10 June FREE ZONES PROGRAMME: Providing The Most Conducive Investment Environment And MARKET PRESENTED BY: THE EMBASSY OF GHANA, SEOUL

10 June INTRODUCTION The global trend of investing in industrial zones has caught up with Africa, specifically Ghana. The World Bank acknowledges Africa as the new frontier for trade and investment, with an average return on investment of 26%.

10 June GHANA Geographically, Ghana is strategically located for global trade. -Located at the centre of the World -In the heart of West Africa - Direct sealinks to Europe, Americas, the Far East and the Middle East - Ghana’s time zone falls within the Greenwich Mean Time (GMT)

10 June CONCEPT OF THE GHANA FREE ZONES PROGRAMME A government policy implemented to promote export oriented investments Designed to promote processing and manufacturing of goods and services for export Combines both enclave and single factory enterprise schemes The whole of Ghana is accessible to potential investors The programme is completely private sector driven

10 June MISSION STATEMENT The Mission of the programme is to help transform Ghana into the Gateway to West Africa by creating an attractive and conducive business environment through the provision of competitive free zone incentives and operation of an efficient “one-stop-shop” for the promotion and enhancement of domestic and foreign investment

10 June AREAS OF OPERATION ENCLAVE DEVELOPMENT MANUFACTURING SERVICE COMMERCIAL/WAREHOUSING

10 June EXPORT PROCESSING ZONES Four Export Processing Zones have been declared: Tema Export Processing Zone (EPZ)1,200 acres Sekondi EPZ2,200 acres Shama EPZ 3,000 acres Ashanti Technology Park1,090 acres

10 June TEMA EPZ FACILITIES The Tema EPZ is the flagship of the Ghana Free Zone Programme. It has a total area of 1,200 acres (480 hectares). The Tema EPZ is well serviced with the following off- site facilities: – Access and service roads – Central sewage system – Water system – Telecommunication services – Electricity Designated as a multipurpose EPZ A range of property options i.e. office space and serviced lands First class road linking TEPZ to sea port (Tema) and airport (Accra)

10 June TEMA EPZ FACILITIES CONT’D Multipurpose Industrial Park – Open to non-free zone enterprises. – Will house the following: A common Service Centre (CSC) A Furniture City An ICT Park Textile Development Centre Jewellery Centre

10 June SEKONDI EPZ Total acreage of 2,200 (880 hectares) of land. Designated as an Export Processing Zone in Area has been earmarked for an oil refinery and related activities. No development has taken place yet Looking for investors interested in developing the enclave

10 June SHAMA EPZ Located in the Western Region Total land area is 3000 acres (1200 hectares) of land Acquisition completed in 2004 Survey and pillaring of the entire 3000 acres completed Looking for investors interested in developing the enclave

10 June ASHANTI TECHNOLOGY PARK 1,099 acre (439.6 hectares) land to be developed as a Technology Park. Enclave Development The GFZB is looking for Investors interested in developing the Ashanti Technology Park. Participation can be through build operate and transfer (BOT) systems, Joint ventures and Sector specific development Infrastructure Development Opportunities exist for investors interested in generation and distribution of water, generation of electric power from thermal and bio-mass plants and development of telecommunications infrastructure

10 June ATP – SECTOR SPECIFIC INVESTMENT The Ashanti Technology Park (ATP) will evolve into a multi- sector EPZ, with the lead cluster units being: ICT/CYBER VILLAGE FURNITURE CITY COCOA PROCESSING ZONE LIGHT INDUSTRIAL ZONE HEAVY INDUSTRIAL ZONE WAREHOUSING ZONE SOCIAL SERVICES CENTRE BIO-TECHNOLOGY ZONE

10 June ICT sub-sector Areas for investments within this sub-sector include: Outsourcing Data Entry and Processing Call Centres Software Development Hardware Assembling ICT Infrastructure Development

10 June Furniture Sub-sector There is opportunity for investment in producing furniture or assembling knock down furniture for the West African market. Availability of raw materials i.e. timber, bamboo and cane Opportunity for producing particleboard with waste wood

10 June Agro Processing Sub-sector Opportunities exist for - Cocoa processing - Processing of fruits and vegetables - Oil palm processing

10 June Textile and Garments sub-sector President has a special initiative on Textile & Garment Availability of cotton for production of textiles Availability of skilled manpower from the PSI training centre, polytechnics and universities Opportunity to invest in the garment accessories sector i.e. buttons, zips, labels etc.

10 June Automobile Assembling Sub-sector Availability of automobile engineering technicians from the polytechnics and the University of Science and Technology Highly skilled local artisans in automobile assembling

10 June Light Industry Sub-sector Assembling of electrical appliances Fabrication of hand tools

10 June Commercial Sub-sector Opportunity for using Ghana as a base to re-export finished or semi-finished products to other West African countries.

