. We also encourage you to visit our website: www.kpmg.com.gh where you will find all this
information and much more.
KPMG
13 Yiyiwa Drive
Abelenkpe
P.O. Box GP 242
Accra
July 2012
4
Sources
Africa Research Bulletin
African Development Bank
AngloGold Ashanti Annual Report
Bank of Ghana – Central Bank
Bloomberg
Business and Financial Times
Business Monitor International
Central Intelligence Agency – The World Fact Book
Daily Graphic
Engineering and Mining Journal
European Commission
First Group Website 2012 Trading Economics
Ghana Business News
Ghana Investment Promotion Centre
Ghana National Communications Authority
Ghana News Agency
Ghana Revenue Authority
Ghana Stock Exchange
Ghana Tourist Board
Ghana Web
Government of Ghana Website
IMF World Economic Outlook Database
International Monetary Fund
International Telecommunication Union
Reuters
Standard & Poor’s
The Economist
The Ghanaian Times
The Wall Street Journal
UNCTAD World Investment Report
US Department of State
US Geological Survey
USAID
Wikipedia
World Bank Website
5
Contents
About Ghana 2
Location 2
Climate 2
Vegetation 2
Drainage 2
Population 3
Ethnic Groups 3
Education 3
Government 3
Judiciary 4
Membership with other organizations 5
The Economy 6
The Macroeconomic Environment 6
Employment 7
Foreign Direct Investment 8
Inflation and Interest Rates 9
Infrastructure 9
Transport 9
Energy 10
Mobile Telephones 10
Television and Radio Stations 10
Markets for Investors 11
Export Earnings 11
Export Partners 12
Imports 12
International Reserves 12
Sector Information 13
Agriculture, Agro-processing, Forestry and Fishing 13
Banking and Finance 15
Minimum Capital Requirement 16
National Switch 16
Bills of Exchange Act 17
National Biometric Switch 17
Automatic Clearing House 17
Central Securities Depository 17
Ghana Interbank Payment and Settlement System 17
Credit Reporting Act 18
Other Key Issues 18
Capital Markets 18
Demutualization 18
Automation 18
Energy Sector 19
Power Generation 20
Hydropower 20
Renewables 20
Thermal Power 21
Osagyefo Power Barge 22
Private Sector Initiatives in the Energy Sector 22
Upstream Oil and Gas Prospects 22
Downstream Developments 23
Institutional Development: Establishment of Petroleum Regulatory Authority 23
Investments In The Energy Sector 23
Information Communication and Technology 24
6
Sector Overview 24
The Market 24
Market Trends 25
Investment Opportunities 25
Real Estate Development 26
Industry Structure 26
Residential Properties 27
Affordable Housing Project 27
Commercial Properties 27
Industrial Properties 28
Recreational Properties 28
Construction Finance 28
Home Purchase Finance (Mortgage Market) 28
Tourism 28
Festivals 29
Forts and Castles 29
Museums and other Attractions 29
Beaches and Lake Resorts 29
Water Falls 30
National Parks and Gardens 30
Other Tourist Attractions 31
Lodges and Hotels 31
Potentials of the Ten (10) Regions 32
The Ashanti Region 32
The Eastern Region 32
The Brong Ahafo Region 32
The Central Region 33
The Greater Accra Region 33
The Northern Region 34
The Upper East Region 35
The Upper West Region 35
The Volta Region 36
The Western Region 36
Investment and Legal Framework 37
Why Do Business in Ghana ? 37
Starting a Business in Ghana- Process, Time and Cost 37
Domestic Laws 37
Investment Legislation 38
Investment Procedures 38
Registrar General’s Department 38
Ghana Investment Promotion Centre (GIPC) 38
Ghana Immigration Service 39
Ghana Revenue Authority (GRA) 39
Environmental Protection Agency (EPA)
Free Zones Act 39
Petroleum Commission 40
Ghana National Petroleum Corporation (GNPC) 40
Investment Procedure 41
Expatriates 41
Ghana’s Tax System 43
Corporate Tax 43
Withholding tax 43
Capital Gains Tax 43
Value Added Tax /National Health Insurance Levy 43
7
Customs Duty 44
Domestic Tax 44
Taxation of Individuals 44
Location Incentives 46
Capital Allowances 46
Carry Forward Losses 48
Insurance Against Non-Commercial Risks 48
International Agreements 48
Double Taxation Agreements 48
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8
Ghana in Brief
Official name: Republic of Ghana
Capital: Accra
Form of government: Multi party democracy
Head of State and government: Prof. John Evans Atta Mills
Location: West Africa with Gulf of Guinea coastline of 539km
Area total: 239,460 sq km; land: 230,940 sq km; water: 8,520 sq km
Natural resources: Gold, timber, industrial diamonds, bauxite, manganese,
fish, rubber, hydropower, petroleum, silver, salt, lime-
stone
Population (2010 Provisional Census Results) 24.6 million; Religions: Christian 68.8% (Pentecostal/
Charismatic 24.1%, Protestant 18.6%, Catholic 15.1%,
other 11%), Muslim 15.9%, traditional 8.5%, other 0.7%,
none 6.1% (2000 census)
Official language: English
Climate: Tropical: Warm and comparatively dry along southeast coast; hot
and humid in southwest; hot and dry in north
Terrain: Mostly low plains with dissected plateau in south-central
area
GDP (Projected - 2011 Budget Statement): 12.3%
Exchange Rate: US$1: GH¢1.96
Time Zone: GMT
:
9
About Ghana
10
G
hana lies at the heart of a
region which has been leading
sub-Saharan African culture since
the first millennium BC in metal-
working, mining, sculpture and
agriculture. In 1951, the Gold Coast
became the first British colony in
Africa to achieve self-government.
and upon attaining political
independence in 1957, it became
known as Ghana.
Location
Modern Ghana takes its name from the ancient kingdom
of Ghana which was situated some 800 km, (500 miles)
to the north of present-day Accra, which flourished up
to the eleventh century AD. Ghana lies on Latitude 5
degrees, 36 minutes north and Longitude 0 degrees, 10
minutes east. To the west of Ghana lies Côte d’Ivoire, to
the east Togo, to the north Burkina Faso and to the south
is the Gulf of Guinea. The Greenwich Meridian passes
through Tema near Accra making Ghana geographically
the closest to the center of the world, that is, the no-
tional point of intersection between the equator and
longitude zero degree (0 degree) which is located in the
Atlantic Ocean at about 614km from Accra.
Climate
The climate is mainly tropical. There are two main
seasons; the wet and the dry seasons. Northern Ghana
experiences its rainy season from March to November
while the south, including the capital Accra, experiences
the season from April to mid-November.
Vegetation
Ghana has tropical vegetation of dense tropical rain forest
in the southern middle belt. The vegetal cover is ever- in the southern middle belt. The vegetal cover is ever in the southern middle belt. The vegetal cover is ever
green forest with semi deciduous forest at the northern
and southern fringes. Towards the north is savannah
grassland and towards the coast is the coastal savannah.
There are a few mountains and several hills rising to a
height of 900 meters and above. Mount Afadzato is the
highest mountain and lies 1,500 meters above sea level.
Drainage
The country is drained by a large number of streams and
rivers. The Volta and its tributaries drain more than two-
thirds of the country. All the major rivers in the country
flow into the Gulf of Guinea directly or as tributaries to
other major rivers. The Akosombo Dam, which was built
on the Volta River in 1965, provides hydro-electricity for
Ghana and some of its neighboring countries.
The Volta Lake formed after damming the river is naviga-
ble for a distance of about 400 km and motorized vessels
now ply its waters carrying passengers and goods from
the south of the country to the north and vice versa.
There are several rivers in the country and the most
important is the Volta dammed at Akosombo, Akuse and
Bui (situated on the Black Volta) for hydro-electric power
generation plants.
Other rivers are the Pra, Ankobra and Tano. Among the
smaller rivers are the Densu and Ayensu which provide
Winneba and parts of the capital, Accra, with pipe-
borne water. The largest natural lake in the country is
Bosomtwi with a total area of 48 square kilometres and
reaches depths of 72 meters in some parts.
Population
Ghana has a population of about 24.65 million people
and is one of the most populous countries in West
Africa, second only to Nigeria. Since achieving political
independence in 1957, its population has nearly tripled in
size, from about 6 million to 24.6 million in 2010, and is
expected to increase to 27 million by 2020.
The past rapid growth of Ghana’s population is an out-
come of high fertility, which until recently remained fairly
constant, and declining mortality. This combination of
high fertility and declining mortality is also the cause for
the young age structure of the Ghanaian population with
43 percent under 15 years of age and over 65 years.
However, Ghana’s age structure is changing, a conse-
quence of falling fertility.
It is estimated that the declining proportion of children
and the increasing share of the working age group,
between now and 2020 the number of children under 15
(now nearly eight million) will remain virtually constant
while the 15 to 64 year age group will nearly double to 18
million. It is estimated that there will also be a substantial
increase in the elderly population (65 and over), to over
one million, but their share of the total population will still
be small.
11
Ethnic Groups
Ghana is home to more than 100 different ethnic groups.
The official language is English; however, most Ghanaians
also speak at least one local language.
The ethnic groups in Ghana are the Akan (the Fante,
Akyem, Ashanti, Kwahu, Akuapem, Nzema, Bono,
Akwamu, Ahanta and others) 49.3 %; Mole-Dagbani
15.2%; Ewe 11.7 %; Ga-Dangme ( Ga and Dangme)
7.3%; Guan 4%; Gurma 3.6%; Gurunsi 2.6%; Mande-
Busanga1%; other tribes 1.4%; other (Hausa, Zabarema,
Fulani) 1.8% (2000 census). The religious distribution is
as follows: Christian 68.8% (Pentecostal/Charismatic
24.1%, Protestant 18.6%, Catholic 15.1%, other 11%),
Muslim 15.9%, traditional 8.5%, and other 0.7%, none
6.1% (2000 census).
Education
Ghana has approximately 18,530 primary schools,
8,850 junior secondary schools, 900 senior secondary
schools, 28 training colleges, 20 technical institutions,
four diploma-awarding institutions, six public universities
and over forty private universities. Most Ghanaians
have relatively easy access to primary and secondary
education. Ghana’s spending on education has varied
between 28 and 40 percent of its annual budget in the
past decade. All teaching is done in English, Ghana’s
official language.
Ghana has a six-year primary education system
beginning at the age of six. Under the educational
reforms implemented in 1987, after the six year primary
education, the students pass on to a three-year junior
secondary system, all making up the basic education
and this is followed by a three year senior high school
system.
At the end of the third year of Junior High School, (JHS),
there is a Basic Education Certificate Examination
(BECE). Those continuing must complete the three-
year Senior High School (SHS) program and take the
West African Senior Secondary Cerificate Examination
(WASSCE) to enter university.
Government
The system of government practiced in Ghana is
parliamentary democracy with separation of powers
among the Executive, the Legislature and the Judiciary
guaranteed under the constitution. The press enjoys a
great deal of freedom which has nurtured it into one of
the most vibrant in Africa. The 1992 constitution provides
checks and balances which limit the powers of each of
the Legislature, the Executive and the Judiciary.
The constitution also provides a Council of State, made
up of experienced elders with proven character, to
advise the President on national issues. The constitution
has also established a number of autonomous
institutions such as the Commission for Human Rights
and Administrative Justice (CHRAJ), the Electoral
Commission (EC) and Economic and Orgranized Crime
office (EOCO). These institutions are there to facilitate
good governance.
The Government is elected by universal suffrage. There
have been five democratically elected presidents and
parliaments since 1992 and the next presidential and
parliamentary elections are due in December 2012.
Ghana has 10 Administrative regions and 169 district
assemblies. Decentralization of governmental powers to
the District Assemblies has been vigorously pursued for
some time now and the process still continues.
Ghana is considered a beacon of hope for black Africa as
it continues to champion the course of good governance
as well as pursuing sound economic management.
Judiciary
The legal system is based on the English common law,
and customary law of Ghana. The court system is made
up of the Supreme Court of Ghana, Court of Appeal, and
the High Court of Justice which constitute the superior
courts. Below these are the Circuit Courts, District
Courts, and family tribunals which constitute the lower
courts. The traditional rulers also settle disputes among
their subjects but such decisions do not constitute judg-
ment of a court of competent jurisdiction. The 1992 Con-
stitution which is the basic law of the land guarantees an
independent judiciary. The tribunals which use to be part
of the court system are being phased out.
Membership with other organizations
Ghana is a member of the South Atlantic Peace Coopera-
tion zone, The Commonwealth of Nations, the Economic
Community of West African States, the African Union,
and an Associate Member of La Francophonie.
In 2000, Ghana was one of the 189 countries that signed
up to the 2015 Millennium Development Goals Declara-
tion by the United Nations. Ghana has made substantial
progress towards reaching a number of these goals such
as eradicating extreme poverty, achieving universal pri-
mary education and reducing maternal mortality.
