Tapping Into Potential Economic Growth In Africa: Ghana Is Open For Business
In 2016, the value of total imports into Middle Eastern countries was nearly $600 million of which gold accounted for over $27 million and petroleum just under $18 million. The countries that imported the most from Middle Eastern countries included China, the United States, and India.
Reports however show that there are considerable potential - and as yet untapped - energy resources such as oil and gas within African countries. This potential for additional exports suggests the need for greater economic cooperation between
Middle Eastern countries and the African continent.
Untapped energy potential is estimated at between $13 trillion and $14.5 trillion in hard coal, natural gas, crude oil, and uranium. South Africa, for instance, is the seventh largest coal producer on a global scale after economic giants such as China, the United States, and India1. Some major investments have already flowed into Africa. For example, in 2009 China and Africa conducted some $100 billion in trade. The primary African countries for Chinese investments are Nigeria and Ghana. However, other countries on the continent are also seeking meaningful economic partnerships. Large-scale Middle Eastern investment efforts are already evident. For example, in 2012, Saudi Arabia increased its investments into African farmland. Saudi Arabia has land that is unsuitable for agriculture and this has made the country look outside its borders for arable land. Many African countries do have such arable land for potential investors. About 60% of the world’s uncultivated land is within the borders of Africa. Investing in African land has alleviated some of the food shortages that Saudi Arabia has had and this explains the Kingdom’s interest in expanding to countries along the Nile, such as Sudan and Ethiopia.
Ghana is open for business
Although historically Middle Eastern countries have invested more in North African countries, there has been increasing interest in the rest of Africa. For example, in 2015, Kenya, Uganda, South Africa, and Nigeria welcomed the largest number of Gulf investors. As of this year, there has been increasing amounts of interest in economic cooperation between Ghana and Middle Eastern countries. In May, the Ghana Gulf Cooperation Chamber of Commerce (GGCCC) was launched, the main objective of which is to facilitate economic cooperation and relations between Ghana and Gulf countries such as the United Arab Emirates, Kuwait, Saudi Arabia, Qatar, Oman, and Bahrain. Ghana aims to strengthen mutually beneficial business ties with Gulf States. Earlier this year, President AkufoAddo of Ghana, spoke about his country’s desire to seek economic relationships with Gulf countries, stating; “Ghana is open for business.” And in September of this year, the newly installed 19th Ghanaian Ambassador to the United States, His Excellency Dr. Barfuor AdjeiBarwuah, echoed the same sentiment whilst being honoured at the Global Oved Dei Seminary and University (GODSU) Empower U Women’s Conference and Fall 2017 Graduation, in Silver Spring, Maryland, USA.
Perfect for long-term investment
Previous concerns about investments in West African countries being high-risk due to a country's instability, as well as the cost of developing essential infrastructure, are no longer valid. With an increase in political and economic stability across the region, countries such as Ghana are perfect for inward investment. Current supporters such as Saudi Arabia, amongst others, recognise the benefits of investing in infrastructure on the African continent. Once proper infrastructure is in place, those untapped resources can be exploited in an economic way. The missing link is therefore not resources, but capital and funding to unearth the resources. Ambassador Adjei-Barwuah says, “Ghana has embarked upon an audacious programme of ‘One District One Factory’ – a programme that relies on agricultural production and attendant agro-processing enterprises. The idea is to add value to traditional agricultural products with a view to increasing exports. Ghana’s improved investment climate is reflected in her political stability and social cohesion besides favourable investment legislation and trained workforce." Ghana prioritises textile manufacturing, mining, and infrastructural developments such as railways, highways and airports as part of its long-term planning.
1. 2016 figures Statistical Review of World Energy 2017