ESTABLISHING BUSINESS IN GHANA

GENERAL

The following Legal Instruments, The Companies Code 1963, The Partnership Act 152, The Business Name Act 1962, The Ghana Investment Promotion Act (Act 478, The Free Zones Act (Act 504), establish the general legal framework for the setting up of business, and for investing in Ghana.

With a stable political environment and forward looking investment climate, Ghana is prime location for investors, who may wish to tap the country's abundant natural resources, exploit market opportunities in Ghana and also within the larger Economic Community of West African States (ECOWAS).

INVESTMENT CLIMATE

The economy of Ghana has undergone a remarkable transformation. The economic management program embarked upon in a rather challenging environment of the 80's has re-engineered the Ghanaian economy, which has since registered an average growth rate of 5% per annum. The consistent growth rate of the economy has laid the foundation for social stability and international credibility. Amendments to Ghana's 1985 investment code have opened up a wide range of new business opportunities. The 1994 Ghana Investment Promotion Act guarantees the freedom for non-Ghanaians to establish and run enterprises in potentially lucrative areas such as natural gas, hydropower projects, fruits and vegetables farming, food processing including fish canning; production of agro-chemicals, pharmaceuticals and information technology. The government's privatization initiatives also open up a number of sectors for new business partnerships and investment, notably the banking and the state petroleum and telecommunication s sectors. Tourism is an especially strong area for a new business projects. Key opportunities in this sector include: tourist accommodation, particularly beach resorts; tourists transportation, catering enterprises, eco-tourism, night life and leisure and tourist servicing enterprises. As a result, renewed private sector activity is increasing and attracting foreign investment in a growing number of strategic areas, notably mining, manufacturing, telecommunications, real estate development and financial services.

Among the factors responsible for this trend has been the adoption and implementation of sound macroeconomic policies and the enactment of more liberal investment legislations. These legislations seek to free the investor from bureaucratic constraints and provide facilitating mechanisms to reduce costs associated with delays in implementing projects. One such legislation is the Ghana Investment Promotion Centre Act, 1994 (ACT 478), which re-established the Ghana Investment Promotion Centre (GIPC) as an autonomous government agency mandated to encourage, facilitate and promote domestic and foreign investment.

SETTING UP BUSINESS IN GHANA

PROJECT APPROVAL is NOT required for investment in the economy, except in the following areas:

• Petroleum Business - by Ghana National Petroleum Corporation
• Minerals and Mining Business - by Minerals Commission
• Portfolio Investments - by the Ghana Stock Exchange
• Free Zones Activities - by the Ghana Free Zones Board

PROCEDURES

One stop approval and or facilitation by respective Investment promotion Agencies.

OWNERSHIP

Joint-Ventures with Ghanaian partners are encouraged BUT 100% Foreign participation is allowed.

EQUITY

• US$10,000 for Joint Ventures with Ghanaian partner
  
• US$50,000 for 100% Foreign Ownership
  
• US$300,000 for Trading Activity

EXPATRIATE EMPLOYMENT

Automatic quotas tied to Investment Capital

• One quota for US$10,000 - US$100,000 paid-up capital
• Two quotas for US$100,00 - US$500,000 paid-up capital
• Four quotas for US$500,000 plus paid-up capital

INVESTMENT INCENTIVES

• Corporate tax - 8% on export income, 25% for hotels and 35% for others
• Locational incentive - 25-50% tax rebates
• Tax holidays - indefinite for cocoa farming, 3-10 years depending on sector; 10 years for Free Zones with 8% corporate tax thereafter
• Tariff exemption - 100% duty exemption for production equipment

INVESTMENT GUARATEES

• Constitutional provision
• Investment laws which guarantee 100% transfer of profits, dividend etc.
• MIGA membership
• Investment Promotion

ADVANTAGES FOR DOING BUSINESS IN GHANA

• Stable Multi-party government
• Demonstrated commitment to market liberalization
• MIGA membership
• Investment Promotion
• Ongoing privatization in key economic sectors
• Expanding stock market
• Competitive labour force
• Export free zones where goods traded with other countries are exempt from customs and laws
• Immediate access to all markets of the Economic Community of West African States (ECOWAS)
• Quota-free access to U. S. A. and European Union markets
• Member of the World Trade Organization
• Official language English

USEFUL CONTACT ADDRESSES

Listed official channels in exploring business opportunities and/or establishing operations in Ghana.

1. For information on investment opportunities, registration of projects involving foreign participation, and general investment:

   The Chief Executive
   Ghana Investment Promotion Centre
   P.O. Box M193
   ACCRA

   Tel: 233-21 665125-9
   Fax: 233-21-663801
   E-mail: gipc@ghana.com