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Investment law needs drastic revision
- Wayo Seini
Accra, Dec. 13, GNA - Professor Wayo Seini, Senior Fellow at
the Institute of Economic Affairs (IEA) on Thursday said the
Ghana Investment Promotion Centre (GIPC) Act 478 which was
passed to promote and attract foreign investment into Ghana
needs to be drastically revised.
He said: "As at now, the Act appears to be obsolete," and
that there was the need for an entirely new Act that would
take into consideration not only the economic environment
and requirements but also the prerequisites for attracting
foreign and domestic investors.
Prof. Seini was giving a presentation on the topic: "Review
of the Ghana Investment Centre Act 1994, Act 478" at a
roundtable organized by the IEA.
The discussion brought together executives of the Ghana
Union of Traders Association (GUTA), Internal Revenue
Office, Bank of Ghana and the staff of GIPC and economic
consultants.
Prof Seini said, "It is obvious that the Ghana Investment
Promotion Act, 1994, Act 478 contains a lot of articles and
sub-articles that offer too much to would be foreign
investors and too little to stimulate domestic savings,
investment and growth of indigenous enterprises."
He said the Act was probably passed at a time when there was
the need to virtually beg for foreign investors to come to
Ghana.
Quoting some aspects of the Act, Prof. Seini said Article
19(3) tend to contradict the schedule of enterprise that
were reserved for Ghanaians, adding; "The sale of anything
whatsoever in a market, petty trading, hawking or selling
from a kiosk at any place is reserved for Ghanaians.
"In any case of trading enterprises involving only the
purchasing and selling of goods which either wholly or
partly owned by a non-Ghanaian, there shall be an investment
of foreign capital or its equivalent in goods worth at least
300 hundred thousand dollars."
Prof. Seini observed that the provisions had been too
liberal in many respects.
"Nevertheless, for a country to grow and develop, investment
needs not only be entirely foreign. The need to encourage
domestic mobilization of savings and investments is crucial
to the development of a nation."
He called for a hard core of indigenous entrepreneurs who
would lead the way and guide would be investors to establish
in Ghana rather than relying heavily on public institutional
efforts.
Prof. Seini noted that the threshold of foreign currency
requirements were low at all levels and said: "if you are
talking about attracting investment in this day and age, you
should be thinking about millions and billions of United
States dollars.
Mr Robert Ahomka-Lindsay, Chief Executive Officer of GIPC,
said the Act would be reviewed to cover everything from
nuclear power station to the slippers seller.
He said the involvement of Ghanaians in major trading
activities was important but had to be handled carefully.
"There are fundamental questions of policy that needs to be
addressed. We have a draft law and we want inputs from
stakeholders"
He reminded the country that, "no country has developed at
any level by trading alone."
Mr Kwesi Ahwoi, Trade and Investment Consultant, admitted
that there was the need for a change but explained that the
1994 Act was drafted in an environment that demanded a call
for foreign investors.
Other participants shared diverse views on the need to
review the law but ultimately agreed that there was the need
for a review.
GNA
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