12
The Economy
13
L
ate in 2010, Ghana was
upgraded to a lower middle
income economy status.
With vast reserves of natural
resources, Ghana has twice the
per capita output of the poorer
countries in West Africa and is one
of the world’s top gold and cocoa
producers. Other exports such as
petroleum oil, timber, electricity,
diamond, bauxite, manganese
and individual remittances are
major sources of foreign exchange
earnings. World Bank projections
indicate that Ghana, which began
exporting oil in 2011, will have the
fastest growth rate on the continent
estimated at 13.4% in 2011 and
10.4% in 2012 (World Bank Global
Economic prospects 2011).
Agriculture has long been an important sector of the
economy, employing about 50% of the labor force and
contributing around 43% of GDP in 2007. Cocoa is the
major export crop, followed by timber and non-traditional
products such as horticulture, fish/seafoods and pine-
apple.
Cocoa, timber and other tree crops are grown in the
southern forest belt of the Ashanti, Brong-Ahafo, Eastern
and Western regions. Most of the cocoa crop is exported
as beans, although there are some cocoa-processing
plants, and more are under construction.
The Ghanaian economy revolves around the services sec-
tor, which accounted for approximately 50% of GDP in
2010 and employs majority of Ghanaians.
Ghana’s labour force in 2010 was estimated at 10.5
million people. The economy continues to rely heavily
on agriculture which accounts for 30.2% of GDP and
provides employment for 56% of the work force mainly
small landholders.
The Macroeconomic Environment
Ghana’s macroeconomic performance has been positive
in recent times. This level of performance has been
stimulated by the prevalence of relative peace coupled
with private sector competitiveness; human resource
development; good governance and civic responsibility.
The sound macro-economic management along with high
prices for gold and cocoa helped sustain GDP growth in
2008 and 2009.
For 2010, GDP growth was 4.1%, and the economy
continues on its path of recovery, mainly backed by
government’s expenditure in infrastructure and FDIs.
The Government Statistician put provisional per capita
GDP for 2010 at GH¢1,872.07 ($1,318.36) compared with
GH¢1,069.89 ($753) under the old series, moving the
country into the lower middle income bracket. The new
series places Ghana as the third largest in ranking of GDP
per person in the ECOWAS sub-region behind Cape Verde
and Nigeria, and 21st in Africa.
On sectoral performance, the share of the agricultural
sector in GDP under the new series saw agriculture,
the dominant sector, now making up to 30.2% of the
economy, lagging behind the services sector, which
accounts for 51%. The industrial sector accounts for
18.6%. (Source: GNA 5 November 2010).
The economy is seeing significant progress which
is underlined by the relative political stability and
macroeconomic reforms. The improvement in the
economy has brought about an influx of foreign
investments of various forms as well as a gradual
increase in middle-class professionals.
Summary of macroeconomic
indicators
Employment
According to the latest population census (2010) Ghana’s
population is estimated at 24.65 million. Constituted in
this is an economically active population of about 10.33
million. (Source: IMF, World Economic Outlook Database).
The current minimum wage stands at GH¢ 4.48 per day
and took effect from 9 February 2012.
Government has embarked on a wage policy reform by
14
Summary of Macro
Economic Factors
2006 2007 2008 2009 2010
Gross Domestic Product
(GDP)
GDP at constant prices
(GH¢)
18,705
19,913
21,592
22,598
24,094
GDP at current prices
(GH¢)
18,705
23,154
30,179
36,867
44,799
GDP real growth
6.5 8.4 4.7 6.6
Sectoral Growths
Services (%)
7.7 8 6.8 8.2
Agriculture (%)
-1.7 7.4 7.6 4.8
Industry (%)
6.1 15.1 4.5 6
Population (million)
22.4 22.9 23.3 23.8 24.6
which all civil and public servants were expected to have
be fully migrated by the end of June 2011 to the Single
Spine Pay Policy. However, the process is still ongoing
and a number of civil servants are yet to be migrated on
to the scheme. The single spine pay policy, implemented
by the Fair Wages and Salaries Commission, is a unified
salary structure that places all public sector employees
on one vertical structure, making sure that, jobs within
the same job value range are placed within the same pay
range. It is hoped that the policy would help to make
the public services pay competitive for the attraction and
retention of highly-skilled labor force.
Ghana has a strong and vibrant labor movement that is
very effective in articulating the demands of workers.
The various sectors of the economy are represented
by sector labor unions that are affiliated to the national
umbrella labor union called the Trades Union Congress
(TUC). It is the TUC that negotiates with the Ghana
government and employers association over wages on
behalf of the workers.
Foreign Direct Investment
According to UNCTAD (World Investment Report 26 July
2011), Ghana was the 7th largest recipient of foreign
direct investments (FDIs) in Africa at the end of 2010.
Investors brought into the country, an amount of $2.5
billion, representing about 5% of total FDI inflows to
developing countries.
In the first quarter of 2012, the Ghana Investment
Promotion Centre recorded a total of 95 new projects
with a total estimated value of US$1.18 billion. The
estimated value represents an increase of 67.98%
compared to the value recorded in the same quarter of
2011.
The FDI component of the estimated value of the newly
registered projects was US$979.85 million. This is a
significant increase of about 178% over the recorded FDI
value in the corresponding quarter of 2011. The USA with
an FDI value of US$407.21 million ranks first and China
remains the top source of FDI to Ghana in terms of the
number of projects (Ghana Investment Promotion Press
Release 10 May 2012)
2
number of projects (Ghana Investment Promotion Press number of projects (Ghana Investment Promotion Press
.
Inflation and Interest Rates
Inflation has been on a downward trend since it peaked
at 20.7% in June 2009. This fall in inflation, according to
the Monetary Policy Committee of the Bank of Ghana,
has been driven by both non-food and food inflation.
Inflation as at May 2012 was 9.3%. A single digit inflation
rate of 9.44 %was achieved at the end of August 2010,
which led to a corresponding drop in the prime rate by
the Bank of Ghana to 13.5%. By February 2011, inflation
which was at 8.58% in December of 2010 has fallen
further to 8.39% as of July 2011.
The cedi has slipped against the dollar by 19% and has
been fluctuating against major currencies since the
beginning of 2012. It is currently experiencing some
depreciation against major trading currencies, and the
1
.
The United States as one of Ghana’s major trading partners has an active American Chamber
of Commerce in Accra.
15
2. In the area of investment, Britain remains the main source of FDI inflows (excluding mining) in terms of value of investment, accounting for about 37% of total FDI to Ghana between 1994 and
2009, followed by the United States, the United Arab Emirates, Nigeria, Malaysia and China in that order. China, however, leads in the number of registered projects with 415 projects mainly in
manufacturing and general trade. India comes next with 388 projects, mainly in the area of manufacturing, followed by Lebanon with 291 projects.
Ghana’s economic co-operation with the East, particularly China, has grown remarkably in recent times. Over the past decade aid inflows to Ghana from China have increased considerably. The
largest single aid inflow has been in the energy sector and involved USD 562 million for the construction of the Bui hydroelectric dam. Other significant aid from China includes a USD 99 million
interest-free loan for the construction of landing sites for fishing communities and a USD 30 million concessional loan for the first phase of a national fiber optic and e-government project extended
in 2007 and 2008.
India is one of the top five foreign direct investors in Ghana. In 2010 Indian investments in Ghana included over 46 projects with an estimated total value of USD 277 million. Indian investments
are found mostly in the agricultural and manufacturing sectors of the economy. In addition, within the health sector, Ghanaian pharmaceutical companies manufacture drugs in collaboration with
Indian firms. In 2010 the Indian Bank of Baroda opened a branch in Ghana. Ghana’s information and communications technology (ICT) sector also has a significant Indian presence. The Electronic
and Computer Software Export Promotion Council of India regularly invites Ghanaians to its exhibitions in India to share ideas on new technologies. Furthermore, under its Technical and Economic
Cooperation (ITEC) program, India awards annual scholarships to Ghanaians for both graduate and post-graduate programs in ICT.
exchange rate is GH¢1.96: US$1. Expectations are that
the local currency will appreciate against the major
foreign currencies and this would improve foreign
exchange risk for companies in Ghana.
Infrastructure
Transport
Road transport is by far the dominant carrier of freight
and passengers in Ghana’s land transport system. It
carries over 95% of all passenger and freight traffic. Most
communities, including the rural areas are accessible
by road transport. The roads are classified under three
categories: trunk roads, urban roads, and feeder roads.
The Ghana Highway Authority, established in 1974 is
tasked with developing and maintaining the country’s
trunk road network totaling 13,367 km, which makes
up 33% of Ghana’s total road network of 40,186 km.
The railway connects Accra, Kumasi, and Takoradi, and
the major mining areas, to the sea ports. The railway
network also provides passenger services from the
interior of Ghana to the main sea ports at Tema (near
Accra) and Takoradi. There is a commuter line which links
Accra and Tema.
The main waterways include the Volta, Ankobra, and Tano
Rivers, which provide 168 kilometers (104 miles) of year-
round navigation, and Lake Volta, which provides 1,125
kilometers (699 miles) of arterial and feeder waterways.
The two seaports of Ghana at Tema and Takoradi
handle most of the country’s imports and exports. The
turnaround time for ships at Ghanaian ports is now one of
the quickest in West Africa and the tonnage managed has
also increased significantly.
There are six airports in Accra, Kumasi, Takoradi, Sunyani,
Tamale, and Wa. The international airport, Kotoka is in
Accra. A number of major international airlines that
fly there regularly include British Airways, Delta, KLM,
Brussels Airways, Lufthansa, Alitalia, South African,
Air Namibia, Air Maroc, and Egypt Air Emirates. Three
airlines, Citylink, Starbow and Antrak connect Accra to
Tamale, Kumasi and Takoradi.
Energy
Hydroelectricity is the primary source of Ghana’s power.
It is generated at the Akosombo and Kpong power plants.
The $700-million, Bui hydroelectric project located on the
Black Volta would have a generation capacity of 400 MW
when completed. There are thermal facilities located at
Tema and Takoradi. In addition to increasing the domestic
electricity supply, power generated from Bui could be
exported to Burkina Faso, Mali and Cote d’Ivoire in
addition to current exports of power to Benin and Togo.
The Electricity Company of Ghana (ECG) is responsible
for electricity distribution to the Ashanti, Western,
Central, Eastern, Greater Accra and Volta regions. The
Volta River Authority (VRA) is responsible for generation
and for the distribution of electricity in the Brong Ahafo,
Northern, Upper East and Upper West regions. When
the West Africa Gas Pipeline (WAGP) is completed, VRA
plans to convert oil-fired facilities at Takoradi and Tema to
natural gas.
Mobile Telephones
Mobile telephony is one of the fastest growing industries
in Ghana. There are six current operational service
providers which include MTN (Scancom), Tigo (Millicom),
Airtel (Bharti Airtel), Vodafone,Expresso and Globacom.
There are over 12 million mobile phone subscribers.
The introduction of 3 Generation services has led to an
increase in the range of services provided by cellular
operators.
Television and Radio Stations
There are 143 FM radio stations and 10 television
broadcast stations. There are also cable TV channels.
16
Markets for Investors
17
T
he domestic market in
Ghana is relatively small
but is growing. There is a
regional market provided by the
15 members of the Economic
Community of West African States
(ECOWAS) though integration of
the individual countries is yet to be
achieved. The free trade among
the ECOWAS member countries
creates an opportunity for an
expanded market for players in the
sub-region.
The government, sponsored by
the World Bank is also striving
to make Ghana the gateway to
West Africa by positioning the
country as a hub for import, export,
storage, assembly, distribution, and
manufacturing, transshipment of
goods, services and passengers.
The key institutions in Ghana that play various roles in
facilitating the activities of investors include the following:
The Ghana Immigration Service (GIS) •
The Ghana Ports and Harbors Authority (GHAPOHA) •
Ghana Investment and Promotion Council (GIPC) •
Free Trade Zones Board •
Ghana Revenue Authority(GRA) •
Ghana is not eligible under the European Union’s
Everything but Arms Initiative as it is not a Least
Developed Country. However, it is an ACP country and
enjoys the preferences the European Union affords
other ACP countries (this is now being revised under an
Economic Partnership Agreement). It also qualifies under
the generalized system of preferences which gives it
preferential access not only to the European Union but
to other rich markets as well.
Export Earnings
Ghana earned $3.8 billion from merchandize exports, per
the preliminary estimates of total exports for the first
three months of 2012. The earnings represent a year-on-
year growth of 22.8 percent and the growth in export
earnings was driven by gold, cocoa beans and crude oil.
Exports of gold amounted to $1.5 billion, cocoa beans
$939.8 million and crude oil $689.6 million. Other ex- $939.8 million and crude oil $689.6 million. Other ex $939.8 million and crude oil $689.6 million. Other ex
ports, including non-traditional exports, amounted to
$675.2 million during this period.
