Business and Investment Climate Reforms in Ghana – Progress, Challenges and Issues Presentation to GTZ Seminar Mount Grace Country House Hotel May 22, 2006

PSD Strategy - Logical Framework The Goal is sustainable, equitable and widespread private sector-led growth throughout Ghana The Goal is sustainable, equitable and widespread private sector-led growth throughout Ghana The Purpose is to enhance the competitiveness of the private sector The Purpose is to enhance the competitiveness of the private sector The 4 key Outputs are: The 4 key Outputs are: Enhance Ghana’s position in global and regional markets Enhance Ghana’s position in global and regional markets Improve efficiency and accessibility of national markets Improve efficiency and accessibility of national markets Improve competence and capacity at the firm level Improve competence and capacity at the firm level Strengthen Government’s private sector policy formulation, implementation, monitoring and evaluation Strengthen Government’s private sector policy formulation, implementation, monitoring and evaluation

Implementation Framework Strategy c o-ordinates Investment Climate Reforms of MDAs – Trade and Industry, Private Sector Development and PSI, Public Sector Reform, Local Government and Rural Development, Justice & AGs, Finance, Registrar- General’s, Investment Promotion Centre… Strategy c o-ordinates Investment Climate Reforms of MDAs – Trade and Industry, Private Sector Development and PSI, Public Sector Reform, Local Government and Rural Development, Justice & AGs, Finance, Registrar- General’s, Investment Promotion Centre… An Oversight Committee made up of the key Implementing MDAs and the private sector is overseeing implementation An Oversight Committee made up of the key Implementing MDAs and the private sector is overseeing implementation Development Partners are providing financial and technical support for implementation Development Partners are providing financial and technical support for implementation World Bank, DFID and DANIDA providing Pooled Funds World Bank, DFID and DANIDA providing Pooled Funds USAID, UNDP, JICA, IFC, Governments of Germany, France, Italy, Switzerland, Netherlands providing Aligned Support USAID, UNDP, JICA, IFC, Governments of Germany, France, Italy, Switzerland, Netherlands providing Aligned Support EU providing Sector Budget Support EU providing Sector Budget Support A Monitoring and Evaluation Framework has been designed and is being operationalised A Monitoring and Evaluation Framework has been designed and is being operationalised Implementation will be based on regular and quality dialogue with the private sector Implementation will be based on regular and quality dialogue with the private sector

Key activities Implementation of Trade Sector Support Program to provide a trade enabling environment - includes reform of quality standards institutions Implementation of Trade Sector Support Program to provide a trade enabling environment - includes reform of quality standards institutions Enhancing investment promotion activities Enhancing investment promotion activities Improving operational modalities and performance of strategic export sectors Improving operational modalities and performance of strategic export sectors Reform of the Registrar-General’s Dept to reduce the time and cost for starting a business Reform of the Registrar-General’s Dept to reduce the time and cost for starting a business Promotion of Public-Private Partnerships in infrastructure programs Promotion of Public-Private Partnerships in infrastructure programs Improvement in public sector service delivery through: Improvement in public sector service delivery through: Institutional reform of the key agencies that interface with the private sector Institutional reform of the key agencies that interface with the private sector Implementation of Customer Charters and a culture change program for key PSD-related Ministries, Departments and Agencies Implementation of Customer Charters and a culture change program for key PSD-related Ministries, Departments and Agencies Review of Local Government regulation, taxes and charges especially for MSMEs Review of Local Government regulation, taxes and charges especially for MSMEs

Key activities Policy and Regulatory Impact Assessment to ensure that policy and regulation do not impose undue burden on the private sector Policy and Regulatory Impact Assessment to ensure that policy and regulation do not impose undue burden on the private sector Business law reforms, including review of the Companies Code in line with best practice Business law reforms, including review of the Companies Code in line with best practice Institutional strengthening of Commercial Courts and promotion of Alternative Dispute Resolution Institutional strengthening of Commercial Courts and promotion of Alternative Dispute Resolution Monitoring of Financial Sector Reforms, Land Reforms; Infrastructure Programs; Agriculture Sector programs… Monitoring of Financial Sector Reforms, Land Reforms; Infrastructure Programs; Agriculture Sector programs… Implementation of a best-practice framework for firm- level initiatives and an action plan for the informal sector Implementation of a best-practice framework for firm- level initiatives and an action plan for the informal sector Enhanced and quality dialogue with the private sector Enhanced and quality dialogue with the private sector Effective Monitoring and Evaluation of the PSD Strategy Effective Monitoring and Evaluation of the PSD Strategy

Issues and Challenges Business and investment climate reforms are necessary, but are they sufficient to achieve private sector development and growth – direct interventions at the firm level Business and investment climate reforms are necessary, but are they sufficient to achieve private sector development and growth – direct interventions at the firm level Impact of globalization on the competitiveness of the private sector in Africa – Access to Markets Impact of globalization on the competitiveness of the private sector in Africa – Access to Markets Coordination and Prioritization of activities – breadth and crosscutting nature of the reform agenda versus limited resources Coordination and Prioritization of activities – breadth and crosscutting nature of the reform agenda versus limited resources Monitoring and Evaluation Challenges Monitoring and Evaluation Challenges Difficulty of setting realistic targets for activities Difficulty of setting realistic targets for activities Ability to get accurate data/information to assess results Ability to get accurate data/information to assess results Attribution of reforms directly to results Attribution of reforms directly to results Effectiveness of monitoring and impact assessment tools; e.g. World Bank Doing Business report Effectiveness of monitoring and impact assessment tools; e.g. World Bank Doing Business report

Issues and Challenges Level of engagement of the private sector in the process Level of engagement of the private sector in the process Strengthened private sector associations Strengthened private sector associations Enhanced public-private dialogue Enhanced public-private dialogue Capacity of MDAs to implement reforms – linked to wider public sector reform issues of motivation and capacity Capacity of MDAs to implement reforms – linked to wider public sector reform issues of motivation and capacity Development Partners aligning their programs and support to Government’s reform agenda Development Partners aligning their programs and support to Government’s reform agenda Decentralization of the reform agenda to address specific constraints at the regional/local level Decentralization of the reform agenda to address specific constraints at the regional/local level Political commitment to the reform agenda – reforms with medium to long-term impact for Government’s with short-term election cycles Political commitment to the reform agenda – reforms with medium to long-term impact for Government’s with short-term election cycles