Investors Have High Hopes for Ghana, Says Finance Minister

 

 

 

 

 

Ghana’s finance minister says investors were optimistic in meetings with senior government officials who accompanied Vice President Mahamudu Bawumia to the World Bank spring meetings in Washington. In an interview with VOA, Ken Ofori-Atta said investors detected a new energy, and a sense of hope in a team that is focused on getting Ghana out of its current predicament. He also said that with a new government in place, the world is ready to see Ghana shine again in a much more stable West Africa.

“We came in on a platform of change and real hope that we will revitalize the economy and create jobs and there would be growth,” Ofori-Atta said. “But we met some pretty difficult challenges with regards to fiscal deficit close to 9 percent, lots of unemployment, growth of 3.4 percent, which was very low, and the discovery of some 7 billion Cedis [$1.3 billion] arrears that we all did not know about. Foreign exchange was low, and you also had the exchange rate in a pretty difficult situation. So we had to contend with all of that since we came [to power].”

But opposition groups say the new administration should get to work rather than complain about the state of affairs. They contend that Ghanaians displayed confidence in them by rejecting the previous government for failing to improve the lives of its citizens.

Ofori-Atta said that in just over 100 days, the government outlined its plans to jump-start the economy in a budget, which was presented to parliament. The aim, he said, is to create millions of jobs as the ruling party, led by President Nana Addo Dankwa Akufo-Addo, promised ahead of the December elections.

“We decided to create a budget that is both leading to a fiscal consolidation in a real way and also not compromising growth,” Ofori-Atta said. “So we brought down the deficit as a target from 8.7 percent to 6.5. We squeaked out a primary balance surplus. We’re reducing our debt-to-GDP ratio from 72.5 to 70.9 percent, and then increase revenue by 34 percent. So, quite dramatic contraction in a sense. However, we also were clear that we needed to spur growth.”

One means to achieve their goals: abolishing some taxes.

“One of the most dramatic things was to abolish about 14 taxes, which the senior minister [Yaw Osafo Marfo] termed to be nuisance taxes,” Ofori-Atta said. “Taxes that were kind of suppressive and created a sense of cohesion by the state. As a center-right party, we have to revitalize the economy, we have to give stimulus, we have to encourage people to use their creative energies.”

Ofori-Atta also said abolishing the taxes will free Ghanaian businesses, and entrepreneurs will help to “bring Ghana back” into a working mode.

Another measure the administration plans to implement is the revitalization of the rural economy. This, he said, includes establishing a factory in each of the country’s districts, as well as sending $1 million to each constituency as a resource to support the policy of one district, one factory, which was promised by the president in the run-up to the polls.

Critics, however, say the one district, one factory promise was overly ambitious. They contend that with the dramatic reduction of taxes, government revenue would be sharply reduced, thereby handicapping the ability of the administration to raise the necessary funds it needs to keep the promises to Ghanaians. They also say the reduction of taxes was just a ploy to score political points.

But supporters of the ruling party reject the criticisms as unfounded.

Source: www.voanews.com

Ghana, Czech Republic Sign Double Taxation Agreement

Ghana and the Czech Republic have signed a Double Taxation Agreement to enable nationals of both countries to pay income taxes only once to one of the countries.

The Minister of Finance, Mr. Ken Ofori-Atta, signed on behalf of Ghana, while the Czech Ambassador to Ghana, Ms. Margita Fuschova, signed on behalf of her country. 

A statement issued by the Ministry of Finance in Accra explained that the agreement came after the two countries concluded negotiations for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion protocol with respect to taxes on income.

“The agreement gives investors a stable and predictable tax environment and consequently will encourage investments in both countries,” it said.

While the agreement eliminates the incidence where income from both countries are taxed twice, the protocol will increase Ghana’s Exchange of Information network, which allows treaty partners to exchange information in order to mitigate tax risk and tax evasion across borders.

The statement said tax evasion through the mutual assistance in the collection of taxes would also be reduced. 

