Despite recent upheavals, Ghana remains one of the bright spots for investment in the West African sub-region. Here, David Parkes, partner at King & Wood Mallesons and associate Ofei Kwafo-Akoto outline the prospects for investment
Ghana has faced a series of macroeconomic challenges over the past year, with sustained depreciation of the Cedi against major foreign currencies, high fiscal and current account deficits and a slowdown in real GDP growth. However, attracting foreign investment continues to be a key priority for the government and certain recent legislative developments reveal strong efforts to create an enabling regulatory environment for investors.
Energy and infrastructure
In July 2015 the Petroleum Revenue Management (Amendment) bill was passed into law in an effort to address irregularities and operational challenges in the management of Ghana’s revenue from the oil and gas sector. The primary objective of the bill was to amend the Petroleum Revenue Management Act 2011 to provide for the re-allocation of funds to the Ghana Infrastructure Investment Fund for the purposes of infrastructure development, signalling great opportunities for investors in this sector.
In August 2015 the Ghana Nuclear Regulatory bill was passed with the objective of establishing the Ghana Nuclear Regulatory Authority to oversee all activities in the nuclear energy sector. According to Lom Ahlijah, Legal Counsel at the state-owned electricity transmission company Ghana Grid Company (GRIDCo), “the enactment of the Nuclear Regulatory Act 2015 is a game changer in the power sector, especially as it opens up a new frontier in the Ghana power sector. This will pave the way for the use of nuclear power in Ghana’s energy mix to secure the long-term needs of the country”. The government has already signed agreements with international partners such as the State Atomic Energy Corporation of Russia (ROSATOM) for the construction of a 1000-1200MW nuclear power plant.
Nonetheless, there remains much legislative reform to be effected in the energy and infrastructure sector. Of the laws currently in place, Ahlijah observes that, “legislative intervention is needed to streamline entry requirements for investors in the sector by ensuring that the ease of doing business is greatly expedited”.
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