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GIPC records US$785m in FDI in H1… as investments begin to rebound

A Foreign Direct Investment (FDI) of US$785 million has been recorded by the Ghana Investment Promotion Centre (GIPC) at the end of the second half of the year 2020, despite the bites of COVID-19 on the Ghanaian economy.

The total FDI of US$785.62 million represents investment recorded by the GIPC and the Petroleum Commission.

In all, the country recorded total investments of US$869.47 million, with total FDI value amounting to US$785.62 million between January to June 2020.

Worldwide, the United Nations Conference on Trade and Development (UNCTAD) has estimated that the COVID-19 pandemic to send global FDI plunging by about 40 percent – driving the total value of FDI below US$1 trillion for the first time since 2005. However, in spite of a sluggish start in the first quarter of 2020 and a worrying slump in the beginning of the second quarter due to severe lockdown measures to contain the spread of the corona virus, FDI to Ghana have begun to rebound resulting in a notable increase in FDI inflow for the first half of the year.

Meanwhile, GIPC’s CEO, Yofi Grant said, a total of 69 projects were recorded. Out of the 69 projects, the services sector registered a majority of 25 projects followed by the manufacturing and export trade sector with 21 and 11 projects respectively. With regards to value, general trading recorded the highest amount of US$246.05 million.

This was tailed closely by the mining exploration sector with US$231.02 million having sealed some major investments such as the Chirano Gold mine project for the exploration of minerals. The manufacturing sector also saw significant investments valued at US$170.67 million on the back of some notable ventures such as a deal by Matrix industries for the manufacture of paper and aluminum products as well as the Rainbow Paints Limited project which is a joint venture between Ghana and Kenya for the manufacturing of paints and related products.

Geographically, the spread of the projects cuts across 6 regions namely, Greater Accra, Central, Eastern, Ashanti and Volta regions with most projects registered in the Greater Accra enclave. Together, the 69 projects are expected to make significant contribution to job creation in the country. Per estimations, a total of 14,614 jobs are expected to be created when the projects are fully operational. Out of this, 14,052 of the jobs representing 96.15 percent will be for Ghanaians whilst the remainder of 562 jobs which represents 3.85 percent will be taken up by foreigners.

Regardless of the upbeat performance, the United Nations Conference on Trade and Development (UNCTAD) predicts that FDI will continue to see a decline of 5-10 percent in 2021 with a slow recovery to be initiated in 2022 driven by restructuring of global Value Chains and a general rebound of the global economy. But the GIPC remains cautiously optimistic about the flow of FDI to Ghana.