Despite government’s efforts to attract more foreign investors, they do not hold the key to the country’s economic transformation, Tetteh Hormeku of Third World Network has pointed out.
He noted that most often foreign investors are given preferential treatment to the detriment of domestic operators, but they do not perform as expected.
He said “over the past 30 years economic policies in our country have been driven by the interest of foreign investors rather than domestic operators.
“This is because of the perception that only the foreign investor has the salvation of the economy at heart which is not true.”
He told BUSINESS GUIDE in Accra that the prioritization of foreign investors over their domestic counterparts had led to distortions in the country’s economic policies which in turn would adversely affect Ghanaians.
“Instead of creating tax incentives for domestic operators some foreign investors rather enjoy this benefit and take undue advantage of it to rob the nation.
“For example, expatriates in the mining sector come and enjoy the tax holiday offered to them, and when it is about expiring they disappear and come back in new guises so they can always come here and operate for cycles of years without paying taxes,” he emphasised.
He said the non-payment of taxes deprives the government of the essential revenue needed to invest in other areas of the economy.
According to the 4th quarter investment report by the Ghana Promotion Investment Centre, (GIPC), the total value of the country’s Foreign Direct Investment, FDI inflows increased by 500 percent in 2011.
It stated that over 500 new projects registered in the country in 2011 were estimated at a total value of $7 billion dollars, which is equivalent to GHC11 billion. This is expected to create over 8,351 jobs this year.
However Mr. Hormeku was of view that despite the contribution made by foreign investors, government needs to make conscious efforts to liberalize trade by removing tariffs on a lot of exported goods.
“The so-called foreign investors enjoy massive incentives and subsidies in their countries that allow them to produce not only competitively, but cheaply, and in addition enjoy lower tariffs when they come to Ghana. How then can our local exporters compete with that,” he questioned.
He called on government to encourage and support the growth of local industries by creating subsidies and incentives.