CETRA Mini Blog Series: Doing Business in Ghana
Welcome to our Ghana Mini Blog Series. Over the course of the next few weeks CETRA will feature guest blog posts from Anukware Adzima about doing business in Africa.
Country Profile: Ghana, Africa
The Republic of Ghana is located on the West African coast. It is bounded in the west by Côte d’Ivoire, in the north and north-west by Burkina Faso, and in the east by Togo. In the south, Ghana is bordered by the Gulf of Guinea. The capital of Ghana is Accra.
Ghana has a total area of 238,537 sq.km (92,100 sq.mi). Overall, Ghana is a lowland country. The coastline is mostly low and sandy, and is intersected by several rivers and streams. The middle area of the country is a tropical rain forest belt with some heavily forested hills and a lot of streams and rivers. The northern belt is covered by an undulating low bush savannah and grassy plains.
Ghana has an estimated population of 24 million made up of several ethnic groups, each with its own unique language. The majority of the people depends on agriculture and lives on farms or in small villages although the private sector is picking up fast. The most densely populated parts of the country are along the coastal belt, the Ashanti region in the south-central part of the country, and the two principal cities, that is, Accra and Kumasi. About seventy per cent of Ghana’s total population lives in the southern half of the country.
English is the de facto official language of Ghana. It is also the medium of instruction from the fourth year of the Ghanaian child’s primary education through university. Eleven of Ghana’s written local languages—Two varieties of Twi (Akuapem Twi, Asante Twi), Ewe, Fante, Ga, Dangme, Nzema, Dagbani, Dagaare, Gonja and Kasem3 —are designated as government-sponsored (national) languages.
Ghana’s current educational system is divided into: a free and compulsory six-year primary education, a three-year junior high school education and a four-year senior high school education. Senior high school education is provided in different areas including technical, vocational, science, business and arts/social sciences subjects. After high school students can continue to pursue their education in vocational or technical (e.g. in polytechnics) institutions, teacher training institutions or continue on to study in one of the universities.
Ghana is a constitutional democracy with a multi-party system, and a legal system that is based on British common law. After a national referendum in 1992, following over two decades of various military dictatorships, Ghana promulgated a new constitution which came into effect in January 1993, and has since been in operation although it was currently but pending other processes. Notwithstanding, it is expected that the Constitution, as will be amended, will continue to respect and specify fundamental human rights and freedoms. It is equally expected that the Constitution, as will be amended, will continue to focus on the legal concept of Separation of Powers by spelling out the functions and powers of the Executive, the Legislature, and the Judiciary respectively.
Doing Business in Ghana:
Out of 183 countries surveyed worldwide, The International Finance Corporation/The World Bank’s Doing Business 2013 ranked Ghana 64th on overall ease of doing business. Ghana’s policy reforms, regarding reducing the cost of operating a business in the country, have not only made the business environment conducive and promoted steady and positive growth but Ghana is also, currently, a very alluring destination for foreign businesses due to government’s focus on attracting foreign investment. According to the US Department of State, “political stability, overall sound economic management, a low crime rate, competitive wages, and an educated, English-speaking workforce enhance Ghana’s potential as a West African hub for American businesses.” Generally, incentives for investing in Ghana, among other things, include: tax holidays; capital allowances; location incentives (tax rebates); corporate tax rates; exemption from income tax; loss carry-over; exemption from minimum chargeable income tax; capital expenditure for research and development; withholding tax; immigration quota; and investment guarantees. Both Ghana’s relative political stability and physical location gives the country the advantage of being the gateway to investing in the West African sub-region.
Ghana’s Constitution and legal system protect foreign investors’ interest(s) well in cases of expropriation or nationalization—that are rare in recent years—with prompt payment of adequate and fair compensation. The legal system also does not discriminate against foreign investors in dispute settlement. US investors also take advantage of the provisions in the various US-Ghana bilateral agreements on trade and investment promotion and protection, where and when necessary.
Stay tuned for Anukware’s next blog post “The need for language service providers in Western Africa”