Ghana recorded $874 million in incoming investments in the first half of the year. Ghana’s attractiveness as an investment destination has proven its resilience during the COVID-19 pandemic as it raised $874.01 million in investments from 122 projects in the first half of 2021.
Of the total investment of $874.01 million, the foreign direct investment component amounted to $829.29 million, while the domestic component represented $44.72 million.
The foreign direct investment of 829.29 million US dollars represented a remarkable increase of 32.15 percent in inward foreign direct investment compared to the value of foreign direct investment which amounted to 627.52 million US dollars in the same period last year.
This strong FDI performance in the first half of the year was driven by success in key sectors, including the services sector with 63 projects valued at $597.63 million, the manufacturing sector with 24 projects valued at $98.74 million, in addition to general trade, construction and investment. Foreign direct: $41.87 million and $22.63 million, respectively.
Now that the projects are fully operational, they have the potential to create 8,931 jobs, and improve employment overall. According to GIPC data, 8,091 (90.59 percent) of these jobs will be for Ghanaians, while the remaining 840 (9.41 percent) will be for non-Ghanans.
The largest investment partners of Ghana during this period are Singapore with $307.50 million, Australia with $204.01 million, India with $61.57 million and the Netherlands with $46.80 million. The United States and China have also made significant investments.
While Ghana’s stable semi-annual performance means continued confidence in the Ghanaian economy by foreign investors, it is also worth noting that in the first half of 2021, a total of 27 wholly-owned Ghanaian projects were valued at an estimated US$669.64 million. Existing companies contributed a total of $11.56 million in additional equity (cash and merchandise).
In terms of project spread, nine districts benefited from the spread of 122 projects. Greater Accra outperformed all other regions, with 96 projects, representing 78.69 percent of all projects submitted in the first half of the year. Other regions that have registered their projects are Ashanti, Western Region with 8 and 9 projects respectively, Puno and Central and Eastern Region with two (2) projects each, while Ahafo Regions, Northern and Upper Western Regions each have one registered project.
Overall, the positive performance of Ghana’s FDI over half a year differed somewhat from the expected global slowdown in FDI inflows. Perhaps not surprisingly, the steady performance was attributed to the revitalization of Ghana’s Covid 19 mitigation program and institutional revitalization programme, as well as the timely rollout of several government stimulus which led to a rapid recovery of the Ghanaian economy.
However, the United Nations Conference on Trade and Development (UNCTAD) notes that the COVID-19 pandemic has had a significant impact on global FDI flows, with global FDI dropping by a third to $1 trillion in 2020, over ten years. Through experience during the global financial crisis.
However, UNCTAD predicts that global FDI flows are likely to pick up again in 2021, growing by 10-15%. But the pace of economic recovery and the potential for pandemic setbacks, as well as the potential impact of recovery spending packages on foreign direct investment and policy pressures, will all affect investment outlook.
As the country’s leading investment promotion agency, the Ghana Investment Promotion Center remains optimistic about maintaining upbeat performance while moving forward in a new and innovative way.
The center hopes to achieve this by revitalizing international investment as a channel for economic growth through strong engagement with the international investor community and hosting the first annual investment summit titled “Spark up 2021”.
In addition, attracting investment under the Ghana Covid-19 Institutional Relief and Revitalization Initiative (CARES) will remain a priority for GIPC to ensure that Ghana’s economic recovery is inclusive, benefiting all sectors of the economy.
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