TRALAC - Trade Law Centre

Number of American companies coming to Ghana increasing

Thursday, 21 July 2016 Published: | Emmanuel K. Dogbevi

Source: Ghana Business News

It appears the interest of American companies in Ghana is increasing, as 37 of them have invested in Ghana in the last five years, the US Ambassador to Ghana, Robert P. Jackson told ghanabusinessnews.com in an exclusive interview.

The interview covered US foreign direct investment (FDI) into Ghana, bilateral trade, the African Growth and Opportunity Act (AGOA), visa issues, the number of American citizens in Ghanaian prisons and what the favourite Ghanaian dish of the Ambassador is.

Mr. Jackson indicated that in the last five years, 37 American companies have invested in Ghana and in the last year 79 new investments or trade deals all of a total of $800 million have been made.

“Average of $10 million per deal. Since the beginning of the year six American companies have started to operate in Ghana, including Procter & Gamble, Uber and Pizza Hut. They are a variety of companies,” he said.

Asked what impact he thinks they are having on the Ghanaian economy, he said, they are creating jobs, and creating tax revenue.

“I see it as a win-win between the two countries,” he said.

Mr. Jackson stated that 350,000 jobs have been created in Africa as a result of AGOA.

Adding that, one million jobs have been created indirectly in Africa, he admits, however, that the US has difficulties in quantifying how many jobs have been created in the US as a result of AGOA.

On Ghana;s performance in AGOA, Mr. Jackson noted that, the country’s performance in AGOA has been uneven, textile imports were relatively modest in recent years, he said.

“Within the last year, textile imports have reached $1 million and we believe that there is potential for continued growth. Now that the phyto-sanitary conditions have been improved, Blue Skies will start exporting cut fruits to the US. The juice will follow later,” he said.

The Ambassador believes that Ghana has advantage with textiles and tropical fruits.

On bilateral trade between the two countries, Mr. Jackson said Ghana exported $350 million worth of goods to the US, and the US exported around $850 million.

And he thinks the establishment of an EXIM Bank in Ghana is a good step.

He noted also that Ghana has potentials in textiles, cashew and shea exports, adding that the US is looking for particular products that Ghana has a niche in.

Mr Jackson said the US is looking at possibilities of free trade with a number of countries and blocks around the world to promote economic growth.

On the challenge that US negotiations to remove taxes on textile imports from Asia could have on Africa, as Africa only exports $1 billion worth of textiles to the US, while Vietnam alone exports textiles worth $20 billion, and as a result Africa cannot compete, he argued that Ghana doesn’t have to compete with Vietnam.

“It must produce niche products and Ghana must put the right investment environment in place. Access to credit is a challenge and there is a challenge with access to electricity,” he said.

Expanding on the matter of Ghana’s potential for textiles, he said “we have identified six companies that we have provided training for, that we think can successfully export to the US. The best known is Dignity, DTRT, they have more orders than they can fill. The only constraint they have is space, which they are in the process of acquiring,” he said.

Responding further to the trade values between the two countries – he said currently at $1.2 billion, trade between Ghana and the US is not growing.

“But the energy situation here and fall in the price of oil affected it. It was $1.4 billion in 2014,” he said.

When I asked him why the US is not encouraging Ghana to export processed products, add value to raw materials?

He answered, “In fact, we are encouraging that, but it depends on the products. In fact for agriculture products, the phyto-sanitary challenges have been significant, but I think we are overcoming that, and through our Trade Africa programme which is a USAID programme, we are investing $10 million to assist Ghana in building its export base. Moreover, President John Mahama has been invited to the Second Business Forum in New York in September that would be an opportunity for him to talk to business leaders.

We need to be thinking about how the region can work well, how can ECOWAS work well, not just Ghana,” he adds.

On the subject of visa issuance to Ghanaians, Mr. Jackson said the US Embassy in Ghana issued more visas than it refused.

“Last year we issued about 13,000 visas. Over 9000 for tourists, businessmen and students, approximately 3500 for people who want to immigrate to the US,” he said.

On US military assistance to Ghana – he said the US has provided $2 million for training and equipment.

“We do a number of joint exercises once a year. We also did a Zone F exercise, involving Togo, Ghana and Cote D’Ivoire. We’ve also done counter-terrorism exercises,” he said.

Emphasising, he said, We are looking at two things, Counter-terrorism and peacekeeping. The quality of Ghana’s anti-terrorism is high. Ghana’s contribution to peacekeeping is high. We provide training, medical equipment and some aviation equipment. We are moving beyond provision for infantry.Ghana’s military, army, police, navy and police all exercise with us. We exercise with other African countries as well,” he said.

Mr. Jackson answering a question what the US is doing to assist Ghana deal with the problem of illicit financial flows, he said, the US is training prosecutors, judges and forensic investigators.

“On the financial side we are very focused on money laundering and drug trafficking. I am very satisfied that the officials are being trained and they would use their skills,” he said.

When asked why there have been only two prosecutions in Ghana for money laundering, he said, “ask your government why there have not been prosecutions. There have not been many prosecutions. I will like to move from the investigations to prosecutions,” he said.

Asked about how many Americans are serving prison terms in Ghana, he said; “Five Americans are currently in prison in Ghana, four for narcotic offences. That number is going to decrease, as two of them are going to complete their sentences in the next few weeks.”

After six months in Ghana, Ambassador Jackson, who says he is more of a protein person, says his favourite Ghanaian meal is the guinea fowl, roasted guinea fowl.

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