Amcham & EBO's joint event on Local Content

29-03-2018

Amcham & EBO's joint event on Local Content

 

 

This morning a business breakfast forum took place in the Accra City Hotel. The forum was jointly organized by The European Business Organization & American Chamber Of Commerce Ghana.

Local Content has become a “hot item” for foreign Investors in Ghana which has resulted in many questions. The current local content policies for Ghana and their impact on foreign investors was discussed; the discussion  included some of  the negative consequences of the current  local content regulations which are popping up in more and more industries. The panelists were: Kwasi Abeasi, Chairman – Board of Directors, Ghana Investment Promotion Centre, Nana Osei Bonsu, CEO – Private Enterprise Federation, David Addo Ashong, Founding Partner – Ashong Benjamin and Associates and  Senyo Hosi CEO – Ghana Chamber of Bulk Oil Distributors (CBOD)

During the meeting it came forward  that on the subject of local content, the government has no policy consistence, there seems to be a lack of certainty leading to conflicting  signals. Although it was confirmed that laws could not be retroactive hence new regulations should not affect existing contracts , the government should communicate that. Also the fact that within the GIPC law there is a stipulation that there can be no  expropriation, there was on the other hand the local content law concerning the custom clearance companies (needed to be 100% Ghanaian owned) which basically conflicts with GIPC law. It seems there were too many ad hoc policies, a lack of structured and harmonized policies . That is not good , local content should be value driven instead of focusing on ownership.

Also there was debate on the local content policies in the downstream oil industry, a lot of uncertainty with European companies who have been in Ghana for over 50 years . Although the forum stated that existing contracts will not be affected, these policies will affect their investment decisions concerning future contracts and will lead to postponement of investment or even retracting investments. The result will be that Ghana will only attract so called Vampire investors; in for the quick win , no long term investment but only to “suck” as much proceeds out of Ghana within a short timeframe of 4 years (governments term). Politicians should realize that because politicians don’t bring investors ; they can only chase them away.

For more info: contact Tjalling Wiarda at tjalling@gnbcc.net

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