GIPC boss urges persuasion in part-indigenization of foreign firms

The Chief Executive of the Ghana Investment Promotion Centre is uncomfortable with current proposals for the part-indigenization of foreign firms seeking to establish local operations.

George Aboagye is proposing that such firms be encouraged to cede part of their ownership rather than being compelled with legislation.

Those calling for the part-indigenization policy insist that legislation must be used so Ghanaians can also share in the massive profits that some of the firms churn out from their local operations.

But the GIPC boss told Joy Business if it not well-managed, the policy could prove a turn-off for potential investors.

“Investments are moving across the globe and in a competitive way, you have to try and attract these investments into your country; capital moves to places where it is welcomed and it is free to move around and it is free to do what it wants to do in order to make profits,” he said.

Using legislation to compel potential investors to give local partners shares can be a disincentive to foreign investment in the country. "You cannot force marriages and expect peaceful co-existence," he counseled.

Mr Aboagye questioned the capacity of local businesses to buy stakes in foreign companies.

Government is currently working on a policy that will require companies seeking to establish or already operating to cede part of their ownership to Ghanaians.

The Securities and Exchange Commission is currently reviewing proposals to get some of the companies to offload some of their shares on the local bourse.

Ahead of that however the Communications Ministry has already introduced a directive that will compel firms managing infrastructure in the telecoms sector to cede thirty percent of their businesses to local firms.



Source: Joy Business/Ghana