Foreign Direct Investment inflows to Ghana fell by 39% in 2022 to $1.472 billion, as greenfield projects remained flat while international project finance and Mergers and Acquisitions deals declines, transaction advisory firm, Bridgewater, has revealed.
This is due to the economic slowdown and challenging business environment.
The first half of 2023 recorded 72 projects with an FDI component of $229.82 million, in contrast to 125 projects and an FDI value of $343.83 million in the same period in 2022.
This represents a 33% drop in investments in the first half of 2023 as economic growth remained downcast, with full recovery expected by 2025.
Bridgewater said “A major benefit of FDI in Ghana is job creation which is usually estimated to be in the thousands, but the majority of the projects are disproportionately located in the capital and mainly targeted at the services and manufacturing sectors.”
China remained Ghana’s leading source of FDI, outpacing those from Europe and America.
In Africa, Mauritius, South Africa and Nigeria are Ghana’s key intra-African investment sources.
“As policymakers prepare for the World Investment Forum 2023 with sustainable energy at centre stage, affordable financing options to developing countries, transformed risk-taking models, and encouraging suitable public-private partnerships may constitute some forward actions”, Bridgewater pointed out.
This FDI report provides an overview of global investment trends and developments in Africa in the face of macroeconomic headwinds and geopolitical tensions.
Africa’s FDI inflows in 2022 dropped to the 2019 levels of $45 billion, but it was characterized by increased greenfield projects.
North Africa remained the largest recipient of FDI to Africa with 33% share of Africa’s total inflows in 2022.
Source:myjoyonline.com
