Vice President of IMANI Africa, Bright Simons has revealed that the Ghana Investment Promotion Center (GIPC), the nation’s key agency for attracting foreign investment, is grappling with an unprecedented financial crisis.
The agency, which once thrived on service fees from investors, reported zero income from these fees in the second quarter of 2023, a stark contrast to the nearly 11 million GHS generated in the same period of 2022.
In post on X, Mr. Simons insisted that GIPC earned substantial fees for services such as registration certificates, technology transfer validations, and work permit processing.
“ For example, classifying a project as a “strategic investment” cost investors around $10,000, while obtaining investment trend statistics required a payment of approximately $250. However, this year, the agency’s income relied solely on about $35,000 from the central government, raising concerns about its sustainability and operational viability.” He noted.
He further stated that the drastic revenue decline has led GIPC to advocate for a shift from a self-financing model to a predominantly tax-funded structure, arguing that its services provide significant value to the public.
“The agency’s plea comes amidst a backdrop of Ghana’s ongoing fiscal crisis, which has reportedly deterred foreign investors. GIPC noted a 50% drop in investments from 2022 to 2023, although it also highlighted a 16% increase in inbound investment inflow in the first quarter of 2024 compared to the previous year.”
Mr. Simons said despite these mixed signals, the agency’s financial woes raise critical questions about its effectiveness in improving the business environment, observers suggest that investors may be hesitant to pay for services that they perceive as lacking tangible benefits.
Additionally, he explains that though GIPC has signed numerous agreements with UAE entities to boost investment, these efforts have not yet translated into significant financial inflows.
As GIPC navigates this challenging landscape, it faces an urgent need to reassess its service offerings and determine how to regain investor confidence. The agency’s future may depend on its ability to adapt and provide real value that justifies its fees, or it may have to rely increasingly on government funding to survive.