Giving a breakdown, the Bank of Ghana comments that
total non-oil imports amounted to $3.6 billion of which
capital imports was $781.2 million, intermediate imports
$1.7 billion, consumption imports $775.8 million and oth-
ers US$251.8 million.
However, the Bank reports that total merchandise
imports provisionally amounted to $4 billion in the first
quarter of 2012, representing a year-on-year growth of
19.8 per cent. Oil imports, including crude, gas and re-
fined products amounted to $457.2 million compared with
$692.2 million for the same period of 2011.
Export Partners
Ghana exports were worth 3,339 million USD in the third
quarter of 2011. Historically, from 2003 until 2011, Ghana’s
exports averaged 1,272.8700 million USD reaching an all
time high of 3,345.0000 million USD in June of 2011 and
a record low of 265.1000 million USD in March of 2003.
Ghana’s main exports are gold, petroleum, cocoa beans
and timber products. Others include tuna, aluminum,
manganese ore, diamonds and horticulture. It’s main
exports partners are the Netherlands, Burkina Faso,
South Africa and United Kingdom (First Group Website.
2012 Trading Economics).
Imports
Ghana imports were worth 4,046 million USD in the third
quarter of 2011. Historically, from 2003 until 2011, Ghana’s
imports averaged 1,937.70 million USD reaching an all
time high of 4,120.00 million USD in June of 2011 and
a record low of 692.80 million USD in March of 2003.
Ghana imports are mostly industrial supplies, capital
and consumer goods and foodstuffs. Our main import
partners are China, United States, Belgium, United
Kingdom, South Africa and France.
International Reserves
The Gross International Reserves of Bank of Ghana (BoG)
declined to $4.3 billion as at June 2012 from $5.4 bil-
lion in December 2011. This is equivalent to 2.5 months
18
imports cover of goods and services.
For the first quarter of 2012, the Balance of Payments
recorded a deficit of $1.3 billion, compared to a deficit of
only $154.2 million in the same period of 2011. Provisional
data from Bank of Ghana for the first five months of 2012
showed that total revenue and grants recorded a year-
on-year growth of 34.5 per cent, amounting to GH¢5.1
billion.
Total tax revenue was GH¢4.4 billion, 46.3 per cent
higher than the out-turn of GH¢3.0 billion recorded during
the corresponding period in 2011. Total merchandize ex- the corresponding period in 2011. Total merchandize ex the corresponding period in 2011. Total merchandize ex
ports were $6.6 billion over the first five months of 2012,
representing a year-on-year growth of 24.6 per cent.
There were higher receipts from gold, cocoa beans and
crude oil exports as commodity prices increased during
the period.
Export receipts from gold amounted to $2.7 billion,
cocoa beans were $1.6 billion, while crude oil was $1.2
billion during the period. Other exports, including non-
traditional products, amounted to $768.2 million. Total
merchandize imports were $7.5 billion during the five
months, indicating a growth of 27.9 per cent on a year-on-
year basis. (Bank of Ghana).
19
Sector Information
20
Agriculture, Agro-processing, Forestry
and Fishing
Ministry of Food and Agriculture
P.O. Box M37
Ministries
Accra
Tel: +233 302 687223
Email: [email protected]
Website: www.mofa.gov.gh
Ghana Investment Promotion Centre
Post: P. O. Box M193, Accra-Ghana
Tel: +233 302 665 125-9
Fax: +233 302 663 801/663655
Email: [email protected]
As Ghana’s most important economic sector employing
more than half the population, agriculture in Ghana is an
unexploited investment opportunity. The major strengths
of this sector include a diversity of commodities, well-
endowed drainage basin, a well-established agricultural
research system and relative proximity to the European
market. Ghana has a big share of the African quota of the
EU market in fruits and vegetables export.
Ghana has a total land area of 23.9 million hectares
with 57 percent suitable for agricultural purposes.
Agriculture’s contribution to GDP over the years has
shown a steady reduction and the growth rate of the
sector does not show any clear trend (GIPC). However,
there are indications that Ghana has the potential for
agricultural business to develop into a multi-billion dollar
industry. Cocoa is the main export crop and demand for
the crop is growing as China now imports 80-90 percent
of Ghana’s total cocoa production. Ghana is the second
largest exporter of cocoa in the world. Agricultural crops,
including yams, grains, cocoa, oil palms, kola nuts, and
timber, form the base of Ghana’s economy. Leading
processed agricultural export products include processed
tuna, cut fresh pineapples, other prepared fish and
tomato paste.
The country may be classified into three main agriculture
zones. The forest vegetation zone: consists of parts
of Western, Eastern, Ashanti, Brong-Ahafo and Volta
Regions. The northern savannah vegetation zone: the
Upper East, Upper West and Northern Region; the
coastal savannah: includes the Central, Greater Accra and
parts of Volta Region.
The northern savannah zone is the largest agriculture
zone. Most of the nation’s supply of rice, millet, sorghum,
yam, tomatoes, cattle, sheep, goats and cotton are
grown in the region. In recent times, mango and ostrich
commercial farms are also gaining footholds in the
northern zone.
The coastal savannah is known for rice, maize, cassava,
vegetables, sugar cane, mangoes and coconut, as well
as livestock. Sweet potato and soya bean crops thrive in
this area under irrigation. The lower part of this zone is
drained by River Volta. Together with other streams and
lagoons, these water resources present opportunities for
fish farming or aquaculture
In the forest zone where there is abundant rainfall, cocoa,
coffee, oil palm, cashew, and rubber as well as plantain,
banana and citrus crops are grown.
Major stakeholders and government are looking for ways
to partner with investors outside the country to improve
agri-business through modern technology, to ensure food
security in meeting international requirements. An added
advantage is that over two thirds of the land in Ghana is
fertile, and needs little or no fertilizers/chemical to grow
crops in large quantities.
Investment Opportunities
Provision of agricultural inputs such as improved •
seeds and agrochemicals including fertilizers,
pesticides and herbicides. Veterinary drugs, vaccines
and chemicals; animal feed and feed ingredients are
also required.
Opportunities exist in the processing of agricultural •
products such as cereals (maize, rice, millet) starchy
crops (yam, cassava. Sweet potato, plantain),
legumes (carrots, cabbage, garden eggs, tomato),
fruits (pineapple, pawpaw, banana, mango), industrial
crops (rubber, sugarcane, cotton, oil palm, coconut,
cocoa, coffee), livestock (cattle, pigs, poultry, sheep)
and fisheries (tuna, tilapia, catfish). Rearing of silk
worm for the production of raw silk.
Dairy products: processing of the products as well •
as the supply of machinery to establish hatcheries for
day-old chicks.
Floriculture offers a lot of opportunities as Ghana’s •
climate and topography make the country suitable for
the cultivation of a number of exotic flowers. Species
such as heliconia, caribea, celosia, curcuma, gladioli,
hibiscus, roses, ornamental palms and ferns perform
well under natural conditions. There is potential in the
21
national, regional and European Union markets
Processing of farm produce such as to add value, •
reduce post-harvest losses, promote price stability
and expand demand for local agricultural produce.
For example, with the canning of tomatoes, and
processing fruits into fruit juices.
Developing irrigable land through irrigation is another •
key area. While Ghana has a potential irrigable area
of 346,000 hectares, only 10,000 hectares have been
developed.
Technological and support services also require •
investment. Key areas are in the supply and
installation of cold chain equipment, packaging and
factory building technology
In the distribution field, companies are required •
to provide post-production services in transport,
packaging and cold vans.
There are further opportunities in standards, training •
and certification; capacity building for management
and market-oriented enterprises; market intelligence
research and in the development of agricultural
finance and insurance.
Investment opportunities exist in the production of •
agricultural inputs such as fertilizers, pesticides and
fungicides.
Technology and services in the agricultural sector •
which include irrigation, heavy equipment hiring (i.e.
hiring of tractors, ploughs, harrows and combine
harvesters etc) provide investment opportunities.
Investment opportunity also exists in the storage •
industry. Inadequate and inappropriate storage
facilities are constraints to agricultural production
thereby contributing to high post-harvest losses and
low returns for farmers and processors.
Banking and Finance
Bank of Ghana
Head Office
One Thorpe Road
P.O. Box GP 2674
Accra
Tel:+233-30-2666174 - 6
+233-30-2666361 - 5
+233-30-2666902 - 8
+233-30-2666921 – 5
Email:[email protected]
In line with the country’s goal of achieving middle income
status by 2015, Ghana has been undergoing a process
of financial sector restructuring and transformation as an
integral part of its Vision 2015 strategy.
Prior to 2003, the Bank of Ghana operated a three-
pillar banking model with all banks licensed as either
development, merchant and commercial banking. In
February 2003, the Bank of Ghana introduced Universal
Banking which allowed the banks to undertake
commercial, development, merchant or investment
banking without requiring separate licenses. This has
leveled the playing field, and opened up the banking
system to competition, product innovation and entry.
To operate under the Universal Banking License(UBL),
existing banks must have a minimum net worth of
GH¢7.0 million (excluding statutory reserves), and new
banks should have a paid-up capital of GH¢7.0 million.
Banks are required to hold 9% of the cedi and forex
deposit base with BOG on daily basis as primary reserves
and 35% of their deposit base in cedi denominated
assets as secondary reserves.
The Government of Ghana Index-Linked Bonds (GGILBs)
was introduced in 2001, which as part of the reserve
requirements converted Government of Ghana (GoG)
short-term liabilities into long-term loans. BoG requires
banks to hold 15% of their total deposits in GGILBs. The
GGILB is now being phased out by the new 2nd and 3rd
year fixed or floating bonds.
Currently, there are 26 banks operating in the formal
banking sector. They are regulated by the Bank of Ghana,
Ghana’s central bank.
Liberalizing entry and encouraging foreign banks and
investors in the financial services industry has increased
competition in the banking industry as well as the
introduction of strong business practices, technology,
products, and risk management systems.
The current licensing policy of the Bank of Ghana is to
limit entry of foreign banks to truly internationally active
financial institutions.
Minimum Capital Requirement
The Bank of Ghana has proposed an increase in the
minimum capital requirements of banks from GH¢7.0
million to GH¢60 million. The proposed minimum capital
requirements for deposit taking non-banking financial
institutions (NBFIs) and finance houses is an increase
from GH¢1 million to between GH¢5-8 million.
Banks and deposit taking NBIFs were expected to submit
22
capitalization plans by the end of June 2008. Submission
of capitalization plans would guarantee continued access
to the settlement and primary dealership systems. After
December 2008, participation in the settlement system
will be restricted to institutions that have met the capital
requirements.
To ensure an orderly consolidation, the banking system
would allow for lower tier banks after December 2008.
Banks that do not meet the capital requirements will
belong to the lower tier. Banks and NBFIs granted
licenses or provisional licenses within the last six
months to date are required to meet the new capital
requirements within two years from the date of
operation. New licenses for banks, deposit-taking NBFIs
and Finance Houses would henceforth only be issued to
banks that meet the new minimum capital requirements.
The Bank of Ghana intends to continue with its current
policy of issuing bank licenses only to internationally
active banks.
National Switch
The Bank of Ghana has established a National Switch
(e-ZWICH) to allow the establishment of a common
platform for all payment transactions in the country.
This would result in the integration of all existing bank
switches and allow banks that do not have switches
(e.g. ARB Apex Bank) to join the common switch at
significantly reduced costs. It would also allow the
interoperability of all ATMs and the settlement of
payment transactions by customers of different banks at
Points of Sale (POS).
The national Switch has the capability to deal
with transactions that take place online (in places
with telecommunications) and offline (i.e. where
telecommunications are not present, e.g. in some rural
areas). This is a major departure from existing systems
and has been made possible by the Universal Electronic
Payments (UEPS) technology.
Bills of Exchange Act
Ghana is essentially a cash-based economy with
embedded high transaction costs. In recognition of
this, the Bank of Ghana is undertaking reforms in the
legal, institutional, and infrastructural framework of
the payment system to make the Ghanaian financial
system modern and competitive. A draft bill known as
the Bills and Cheques Bill is now before Parliament and
is expected to replace the Bills of Exchange Act when
passed. The draft bill provides for electronic presentment
of cheques and amends various sections of the Bills of
Exchange Act to bring it in line with current business
trends and practices.
National Biometric Switch
The Bank of Ghana has introducied a National Biometric
Smartcard (The E-ZWICH card). This is expected to
address the shortcomings of existing debit cards which
cater for only a small fraction of the population because
of its features of accessibility; low transaction costs;
limited infrastructure needs; personal safety; security;
convenience; and simplicity.
Automatic Clearing House
The Bank of Ghana is introducing Codeline Cheque
Truncation to allow very fast cheque clearing as well as
the Automated Clearing House (ACH) for the clearing
of electronic debits and credits. The process of direct
debit does not exist presently in Ghana because of the
absence of an ACH.
Central Securities Depository
The Bank of Ghana has established a Central Securities
Depository (CSD). The CSD makes it possible for records
of ownership of individual securities to be maintained
centrally as well as at the respective primary dealers.