“Furthermore, cross-border trade and investments between the two countries by the elimination of tax impediments will be greatly enhanced.

“The agreement will also foster diplomatic and other relations between the two countries,” the statement added.

Mr Ofori-Atta expressed the hope that diplomatic and economic ties would improve with the signing of the agreement.

Ms Fuschova also expressed similar sentiments, saying she looked forward to improving relations between the two countries reminiscent of the 1960s.

 Source: graphic.com.gh

Government Sends Right Signals For Investment in First 100 Days – Yofi Grant

The government has set the right economic tone in its first 100 days in office to signal a positive investment climate for the country to attract the right Foreign Direct Investments (FDIs) to boost the economy, the Chief Executive Officer of the Ghana Investment Promotion Centre (GIPC), Mr Yofi Grant, has said.

He also noted that the policies outlined in the 2017 budget and the government’s economic policy had also boosted the confidence of the players in the private sector while creating the environment to spur growth and create jobs for the people.

Mr Grant said this in an interview with the Graphic Business in Accra last Tuesday, on what measures had been put in place by the government to attract more FDIs while encouraging local investors to up their game within the economy by leveraging the various policies outlined so far.

“The bold initiative by the Bank of Ghana to reduce the policy rate from 25.5 per cent to 23.5 per cent has increased confidence in the economy; we have seen the local currency strengthening in the last couple of weeks and it is expected to go down further,” he said.

According to him, a strong currency was a positive signal to investors, both local and foreign, and “we will leverage it to attract those who want to invest to come in to do so”.

He also mentioned that inflation was on a sharp decline, hovering around 13.2 per cent as of the end of February. In the same period last year, inflation was 18.5 per cent.

Tax cuts

Mr Grant said the government was able to live up to its promise of cutting taxes in many instances and reducing others in other areas, all to free up some liquidity for the private sector.

Taxes such as the 17.5 per cent Value Added Tax (VAT) on financial services, domestic air tickets and imported medicines have been scrapped, while others such as the one per cent special import levy have been removed.

Also, the excise duty on petroleum, duty on imported spare parts, levies imposed on ‘kayayei’, levies imposed on religious institutions and the five per cent VAT on real estate have been abolished under the new government.

Meanwhile, the 17.5 per cent special petroleum tax rate has been reduced to 15 per cent, while the five per cent national electrification scheme levy has also been reduced to three per cent, and the five per cent public lighting levy has been reduced to two per cent.

Mr Grant said going forward, the government would be working on other tax incentives to improve what had been done in the budget.

For instance, there are positive signs to reduce the corporate tax from 25 per cent to 20 per cent, a move which corporate Ghana strongly anticipates to free up capital for them to expand.

Earlier in the month, Mr Grant told members of the American Chamber of Commerce (AMCHAM) Ghana in Accra that the government was considering giving 10-year tax breaks and citizenship to companies that relocated their headquarters to Ghana, among other things.

The GIPC boss said the signals sent so far were positive and gave the assurance that more were on the way.

Way forward

Mr Grant said the government, with the involvement of the GIPC, was also considering major reforms to add to the existing incentives to make the investment climate more conducive.

“We at the GIPC are holding a lot of meetings with the embassies which are making enquiries about the policies of the government to create a better business climate for the private sector and investors,” he said.

He also noted that many investors were also enquiring about the ‘one district one factory’ initiative and “we are working around the clock to ensure that the private sector truly benefits from it”.

Mr Grant said the investment tours undertaken across many parts of the world so far pointed to revived interest in the economy and gave the assurance that the government would carry out its promises to ensure that the economy grow on the back of a vibrant private sector.

Source: graphic.com.gh

Government Releases GH¢465 Million for Start of One-District-One Factory Project

The government has released GH¢465 million for the commencement of the one-district-one-factory project. It has also released GH¢256 million for the revamping of 100 private commercially viable and distressed companies throughout the country.

The Director of Policy Planning, Monitoring and Budget at the Ministry of Trade and Industry, Mr Padi Adjirakor, announced this in Accra yesterday.

