Global Business Strategy Plan Doing Business in Ghana

Country Factors: Political and Legal Describe the political and legal system in your target country. What are the major trends? What is the local government’s attitude to foreign business? How is the government involved in business activity? What are the risks and opportunities to your business given the political and legal climate?

Political Climate Ghana is a young, but fairly stable democracy, with mainly 3 or 4 big political parties. The president is head of state, head of government, and commander in chief of the armed forces. The constitution calls for a system of checks and balances, with power shared between a president, a unicameral parliament, an advisory Council of State, and an independent judiciary.

Government Attitude towards Foreign Business The positive encouragement of investors through the activities of the Ghana Investment Promotion Centre, the Ghana Free Zone Board, which offers tax, tariff and other regulatory relieves to enable exporting enterprises to produce goods at low cost and to achieve globalized manufacturing status. There is a liberalized Technology Transfer Regime, which aims at promoting technological skills and management expertise in local enterprises; The financial market has been Liberalized. There are incentives, which are carefully designed to attract investors (both foreign and Ghanaian); to reduce financial risks to investors; to free investment capital and; to reduce high start up costs; The liberalization of the laws and regulations controlling the entry and establishment and the principle of national treatment which permits unrestricted foreign participation in all sectors of the economy with the exception of unsophisticated activities with low capital outlays; The on going privatization program, which involves total or partial transfer and control of publicly owned assets to private sector investor or entities (both foreign and Ghana);

Country Factors: Economic Describe the economic system in your target country. What are the major trends? How is the local economy performing on the world scene and how might this affect you? What are the risks and opportunities to your business given the economic climate?

Economic Climate: Ghana Solid macroeconomic management coupled with major debt relief, large inflows of donor resources, and relatively high cocoa and gold prices have been the keys to the steady improvements in real GDP growth, which in 2004 topped 5% for the first time in a decade and reached an estimated 6.2% in Ghana was recognized for its economic and democratic achievements in 2006, when it signed a five-year, $547 million anti-poverty compact with the United States' Millennium Challenge Corporation. The Central Bank base rate has dropped to 15%, enabling banks to give more affordable credit to business operators. Key economic challenges include: overcoming infrastructure bottlenecks, especially in energy and water; poor management of natural resources; improving human resource capacity and development; establishing a business and investment climate that encourages and allows private sector- led growth, and privatizing remaining state-owned enterprises, several of which are significant budget liabilities.

Opportunities for Foreign Investor in Ghana A stable political environment A sound macroeconomic policy 100% foreign ownership permitted On-going Privatization of program A large Economic Community of West African States (ECOWAS) market (250 million people). Good and ever improving physical infrastructure Availability of skilled and trainable labor. Competitive labor cost. Quota-Free access to USA & European Union markets. Proximity to European Union (6 hrs flight time) and USA markets (9 hrs direct flight time). Fast developing financial infrastructure High degree of personal safety Warm and friendly people Fairly high quality of life.

Attractive Opportunity for Real Estate Companies The income of a company from a business of construction for sale or letting of residential premises is exempt for five (5) years from the date of commencement of operations. Insurance Against Non-Commercial Risks: Ghana is a signatory to the World Bank’s Multilateral Investment Guarantee Agency (MIGA) Convention. This Convention guarantees coverage (insurance) against non-commercial risks such as transfer restrictions, breach of contract, expropriation, war and civil disobedience. Double Taxation Agreements: Ghana also uses Double Taxation Agreements (DTA) to rationalise tax obligations of investors who come from global tax sourced jurisdictions with a view to saving the investors the incidence of double taxation. A large amount of remittances come in from Ghana’s extensive diaspora, much of which is invested in the booming property sector in the main cities.

Risks/ Challenges Complex land tenure system High inflation rate Inadequate business infrastructure Bureaucratic hurdles Limited Ghanaian purchasing power (low disposable income)

Country Factors: Cultural Describe the major cultural issues in your target country: –Language –Religion –Education –Social What are the major trends? What are the risks and opportunities to your business given the cultural climate?

Cultural Factors Ghana maintains strong historical, cultural and economic links with Britain There is an increasing demand for U.S.- made goods and a liking for things "American" in general among people in Ghana. Ghanaian values are very traditional, and this tendency extends to business dealings as well.

Cultural Factors: Ghana Local people are known for their friendliness and hospitality. English is widely spoken throughout Ghana, and is the official language. Most Ghanaians descended from migrating tribes that probably came down the Volta River valley at the beginning of the 13th century. Among the more important linguistic groups are the Akans, which include the Fantis along the coast and the Ashantis in the forest region north of the coast; the Guans, on the plains of the Volta River; the Ga- and Ewe-speaking peoples of the south and southeast; and the Moshi-Dagomba-speaking tribes of the northern and upper regions. In 2006 there were approximately 5.1 million students attending schools at these three levels: 68% at the primary level, 23% at the junior secondary level and 10% at the senior secondary level. Over 84,078 undergraduates are now enrolled in secular degree-granting programs in seventeen public and private universities, 29,047 students enrolled in polytechnics, and 26,025 trainees enrolled in teacher training colleges.