This should reduce the risks to investors that arise from
possible poor record-keeping or any dealer malfeasance.
Ghana Interbank Payment and Settle-
ment System
The Ghana Interbank Payments and Settlement System
(GHIPSS) is a limited liability company set up to
bring all the various aspects of the payments system
infrastructure under a single entity. This is to allow more
efficient and coherent management and oversight. The
business of GHIPSS includes the following:
National Switch and Smart Card Services •
Cheque Clearing •
Codeline Cheque Truncation •
Real Time Gross Settlement System (RTGS) •
Central Securities Depository(CSD) •
Automated Clearing House (ACH) •
All banks are required to be members of GHIPSS either
directly or through member banks. This means that all
banks have to be members of the national switch and
smartcard, ACH, RTGS, etc.
23
Credit Reporting Act
The Credit Reporting Act (Act 726) has been enacted in
2007 to enhance credit risk management by the banking
system. The purpose of the Act is to provide a legal and
regulatory framework for credit reporting in Ghana. As at
the end of 2009, two credit bureaus had been licensed to
begin operation.
Other Key Issues
Several bills have already been passed or are in the
process of being prepared. These include the Anti-
Money Laundering Bill, the Credit Union Bill, the
Insurance Bill, and a new Insolvency Bill (Bankruptcy
law). Work is also ongoing regarding the Borrowers and
Lenders bill and a new Non-Bank Financial Intermediaries
(NBFI) bill which were expected to be passed in 2008.
These reforms when implemented would represent a
major transformation of the financial services sector. The
Passage of the Banking Amendment Act, 2007 resulted
in the issue of the first offshore banking license to
Barclays Bank.
Capital Markets
Investor confidence in Ghana’s capital market has been
on the rise over the past decade. Currently, there are
about 27 listed companies, 10 brokerage firms, 5 mutual
funds and 1 unit trust company on the Ghana Stock
Exchange (GSE). A level playing ground has been set
by the Securities and Exchange Commission (SEC) to
protect the interest of investors and all other parties.
Demutualization
The objective to demutualize the Ghana Stock Exchange
(GSE) stems from the current structural constraints that
are faced by the GSE as a non-profit organization.
Demutualizing GSE is aimed at fostering greater diversity
of ownership which will allow for an enhanced public
representation in the governance of the Exchange as well
as remain competitive and responsive to the demands of
its market constituents.
The strategic plan for the demutualization of the
GSE was completed in 2009 and the final report was
submitted to GSE for review and finalization.
Automation
Activities towards automation commenced in 2007. In
this light, the GSE Securities Depository Company
Limited was incorporated and commenced operation
in November 2008. About 37,000 accounts had been
opened in the depository as at the end of 2009 and
migration of shares is still ongoing.
With the GSE now resourced, ATS, the Electronic
Clearing/Settlement and the Depository system which
went live in November 2008, dealers now have access
to trading from the Exchange’s Trading Floor; the offices
of Dealers; and through a secured internet facility at any
location.
The automation of the trading platform has huge
prospect in enhancing the liquidity on the market as well
as improve trading on the Exchange. Also it is expected
that the automation system will also enhance the bond
market which is gradually gathering momentum as well
as GSE’s move to develop a program that will help lure
SMEs to list on the Exchange.
Energy Sector
MInistry of Energy
P. O. Box T40
Stadium Post Office
Accra-Ghana
Energy Commission
Location
FREMA House Plot 40, Spintex Rd.
P.M. B. Ministries, Accra - Ghana
Telephone: (+233) 302 813 756/7
E-mail: [email protected]
The energy sector plays a pivotal role in the development
agenda of the country. With the advent of the post-
colonial era, the energy sector was envisioned to be a
major driving force in the transformation of the economy
from one largely sustained on the wheels of subsistence
farming to one that is fully industrialized. This began with
the construction of the hydro-electric dam at Akosombo,
a major initiative by the then CPP government which
opened up the economy and the energy sector in
particular to the exploitation of the power-generating
potential of the country. Subsequently, other forms of
energy have been tapped including renewable, nuclear
energy and fossil fuels.
In this light, government’s overall goal for the sector
has been to develop and sustain an efficient and viable
energy sector that provides secure, safe and reliable
supply of energy to meet Ghana’s development needs
in a competitive manner. This is to assure a universal
access and choice of modern energy forms to all
24
Ghanaians without exception thereby contributing
significantly to national revenue and economic growth
by becoming a net exporter of oil and power by 2012 and
2013 respectively.
Thus, Ghana’s energy sector can be classified into power
and petroleum sub-sectors.
Power Generation
Traditionally, wood fuel continues to provide a significant
source of energy to many households in Ghana,
consisting of about 70% of Ghana’s energy consumption.
This consumption level has engendered the creation of
sustainable energy development in the country through
proper management and the use of an alternative to
wood charcoal through the use of bamboo. However,
Ghana’s power supply sources are mainly from hydro-
electricity, thermal from light crude oil and a small
percentage of photo-voltaic solar.
The objective of the Government is to achieve a target
of 5,000 MW of installed power generation capacity
by 2015. This level of capacity would enable Ghana to
supply adequate electric power to meet the growth in
national electricity demand and also for export to our
neighboring countries.
In this light, Government’s outlook for 2010 is focused
on upgrading the transmission and distribution systems
while scaling up rural electrification to help ensure
increasing access to electricity by household and industry
(2010 Budget Statement).
Hydropower
Ghana has made significant strides in maximizing
its hydropower potential which is pegged at about
4,000 megawatts. Aside of the construction works
on the 400 megawatts Bui Hydroelectric Project, the
Government of Ghana has also signed a Memorandum
of Understanding (MOU) with the Brazilian Government
for the development of Juale River and Pwalugu hydro
power plants at the cost of US$555 million with a
generating capacity of 87MW and 48 MW respectively.
The construction of the hydro-dams forms part of the
planned system generation expansion under the Energy
Commission’s Strategic National Energy Plan-SNEP-
covering the period between 2006 and 2020. This also
includes the construction of the 93MW Hemang
hydroelectric power dam which is expected to be
completed by 2015.
Upon completion of all the power plants under
construction, the country’s total installed power
generation capacity would reach 3,500 megawatts by
2013. Currently, electricity consumption in the country
is estimated at 7,095 billion kilowatt hours (kWh), while
production capacity is pegged at 6,489 billion kWh.
The demand for power consumption in the country is
expected to grow at 7.6% over the next five years.
The policy objectives of the expansion program are to
ensure security of electricity supply, minimum negative
environmental impacts in electricity supply and to ensure
universal access to affordable electricity service.
Renewables
Ghana has a huge potential for electricity generation from
renewable energy sources such as solar, wind, biomass
and small hydro. To maximize this, steps are being
taken by Government to provide the necessary legal
basis for the rapid development of renewable energy
in the national energy mix by establishing a Renewable
Energy Law as part of meeting the objective of security
of supply of energy. Also, a combination of technical
and regulatory instruments will be enshrined in the law
to compel utility companies to procure a predetermined
percentage of their electricity supplies from renewable
energy sources. To consolidate its search for strategic
energy solutions, government facilitated the preparation
of a training manual for Solar PV testing, installation and
maintenance.
To further build capacity, Government also facilitated the
development of training and testing materials and testing
facilities in Tamale Polytechnic and Kwame Nkrumah
University of Science and Technology (KNUST) for human
resource development in Solar PV.
In addition, Government played a major role in the
signing of a protocol on off-grid solar electrification
for security outposts, schools and health centers. An
operational manual for providing matching grants to
support renewable services by the private sector was
also developed and Solar PV systems installed in 75 rural
health posts.
Going forward, the Government of Ghana envisions to
further promote renewable energy technologies (solar,
wind and mini hydro), solar electrification project in
schools, security service and health centers. In addition,
Government will continue training on solar PV systems
as well as implement grid-connected solar PV and wind
systems, rehabilitate grid-connected solar system and
develop licensing and monitoring framework for the
electricity industry.
25
Thermal Power
The inclusion of thermal power in Ghana’s energy mix has
been further boosted with two new plants in Tema. The
126 megawatts Tema Thermal 1 Power Project (TT1PP)
is now fully operational after being commissioned in
2009. Other ongoing activities include the installation of
49.5 megawatts Tema Thermal 2 Power Project (TT2PP)
which is 95% complete. This adds to TAPCO- Takoradi I
(330MW) and TICO- Takoradi II (220KW).
In January 2010, expansion works commenced on the
Takoradi Thermal Power Plant at Aboadze in the Shama
District of the Western Region. The 132-megawatt
capacity combined cycle plant will consist of four gas
turbines, four heat recovery steam generators and two
steam turbines. The gas turbines will run on light oil,
diesel oil and natural gas.
Also, a Memorandum of Understanding has been
concluded with TAQA to carry out the expansion of the
Takoradi International Company (TICO) power plant from
220 MW simple- cycle plant to a combined-cycle plant of
330 MW.
The 80 megawatt Mines Reserve Power Plant, which was
constructed at a cost of more than US$45 million in June
2007, has been made available to the VRA to supplement
any energy generation shortfalls in the country. This was
previously used by four mining companies (Newmont
Ghana Limited, Goldfields Ghana, Anglogold-Ashanti, and
Golden Star Resources) only in load-shedding situations.
The 126MW Emergency Diesel Power Units which were
purchased by Government were largely unused owing
to high cost of operation. Additionally, work is soon to
commence on the 132MW combined-cycle power project
which will be sited near the VRA Thermal Power Plant in
Aboadze.
Osagyefo Power Barge
The refurbished Osagyefo Power Barge adds to energy
generation mix of the country. This was carried out
by Balkan Energy Company LLC, a US-based Energy
Company which partnered the Government of Ghana to
operationalize the Osagyefo power barge. Balkan Energy
entered into a 20-year agreement with the government
of Ghana to run the barge and it is expected that Balkan
Energy would convert the barge into a combined cycle
power plant with an incremental capacity of 60MW at a
cost of about $100 million. The company would also pay
the Government of Ghana a yearly lease of $10 million
from the beginning of the 6th year to the 12th year. The
agreement will be reviewed every five years.
This project aims to augment the Akosombo and Kpong
Hydro-electric Power Plants as well as the Aboadze
Power Plant and a few others as a means to address the
power challenges of the country. The barge, which is
expected to generate 185 megawatts of power, is a dual
fired unit which can operate on diesel as well as natural
gas.
Private Sector Initiatives in the Energy
Sector
The current regime of power production is receiving an
active involvement of Independent Power Producers
(IPP). The Asogli Power Plant, for instance, which is a full
private sector financed power plant of 200 MW capacity,
has been completed and awaiting the availability of
natural gas to commence operation. On the expansion
of Tema Thermal Power Plant, VRA has concluded an
agreement with Tema Osonor Power Company, an
Independent Power Producer (IPP) to expand the plant
by 126 MW and ultimately into a combined-cycle facility
with a total capacity of about 330 MW.
Beyond the existing plants, a total of 1,611.5 MW of
capacity is currently under construction by Government
and Independent Power Producers while other plans have
been initiated to increase power generation capacity in
the country.
Upstream Oil and Gas Prospects
Ghana’s oil and gas prospects are significant. It is
believed that Ghana’s oil and gas resources stretches
across the country’s shoreline from the west (Cape Three
Points) to the east (Keta). Similarly, the Voltain Basin,
which covers over 40% of the country’s land mass,
is believed to have oil and gas reserves. This Voltain
Basin is yet to be fully explored and will be given priority
attention during the medium period.
Recent appraisals completed on three of the discoveries
in the Jubilee Field, which is made up of two blocs,
indicate that the field contains expected recoverable
reserves of about 800 million barrels of light crude oil,
with an upside potential of about 3 billion barrels.
The Jubilee Field will be developed in phases with
the aim of ensuring that gas is not flared. The first
oil production was started in 2011 and is driven by a
production philosophy of maximizing the value of the
resource. Tullow oil an operator of the Jubilee Field
26
projected prodcution of 120 barrels per day will be
reached in early 2013. Up till May 2012, the field had
produced 33 million barrels of oil.
The discoveries have elicited great interests in Ghana’s oil
and Gas prospects. Currently, there are eleven Petroleum
Agreements operating in the country at different stages
of exploration or development. Several other prospective
oil companies have expressed interest to explore Ghana’s
sedimentary basins.
Government intends to accelerate the process of
acquisition of blocks in the Ghana sedimentary basins in
order to fully and speedily delineate the country’s oil and
gas potential.
Downstream Developments
It is the Government of Ghana’s intention to ensure
increased local refining capacity to meet both domestic
demand and exports. Currently, about 60% of domestic
demand can be met by the Tema Oil Refinery (TOR). To
bring refining capacity to acceptable levels, there is the
need to expand the capacity of TOR and also improve
its operations. About US$300 million is needed to be
invested in TOR to increase its capacity by about 100,000
barrels per stream day from its current level of 45,000
BSPD.
