20.10.2011 Regional News

What is the economic future of Kumasi?

20.10.2011 LISTEN
By Kofi Adu Domfeh

Kumasi, the Ashanti regional capital of Ghana, is a beehive of commerce – a melting point for trading in the West African sub-region.

It is therefore not surprising that businesses hoping to reach out to customers in most parts of the country would make the city their first point of call.

Over the past few years, a good number of institutions and firms have established branches in Kumasi – with financial service providers and dealers in consumer products leading the pack.

However, the economic future of Kumasi looks uncertain because growth-oriented and job-creation ventures are amiss in the region.

Available figures indicate over 80 percent of foreign direct investments into the country are skewed towards Accra and Tema. The attraction includes ease in accessing air and sea ports, proximity to policy makers and favorable business climate.

Takoradi is expected to get a fair share of the investment drive as a result of the oil and gas exploration in the area.

In places like Kumasi however, economic opportunities in the mining and timber industries are shadows of their past. The collapse of the Shoe, Leather and Tanning and Jute factories have also contributed to the dwindled fortunes of the region.

Suame Magazine, the amiable indigenous automobile and light industrial hub, is currently under threat of modern technologies in vehicular servicing and maintenance.

The service industry and merchandising of foreign produce seem to be the best thriving businesses.

But how sustainable is it when real investments in tourism, agro-processing, commercial real estate and infrastructure remain unattractive?

This situation may not be different from most other regional capitals of Ghana and it is a worry to investment promoters.

Abenaa Akuamoah-Boateng, a Coordinator of the Millennium Cities Initiative, is uncomfortable with the centering economic development in the Greater Accra Region, saying this is a huge disservice to other regions of the country.

“What we forget is that Accra and Tema can only expand to a point, beyond that it's chaos and disaster”, she observed. “Investors tend to stop there because all what they need to make their investments a reality are also centred in Accra.

“Even when you talk about areas like the Registrar General now being in the regions, what happens is more often than not their offices are like post offices, where you have to drop it and it still has to come to Accra”.

Mrs. Akuamoah-Boateng believes the country's sustainable growth will mostly depend on an investment model which hinges on the strength of regional development.

Potential foreign and domestic investors should be attracted to commercially viable ventures in the regions as well as help improve the competitiveness of local enterprises.

The investment promoter stated that the Boankra Inland Port, for instance, would have served as a growth point to change the face of business in Ashanti.

“There are some industries that if we are really to look at them properly, site them properly and give them what they need to grow, it will add on – it will not take anything away from Accra and Tema – it will rather add on”, Mrs. Akuamoah-Boateng suggested.

Story by Kofi Adu Domfeh/Luv Fm/Ghana