Speaking on behalf of the sector Minister, Mr Alan Kyerematen, at the opening of the Ghana International Trade and Finance Conference, Mr Adjirakor said all businesses that qualified for the two programmes must present their proposals outlining their business plans to the ministry for the necessary action to be taken.

Background

In its 2016 manifesto, the New Patriotic Party (NPP) promised to establish a factory in each of the 216 districts to transform Ghana’s economic fortunes, while creating employment for the youth.

The initiative, otherwise known as district enterprises, is to establish medium-to-large-scale factories or industrial enterprises that have the potential to fundamentally affect the economy of the districts.

Among other things, the district enterprise is aimed at supporting existing companies, while creating new ones to create employment, as well as add value to the country’s natural resource base.

Mr. Adjirakor said the project, which was expected to kick-start any moment from now, would boost the nation’s economy, create more jobs, as well as make most districts economic giants.

AGI Lauds Government

Reacting to the announcement in an interview at the same function, the Chief Executive Officer of the Association of Ghana Industries (AGI), Mr. Seth Twum-Akwaboah, lauded the government for the bold step taken to facilitate the growth of companies in the country.

He said with the release of the money, companies that would successfully go through the selection process would be supported financially and technically.

He explained that the initiative would reduce the cost of doing business by providing shared industry resources and revenues.

Investors from Mexico

In a presentation, the Mexican Ambassador to Ghana, Ms Maria de los Angeles Arriola Aguirre, said investors from Mexico were ready to invest in areas such as agriculture, health, communication, among other areas, in Ghana. 

She, therefore, appealed to the government to put in place measures that would encourage those Mexican investors to invest in Ghana.

Source: graphic.com.gh

AIM Awards Gala Honours Investment Agencies

The Annual Investment Meeting (AIM) Awards Gala, held April 4 in Dubai, honoured investment promotion agencies from across the world for their outstanding work in driving investment into their countries.

The ceremony was held as part of the AIM 2017 at Armani Pavilion, Armani Hotel Dubai, Burj Khalifa, Dubai, UAE.

The event was graced by Sultan Bin Saeed Al Mansouri, UAE Minister of Economy; Dr Mohammed Al Zarooni, director General Dubai Airport Freezone Authority (Dafza); Mohamed Juma Al Musharrkh, director of Invest in Sharjah; Dr Douglas van den Berghe, CEO of Investment Consulting Associates and Dawood Al Shezawi, CEO of AIM organising committee.

With a wide group of international guests – top executives in charge of investment decisions related to participating countries and top management and entrepreneurs from leading international companies – the award gala recognises the contribution of the professional and advisory service firms, individuals and agencies in supporting foreign direct investment (FDI), said a statement.

Al Shezawi said: “FDI plays a huge role in supporting growth across all parts of the world and is a significant contributor to net job creation.”

“As such, it is time that we celebrate the achievements of these companies who attract sizeable and beneficial FDI that contribute to the economic growth and development of world markets,” he said.

In the seventh year of the Annual Investment Awards Gala, the organisers of the show have expanded the concept of the Awards to recognise the rapidly growing expansion of companies across varied regions.

As such, the winning companies were announced from all nine participating regions. Moroccan Investment Development Agency (Groupe PSA), Kingdom of Morocco, was honoured as the winner for its best investment project in 2016 in the Middle East and North Africa region.

In addition, Argentine Republic, Agencia Argentina de Inversiones y Comercio Internacional (Renova) was awarded from the Latin America and the Caribbean region.

Republic of Ghana, Ghana Investment Promotion Centre, from the West and Central Africa was also recognised for its enduring efforts.

