Govt set to transform Ghana into financial haven

The Seventh Ghana Investment Advisory Council ended Saturday after high-powered, prominent local and international business executives exclusively met with President John Agyekum Kufour and advised him on the policies and measures he should adopt for the New Patriotic Party Government to turn Ghana into the choice destination for indigenous and foreign investments.

“I believe the new possibility to which we are already committed is to transform Ghana into an International Financial Services Centre,” President Kufuor told stakeholders and experts at the opening session of the bi-annual GIAC meeting.

Stating that the transformation of the country into an International Financial Services Centre was an “idea whose time has come,” he notes that macro-economic stability, a buoyant business climate and investor friendliness and confidence coupled with prioritisation of good governance, private sector development and human resource development stands Ghana out as the best-suited country to serve as the regional financial power house of Africa.

“The advice I got over the past two days, I will put to maximum use,” says President Kufour, after two days of positive and upbeat dialogue on the state of the Ghanaian economy and its future prospects. The GIAC members deliberated on crucial drivers of growth and poverty reduction in Ghana. These include labour, Information Communication Technology, public sector, lands, communications, finance and agriculture.

Representative from Hewlett Packard Company underlined the usefulness of the meetings::

"As a company, we see tremendous progress in this government and its support of business. While HP does not currently directly invest in Ghana, we are expecting to in two to three years. It is through these meetings that we are encouraged by government's efforts."

In the past, the President had acknowledged the invaluable wealth of advice given by the council at previous meetings. And the Government has implemented them, yielding the beneficial economic results recorded so far. Another GIAC member added his voice to it. Saied Fakhry Chairman Interplast Ltd said:

"It is unfortunate that most Ghanaians do not know much about what we are doing - especially when what we are doing directly affects them and this country." He also said he is "proud to be a member" and that he is "confident that this is the best meeting" thus far as well as that President Kufuor is "a listening president." As part of the finance working group, he said he saw "setting dates" as a priority in evaluating progress.

The GIAC meeting was held in the Volta Hotel at Akosombo in the Eastern Region from 31st March to 1st April. Speaking on behalf of the GIAC members, Masak Miyaji of Mitsubishi Corporation states, “Ghana has a unique and successful story to tell the world. It is working! The best way to predict the future is to create it and Ghana is doing that.”

Local financial experts, led by Databank Financial Services, have been pushing for Ghana to establish itself as an offshore financial haven in the sub-region to attract investors.

According to the President, who chairs the GIAC, border activities of such IFCs grossed about $4.5 trillion in 1999. Already, some African countries such as Mauritius and Morocco are reaping substantial benefits from setting up their own IFCs. “Ghana is determined to join this far-sighted group.”

He believed that the establishment of the IFC for the country was necessitated by international economic developments. “In a globally competitive world, we must find additional growth pillars to support our economy.”

President Kufuor was upbeat that the long-awaited One-Stop-Shop for investors is almost operational. The establishment of the shop was on the advice of the now 34-member GAIC. The shop will be managed by the Ghana Investment Centre. He said GIPC was seeking to increase further incentives by reviewing the Investment Promotion Act to make it compatible with international best practice.

“I am confident that when these policies are fully operational our ranking in ECOWAS and indeed in the world for 'Starting Business' will be greatly improved.”

He said Ghana needs well-functioning, effective and efficient capital markets to leapfrog her economy from stability to accelerated growth.

Citing the first Ghana Business Leaders' Confidence Index undertaken by Steadman in the last quarter of 2005, he revealed that confidence was high, with the financial sector leading with 71 index points. President Kufuor noted that 87% of respondents were confident that the conditions would be better in the next six months.

“Our vision of a prosperous and peaceful middle-income country by 2015 is backed by viable policies, premised on hard won gains,” the President observed. The advisors counseled the President on steps the Government should take to ensure and accelerate private sector-led growth in Ghana in priority growth areas like ICT and agro-processing.

Since its first meeting in May 2002, the GIAC has requested reforms for finance, labour, customs, civil service, land and agriculture. At the inaugural meeting, members identified 18 issues and problems that hampered Ghana's investment promotion. Out of these, the President and the members agreed to work on five issues until the bottlenecks were eliminated before taking on board fresh but already identified problems. The five issues were: financial sector, labour, custom/civil service, land, agricultural and agri-business reforms. The 6th GIAC meeting was held June 24 to 25 at the same venue like the current one.

The weekend's meeting was attended by the Finance and Economic Planning, Public Sector Reform, Private Sector Development, Agriculture Land and Forestry, Manpower and Employment, and Trade and Industry Ministers and/or their representatives. Each Minister made progress reports on the implementation of the GIAC's recommendations concluded at the last meeting.

E O T Prempeh, Chairman of M&J Group of Companies, offers his opinion, “In this meeting, I saw a lot of action from the ministers. However, what I would like to see next time from the ministers are deadlines in which we can clearly monitor what has been done and what still needs to be done and the resources needed to meet those deadlines.”

The membership of the council includes representatives of international and local investors from African Communications Agency, Interplast, Tata Group, Databank Financial Services, BHI Holding Ltd. and Dannex. Others are Property Ventures, Heinz, Coca-Cola Company, Empretec, Barclays Bank Ghana, Standard Chartered Bank, Hewlett Packard, NEPAD Business Forum, and representatives from 23 companies.

The council consists of a strategic balance of internationally-reputed investors. They include the President of Heinz Sea Food Europe and Area director, Adolfo Valescchi, Vice President of Coca Cola Africa, Robert Lindsey, Cheol-Woo Lee, vice president of Global Business Development, among others. In addition, the World Bank, IMF, GIPC, UNDP and Private Enterprises Foundation serve as observers on the GIAC. The council has an Oversight Committee that helps the sector ministers in implementing of its recommendations. The President has tasked the GIAC to be involved in the implementation process. The operations of the council are co-ordinated and managed by the GIAC Secretariat The recent World Bank survey, “Doing Business in 2006,” ranks Ghana 82th in World rating, with easiest place to do business in Africa; and first in West Africa. In the sub-region, she is also first in three key categorizations, namely protecting investors, paying taxes and enforcing contracts.

The World Bank has, therefore, acknowledged the country as having the potential to be a regional finance magnet with a vibrant capital market.