French Investors Look To Ghana
- Created on Wednesday, 18 July 2012 17:13
French investors are preparing to swarm the country in an investment tour that is projected to create more than 15,000 jobs. Suleiman Mustapha reports
France plans to step up its economic ties with Ghana by encouraging its private sector to double its investments in the country from the current annual figure of US$400 million to about US$700 million by 2013.
Consequently, the Mouvement des Entreprises de France (MEDEF) or Movement of the Enterprises of France, the largest union of employers in France, will converge on Ghana next year for a summit to identify investment opportunities in the country.
French Ambassador to Ghana, Mr Frederic Clavier, told the GRAPHIC BUSINESS in an exclusive interview that French investors were moved by the level of investment opportunities in the country.
MEDEF, which is the highest business lobbying organisation in France, is similar to the CBI of the United Kingdom or Federation of Small Businesses in the United States.
“French cooperation with Ghana is deepening at various levels of business and French assistance is expanding in various development projects concerning the economy such as the sovereign concessional loan from our development agency, AFD, granted to the Volta River Authority”, the ambassador said.
According to Mr Clavier, Ghana was on top of the list of countries that the French private sector wanted to do more business with, saying, "we want to be a major player in this country".
"We see the stability and growing economy of Ghana and we have decided to do better in terms of investment in this country," he said, adding that, “Ghana is by far a model business destination in the West African sub-region”.
The Movement of French Enterprises, which is made up of more than 800,000 enterprises is expected to see a massive injection of investment flows from France by next year.
According to the diplomat, the visit of the French Prime Minister last year indicated “France’s willingness to participate in Ghana’s economic development,” adding that his country was re-orienting its policies toward Africa to further engage non-French-speaking nations.
There are at the moment 60 French business establishments in Ghana and France is the 11th on the roll of international investors in Ghana, but fourth on the list of Ghana's overseas clients.
“Ghana stands on first place for its comparative advantages. The perspectives are excellent, with a steady economic growth. The numerous projects, in particular in the field of infrastructure, favour the attractiveness of the country”.
Top executives of the French business community who will be visiting the country next year will cut across various fields of investments including; energy, electricity, agriculture, information and communication technology, packaging, insurance, shipping, telecommunications, banking, water, transport, engineering and public works.
"We intend to capitalise on that and participate even deeper in your economy to ensure that our score on your investment sheet will rise from 11th to a better place soon," he said.
“This is expected to contribute directly or indirectly to the employment of 20,000 persons, in particular in agricultural and food-processing industries”, Mr Clavier said.
In 2009, trade between France and Ghana reached €535 million, after recording growth in excess of 20 per cent per year since 2005.
In addition to the debt cancellation measures for the country implemented under the framework of the Club of Paris, France granted Ghana additional treatment which has taken the form of a debt reduction and development contract (C2D).
The first C2D (2005-2007), with €21 million was implemented in the form of a global budgetary assistance through Multi Donor Budget Support (MDBS).
The second C2D in favour of Ghana was established for the 2008-2013 period, for a total of €42 million.
For the 2008-2010 periods, it has taken the form of global budget assistance in the amount of €21 million, marking the continuity of France’s presence within the MDBS. A second phase with an equivalent sum and according to the same terms will be implemented for 2011-2013.
In 2011, France under its development wing, AFD signed three financing agreements total of some 50 million euros with the Ghana Government involving urban development projects.
In 2003, a major French bank Société Générale took over SSB Bank and in the agricultural sector Compagnie Fruitière started fruit farming (ananas).
These investments represented almost half of the total foreign direct investments recorded in Ghana in 2003.
In 2005, Total took over Mobil Ghana and is now the market leader in the distribution of refined petroleum products. The same year, the regional office of L'Air Liquide (industrial and medical gas producer) was transferred to Accra.
The other major companies are dealing in petroleum products (Total), hotel activities (Accor – Novotel), shipping (Bolloré, SDV, Antrak), goods inspection (Bureau Veritas), water and electricity infrastructure (Burgeap, Norelec), wholesale/retail (CFAO), agriculture (GREL) and industry (Franpac, l"Air Liquide, Nexans Kabelmetall).
Proparco, the subsidiary of AFD which is dedicated to supporting the private sector, has set up a strong partnership with the banking sector by providing medium-term line of credit to finance the investment projects of small and medium sized enterprises.
Five commercial and leasing companies have so far benefited from PROPACO’s lines of credit up to US$27 million.
source: daily graphic