Furthermore, Kenya, Kenya Investment Authority-KenInvest from East Africa, Republic of Mauritius, Board of Investment Mauritius from Southern Africa, Islamic Republic of Afghanistan, Ministry of Commerce and Industries (The Alokozay Group of Companies (AGC) from Central Asia, Republic of India (BRS Venture Holdings & Limited), Invest India from South, East Asia and Oceania, Slovak Republic, Sario (Slovak Investment and Trade Development Agency); (Jaguar Land Rover) from Central, Eastern Europe and Turkey and Kingdom of Belgium, Flanders Investment & Trade (Sanofi) from Europe were honoured and awarded for their exceptional efforts in boosting foreign direct investments (FDI) to their countries.

Al Shezawi added: “Taking this as an opportunity, I congratulate all the winners and extend my heartfelt appreciation and gratitude to all the participating companies for extending their support and cooperation in making this event memorable.”

“While we’ve lived up to our promise of facilitating the best in the industry, we promise that the future edition of the international forum will be much bigger and better,” he added.

 Source: TradeArabia News Service

Corporate Taxes to Drop by End of Year – Yofi Grant

The government is to announce new tax incentives by the close of the year to give more liquidity to private sector businesses to expand and create more jobs for the people.

For instance, the government will announce a reduction in the corporate tax rate from 25 per cent to 20 per cent by the end of the year.

The Chief Executive Officer of the Ghana Investment Promotion Centre (GIPC), Mr. Yofi Grant, announced this when he addressed members of the American Chamber of Commerce and Industry (AMCHAM) Ghana in Accra last Friday.

“For this government, the growth of the private sector is our focus because we believe in what it can do to transform the economy and create the needed jobs for the people,” he said.

He said the position of the government on taxes was a good sign to attract more investors into the country and noted that all what was required to facilitate local and foreign investments into the country got to its optimum would be done.

Tax cuts

Among other economic incentives announced in the budget statement and economic policy of the government for the 2017 financial year was the reduction in taxes to ease the high cost of doing business in the country.

Taxes such as the 17.5 per cent Value Added Tax (VAT) on financial services, domestic air tickets and imported medicines have been scrapped, while others such as the one per cent special import levy has been removed.

Also, the excise duty on petroleum, duty on imported spare parts, levies imposed on kayayei, levies imposed on religious institutions and the five per cent VAT on real estate have been abolished under the new government.

Meanwhile, the 17.5 per cent special petroleum tax rate has been reduced to 15 per cent, while the five per cent national electrification scheme levy has also been reduced to three per cent and the five per cent public lighting levy has been reduced to two per cent.

Those, Mr. Grant said, were done to ensure the ease of doing business in the country.

He noted that more would be done to create the environment where the real potential of the private sector would be felt on the economy and in the lives of all.

In the offing

The GIPC boss said the government intended to announce new measures to attract more investors into the country in the manner that would see Ghana as the most attractive investment destination on the continent and in the world.

He said, for instance, that “we are thinking of giving 10-years tax break to companies that relocate their headquarters to the country.”

He explained that the motive was to ensure that such large manufacturing companies would come to the country to employ a chunk of the people while offering them the opportunity to learn and improve their skills.

Mr. Grant said like countries such as Turkey, “we are also considering giving companies and individuals permanent work permit, granting citizenship, among other things, all in a way to expose our readiness to work with investors who intend to leverage the friendly business environment in the country.”

“We are serious about these because we know the value in them and we will work to make it succeed,” he said.

Subsequently, he called on members of the chamber to approach the GIPC with ideas to help change the way of doing business in the country to ensure a win-win situation for all.

Source: graphic.com.gh

GIPC Wins Best Project in West and Central Africa Region at AIM 2017

The Ghana Investment Promotion Centre (GIPC) has won an award for Best Project in West and Central Africa Region for 2016 at the Annual Investment Meeting (AIM) 2017 in Dubai.

The award was presented to the Chief Executive Officer of the GIPC Mr. Yofi Grant by H.E Sultan Bin Saeed Al Mansoori, UAE Minister of Economy during the Investment Award Gala Dinner held on Sunday 2nd of April 2017 at Armani Hotel in Burj Khalifa, Dubai.

The GIPC, an agency under the Office of the President, won the award for the West and Central Africa Region by showcasing the Rotan Power Project as a model project for the year 2016.

