Ghana's Parliament has formally endorsed reforms by the Ghana Investment Promotion Authority (GIPA). These reforms aim to improve Ghana’s investment climate and attract more quality foreign direct investment (FDI). The Parliamentary Select Committee on Trade, Industry and Tourism pledged its full support for these changes.
The most significant reform involves removing the blanket minimum capital requirements for foreign investors. Previously, foreign joint ventures needed US$200,000 (GHS 2.4 million) and wholly foreign-owned enterprises required US$500,000 (GHS 6 million). These thresholds are now eliminated for most sectors, with the trading sector being a notable exception. This change is part of the new Ghana Investment Promotion Authority Act, 2023 (Act 1173).
This legislative backing comes as Ghana seeks to position itself as a leading investment destination within Africa. The country is actively working to recover from recent economic challenges, including high inflation and currency depreciation. Streamlining investment entry points is crucial for attracting the capital needed for economic growth and job creation. Ghana’s economic strategy relies heavily on FDI to diversify its economy beyond traditional exports like gold and cocoa.
GIPA's Chief Executive Officer, Simon Madjie, clarified the implications of removing the capital requirements. He stated that investors still need adequate capital, but assessment will now be sector-specific. This approach ensures that capital adequacy is judged based on the actual needs and risks of each industry. Mr. Madjie emphasized that the new framework uses local-content requirements and sector-specific financial regulations. These measures protect local businesses and promote Ghanaian participation in various economic activities.
The reforms also align with the African Continental Free Trade Area (AfCFTA) Protocol on Investment. This alignment is critical for Ghana, which hosts the AfCFTA Secretariat, to enhance its regional competitiveness. GIPA has registered over 7,160 investment projects since 1994, attracting more than US$62 billion in cumulative FDI. This historical performance underscores the importance of a robust and attractive investment framework.
Sectors such as mining, petroleum, power, insurance, and fintech will continue to have specific regulatory and local-content requirements. These provide stronger safeguards than a generic capital threshold. GIPA is also intensifying regional investment promotion efforts through roadshows and opportunity mapping. The Authority is expanding and refurbishing its regional offices to bring investment facilitation services closer to potential investors.
Mr. Madjie also appealed for support to operationalize citizenship-by-investment provisions under Act 1173. This initiative, in collaboration with the Ministry of the Interior, aims to attract high-net-worth investors. It would offer structured residency and eventual citizenship programs. GIPA also seeks stronger enforcement of economic activities reserved for Ghanaians. These include informal retail trading, taxi services, and small-scale pharmaceutical retailing. Developing and enforcing regulations on technology transfer is also a priority to ensure skills and knowledge transfer to Ghanaian businesses.
Alexander Hottordze Roosevelt, Chairman of the Parliamentary Select Committee, acknowledged GIPA’s vital role. He stressed the need to adequately resource the Authority to fulfill its expanded promotional and regulatory duties. The Committee pledged to support GIPA in overcoming challenges and implementing the reforms under Act 1173. Members commended GIPA for promoting Ghanaian investment opportunities both locally and internationally. They expressed strong support for initiatives that strengthen investor confidence and attract quality investments into the country.