About US$683.5 million is to be injected into the
operations of the Bulk Oil Storage and Transportation
Company Limited (BOST), in the medium term period
up to 2015, to improve bulk transportation of petroleum
products especially to the northern parts of the country.
Government intends to encourage the Oil Marketing
Companies (OMCs) to increase the number of petroleum
products service stations to ensure improved access
to petroleum products in the country. The current
administration of Premix fuel is being reviewed.
Government will continue to encourage the development
of bio-fuels, as an alternative transportation fuel.
Institutional Development:
Establishment of Petroleum
Regulatory Authority
The draft Bill to regulate the upstream petroleum industry
is being reviewed with the view to reducing redundancies
and further giving effect to the intention to consolidate
the activities of the numerous regulatory agencies
existing in the energy sector. It is believed that a smaller
number of regulatory agencies is needed to manage
the sector in order to ensure efficient and coordinated
operation and enforcement of regulations.
Investments in the Energy Sector
It is estimated that, about US$9.0 Billion is required in
the next five years to finance the numerous initiatives in
the energy sector, including oil and gas activities which
alone require over US$5.5 Billion. While Government will
continue to inject funding into the sector, when available,
a major policy shift is to encourage the energy sector
institutions to raise a substantial portion of their capital
investment requirements on their own without recourse
to Government. Government has therefore requested the
sector agencies, particularly VRA, Ghana Grid Company
(GRIDCO), Electricity Company of Ghana (ECG) and Tema
Oil Refinery, to raise financing from commercial loans
and other private sector financing arrangements and also
via the Ghana Stock Exchange.
Information Communication and
Technology (ICT)
Sector Overview
The ICT Industry comprises telecommunications
operators, internet service providers, VSAT data
operators, software manufacturers, broadcast
institutions, ICT education providers, internet cafés,
etc. Generally, the Ministry of Communications and
the National Communications Authority (NCA) oversee
activities in the sector which have established the
necessary legal and regulatory framework which
guarantees the safety of investments in the ICT industry.
Accra lies at the heart of the ICT industry as it hosts
the headquarters and branches of the ICT companies
associated infrastructure and support companies.
Ghana has been recognized as an attractive destination
for Business Processing Outsourcing (BPO) and was
ranked the No. 1 destination in Sub-Saharan Africa (ahead
of Mauritius and Senegal) and No. 15 globally out of
50 countries by the 2009 A.T. Kearney Global Services
Location Index (GSLI).
The infrastructural base of the sector includes licensed
gateway operators, SAT-3 Access, Private Licensed VSAT
Systems, Fixed Wired Line Networks, Wireless Mobile
Operators, Public telephones systems, Telecentres,
Dedicated Transmission Networks, Public Distribution
Networks (cable, TV, DSL, etc), Internet Service
Providers, Internet Backbone Connectivity throughout
27
the Country and Public Access Point and Broadcasting
Systems. As an initiative to support emerging
technologies, the Ministry of Communications is also
facilitating the establishment of Science and Technology
Parks.
The Market
As at December 2011, the telecommunications sub-
sector had 2 fixed line operators plus 6 mobile cellular
operators authorized to operate. Out of 165 Internet
Services Providers (ISPs) authorized, 29 were in
operation. The Sector also witnessed 13 DTH satellite
Service providers, 176 Data Operators, 99 Public/
Corporate Data operators, 140 FM stations and 32 TV
Stations having authorizations to operate with 8, 29,
25, 84 and 13 of them respectively actually being in
operation.
No. of authorized operators
Source: GIPC
Market Trends
Ghana is set to be a major player in the African ICT sector
in the next five years, according to a survey conducted
by the Africa Business Panel. The survey ranks Ghana at
number 4 on the continent after South Africa, Nigeria and
Kenya.
The market continues to grow aggressively in all
segments, particularly in the telephony sector with
mobile penetration rate increasing rapidly. Internet usage
has also increased though connectivity is expensive.
Investment Opportunities
There are considerable investment opportunities in
the ICT sector. The sector requires service providers in
connecting international voice calls to the local public
network. Internet Service Providers are also required to
offer internet access to the public especially the rural
areas at less cost and broadcasting operators to establish
Radio and Television broadcasting in the country.
There is also a lack of ICT facilities and Infrastructure on
a broad scale across the nation. Investments are needed
in the provision of software for the country, extension of
the broadband network to reach the whole country and
to provide computer access to rural students.
Technological and other support related services such as
the supply of quality telecommunications equipment, ICT
Equipment and Office and Network Equipment present
opportunities to an investor. There are also opportunities
in the following areas:
Education in the area of software development, •
networking, VSAT, telecommunication and IT
Engineering
Provision of Business Solutions (software and •
networking services)
Business Processing Outsourcing •
Supply of High-Tech Telecommunication Equipment •
Back Office Operations ( especially for the Financial •
Institutions)
Provision of Broadband Facilities and Services •
Internet Service Provision Service •
Transaction Processing •
Manufacturing, assembling and supply of computers •
and accessories
VSAT services •
E-commerce and Legal Database Services •
Logistics Management Services and Medical •
Transcription Services
Real Estate Development
Real Estate and Construction
Ministry of Water Resources, Works and Housing
P. O. Box M43, Ministries
Accra, Ghana
Tel.: +233 302 673701
Fax: +233 302 673882
Email: [email protected]
Website: www.water-mwrwh.com
Ghana Real Estate Developers Association
Post: P. O. Box TF 113
Trade Fair Site
Accra - Ghana
Tel.: +233 302 782 531, +233 24 4318288,
Email: [email protected]
Website: www.gredaghana.org
The Ghanaian real estate market has seen significant
28
expansion due to the rapid growth of the Ghanaian
economy and the influx of foreign investors into the
country. Demand for various types of properties is on
the increase and there are high prospects for companies
already operating in the industry as well as those seeking
to enter the industry. Immense opportunities exist in
the construction of residential houses, industrial and
commercial houses as well as shopping centers, hotels
and hostels for tertiary institutions.
Industry Structure
The real estate industry consists of residential,
commercial, industrial and recreational properties.
Commercial properties include hotels, office buildings,
conference facilities, and retail space. The industry is
currently dominated by residential and commercial
properties with the residential property market being
the most active. The industrial property market is
significantly smaller in size than the commercial propety
market, while recreational properties are the smallest
segment. The residential and commercial markets are
dominated by private companies, which control over 90%
of property holdings.
Residential Properties
Formal housing supply has traditionally been the role of
the Government of Ghana through major competitive
providers like State Housing Corporation (SHC), Tema
Development Corporation (TDC) and Social Security and
National Insurance Trust (SSNIT). SHC and SSNIT have
concentrated on providing blocks of flats in regional
capitals such as Accra, Cape Coast and Takoradi. TDC
is basically involved in site servicing and facilitating
residential development.
In seeking to boost housing supply, the Government
of Ghana is pursuing various programs such as the
affordable housing program initiated in 2005, to build over
100,000 thousand units of affordable housing through
Private, Public Partnerships (PPP) across the country.
Government’s efforts are being complemented by
individual households and real estate developers that are
providing residential housing to meet the high demand.
The government has also entered into a public-private
partnership arrangement with HFC Bank Limited to
construct 200,000 low-income housing units nation-wide
over the next five years.
Affordable Housing Project
The demand for housing units is mostly concentrated
within the Accra-Tema metropolis. The development
of new housing estates is being spearheaded by the
Ghana Real Estate Developers Association (GREDA),
an umbrella organization of loosely associated private
real estate developers. The top five GREDA companies
that account for roughly 75% of the group’s residential
property development are Regimanuel Gray, Parakuo
Estates, NTHC Properties Ltd, ACP Estates Ltd, and
Manet Housing Company Ltd.
The priority of the government in the housing sector is
the provision of affordable houses for the middle and
lower income earners who form a greater percentage
of those in need of houses. This policy is evidenced by
the 2011 National Budget which abolished the five (5)
years tax exemption hitherto granted to those in the real
estate development and now limiting it to only those
who partner with the Ministry of Works and Housing to
provide affordable houses.
Commercial Properties
Demand for commercial properties in Ghana has
increased substantially over the past decade due to the
growing presence of foreign and multinational companies
seeking investment opportunities in the country.
Estate developers are actively building multi-purpose
commercial properties to meet the ever-growing demand.
Many owners of residential property in prime areas of
Accra are converting or remodeling their properties into
new commercial developments. Prime commercial areas
and streets in Accra are Accra Central Business District,
Airport Commercial Area, Asylum Down, Osu, Kwame
Nkrumah Avenue, Kojo-Thompson Road, Independence
Avenue, Spintex Road, Liberation Road, Ring Road
Central, and Cantonments Road (Oxford Street). There
is also demand for property in Takoradi in the Western
Region as interested stakeholders in the oil industry seek
accommodation for residential and office purposes.
Industrial Properties
The development of the industrial property market
in Ghana has been slow as there is a decline in
manufacturing and an increase in importation of finished
products into the country. The industrial property market
consists mainly of factories and warehouses for rent or
sale and is restricted to the North and South Industrial
areas in Kaneshie, Spintex Industrial area, and Tema
Industrial area.
29
Recreational Properties
Recreational developments are built by private
entrepreneurs interested in running the complex
themselves. The Government of Ghana also owns
cultural properties in all the regions to promote tourism.
Predominant amongst these properties are the Accra Art
Centre and the Centers for National Culture.
Construction Finance
With the stable economic environment, there is now
easy access to debt finance for construction in Ghana.
Financial institutions involved in construction finance
have no standardized lending conditions for applicants.
Each development is considered on its own merit and
depending on the risks associated with the project, the
institution grants the terms of lending. Barclays Bank
Ghana, National Investment Bank, Bank of Africa and
HFC Bank are some of the banks offering construction
finance in Ghana.
Home Purchase Finance (Mortgage
Market)
The stable macroeconomic environment in Ghana
has resulted in the gradually growth in the mortgage
market in the country. Funds are now available at
competitive cost and pricing, enabling people to afford
decent housing. Most prominent mortgage lenders in
the country include HFC Bank and Ghana Home Loans,
although other universal banks like Fidelity Bank, Barclays
Bank, UBA and Ecobank are also offering such products.
Tourism
Ghana Tourism Authority
Head Office
No. 2 2nd Avenue
South Ridge
P.O. Box GP3106
Accra
Tel: +233 302 682601/682607/682608
Fax: +233 302 682510
Ghana is fast becoming a leading destination for tourists
in Africa and tourism is rated as one of the highest
foreign exchange earners in the country. Efforts are
under way by the government through the Ministry of
Tourism and the Ghana Tourist Board to develop and
support the effective management of the industry to
become a major source of foreign exchange and revenue
for the development of the country.
The country boasts of historical sites, including forts
and castles, cultural monuments, craft villages, beautiful
nature parks and gardens, and sandy beaches that make
it a unique destination for the international tourists to
Africa. Ghana’s greatest asset is its people who are
renowned the world over for their warmth, cheerfulness,
and hospitality.
Festivals
Each year, festivals and durbars are held in various parts
of Ghana, to celebrate the heritage and culture of the
people. Several rites and rituals are performed and
most of the celebrations are attended by entire villages
and are strictly observed by the traditional elders of the
respective ethic groups. Some major festivals include
Akwasidae by the Ashantis, Homowo by the Gas,
Hogbetsotso by the Ewes, Damba by the Northerners
and Aboakyir by the people of Winneba.
Forts and Castles
Forts and castles dotted along Ghana’s coastlines were
built and occupied at different times by the traders from
Europe, Portugal, Spain, Denmark, Sweden, Holland,
Germany and date back to the 15th Century. Most of the
castles and forts have been restored and are open to the
public. The major ones include Cape Coast and Elmina
Castles in the Central Region, Christianborg and Fort
Castle in Accra.
Museums and other Attractions
Ghana is home to various art and craft centers and
museums. Among the attractions are the National
Museum which has a display of exhibits that reflect the
heritage of the country, the National Theatre with its
distinct modern architecture, the Independence Square,
the Kwame Nkrumah Mausoleum which is the final
resting place of the first president of Ghana, Dr. Kwame
Nkrumah, the Accra International Conference Centre,
Ghana Academy of Arts and Science and the National
Archives of Ghana.
Beaches and Lake Resorts
Ghana faces the Atlantic Ocean and has hundreds of
kilometers of fascinating beaches in the Greater Accra,
Central, Volta and Western Regions. Most beaches in
the country are open to the general public and with their
tropical climate and beautiful environmental conditions,
30
they are ideal for tourists to relax. Major beach
destinations include Labadi Beach, Coco Beach and the
Kokrobite Beach, in Accra; Winneba Beach, Elmina Beach,
Anomabo Beach and Gumoa Fetteh Beach in the Central
region, Busua Pleasure beach, Princess town Beach
and Miami Beach in the Western region; Keta Beach
in the Volta region and Ada Beach in the Greater Accra
region. Some of the popular beach resorts in Ghana are
Coconut Grove Beach Resort, Biriwa Beach resort, Next
Door Beach Resort, White Sands Beach Resort, Tills No 1
Beach resort and Ada Manta Paradise Beach resort.