The project was registered by the Centre in 2016 to generate a total of 660MW of thermal power at Aboadze in the Western region of Ghana; at an estimated value of $1,055billion. It is a joint venture owned by Singaporean and Ghanaian partners.

The AIM Investment Awards is a recognition of the best Investment Promotion Agencies (IPAs) attracting the best investment project each year. Successful IPAs are thus awarded for their outstanding work in attracting sizable and beneficial foreign direct investment projects that contribute to the national economic growth and development of their countries. The general requirements for submissions are investment size, trade balance effects, knowledge transfer, technology transfer and innovative processes, sustainability and local linkages.

Last year, the GIPC was adjudged the Best Investment Promotion Agency (IPA) in West and Central Africa for 2015 at the same event.

This year’s event which is being held from April 2-4, 2017 at the Dubai World Trade Centre is the seventh edition of the AIM and was organized under the patronage of Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai.

The theme for this year’s award ‘International Investment, Path to Competitiveness & Development’, focuses on how to attract the right kind of international investment that contributes to the competitiveness of national economies. It sheds light on the special role of foreign firms in enhancing a country’s competitiveness which would in turn help them attract more investment.

The Ghana Investment Promotion Centre (GIPC) is attending the Conference in partnership with the Ghana Free Zones Board (GFZB). The team has been working to showcase Ghana through an exhibition and a series of meetings organized with high profile businesspeople and companies from the region.

GIPC CEO Holds Discussions with European Investment Bank

The Chief Executive Officer of the Ghana Investment Promotion Centre, Mr. R. Yofi Grant, has held discussions with senior representatives of the European Investment Bank (EIB) towards the creation of strategic partnerships for the promotion of sustainable investments into Ghana.

The meeting, held in Luxembourg, went very well in cementing an already existing relationship between the EIB and Ghana.

There were constructive discussions about exploiting Ghana’s bauxite, iron ore and manganese deposits as well as integrative infrastructure which have positive implications for West Africa.The meeting further highlighted Ghana positioning itself as the Centre for regionalising business in West Africa by developing our communications, transportation and energy infrastructure.

The EIB expressed interest in partnering the private sector in the One District One Factory policy. Interest was also shown by the EIB in financing possibilities in the sustainable and renewable energy space, and off grid energy and power solutions.

Present at the meeting were Mr. R. Yofi Grant CEO of GIPC, Mr. Diederick Zambian, Head of Division, Country Relations and Public Sector, Sub Saharan Africa, and Mr. Romulo Isaia, Loan Officer, Country Relations and Public Sector, West Africa.

Ghana, Mauritius Sign Double Taxation Agreement

Ghana and Mauritius have signed a treaty, the Double Taxation Avoidance Agreement (DTAA), to avoid or eliminate double taxation of the same income in the two countries. The two countries also set up a permanent joint commission on bilateral cooperation as part of measures to facilitate trade between them.

Additionally, they have agreed to collaborate on an investment promotion and protection agreement to better channel investments into each other’s country, possibly via special investment zones.

The Foreign Affairs and Regional Integration Minister, Ms. Shirley Ayorkor Botchwey, signed the agreement on behalf of Ghana, while the Minister of Foreign Affairs, Regional Integration and International Trade, Mr. Seetanah Lutchmeenaraidoo, signed on behalf of Mauritius.

The DTAA is subject to ratification by Ghana’s Parliament.

The agreements were signed last Saturday at Port Louis, Mauritius, in the lead-up to the celebration of that country’s 49th Independence anniversary on Sunday, March 12, 2017.

Boosting Trade

Speaking at a joint press conference after the signing ceremony, Vice-President Alhaji Dr. Bawumia, who was the special guest for the celebrations, explained that the agreements formed part of Ghana’s quest for greater cooperation with the rest of the world, especially Africa, in order to boost trade.

