8 •
The Lion King
• April - June 2017
BUSINESS
GHANA BECOMES THE NEW
HUB FOR AFRICAN BUSINESSES
BY OLAWALE HAMED
O
ver the last 10 years, we have
increasingly observed the mass
exodus of multinationals from
Nigeria to Ghana. Whilst some close
shop completely in Nigeria, others
have adopted a gradual approach
towards the same end result. Some of
such companies in the manufacturing
sector include Dunlop Nigeria Plc
and Michelin. The aviation sector also
has not been left out in this trend.
Recently, it was reported that some
international airlines, formerly based in
Nigeria, started relocating their offices
to Accra, Ghana. These airlines now
comefromAccratopickuppassengers
in Nigeria before embarking on their
different international journeys.
The development is most worrisome if
we consider the negative impact on
job creation and economic growth
as a whole. The trend causes one to
wonder. Why are these firms relocating
and why is Ghana their new choice
location? Some of the major factors
put forward to justify the move include:
poor power supply, scarcity of foreign
exchange, policy inconsistency on
the part of regulators, corruption and
security of lives and property.
The Doing Business 2017 report,
conducted by the International
Finance Corporation and the World
Bank, ranks Ghana 108 out of 190
economies for overall ease of doing
business, up 3 places from its 2016 rank.
Nigeria, on the other hand, currently
ranks 169 on this list, a position it has
held since 2014. Nigeria’s best ever
position on that list came in 2008 when
the country ranked 120 out of 190.
A survey conducted by the Bank of
Ghana recently revealed that Nigeria
was one of the 10 sources of Foreign
Direct Investment in the former Gold
Coast. Factors considered in drawing
up the Ease of Doing Business list
include:
•
Starting a Business
•
Dealing with Construction Permits
•
Registering Property and,
•
Access to Credit
Ghana’s achievement in wooing
companies from Nigeria is not
merely coincidental. Ghana actually
spearheaded the move of asking
Nigerian manufacturing firms to
relocate to the former Gold Coast by
Hamed Olawale examines
why multinational Head
Offices are moving to Ghana
from Nigeria.
Photo credit: flickr.com/Ronnie Pitman