10 June Estate Development Sub-sector There are opportunities for Estate developers to build residential units for the export processing zone workers

10 June GENERAL PRIORITY SECTORS Agro Food Processing Cotton processing Textile manufacturing Ethnic Beauty Products Sea Food Processing Jewellery/Handicraft Production Light Industry/Assembling Plant Plastic Products Manufacturing Metal Fabrication Ceramic Tile Manufacturing Floriculture Information & Communication Technology

10 June INCENTIVES 100% exemption from payment of income tax for 10 years and not more than 8% thereafter 100% exemption from payment of withholding taxes Relief from double taxation No import licensing requirements Minimal customs formalities 100% ownership of shares by foreign or local investors

10 June INCENTIVES CONT’D No restriction on: a. Repatriation of dividends b. Payment of foreign loan servicing c. Payment of fees and charges for technology transfer agreement d. Remittance of proceeds from sale of any interest in a free zone investment

10 June INCENTIVES CONT’D Operation of foreign currency account allowed Up to 30% of services provided is allowed for sale on local market Free Zone investments are guaranteed against nationalization and expropriation

10 June INCENTIVES CONT’D Relief from various bureaucratic restrictions and other statutory requirements Investment approval not exceeding 28 working days; Unimpeded issuance of expatriate work and residence permits;

10 June MARKET ACCESS Duty and quota free access to the US market under the African Growth and Opportunity Act (AGOA). Access to ECOWAS market of about 250 million people Access to the African market through African Union concept Access to the European Union market through the Economic Partnership Agreement (EPA) when fully operationalized.

10 June BUSINESS ENVIRONMENT Investment Guarantees Ghana is a signatory to the World Bank’s Multilateral Investment Guarantee Agency (MIGA) Convention which guarantees insurance against non-commercial risks such as transfer restrictions, breach of contract, expropriation, war and civil disobedience. Investment Promotion and Protection Agreement with Canada is pending

10 June BUSINESS ENVIRONMENT CONT’D Legal Framework - Conforms to international norms and practices relating to business activity. - There are legislations on copyrights, patents, trademarks, disputes, labour relations, industrial and intellectual property. - There is respect for commercial rights and obligations and an independent court system which ensures equitable protection of rights. - There are alternative dispute resolution mechanisms available such as mediation and arbitration.

10 June BUSINESS ENVIRONMENT CONT’D Effect of Oil Find - injection of capital into economy - improved infrastructure - increased purchasing power and standard of living

10 June PROCEDURE FOR ESTABLISHMENT Incorporate a company in Ghana with the Registrar General’s Department Obtain and complete the GFZB Application Form (US$100) and submit with: Business Plan Copy of Certificate of Incorporation Copy of Certificate to Commence Business Copy of Company’s Code Evidence of possession/lease of real property or intent to acquire such property MOU with potential clients Environmental Protection Agency Permit Evidence of Funding/Capital Transfer Any other relevant document

10 June PROCEDURE FOR ESTABLISHMENT The GFZB shall notify applicant of status of application within 28 working days of receipt of application A developer/enterprise license shall be issued to successful applicant with six months grace for commencement

10 June ADVANTAGES OF LOCATING IN GHANA Stable political environment Well trained, abundant and adaptable labour force Competitive daily minimum wage No restriction on issuing of work/residence permit Duty/Quota free access of manufactured exports to USA (AGOA) and EU Excellent sea and air connection to the world Strategic and central location within West Africa sub-region with access to a market of 250 million people

10 June ADVANTAGES OF LOCATING IN GHANA Comparatively well developed infrastructure Member of Multilateral Investment Guarantee Agency (MIGA) Convention A dynamic private sector willing to collaborate with foreign partners A high sense of personal safety A truly hospitable people

10 June COST OF DOING BUSINESS General Business Registration Application fees-$10.95 Stamp Duty-0.5% of stated capital Filing fees-$10.95 Incorporation fees-$61.33

10 June COST OF DOING BUSINESS CONT’D Free Zone Registration Application Form - US$ License Fee ActivityInitial FeeAnnual Renewal DeveloperUS$4,000.00US$2, ManufacturingUS$2,000.00US$1, ServiceUS$3,000.00US$2, CommercialUS$5,000.00US$4,000.00

10 June COST OF DOING BUSINESS CONT’D Residence & Work Permit 1 st & 2 nd year - US$ rd & 4 th year - US$ th Year onwards - US$1,500.00

10 June COST OF DOING BUSINESS CONT’D Utility services: Water -US$10.00 per 1,000 lit (flat rate) Electricity 0 – 300 units - US$1.27/Kwh 300 – 600 units - US$1.55/Kwh 600 and above - US$1.77/Kwh Exchange rate:GH¢1.10 =US$1.00

10 June COST OF DOING BUSINESS CONT’D Land (EPZs) Premium - US$40, per acre for 50 years Ground Rent - US$1, per year per acre Documentation Fee - US$1,500

10 June CONTACT Visit our Website at » »

10 June CONCLUSION With our status as one of the region’s most successful export platforms and the generous incentives package being offered, we invite you to come to Ghana and let our easily trainable and abundant labour force be a source of competitive advantage for you as you explore and develop larger markets for your goods and services.

10 June THANK YOU. EMBASSY OF GHANA, SEOUL