National Parks and Gardens
Ghana boasts of a number of national parks and gardens
which are a store of spectacular wildlife and exotic plant
life. The most visited ones which include The Kakum
National Park in Cape Coast has a canopy walkway for
obtaining a delightful view of the surrounding tropical
rainforest, elephants, monkeys and other tropical
species. The Aburi Gardens on the Akwapim ridge in the
Eastern region is a peaceful and fascinating place with
a diverse range of plant species. The Mole National
Park at Damongo in the Northern Region provides
an adventurous environment for visitors. It is home
to a large number of different elephants, antelopes,
waterbucks, hartebeests, buffalo, amphibians, reptiles
and bird species, Digya National Park on the central
shores of the Volta Lake, is largely savannah woodland
and it is home to mammals including elephant, buffalo,
water buck, hartebeest, bush pig, baboons, crocodiles
and five other species of monkeys.
Other Tourist Attractions
Other popular tourist attractions include Boabeng-Fiema
Monkey Sanctuary in the Brong Ahafo region with
more than 500 mona and 200 geoffrey’s pied columbus
monkeys which live with the people of the area, Tafi
Monkey Sanctuary, in the Volta region, where the tropical
forest is home to endangered, playful mona and patas
monkeys.
One of the frequently visited tourist attractions in Ghana
is the Larabanga Mosque in Tamale. It is believed to
be one of the oldest mosques in West Africa and is the
oldest mosque in Ghana.
Lodges and Hotels
Ghana has several forms of accommodation, ranging
from five star hotels to homestays. These are of good
quality and can be located in all capitals, districts and
towns in the country. Five star, four star and three star
hotels can be located in the Airport area, Osu, Roman
Ridge, Labadi and Central Accra. Accommodation
facilites of international standards can be found at popular
beach destinations such as Ada Foah, Gomoa Fetteh,
Elmina, Axim and Busua.
Water Falls
Ghana has scenic waterfalls in attractive rural and forest
settings along the coastal regions of the country. These
waterfalls are covered by green vegetation and provide
scenes of the beauty of nature. Some of the waterfalls
have cages forming at their sides whiles other falls
consist of series of falls and provide ideal ground for
picnics. There are also seasonal waterfalls at Alambo
and Likpe Todome in the Volta region. Some popular
waterfalls in Ghana and their location are listed below:
Name of Waterfall Location
Tagbo Falls Volta Region
Tsatsadu Falls Volta Region
Boti Falls Eastern Region
Begoro Waterfalls Eastern Region
Fuller Falls Brong Ahafo Region
Kintampo Waterfalls Brong Ahafo Region
Tsenku Waterfalls Eastern Region
Wli Falls Volta Region
Popular waterfalls in Ghana and their location
31
Potential of the 10 regions
32
The Ashanti Region
The dominant economic activity in the region is
agriculture. Other activities undertaken include mining,
timber processing and industry. Cocoa is the most
important export crop grown in the region and cotton
production is concentrated in the savanna and transitional
zones mainly around Ejura, Nsuta, Kwamang and
Afrancho. Bast fibre is produced in significant quantities
at Mampong, Ejura, Kofiase, Adidwan, Aframso and
Amanten. Oil palm is grown all over the southern sector
of the forest zone with concentrations in the Amansie,
Asante-Akim, Adansi and Ejisu - Juaben districts. Food
crops grown include maize, plantain, cocoyam, cassava,
yam, groundnuts and vegetables.
Gold, which is the next major foreign exchange earner
after cocoa, is mined at Obuasi which is the largest
and richest gold mine in the country. Although it has
been mined for several years, it is still believed to have
large reserves. Other deposits are found at Konongo-
Benemase, Attonsu, Kwakwakwa. Ntronang, Bilpraw and
Akrokerri- Mampamhwe. There are deposits of bauxite
at Nyinahin and diamonds and clay in various parts of the
region.
The Eastern Region
The dominant economic activity in this region is
agriculture. Other activities undertaken include petty
trading, inland fishing and mining. Crop and livestock
production are the main activities found in most rural
communities of the region. There are also commercial
farms producing pineapples, colanut, cocoa, coffee and
oil palm for large-scale for export. Towns and villages
dotted along the Volta Lake undertake canoe fishing for a
living.
Industrial establishments are located in various towns
in the region. The factories produce pharmaceutical
products, lumber, poultry feeds, alcoholic beverages,
furniture, textiles and other hardwares.
Diamond is mined at Akwatia in the Birim South district.
Diamond mining at Akwatia attracted many settlers to
Oda, Akwatia and the surrounding villages, a situation,
which has contributed to the rapid development of the
area. The consolidated Diamond Mines at Akwatia has
become a tourist attraction.
The Brong Ahafo Region
Agriculture is the main economic activity in the region.
The region has a total cultivable land area of 30,400
square kilometers out of which 3,706 square kilometers
is planted with cocoa. About 71% of the region’s
population is concentrated in farming. Crops grown
include plantain, oil palm, maize and oranges.
Industrialization is expanding with the extension of hydro-
electric power to the region. Presently, notable industries
include: Mim Timber Company and Scanstyle Limited
both based at Mim, which produce semi-processed wood
products for export; Wenchi Tomato Factory; a stone
quarry at Buoku; brick and tile factories at Adantia and
Tanoso; and numerous sawmills scattered all over the
region
The Central Region
The economy of the Central Region rests largely on a
small-holder, more or less traditional agriculture, inland
and small-scale fisheries and related activities along the
coast.
The United Nations Development Program’s (UNDP)
assistance was sought to accelerate the development
of the region and this led to a proposal for Tourism (as
lead sector), urban & rural environment and enterprise
development.
The tourism development component involves
investments in various areas of tourism development
including conservation of the region’s vast cultural
and historical assets and sites, i.e. conservation and
rehabilitation of forts, castles and monuments, the
establishment of a unique game park at Kakum and Assin
Attandanso that will conserve the tropical rain forest
environment and rare wildlife conservation for tourism
and travel industry development.
The development program includes the rehabilitation of
Elmina / Mumford Jetty and boat sanctuary, improved
facilities for fish handling, curing and processing, a
marine stock research centre at the University of Cape
Coast (UCC) and the construction of ice-making and
freezing facilities. Promotion of fishing and export of
exotic fish products and pilot scheme for shrimp, lobster
and squid farming are also aspects of the UNESCO
assisted development scheme.
Other projects include expansion of tree crop farming
(fruits for export and to support tourism industry, agro-
forestry), creation of farmers services companies and
small-holder salt production scheme.
The urban/rural renewal component covers improvements
33
to coastal and tourism towns and general rehabilitation
of basic services including waste management. Those
under enterprise development component involve
support for the region’s Intermediate Technology Transfer
Unit (ITTU) to support the expansion of the informal
sector’s chain of micro-entrepreneurs, small-scale salt
and allied chemical production, Kaolin and allied products,
small-scale gold mining and the establishment of palm
oil/kernel refinery.
Consequent to the approval of these proposals, the
Government and the UNDP have signed the projects
document and implementation of the development plan
will soon take off.
The Greater Accra Region
The location of Accra and Tema in the region has made
Greater Accra the industrial center of the country. The
region boasts of more than 200 major manufacturing
industrial establishments employing some 22,060
persons. Most of these establishments including an oil
refinery are located in Accra and Tema. For this reason,
the region consumes about 46.5% out of the total
electricity generated in the whole country. Accra and
Tema also are the largest market area for the country’s
manufactured products.
The location of the country’s largest port at Tema,
the relatively well developed infrastructure and good
industrial atmosphere within Accra and Tema have
undoubtedly helped to increase the growth of industrial
establishments in the region.
Fishing plays a major part in the region’s economy. There
are about 30,000 fishermen in the region a third of the
total number of fishermen in the country. Among the
main fishing villages are Ada, Loi , Pute, Azianya, Accra,
Teshie, Nungua, Tema, Kpone, Prampram, Bortianor,
Ningo and Ahwiam. The commonest fish in the region
are trigger, sole spade, cassava, burrito, sardine and
seabream.
Fishing is controlled by the small-scale canoe fishermen,
notwithstanding the construction of the fishing
harbor in Tema and the emergence of such big fishing
establishments as Mankoadze, State Fishing Corporation,
Ocean Fisheries, Kaleawo Enterprize and Afko Fisheries.
Farming is a major economic activity of the rural areas
of the region. Apart from the small-scale farms held by
individual families, there are some 20 commercial crop
farms and 25 livestock farms. The main crops grown in
the region are cassava, maize, groundnuts, vegetables,
beans, cowpeas, coconut, pineapples, onions and
shallots.
The region is among the few in the country where
livestock is reared because the vegetation is mainly
grassland and less infested by tsetse flies. Cattle is
,therefore, reared in settlements around Agortor, Dawa,
Afienya, Moble, Gbecheli, Katamanso, etc, in the central
part of the region. There are, however, a few commercial
ranches like the Bank of Ghana Cattle Ranch at Shai Hills
and Sam & Sam Farms. The breed mostly reared is West
African short-horn type which is small, hardy, resistant to
ticks and drought, but takes six years to reach maturity.
The rest of the livestock farming are mostly poultry,
sheep and goats.
The Northern Region
Farming is the main occupation of about 70% of the
people in the region. Among the crops grown are maize,
rice, sorghum, yams, tomatoes and cotton and tree
crops such as sheanut, and kapok. Rice is cultivated
mainly in Walewale, Tamale, Damongo, Salaga and
Yendi. Groundnut is cultivated extensively around
Tamale, Bimbilla, Yendi and Walewale. Guinea corn is
also grown extensively in the region. The cultivation of
rice and groundnut is mostly done on commercial basis.
Livestock rearing in the region forms an important part of
the economic activity of the area. Industry is agro-based
in the form of processing agricultural produce such as
groundnuts into edible oil and sheanut into shea-butter.
Several rice mills operate in the area. Non-agro industries
are minimal in the region, mainly due to the poor mineral
resource base of the area.
Feasibility studies indicate the availability of high
quality limestone deposits at Bog-Da near Gambaga
and Buipe which can be used in the manufacture of
Portland cement. Sheini in the Zabzugu-Tatale District
is also noted to have iron ore deposits. There are also
substantial deposits of clay at Kukuo, Yong, Nabari,
Kpaligu and Bewna. Bricks made from this clay are said
to be suitable for the climatic conditions of the north.
Places of interest abound in the Northern Region and so
are many customary and cultural practices. The Regional
Centre for National Culture at Tamale and its craft shops,
as well as the weaving industry at Jekarayili are some
of the attractions for tourists. Handicrafts are a popular
occupation of the people. Weaving, carving, tanning and
pottery are still done using age-old traditional methods.
The waterfalls of Dung and Nankpanduri are year-long
attractions while the Greenwich Meridian runs through
34
Yendi. The Mole –Game Reserve and the Larbanga
Mosque are some of the tourist attractions in the region.
The Upper East Region
The region is predominantly agricultural with about
70% of the economically active population engaged
in livestock rearing, farming or fishing. Food crops
cultivated are rice, millet, sorghum and groundnuts.
Areas with the greatest potential for agricultural
development are the Gbedemblisi and Wiesi valleys.
The valleys are the “rice bowl” of the region with high
potential also for the cultivation of cotton, groundnuts
and legumes.
The region has two big irrigation projects located at
Tono and Vea with developed areas covering 2,490
hectares and 850 hectares respectively. Crops grown
include paddy rice, tomatoes, onions, millet, groundnuts,
sorghum and maize. There are other 172 dams and
dugouts scattered over the region.
Having predominantly savanna vegetation, the region
possesses the basic natural requirements for livestock
and poultry production. The region produces about 25%
of the nation’s cattle herd and a sizeable percentage of
sheep and goats.
The three major manufacturing establishments in the
region are the Tomato Canning Factory at Pwalugu, the
Meat Processing Factory at Zuarungu and the Rice Mill in
Bolgatanga. There is also a stone quarry at Pwalugu and
a granite and marble factory at Tongo. On a smaller scale,
the inhabitants undertake smock weaving, leatherwork,
pottery, and sheabutter and groundnut oil extraction.
The Upper West Region
Over 80 % of the population is engaged in subsistence
agriculture with staples such as guinea-corn, millet, rice,
yams, beans, groundnuts, and cowpea.
At present, about 80% of total production is consumed
locally while guinea-corn and beans are exported to
other parts of the country. Cotton and sheanut mainly
produced by the peasant farmers constitute the major
cash crops of the region. The Upper West Region alone
produces 40% of the nation’s total cotton output whilst
in the sheanut industry; this region and the Northern
Region are the major producers of shea butter with over
22 purchasing centers. The savannah vegetation which
is congenial to animal husbandry places the region in a
good position to produce cattle, goats, sheep and poultry.
