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Tuesday, May 24, 2022

Firms Relocating To Cote d’Ivoire Over Economic Crisis



Cote d'Ivoire

The deteriorating business environment in Ghana which has culminated in the ongoing industrial agitations in the country’s public and private sectors has compelled many businesses to relocate to neighbouring Cote d’Ivoire and Nigeria.

Labour consultant, Mr Austen Gamey is warning of dire consequences for the country if the economic challenges as well as labour agitations are not contained.

“I can tell you on authority that people are moving their businesses to Cote d’Ivoire right now so if we want to destroy this country, we should continue,’ labour consultant, Mr Gamey told Business Finder.

According to him, Ghanaian businesses have found better prospects in those countries, adding that “in Cote d’Ivoire, their currency is not suffering the way the cedi is doing and so we cannot compare ourselves to them at all.”

Many continue to wonder how a country that recently returned from war could be so economically fertile and attract businesses from across the region.

While Ghana’s inflation stands at 17.6 per cent (as at December 2015), that of Cote d’Ivoire is 1.3 per cent; interest rate in that country is 3.5 per cent while in Ghana its 32 per cent. The 2015 World Bank Ease of Doing Business Report on Cote d’Ivoire said “Côte d’Ivoire in 2012 made starting a business easier by reorganizing the court clerk’s office where entrepreneurs file their company documents.”

The report further revealed that in 2014, that country had made starting a business easier by creating a one-stop shop, reducing the notary fees and replacing the requirement for a copy of the founders’ criminal records with one for a sworn declaration at the time of company registration.

“Côte d’Ivoire made starting a business easier by reducing the minimum capital requirement, lowering registration fees and enabling the one-stop shop to publish notices of incorporation,” the report said.

The same report however revealed that Ghana had increased the cost of starting a business by 70 per cent in three years. The report said the increasing costs of registering a business in Ghana coupled with the long delays had made it difficult for entrepreneurs to commence business activities in the country, let alone sustain them in the long haul.

Commenting on the recent labour agitations, Mr Gamey said he sympathised with the concerns of labour, employers and even government, describing them as genuine, however “the parties must sit and talk; without talking, no solution can be found.”


“A tripartite meeting ought to have been called to deal with the matter failing which the National Labour Commission should be asked to intervene immediately,” Mr Gamey said.

Confirming Mr Gamey’s disclosures, the Secretary-General of the Industrial and Commercial Workers Union (ICU), Mr Solomon Kotei told this paper that businesses in Ghana were moving their production lines into Ivory coast and Nigeria as a result of the unfavourable business climate in Ghana.

“Our environment is a real threat to doing business in Ghana so it is not surprising to learn that businesses are moving out; We know that almost all products of Cadbury for instance are being produced in Nigeria and other countries in West Africa,” Mr Kotei added.

It will be recalled that in February 2015, this paper’s interactions with some investors revealed utter desperation over the high cost of doing business in Ghana, characterized by the power crisis, high inflation rate, high cost of credit and numerous crippling taxes among others.

Labour unions have already embarked on industrial actions to press home their demands for better conditions of service and improvement in the standard of living.

Experts on labour issues who criticised the poor handling of the issues at stake called for a speedy resolution of the crisis.

According to them, such  disturbances are most unwelcome in an election year as “they are a threat to the entire security and stability of the country.”

Last week, government rejected a request by the labour unions for the controversial energy sector levy to be scrapped. The levy has resulted in a 28 percent increase in prices of petroleum products.

Also, water and electricity tariffs have seen an increase of 67.2% and 59.2 % respectively.

Organised Labour said in a statement last week the price increases “are reckless and a display of the insensitivity on the part of managers of the economy to the plight of the ordinary Ghanaian.”

Source: The Finder


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