72% of firms perceive Ghana’s business environment as lagging behind peers – UKGCC 2023 Business & Competitiveness Survey

According to the UK Ghana Chamber of Commerce (UKGCC) 2023 Ghana Business climate and Competitiveness Survey, 72 percent of Ghanaian enterprises believe their country’s business climate lags behind that of its peers.

According to the research, 53% of enterprises expect Ghana’s business environment would deteriorate in 2023, compared to 47% in 2022.

This is in addition to the prevalent perception that other nations in the sub-region are not suffering as much as Ghana as a result of COVID-19, the Russian-Ukraine war, and the supply chain interruptions it caused.

Again, a stunning 75% of respondents saw corruption as a continued threat to corporate operations, despite trends indicating a decrease in corruption compared to 2022.

It was also assessed that the cost of labor, both skilled and unskilled, remains inexpensive for most enterprises.

Furthermore, the government’s support for international trade, as well as the availability of high-quality transportation infrastructure, were ranked second and third on the list of the worst business components, respectively.

The poll also looked at the most deteriorating company components over time, as well as the most costly business charges.

A third of respondents identified the cost of capital as the most degraded company component during the previous five years, with the cost of land being the most costly business expenditure.

Despite possessing the necessary capability, more than one-third of respondents acknowledged not taking advantage of the opportunity platform inherent in the African Continental Free Trade Area (AfCFTA).

Respondents proposed improvements such as the government decreasing perceptions of corruption and promoting transparency, as well as ensuring the safety and security of investments, tax reduction, accessible infrastructure, and government incentives, to increase ease of doing business in Ghana.

Regarding the beneficial business components analyzed, respondents cited the availability of telecom services as one of the positive characteristics of the Ghanaian business climate. The view was that telecom infrastructures and advanced technologies had experienced the most consistent advancements. It was also recognized that the cost of labor—both skilled and unskilled—remains cheap to most enterprises that participated in the 2023 survey.

Report presents clear roadmap for action – UKGCC

Anthony Pile MBE, UKGCC Executive Council Chairman, remarked that “this report presents a clear roadmap for action. Lowering corruption, prioritising infrastructure upgrades, addressing regulatory burdens, and investing in skills development are not just numbers on a page – they are the keys to unlocking a brighter future for Ghanaian businesses”.

He urged “the government to embrace these reforms and work hand-in-hand with the private sector to build a competitive and prosperous nation.”

Commenting on the report, Vish Ashiagbor, Country Senior Partner of PwC, a UKGCC Platinum member company and consultants/advisors for the report, noted that “Ghana is in a difficult place. Over the past three years, our economy has been buffeted by events, some of which are external and beyond the control of Government and businesses alike—COVID-19, global financial crisis, and the Russian-Ukraine war which spawned global supply chain hiccups that amplified the economic and business difficulties already triggered by the global financial crisis.

There is no doubt that Government is aware of the role that business plays in its quest to bring about socio-economic development. Indeed, the introduction of the Mutual Prosperity Dialogue is testament to this awareness and acknowledgement. We hope that, in the spirit of transparency, this report is considered objectively by Government, and working with UKGCC, considers what interventions can be implemented in the medium-to-long term to help improve the business environment.”

Over 690 businesses, including UK Ghana Chamber of Commerce members and non-member companies from 16 industries, ranging from small to large companies, participated in the survey