Ghana records $2.6 billion in Foreign Direct Investment in spite of COViD19

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By Norvisi Eyiram Mawunyegah

 March 15, 2021

The worth of Foreign Direct Investments (FDI) inflows into the country increased to 2.6 million dollars in 2020 from the 1.1 million dollars recorded in 2019.This represents an increase of 139.06 percent of the total US$1,108.93 million in FDI the country recorded in 2019.

This is the current data from the Ghana Investment Promotion Centre GIPC. The result shows the trend defied the expected level decline in FDI flows as the next bent of COVID-19 infections threatened to break the Ghanaian economy.

The Chief Executive Officer of the GIPC, Yofi Grant, stated at a press meeting the robust measure in Ghana’s inbound FDI within the global health pandemic could be ascribed to a combination of factors including effective government policy responses and an easing of travel restrictions.

“The FDI component and local components from these investments amounted to US$2,650.97 million and US$145.52 million respectively for 2020. The total initial capital transfers recorded for the period also amounted to US$75.91 million. The FDI value of US$2,650.97 million gives a significant increase of 139.06% over the FDI value of US$1,108.93 million recorded in the year 2019,” he said.

“Cumulatively, some 27,110 jobs are expected to be generated from the aforementioned registered projects,” he added.

In sector provision of investments, the manufacturing sector recorded the largest FDI value of US$1,270.53 million with 57 projects. Accompanied by the services and mining sectors with FDI values of US$656.19 million and US$ 424,32 million respectively.

In the domestic sector, cash and goods amounting US$69.28 million was worked back as investment from 172 already existing companies, whiles US$250.68 million (GHC1,438.91 million) was allocated from 52 wholly Ghanaian-owned ventures.

According to United Nations Conference on Trade and Development, UNCTAD’s Global Investment Trends Monitor, global foreign direct investment (FDI) collapsed in 2020, falling by 42% to an estimated $859 billion, from $1.5 trillion in 2019.

The decline was concentrated in developed countries, where FDI flows fell by 69% to an estimated $229 billion. Greenfield announcements fell by 46% (-63% in Africa, – 51% in Latin America and the Caribbean, -38% in Asia) and international project finance by 7% in (-40% Africa).

In spite of the forbidding economic outlook caused by COVID-19, FDI in all developing countries appeared strong with countries such as South Africa and Morocco recording FDI inflows of US$2.5 billion and US$1.6 billion respectively for the year 2020.

In Ghana, some countries that stood out as nation’s leading sources of inward investments included, China, the United Kingdom, South Africa, Australia and the Netherlands.