There are a number of local industries such as pottery,
shea butter processing, groundnut oil extraction, soap-
making, cloth and smock weaving.
The Volta Region
The economy of the region depends on agriculture which
provides employment for over 60% of the inhabitants.
The major food crops are cassava, maize, rice and yam.
The region leads in the production of cassava and is the
third largest producer of maize, next to Brong-Ahafo
and Ashanti. It is second to the Northern Region in yam
production, while remaining unrivalled in the production
of shallots.
Commercial crops are cocoa, coffee, cotton, sugar-cane,
citrus fruits and pineapple. The region contributes 13%
of Ghana’s marine catch and 75 % of fresh water catch.
Special catches for which the region is famous are
anchovies, shrimps and oysters.
The Western Region
About 51.1% of the population in the region is engaged
in the agricultural sector where the soil types are suitable
for a wide range of crops notably cocoa, coffee, rubber,
oil palm, citrus, coconut, rice, cocoyam, plantain, cassava
and vegetables. The region is the leading producer of
cocoa in the country. Another agricultural activity in the
region is fishing, with an average annual total catch of
about 49 metric tons. Locating the oil rig off Cape Three
Points and the embargo on fishing within the confines of
the rig may have adverse effects on the fishing industry.
The concentration of high forest in the region is the basis
for the corresponding high production of timber and
timber products. Indeed, the region is the leader in the
timber industry, producing about 42% of Ghana’s annual
output.
The region is one of the three most industrialized, the
other two being Greater Accra and Ashanti. The industrial
capacity of the region is due to the two strong industrial
centers, namely Sekondi-Takoradi and the mining areas
around Tarkwa and Prestea.
The major industrial establishments, with only a few
exceptions process agricultural, forest and mineral
products. Most of the industries derive a greater part of
the raw materials from the region, with a small portion
coming from outside.
Prominent among the lines of production of the
industries are cocoa and tobacco products, edible and
35
industrial palm oil, paper products, rubber tire and
tubes, cement, flour, aluminum products, furniture and
corrugated iron sheets.
The recent discovery of oil off the coast of Ghana has
made Takoradi the fastest growing city in Ghana.
36
Investment and Legal Framework
37
Why Do Business in Ghana?
The government is committed to implementing policies
that reduce the general cost of doing business in Ghana
and to promote investor confidence in the country. With
a stable multi-party government that is committed to
market liberalization, Ghana has been ranked as one of
the most attractive locations for doing business in Africa.
Other factors that make Ghana a competitive investment
destination include:
A sound macroeconomic environment •
Immediate access to all markets of the Economic •
Community of West African States (ECOWAS)
100% foreign ownership is permitted •
On-going privatization in key economic sectors •
On-going infrastructure development •
Expanding stock market •
Competitive labor force •
Availability of skilled and trainable labor •
Quota-Free access to USA & European Union •
markets.
Export-free zones where goods traded with other •
countries are exempt from customs duties and laws
Fast developing financial infrastructure •
High degree of personal safety and •
Warm and friendly people •
Starting a Business in Ghana- Process,
Time and Cost
Domestic Laws
Laws governing the establishment of business in Ghana
are in accordance with the provisions made in the
following legal legislation:
The Companies Code, 1963 (Act 179) •
The Partnership Act, 1962 (Act 152) •
The Business Name Act, 1962 (Act 151) •
The investor, whether a Ghanaian or a foreigner, who
wants to establish a resident business entity has to
register with the Registrar General’s Department(RGD)
under one of the Acts named above except where the
entity is to operate in the country as a representative
of non –resident business entity. In that case it does
not go through the process of incorporation under Act
179 but simply submits the required documents to the
Registrar who registers them in the register of External
Companies.
Investment Legislation
The legal framework for investment in Ghana is regulated
by different agencies in the economy. These are:
Registrar General’s Department •
Ghana Investment Promotion Council (GIPC) •
Ghana Immigration Service (GIS) •
Ghana Revenue Authority(GRA) •
Environmental Protection Agency (EPA) •
Ghana Free Zones Board •
Petroleum Commission •
Investment Procedures
The first step for an investor wishing to invest in Ghana
is to register with the Registrar General’s Department.
The department charges a fee of 0.5% of the company’s
stated capital. The official processing time lies between
three to five days, after which the company will receive
the certificate of incorporation and certificate to
commence business.
After incorporation, companies that are partly or fully
owned by foreigners have to register with the GIPC.
Registration is completed after companies have met
the minimum equity requirements depending on their
structure.
The required equity can be brought into Ghana either in
money or kind (goods, plant and machinery, vehicles or
other tangible assets). Money can be brought in cash or
transferred into the account of the incorporated company
at a Ghanaian commercial bank. The bank must confirm
the transfer to the Bank of Ghana, which subsequently
informs the GIPC. Documents relating to equity in kind
such as bill of lading, invoices and others which are
confirmed by the Customs Division of GRA must be
presented to GIPC.
Registrar General’s Department
The Registrar General’s Department is the organization
that registers all companies, societies and institutions
in Ghana and issues certificates of incorporation
and commencement of business to newly formed
companies.
Ghana Investment Promotion Centre
(GIPC)
Ghana Investment Promotion Centre was set up to
initiate and maintain a favorable environment for both
Ghanaian and foreign investment in Ghana. The GIPC
was established under the GIPC Act as the government
agency responsible for overseeing investments in all
sectors of the economy except mining, petroleum,
free zones and portfolio investments. Investments in
the mining and petroleum sectors are licensed by the
38
Minerals Commission and the Ministry of Mines and
Energy respectively whiles that for Export Processing
Zone and portfolio investments are administered by the
Ghana Free Zones Board and Ghana Stock Exchange
respectively.
Ghana Immigration Service
Ghana Immigration Service is the governmental authority
that grants work and/or residence permit. It also handles
re-entry visas, extension of visitor’s permit and visa on
arrival to visitors in Ghana where there is no Ghanaian
Embassy or consulate abroad.
Ghana Revenue Authority (GRA)
The Internal Revenue Service, Value Added Service (VAT)
and the Customs Excise and Preventive Service which
were separate revenue agencies, until about the last
quarter of 2010 have been merged to form a single entity,
the Ghana Revenue Authority (GRA). The Ghana Revenue
Authority has three divisions: Domestic Tax Revenue
Division, Customs Division, and the Support Services
Division.
The Customs Division is responsible for collecting
customs duties and excise whereas the Domestic Tax
Revenue Division takes care of income tax and VAT/
NHIL. The Support Services Division is responsible for
all internal functions such as finance and administration,
legal, human resource etc. Each of the three divisions
is headed by a Commissioner who reports to the
Commissioner-General.
Any investor in Ghana will necessarily have to register at
one of the GRA offices to pay one tax type or another.
Environmental Protection Agency
(EPA)
Environmental Protection Agency is in charge of issuing
the necessary environmental permits to companies
operating in environment sensitive areas of various
fields. The investor will often be required to submit an
environmental impact assessment report.
Free Zones Act
Any investor who will be producing to export at least
70% of total output can take advantage of the Free
Zones Act to get located within the Free Zone Enclaves
at Tema or Sekondi. Boankra in the Ashanti region is
being developed as a third free zone enclave. This will
be after going through the registration processes already
described above and then making an application to the
Free Zones Board to be a free zone enterprises. Some of
the privileges for free zone enterprises are the exemption
from tax of import into the free zone as well as duty
and other taxes on exports to foreign countries by free
zone enterprizes. Free zone enterprises are exempt from
corporate tax for a period of 10 years, and thereafter the
corporate tax shall not exceed a maximum of 8% of the
profit.
Depending on the field of operation of the company,
additional registration may be necessary with other
regulatory bodies.
Ghana Investment Promotion Center keeps track of
all investments in the country whiles the Free Zones
Act regulates enterprises that export at least 70% of
their produce and have been registered as free zone
enterprises.
Petroleum Commission
This is a body set up by the Petroleum Commission
Act, Act 821, to regulate and manage the utilization of
petroleum resources and to co-ordinate the policies in
relation to them.
Among others, the Petroleum Commission is to:
Recommend to the Minister national policies related •
to petroleum activities
Monitor petroleum activities and carry out the •
necessary inspection and audit related to the
activities
Receive applications and issue permits for specific •
petroleum activities as required under petroleum
laws and regulations
Promote local content and local participation in •
petroleum activities as prescribed in the Petroleum
Exploration and Production Act 1984(PNDCL 84) and
other applicable laws and regulations to strengthen
national development.etc
Ghana National Petroleum
Corporation (GNPC)
The Ghana National Petroleum Corporation was
established by the Ghana National Petroleum Corporation
Act, 1983(PNDCL 64)
The Mandate
GNPC was established as a state-owned entity and
given legal backing “to undertake the exploration,
development, production and disposal of petroleum”. The
PNDC Law 84 establishes the legal framework governing
39
the contractual relationship between the State, GNPC
and the prospective investor in upstream petroleum
operations.
The corporation was established with the following
objects:
To accelerate the promotion of petroleum exploration •
activities to ensure early commercial discovery and
production
To undertake the appraisal of existing petroleum •
discoveries to ensure production to meet national
requirements
To ensure that Ghana obtains the greatest possible •
benefits from the development of its petroleum
resources
To obtain the effective transfer to Ghana of •
appropriate technology relating to petroleum
operations
To ensure the training of citizens of Ghana and the •
development of national capabilities in all aspects of
petroleum operations; and
To ensure that petroleum operations are conducted in •
such a manner as to prevent adverse effects on the
environment, resources and people of Ghana.
With establishment of the Petroleum Commission, GNPC
ceases to exercise any advisory functions in relation
to the regulation and management of the utilization of
petroleum resources and the coordination of policy in
relation to that function.
Expatriates
Foreign investors are given expatriate quota depending
on the equity capital each invested in the business.
However there is an opportunity to apply for an increase
in the number of the expatriate staff depending on
one’s circumstances. After registration with the GIPC,
companies can apply for residence permit for their
permanent expatriate staff.
Investment Incentives and Guarantees
Investment incentives are used by governments to
attract investors to sectors of the economy that require
stimulation to grow. Some geographical areas of the
country may also be targeted for investment in order
to generate employment. Such incentives are found
in various legislations such the GIPC Act, Free Zones
Act, and the Petroleum and Mining Laws. Investment
incentives can also be found in the revenue laws.
The GIPC Act protects the businesses of investors from
nationalization or appropriation by any government.
Where such step is to be taken, it can only be done
by law and should be in the national interest. In such
a case, adequate compensation will be paid. No
individual can also be compelled to cede his interest in
any investment to any other person. Transfer of profits,
interest or dividends arising from any investment are also
guaranteed by the GIPC Act.
Paid Up Capital and Related
Quota of Expatriate Staff
Paid Up Capital Required (US$) Quota of Expatriate
Staff
10,000- 100,000 1
100,000- 500,000 2
500,000+ 4
40
Ghana’s Tax System
41
Ghana Revenue Authority
The tax types in Ghana that investors will encounter are
Corporate Tax, Withholding Tax, Capital Gains Tax, Value
Added Tax/NHIL, Employment Tax, Dividend Tax and
Excise and CST.
Corporate Tax
Income tax incentives are provided under the Internal
Revenue Act, 2000 (Act 592), as amended. Depending
on the sector and location in which it operates, it is liable
to pay tax at rates lower than the general corporate tax
rates.
Withholding tax
All companies are obliged to withhold tax from specific
payments to other persons. The Withholding Tax is on
contract payments in excess of GH¢500. The rate varies
from 5% to 15% depending on whether the person is
resident or a non-resident, and on the type of transaction.
Capital Gains Tax
Capital gains tax of 15% is payable on gains from the
realization (disposal) of chargeable assets. This includes
business and business assets, buildings, lands, rights or
interests in stocks or shares, or other assets declared
as taxable for capital gains tax purposes. Gains from
agricultural land and securities of companies listed on the
Ghana Stock Exchange are nottaxable. However, the fol-
lowing are exemption from capital gain tax:
Gains with a scrap value of GH¢50 •
Gains derived by a company out of a merger, amalga- •
mation or re-organization where there is continuity of
underlying ownership in the asset of at least 25%
Gains resulting from transfers of ownership of asset •
to close relatives or to former spouses as part of a
divorce settlement or separation agreement and
Gains used to acquire asset of the same nature •
within one year.
Value Added tax /National Health In-
surance Levy
The Value Added Tax Service (VAT Service) is responsible
for the collection of VAT and National Insurance Levy
(NHIL). However, the Customs, Excise and Preventive
Service (CEPS), collects the tax on behalf of the VAT
Service on imported goods.
A VAT rate of 12.5% and NHIL rate of 2.5 % (15%) is
chargeable on all transactions that attract the tax.
Companies and exporters obliged to pay VAT must reg-
ister with the VAT Service. Registered companies are
obliged to file a tax return and pay VAT every month.
