Chief Executive of the Private Enterprise Federation (PEF), Nana Osei Bonsu, says foreign companies investing in Ghana and seeking tax exemptions must partner local private sector companies.
He explained that would ensure local companies develop capacity over time, grow and work to affect the national economy in a transformational way.
“If coming to do solo business, fine, but if you come as a foreign investor looking for tax incentives, tax holidays when someone else pays, they must pay the collateral benefit to the society and it must be along the line of partnerships,” he said.
Nana Bonsu was speaking at the power breakfast session of the Canada-Ghana Chamber of Commerce (CGCC) in Accra, on the theme “Promoting Joint Venture Partnerships with Foreign Investors”.
Other panelists of the event were Mrs Getrude Ohene-Asiem, Country Director Manager for PGS Ghana and Mr Kweku Boateng, Director, Petroleum Commission.
The PEF Chief Executive noted that historically, foreign companies that came to invest 100 per cent in Ghana, left after making their money without imbibing sustainable competences and skills in local industry and the private sector in particular, which he said the current law seeks to avoid.
Nana Bonsu listed the likes of KAISER in the bauxite and aluminum industry, Pioneer Tobacco Company and the Ghana Rubber Company in the tobacco and rubber industries respectively, as companies that literally suffered from the withdrawal of the major foreign investors, leaving virtually nothing for the growth of the local sector.
“If we want to industrialize, we must not allow the erosion of the value of the local industry potential to grow by the influence of companies coming in to invest directly in nascent industries such as the oil and gas sector.
“We need them to partner local companies and help them to be strong and viable as the foreign investors, some of whom are fully supported state institutions currently operating in the country,” he indicated.
He said PEF welcomes Public Private Partnerships (PPP’s) and told participants at the session that the PEF has always advocated partnerships and joint-ventureships as a means of transferring expertise to local industry players.
“PEF has never been against foreign direct investors. We want them in as partners. Foreign investors who come in as solo investors usually undermine the local industry and do not help with the required transfer of technology, skill transfer nor the carried on expertise that is required to transform the local economy”.
Nana Bonsu said PEF advocates qualification and not a limitation, stressing that PEF does not create an artificial process to limit investors, but a decision to support small local companies to stand effectively within partnerships, with foreign companies who are state sponsored and are playing in our local industry.
“As we speak, there are some from China, Turkey and the state here has no such support for the small companies playing in the industry. Therefore, through partnerships, we get the foreign partners to pay up for the exemption they would be enjoying, because definitely someone will be paying for it,” he noted.
“PEF has not been against FDI’s. We support FDI’s coming in as partners, because at the end of the day for every one dollar that comes in five goes out,” he added
Mr Yoofi Grant, Chief Executive of the Ghana Investment Promotion Centre (GIPC) disagreed with Nana Bonsu, saying the decision for investors to go into joint ventures is a preference; but agreed that there was an urgent need for transfer of technology, skill.
“The situation has arisen because of the inability of local companies to raise capital of about 50 million dollars to participate as solo entities in some of the given industries.
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