A policy to encourage Ghanaians living abroad to return home to invest in the economy will soon be rolled out by the government, the Minister-designate for Business Development, Mr Ibrahim Mohammed Awal, has hinted.
He gave the indication yesterday during a business forum organised by the Ghanaian-German Economic Association (GGEA) on the topic: “Ghana’s economic outlook for the year 2017”.
Responding to a question on whether there was a package by the government to tap from the wealth of knowledge and experience of Ghanaians living abroad, he said: “Our policy is to have what we call the ‘Ghanaian returning programme’ that will encourage Ghanaians living abroad with some form of capital to invest. We will give them some sort of incentives. It’s a programme we will roll out very soon for Ghanaians living everywhere to come and invest.”
“I want to assure you that the government will continue to work to improve the macro-economic environment. One of the key things that we want to do as a ministry is help improve the ease of doing business,” he said.
While affirming that the business environment was a difficult one, he said the government would hold quarterly dialogues with the business sector to come up with what the government could do to improve ease of doing business.
He said another key intervention of the government would be to improve the capacity of the Ghanaian business community, saying that the doors of the government would be opened to the business sector.
“President Nana Addo Dankwa Akufo-Addo is committed to making the private sector the driving force of business,” Mr Awal stated.
Macro-economic figures improving
Making a presentation on Ghana’s economic outlook for 2017, the Resident Representative of the International Monetary Fund (IMF) in Ghana, Dr Natalia A. Koliadina, expressed optimism that Ghana’s economy would see growth, although she said there were too many uncertainties with the global outlook.
On the global front, she said commodity prices remained quite weak, with especially the prices of oil and gas still much low and would continue to be weak in 2017.
Forecasting that inflation would continue to decline in the year, she said: “A slowdown in inflation will make the Ghanaian economy become more competitive.”
She also said the financial sector would be quite strong and vibrant but that the incidence of non-performing loans was due to the country’s high debts.
“It is important for the authorities to make known the programmes for 2017 and what economic benefits they hold for Ghana,” Dr Koliadina urged.
Outlook for 2017
Speaking on Ghana’s emerging economic opportunities for 2017, a representative of the advisory partner, KPMG, Mr Andrew Akoto, said there were risks and challenges in the offing.
Outlining some of the risks to the economic growth prospects, he said the fiscal deficit might limit the government’s ability to mobilise funds to finance some capital projects.
“The large debt levels, including the legacy loans in the energy sector, could compel the government to return to the capital market to raise funds, a situation that will further increase debt levels,” he said.
Closely related to that, Mr Akoto said, the private sector could also be starved of funds, as commercial loans would become expensive and hence pose a challenge to the ability of the business sector to adequately function as the engine of growth.
Although external pressure from commodity price collapse might result in the local currency depreciating, he said, there were still unassailable opportunities in the Ghanaian economy that should entice investors.
These include the private sector’s participation in the energy sector reforms being spearheaded by the Millennium Development Authority (MiDA), infrastructure financing avenues through public-private partnerships (PPPs), as well as manufacturing opportunities in agro-processing and the pharmaceutical industry.
He also indicated that following from successful elections and political stability, the country stood to experience a seven per cent GDP growth in 2017, which could rise to eight per cent in 2018.
Quoting figures from the IMF, he said that “double-digit inflation is expected early in 2017, approaching single digit later in the year”.
Mr Akoto also said the cedi would depreciate due to uncertainties, although it would be moderate, while oil prices would rise to shore up revenues and debt levels would reduce to about 62 per cent of GDP.
Dr Natalia A. Koliadina, the Resident Representative of the IMF in Ghana, speaking at the forum.
Improved economic growth
He also spoke about improved economic growth that would be supported by increased oil production of more than 200,000 barrels per day and projected that the power crisis would stabilise in 2017 to support manufacturing.
He said subdued inflation might result in policy rate reducing to about 22 per cent by the end of the year, while interest rates were likely to reduce, allowing commercial lending to the private sector, while capital market activities would pick up.
Mr Akoto was, however, of the view that uncertainty over the new government’s policy direction might fuel the cedi’s slide but said the slide was not expected to reach the levels experienced in 2014 and 2015.
Source: Daily Graphic
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Your idea is good but raising funds by setting up a venture capital or shares is very difficult especially when you intend to invest in Ghana ; the problem is connections credibility and how strong your contacts to convince the authorities to under write these funds and guarantee that if these funds go 'walkies' the investors shall get their money back or a proportion of their money back besides there is no such thing as a good business plan ; there is what we call a viable business plan; the banks will always ask for a viable business plan not a good business plan there is a big difference and do not forget people do not buy shares or invest their lump sums or savings into a venture capital just because it is Ghana ; the question they ask is ; IS MINE MONEY SAFE with this venture capital fund company because any aspects of such investment can be very risky for the investor ; you need to define such initiative with a bit of shrewdness and clarity because how do you convince somebody living in Germany or the US to come and invest in a project in Ghana when we have mediocre elements managing these assets with the likely hood that such funds will disappear in no time; the proposal made by this Mr WAL is not viable ;because such proposals have been made so many times by different governments ;the false idea is that for some reason there is this pool funds that can be channelled from Ghanaians living abroad for investment in Ghana ; this idea is FALSE; THE QUESTION IS UPON AL THE MACRO-ECONOMIC DATA AVAILABLE IS GHANA THE RIGHT PLACE TO INVEST; besides data shows that most Ghanaians living abroad have their investment tied up in properties abroad or at home including pension schemes abroad and will not be prepared to risk their funds for such initiative ;For any investment initiatives should start from home Ghana because the amount of equity tied up in properties is so huge that if it managed with proper taxation on property asset ; raising finance for investment in Ghana will not be a problem because even in the US and UK the base for most funding is property asset based; Mr Awal should talk to the right people and do the right research to seek what type of investment he wishes to convince Ghanaians to invest including yourself because it is not EASY !!!!!!!
Kwaku, I like your idea. Please get in touch with me at [email protected] to put our minds together to engineer such a program.
Kweku, I agree with you 100%. This one of the reasons why in the UK, there is a group called IAGPA, which is made up of professionals and specialist, putting plans and ideas together to help Ghana develop. This will be a venture capital that will be needed to support the development Agenda of Ghana. Our new pension provision could look at investing lump sums in such Ghana Incorporated to provide steady Income for pensioners. Brilliant Idea but will they listen. Kweku, please get in touch. Email is [email protected]
Kwaku Yeboah, good move but it shouldn't be owned by the government. Ventures like these should be spearheaded by government and perhaps have some shares but it should not be wholly owned by Government. Things wholly owned by government have a tendency not to be managed properly.
I have a simple idea taking the que from the Otumfuo's educational fund. Set up a a company wholly owned by GH govt and Ghanaians called "Ghana Incorporated" Set up a good business plan including infrastructure development-- float shares starting from $1000 upwards and target about $5billion eventually.. With a good business plan you will be surprised to see how many Ghanaians in the diaspora will buy shares and if it grows will, we will put in more money.. We don't have to be going for cut throat loans again.. Oman Ghana is for all of us irrespective of Party colors..