Goods and services exempted from VAT include:
Food produced in Ghana and brought in its raw state •
Petrol, diesel and kerosene •
Equipment for agriculture and fishing •
Housing (ownership and rental) •
Transport •
Customs Duty
Agricultural and industrial plant, machinery and equip-
ment imported for investment purposes are exempted
from customs import duty. All import duty-exempted
goods however, attract processing and/or other related
fees or levies ranging between 0.5% and 1.0%, with the
exception of goods imported specifically for the educa-
tional, health and agricultural sectors.
Commercial buses with seating capacity of above thirty
passengers, workshop vans, breakdown vehicles, mobile
showrooms, ambulances, hearse and motor bikes are
also exempted from the payment of import duty.
However, certain types of vehicles attract both import
duty and Value Added Tax and National Health Insurance
Levy at a combined rate of 15%, except ambulances.
Domestic Tax
Taxation of Individuals
Individuals pay tax on their income at the graduated rate
from 0 through 5%, 10%, 17.5% and 25%. Any income
above the 17.5% band is taxed at 25%. Sole Proprietor- above the 17.5% band is taxed at 25%. Sole Proprietor above the 17.5% band is taxed at 25%. Sole Proprietor
ships and partners of partnerships also pay tax at the
graduated rate.
Individuals enjoy tax reliefs such as child education
relief, old age relief, aged dependant relief, marriage or
responsibility relief, and disable relief. Individuals who
have life insurance policy get relief for the premium paid
for the policy. Those who pay social security and national
insurance trust contribution get relief for the amount
contributed. Employers also get relief for the additional
contribution they make on behalf of their employees.
42
The income tax of Ghana is based on the source principle
and that explains why persons are taxed on income
derived from Ghana or accrued in Ghana. In addition to
the source rule the individual should be resident in Ghana
to have income received in Ghana or brought into Ghana,
taxable in Ghana.
For purposes of payment of assessment of annual
income tax, an individual is resident in Ghana where
she/he has lived in Ghana for at least 183 days in any 12
month period. This residence criterion is varied in the
case of foreign employees who come into the country as
employees for less than the 183 days.
A. Corporate Tax
Resident companies in Ghana pay corporate tax at 25%.
on their profits. By the Internal Revenue Act, (ACT592)
a company is a resident company in Ghana for a year of
assessment if it is either incorporated under the laws of
Ghana, or has its management and control exercised in
Ghana at any time during the year of assessment.
After tax holidays, agro processing enterprises and
manufacturers of cocoa by-products attract different
corporate tax rates depending on their location as shown
below:
Accra and Tema- 20% •
Other Regional capitals except Northern, Upper East •
and Upper West- 10%
Northern, Upper East and Upper West- 0% •
Outside Other Regional Capitals- 0% •
Tax Holidays
First ten years of
operation.
Enterprises that pre-
finance real estate
First ten years of
operation
Tree Crops First ten years from
1st harvest
Livestock, Fish and Cash
Crops
First five years from
commencement
Cattle
First ten years from
commencement
Agro-Processing Business
established after 1/1/2004
First five years
Production of Cocoa
By-Products from cocoa
waste or substandard
cocoa beans
First five years
Companies processing
waste including recycling
of plastic and polythene
material for agriculture or
commercial purposes.
First seven years
Corporate Tax Rates
General 25%
Hotels 20%
Tax Rate for Non-traditional ex- Tax Rate for Non-traditional ex Tax Rate for Non-traditional ex
ports, Rural Banks after 10year tax
holiday, and Free Zone Enterprises
8%
Tax rate for income of financial
institutions from loans granted for
farming enterprise
20%
Petroleum Operations Not Ex- Not Ex Not Ex
ceeding
50%
B. Tax Incentives
Tax holidays
Companies operating in different sectors of the economy
are granted tax holidays as shown below.
43
Location Incentives
Companies operating in the manufacturing sector are
entitled to tax rebates, depending on their location.
The income tax rebate allowable to manufacturing busi-
ness operating in regional capitals other than Accra and
Tema is 25% of the applicable income tax rate of income
while those in other locations other than Accra and Tema
is 50% of the applicable tax rate.
Capital Allowances
Capital allowances are granted for depreciable assets
owned by a person at the end of its basis period. The as-
set pooling system is used in the computation of capital
allowance. Based on this system the assets are grouped
into six classes of depreciable assets. Each class of
assets has its own depreciation rate. Classes two and
four assets are depreciated on a reducing balance basis.
Classes three, five and six are depreciated on straight
line basis.
Capital Allowances
Class Qualifying Assets Depreciation Rate
1 Computers and data handling
equipment
40%
2 Motor vehicles, construction &
earth-moving equipment, heavy
duty trucks, manufacturing plant
and equipment, capital expenditure
on long term crop planting
30%
3 Mineral and petroleum exploration
and production rights, building and
structures used in connection with
2(i) above, plant and machinery
used in mining or petroleum opera-
tions
20% on straight line
basis
4 Railroad cars, locomotives and
equipment; water transportation
vessels and equipment; aircraft;
office furniture fixtures and equip-
ment
20%
5 Building structures and works of a
permanent nature
10%
6 Intangible assets
Petroleum
Capital
Allowances
Life of asset/10%
44
Taxpayers are obliged to notify the Commissioner of
Internal Revenue of any new assets acquired within
one month after the assets have been put to use in the
business. Unutilized capital allowances can be carried
forward indefinitely but cannot be transferred either
separately or together with a depreciable asset i.e. upon
the sale or transfer of the asset.
Carry Forward Losses
Losses from farming, mining, and manufacturing mainly
for export, agro – processing, tourism and ICT (Software
Development) can be carried forward for five years.
Insurance Against Non-Commercial
Risks
Ghana is a signatory to the World Bank’s Multilateral
Investment Guarantee Agency (MIGA) Convention. This
Convention guarantees coverage (insurance) against non-
commercial risks such as transfer restrictions, breach of
contract, expropriation, war and civil disobedience.
International Agreements
These international agreements are signed to promote
business transactions between Ghana and the other
parties to the agreements.
Double Taxation Agreements
Ghana has signed double taxation agreements (DTAs)
with some countries to facilitate cross- border trade
and investment and create an enabling environment
for foreign direct investment in flows to Ghana and the
respective countries. Currently, it has such agreements
with France, The United Kingdom (UK), Belgium, Italy,
Germany, South Africa, Switzerland and the Netherlands.
Investment Promotion and Protection
Agreements
Ghana has signed Bilateral Investment Protection Treaties
with twenty one countries. Currently, countries with
whom the agreements have been signed and ratified
are UK, China, The Netherlands, Denmark, Germany,
The Swiss Confederation and Malaysia. The countries
with whom agreements have been signed but awaiting
ratification are La Cote d’Ivoire, Egypt, The United States
of America (US), France, Zambia, Cuba, Yugoslavia,
Mauritania, Guinea, South Africa, Benin, India and
Burkina Faso.
Countries with agreements pending are South Korea,
Canada, Pakistan, Ethiopia, Israel, Turkey, Jamaica,
Nigeria, Belgium, Indonesia, Philippines, Mauritania, The
Czech Republic, Australia, Singapore, Morocco, Togo,
Finland and Spain.
African Growth Opportunities Act
(AGOA).
Ghana has signed up to AGOA as a means to promote
trade and investment between her and the US. The
Government of Ghana initiated measures to encourage
farmers and local exporters to take advantage of the
opportunities offered by AGOA. One of such initiatives
was the President’s Special Initiative (PSI) for cassava
industrial starch, textiles, garment and apparel production
for export. Small-scale businesses were resourced and
trained to link up with the PSI companies to produce
directly for the US.
Ghana’s main export to the US consist’s of forest
products, agricultural products, energy-related products,
minerals and metals, textiles and apparels, chemicals
and related products, footwear, machinery, transportation
equipment, and manufactured goods and electrical
products. Exports are gradually increasing after it had
declined in 2008 mainly due to the global economic
recession.
Financial Services
Free Zone Export
In line with government’s vision to boost economic
growth through the private sector, it set up the Free
Zones Program in 1996 to promote processing and
manufacturing of goods through the establishment of
Export Processing Zones (EPZs). Two export processing
zones (one in Tema near Accra and the other in Sekondi
near Takoradi, the capital of the Western Region) has
been established by the government of Ghana. A third
one in Boankra in the Ashanti Region is being developed.
The Ghana Free Zones Board (GFZB) was established
under the Free Zone Act 504 (1995), to promote,
facilitate, monitor and regulate investments under the
program.
Every company can apply for a status of a single free
zone company, provided it sells 30% of its products to
the local market and exports 70%.
45
Incentives
Companies in the Free Zone are totally exempted
from payment of duties and levies on all imports for
production and exports from free zones. There is also
an exemption of income tax for the first ten years of
operation and thereafter income tax rate is capped at 8
%. Furthermore, they are not required to obtain import
licenses and are totally exempted from payment of
withholding taxes from dividends and are relieved from
double taxation for foreign investors and employees.
Import and Export Rules
Exports
Procedures and requirements for exporting goods from
Ghana depends on the kind of goods exported. Exports
are categorized into traditional and non- traditional
exports. Traditional exports include cocoa, timber,
gold, minerals and electricity. Non- traditional exports
include agricultural products, fish, aluminium products
and textiles. Exporters are required to register their
companies with the Registrar General’s Department and
GIPC to obtain a number.
Exporters are also obliged to complete foreign exchange
forms from the Bank of Ghana, Customs Entry forms and
certificate of origin from CEPS. Permits or certificates
must also be obtained from relevant institutions like the
Ghana Standards Board.
Prohibited exports are narcotics, parrots and Ghanaian
currency in excess of GH¢ 5,000. There are also
restrictions on the export of antiques, precious minerals
and live plants. Permits to export these must be
obtained from the relevant regulatory agencies such
as the Museums and Monuments Boards, Precious
Minerals Marketing Corporations and Ministry of
Agriculture respectively. General documents required for
exports include:
Original Bill of Lading/Airway Bill •
Attested Invoice (Customs # C.61) •
Packing List •
Import Declaration and Valuation Report •
(FCVR)
Tax Clearance Certificate (Domestic Tax Divi •
sion of Ghana Revenue Authority)
Taxpayers Identification Number (TIN) •
Permit and License from Relevant •
Institutions
Imports
In Ghana, all imported goods attract an import duty
and import VAT. (See Domestic Tax System for details).
Goods like aircraft and aircraft parts, advertising materials,
infant food and machines or plant for agricultural purpose
are exempted from import duty.
Prohibited imports are narcotics, animals and dangerous
weapons. These are only allowed if the competent
Ghanaian authorities have issued the necessary permits
or certificates. For drugs, permit must be obtained from
the Ministry of Health; for animals, Ministry of Food
and Agriculture and for weapons, from the Ministry of
Interior.
Three additional fees and levies are paid on imported
goods. These are an inspection fee of 0.5% of the value
of the imported goods, a 1% ECOWAS levy, and a 0.5%
fee for the financing of the Ghanaian Export Development
and Investment Fund (EDIF).
Duty Drawback
This gives an exporter the opportunity to receive a refund
on import duties after he has re-exported previously
imported products (Same-state drawback) or import
duties paid on raw materials used in the production
of finished goods and exported (Material drawback).
The drawback process commences when goods have
been duly re-exported and a Ghana Customs export
document endorsed by the Customs authorities in both
the exporting and importing countries or a “landing
certificate” from the importing country (when required)
is produced. An application form must be accompanied
with the following documents:
Certified copies of the import documents •
Import duty payment receipts (certified •
copies)
Drawback Debenture Form (Form C3) •
Statement of Composition Form (Form C2A) in case •
of Material drawback
There is a twelve-month time frame beginning from the
date of the first export within which the duty drawback
can be claimed. It is advised that claims are put in
quarterly. The Government of Ghana has established
an escrow account with the Bank of Ghana into which
monies are paid for the purpose of satisfying the duty
drawback needs of exporters.
46
Temporary Importation of Goods
Certain goods imported into Ghana can be conditionally
relieved from the payment of import duties. Such goods
must be imported for a specific purpose and must be
intended for re-exportation within three months, either
in the state in which it was imported or after having
undergone specific processing or repair. Conditions to be
met for the tax relief on temporary importation of goods
include:
Goods must be declared at importation •
that they are imported only temporarily and
will be subsequently re-exported
A Form C59 must be filled •
A cash deposit or a bond to cover the •
potential duty and tax liabilities (if any) must
be given
Goods must be exported within three •
months or such further period as the Customs
Officer may allow
Goods must not be disposed of in the country •
without prior permission of the Commissioner
List of Items that Fall Under The Tem-
porary Importation Regime
Commercial travelers samples 1.
Goods for local exhibition or entertainment and stage 2.
properties.
Goods imported solely for repairs or renovation 3.
Motor vehicles including trailers or cycles without 4.
engines and their accessories.
Touring propaganda material, which are not prohibited 5.
Any goods imported by a tourist and intended for his 6.
use, convenience or comfort while in the country but
not for his consumption while in the country.
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