The Africa Continental Free Trade Area (AfCFTA) agreement is set to create the largest free trade area in the world with 55 countries, 1.3 billion people, and a GDP of US$3.4 trillion. The AfCFTA intends to lift over 30 million Africans out of poverty and increase the wages of nearly 68 million Africans who are currently earning less than $5.50 a day (according to the World Bank and the African Development Bank). Foreign Direct Investment (FDI) has been one of the main drivers of growth in some developing countries across the world. FDI is recorded to be among the largest inflow of investment into developing countries. In most cases, the benefits of FDI include job creation, wage increases, the kickstarting of new industries, and technological and productivity spillovers. In recent years, the attraction of FDI has become one of the key policy focuses of most developing countries. For instance, evidence shows that in 2018, Ghana grew to become the largest recipient of FDI in West Africa overtaking Nigeria with $3.2bn. Despite the COVID-19 pandemic, Ghana has maintained FDI inflows that defy the predicted downturn by the World Bank. Ghana is an attractive destination for FDI due to its political stability, sound economic policies, reliable energy supplies, and transportation linkages across the continent. In order to investigate the barriers, challenges, and opportunities for international SMEs to gain entry into the Ghanaian market via FDI, interviews were conducted with 13 policy makers, business managers, and entrepreneurs in Ghana. The findings show that the current barriers to entry into the Ghanaian market are the minimum capital requirements, the cumbersome registration processes, and the issue of corruption. Furthermore, access to financing, the costs of production, and access to information are some of the crucial challenges encountered in the process. The described opportunities derived from the interview data are the abundance of labour, the government promotion of manufacturing, and the ratification and domestication of the AfCFTA which grants access to a wider market and cheaper raw materials from the resource rich African continent.download full publication
“We can no longer continue to make policies for ourselves, our countries, our region and our continent on the basis of whatever the westerners will give us. It will not work, it has not worked...Our responsibility is to charter a path which is about how we can develop our nations ourselves.”
“only a crisis – actual or perceived – produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That is our basic function: to develop alternatives to existing policies, to keep them alive until the politically impossible becomes the politically inevitable.”
“The society that puts equality before freedom will end up with neither. The society that puts freedom before equality will end up with a great measure of both.”
“Basic institutions that protect the liberty of individuals to pursue their own economic interests result in greater prosperity for the larger society.”
“...where effective competition can be created, it is a better way of guiding individualefforts than any other... regards competition as superior not only because it is in mostcircumstances the most efficient method known but even more because it is the only methodby which our activities can be adjusted to each other without coercive or arbitraryintervention of authority.”
"The fundamental cure for poverty is not money but knowledge."