Ghana Investment Promotion Authority: Act 1173 Reforms Boost Investment Climate

• Ghana Investment Promotion Authority (GIPA) receives parliamentary backing for investment reforms.
• Reforms aim to promote greater local participation and facilitate investments across regions.
• Act 1173 removes blanket minimum capital requirements, except in the trading sector.
• Reforms align Ghana's investment framework with AfCFTA Protocol on Investment.
• GIPA registers over 7,160 investment projects, cumulative foreign direct investment exceeds US$62 billion.

The Ghana Investment Promotion Authority (GIPA) has received backing from the Parliamentary Select Committee on Trade, Industry and Tourism for its efforts to strengthen the investment climate in Ghana. The Committee's support is a significant boost for GIPA as it seeks to position Ghana as a competitive investment destination. According to Mr Simon Madjie, Chief Executive Officer of GIPA, the reforms under Act 1173 aim to promote greater local participation in the economy and facilitate investments across the regions. The law has expanded GIPA's role to support investment in Ghana, particularly within the ECOWAS region and under the African Continental Free Trade Area (AfCFTA).

The reforms introduced under Act 1173 have removed blanket minimum capital requirements for joint ventures and wholly foreign-owned enterprises, except in the trading sector. This change allows capital requirements to be assessed according to the specific sectors in which investors operate. Mr Madjie emphasized that local content requirements, sector-specific regulations, and activities reserved for Ghanaians will provide safeguards for local businesses while attracting competitive investments. The reforms also align Ghana's investment framework with the AfCFTA Protocol on Investment, enhancing the country's competitiveness.

Under GIPA's leadership, over 7,160 investment projects have been registered since 1994, with cumulative foreign direct investment exceeding US$62 billion. The Authority is also expanding its regional offices to support investors closer to their project locations and improving its capacity to facilitate investments. Mr Madjie appealed to the Committee to support the operationalisation of the citizenship-by-investment provisions under Act 1173, in collaboration with the Ministry of the Interior, to attract high-net-worth investors.

Lawyers should watch for the potential impact of these reforms on foreign investors, particularly those operating in the trading sector, where capital requirements have been relaxed. Compliance officers should also note that the new law aligns Ghana's investment framework with the AfCFTA Protocol on Investment.

Source: Original reporting via AllAfrica Ghana