Ghana: The gateway to West Africa
Ghana continues to experience impressive and sustained growth across a number of sectors, and for this reason the country appears on our list of key economies in Africa. It is important to note that the country registered one of the highest economic growth rates in the world in 2011.
Oil production in Ghana boosts economy
Already a large gold and cocoa producer, Ghana commenced with oil production from its offshore Jubilee field in mid-December 2010.
This year, the Jubilee field is expected to increase production from around 90,000 barrels per day (bpd) to 120,000 bpd. Ghana’s newfound oil wealth will contribute to a significant increase in consumer spending power, although as in other resource-rich countries, the extent to which this benefits the domestic population could be limited. However, the economy’s expansion is not coming from oil alone, with other sectors of the economy also performing well.
Ghana’s population is the second smallest in our list of countries after Angola. However, the pace at which the population is expanding is currently still relatively high. Furthermore, Ghana’s urbanisation rate is already quite high by African standards, projected to reach 60.2% by 2025.
Ghana’s retail sector
Ghana’s modern retail sector is restricted mainly to Accra. There are currently only a small number of international retailers on the scene. The size of the middle class is still small, but is growing at a rapid pace, thereby providing the base for the demand for the convenience and variety that is offered by super- and hypermarkets.
Although Ghana might not have quite such a favourable demographic profile as some other countries in our list, to a large degree, it makes up for this by having a more accommodative and less restrictive business environment and better macroeconomic policies.
Doing business in Ghana
Ghana is ranked 64th on the World Bank’s 2013 Doing Business index – the only SSA countries above Ghana in the survey are Botswana, Rwanda, South Africa, and Mauritius. Due to Nigeria’s much more complex operating environment, many investors view Ghana as the gateway to the West African region. For this reason, it is also less of a problem to source products in Ghana than it is in some other African countries. Companies that have set up manufacturing facilities in the country include Unilever, PZ Cussons, and Denmark’s Fan Milk Group. Retailers can therefore buy products locally rather than import them.
Accra Mall, Ghana’s first world-class shopping centre, was opened in 2008, and is conveniently located close to the Kotoka International Airport and near the Tema Motorway, which makes the mall accessible to neighbouring countries as well.
What are your views on the varied business environments presented by different African countries, and how do they impact your decision to invest or transact?