Investment Outlook Ghana is one of the most well-governed and politically stable countries in Africa, making it an attractive investment destination. It is the third largest producer and the second largest exporter of cocoa in the world and the second largest producer of gold in Africa. Cocoa, gold and crude oil make up Ghana’s primary sources of revenue from foreign trade. In recent years, fluctuation in prices of these three commodities, an increasing wage bill, electricity shortage and other factors have combined to slow the pace of economic growth. This has led to a depreciating currency, rising debt level and annual budget shortfall. These pressures have however not affected Ghana’s long- term outlook for growth. In the face of the difficulties, the country turned to the IMF in April 2015 for an almost $1 billion bailout under a three-year arrangement and have received a total disbursement of about USD 464.6 million as at March 2017. Ghana’s newly elected government, led by President Nana Addo Danquah Akufo-Addo, has expressed intent to continue with the current IMF program and also pursue a wide range of ambitious reforms to move the country into a full-fledged middle-income economy. Also at the top of the government’s agenda in the medium term, are measures to broaden the tax base and enhance tax compliance, strengthen control of the wage bill, and adhere strictly to the Public Finance Management Act passed in 2016. The country expects an increase in the oil and gas output in the medium term as a result of higher production from two oil fields (Jubilee and Sankofa Gye Nyame) and the commencement of crude oil and gas production from a third field, Tweneboa-Enyenra-Ntomme ( TEN ) by the second half of 2017. From these three oil-producing fields, the projected output in 2017 is almost 44 million barrels and expected to yield revenue of USD 515.64 million. The government has exhibited a commitment to re-energise and boost private sector participation in the Ghanaian economy. The government plans to incentivise private businesses and foreign direct investment in the country and has recently announced the removal of “nuisance” taxes. The government has also listed agriculture, education, health and infrastructure such as road and railway as its priority areas for 2017.
Forms of Corporate Structure According to the laws of Ghana, business entities may be set up in accordance with the provisions of the Companies Act, 1963 (Act 179), the Incorporated Partnership Act, 1962 (Act 152) or the Registration of Business Name Act, 1962 (Act 151). The most commonly used corporate entities are: • Limited Liability Company Limited liability companies are the most commonly used corporate set up in Ghana. These companies are formed with the primary aim of making profit. They limit the liability of their shareholders to the value of their unpaid shares. Ghanaian law requires companies limited by shares to have at least two (2) directors, a secretary and at least one (1) shareholder. • Unlimited Liability Company This type of corporate set up is used where limited liability is not acceptable, vital or practical. It is not very common in Ghana and is primarily utilized by law firms and other professional establishments who may be prevented from operating as limited liability companies by their professional ethics. As liability is not capped, personal assets of members are liable to be used to pay off the debts of the company, particularly in the event of liquidation. Similar to a company limited by shares, unlimited liability company must have at least two (2) individuals acting as directors of the company, a secretary and at least one (1) shareholder providing capital investment in the company, with an object of making profits. • External Company Corporate bodies formed outside Ghana are not required to incorporate a subsidiary in order to operate within the country. A foreign entity is permitted to register with the Registrar General’s Department as an external company. External companies are subject to Ghana tax laws and are liable to pay tax on their Ghanaian earnings as well as other foreign earnings that are brought into Ghana. • Sole Proprietorship TThis corporate structure is common in Ghana by reason of its speed and cost of set up. It is used by individuals who are entitled to the profits and subject to the liabilities of the business. Registration of the business name of a sole proprietorship is pursuant to the Registration
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