“We have seen the manifestation of the first fruits of this joint permanent commission with the signing of the historic double taxation agreement between Ghana and Mauritius, and we believe that this will provide a platform to give confidence to investors both in Ghana and Mauritius to undertake investments in our respective countries and not be taxed twice by our respective governments. We believe this is just the beginning of our cooperation,” Dr Bawumia said.

He underscored the need for greater intra-African trade to better improve the lives of Africans.

“Our government believes very strongly there has to be more trade within the African continent and among countries of the South. There has to be more investment, and more cooperation,” he said.

He was excited that the type of cooperation that Ghana sought with Mauritius was being manifested in the area of trying to set up Ghana as an International Financial Services Centre in the West African sub-region.

Investments in Ghana

The Prime Minister of Mauritius, Anerood Jugnauth, disclosed that several framework agreements had also been reviewed, including the setting up of a technology park at Dawa in the Greater Accra Region, and investments in the energy and tourism sectors.

“We have also agreed to pursue consultations on two project proposals submitted by Mauritius, namely, the setting up of solar energy power generation, and a tourism and hospitality project providing for the construction of a coastal resort in Ghana. Cooperation between Ghana’s Public Utility Regulatory Commission (PURC) and Mauritius was also discussed,” the Prime Minister said.

Ghana’s delegation included the Minister of Communication, Mrs. Ursula Owusu-Ekuful, Minister of Business Development, Mr. Mohammed Awal, the Chief Executive Officer (CEO) of the Ghana Investment Promotion Centre, Mr. Reginald Yofi Grant, and other senior government officials.

Source: graphic.com.gh

GIPC to Review Investment Act

The Chief Executive Officer of the Ghana Investment Promotion Centre (GIPC), Mr. Yofi Grant, has given a hint of a review of the GIPC Act 2013 (Act 865) which guides investments in the country. The review is to make the country more competitive globally to be able to attract more investments.

At a press briefing on arrival from Mauritius, Mr. Grant said the impact of the review on attracting investments would be significant as it would benefit a lot of Ghanaians. 

“We would be reviewing the GIPC law to make ourselves more attractive and competitive on the global investment horizon. The impact would be significant, because we want to attract the biggest companies globally to come to Ghana to do business.”

“When they come, they would create jobs, develop technical competence and our people would also benefit from the value chain. We would then be able to create jobs and wealth in Ghana and have an economy that is stable,” he said.

The GIPC Act has been subjected to scrutiny by stakeholders as it has over the years failed to eliminate the bureaucracies investors have to go through before registering their businesses.

Mr Grant, however, explained that the GIPC would deploy technology to eliminate some of the bureaucratic procedures to ensure efficiency and ease of doing business in Ghana.

Repositioning GIPC

Mr Grant explained that the GIPC would reposition itself as the ‘Chief Marketing Officer’ for Ghana to drive the needed investments into the country.

The GIPC CEO also reiterated the commitment to build local companies to be able to do businesses in other African countries.

He added that: “We are really up to the challenge and GIPC is going to support that development. It is also going to be dynamic in its operations by looking at investment opportunities that could be highlighted to foreign investors. We are looking at having positions in all the regions of Ghana. We will go out and look for those opportunities in those regions, and we will package them to sell to investors in Ghana and out of Ghana.”

He further stated: “I believe that will go a long way to show that we know what we are about when we say we are positioning Ghana as a positive investment destination.”

Investment mission

A trade mission that comprised private sector players was in Mauritius between March 9 and 12, 2017 to engage their peers in Mauritius and to also deepen the growing levels of trade and investment between the two countries.

Mr. Grant said some outcomes of the mission were the signing of the Double Taxation Agreement that would enhance trade and business between the two countries.

A Double Taxation Agreement is an agreement which regulates the tax treatment of income or capital gains in a situation where the same taxpayer is subject to tax in two states with respect to the same income or capital gains.

He added: “There is also the initiation and negotiation of an eventual Investment Promotion and Protection Agreement (IPPA) between Ghana and Mauritius. When successful, the agreement will help to protect the investment of each country’s investors in the other country.”

 Source: www.graphic.com.gh