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Investing in Ghana's Health Sector
The health industry comprises all firms directly involved in the production and promotion of health care. These include all firms (both public and private) operating in the health market and are involved in the manufacturing of health products, provision of health care, health enhancing services and generation of knowledge in support of health.
The health industry as a new concept has not been recognised and analysed. The capacity of the local manufacturing industry is under-utilised and the potential of Ghana’s herbal and traditional medicines is largely untapped. The role of this industry in wealth creation is in sustaining health services and creating jobs. The overall aim of the health sector is to promote healthy lifestyles and reduce risk factors that arise from environmental, economic, social and behavioural causes.
A major prerequisite for a healthy population is how individuals, families and communities take care of themselves and the environment. Information with the specific aim of empowering people to make the right choice for healthy living has been seen as critical. The main disease burden of the country demonstrates a preponderance of diseases resulting from neglect of basic environmental practices and changes in dietary habits, physical activities and adoption of life threatening behaviour.
The structure of Ghana’s health industry consists of the following:
- Health Services
- Communicable Disease Control
- Non Communicable Disease Control
- Reproductive and Sexual Health
- Accident and Emergency Services
- Clinical Care
- Traditional and Alternative Medicine Practice
The national health vision is to attain middle income status with 1481 USD per capita by the year 2016 by creating wealth through health.
Investment opportunities available in the health sector are in:
- Hospitals and clinics
- Health Centers
- Maternity Homes
- Chemical shops
- Hospital equipment
- Research and development facilities
- Drugs and pharmaceuticals
- Preventive products e.g. condoms, mosquito nets
- Import climate
As the Healthcare sector relies on imports there is a very open import climate. Ghana does not have any explicit import restrictions or tariffs that apply specifically to used or refurbished medical equipment in general. Customs officials, regardless of whether it is new or used, generally treat all imported equipment in the same way. Most hospital equipment including ambulances is exempt from duties and taxes by the Ministry of Finance. Some pharmaceuticals are exempt from duties and taxes.
- Tariff Structure for Imports
- Zero Rate Duty: Imported Mosquito nets falling within Heading No. 5608. 19.00.10 of the HS Code shall now be admitted free of Import Duty
- Twenty (20) Percent Rate: 20% is the standard rate of duty plus 15% VAT however some medical supplies are zero rated
- Exemptions:Exemptions on gifts of a charitable nature imported by NGOs are limited to only those for Health and Educational purposes.
- Technical/safety standards: Pharmaceutical import requirements
- All Drugs registered
- 18 month minimum shelf life
- All labeling must be in English
- Every drug imported must be registered with the Food & Drugs Authority (FDA)
The Ghana Investment Promotion Centre Act, 865, also provides for automatic incentives and benefits.
Ghana is a safe investment destination. Guarantees against expropriation of private investments provided under law are buttressed by the Ghanaian Constitution. Some investment guarantees are detailed below:
- Free transferability of capital, profits and dividends.
- Insurance against non-commercial risks – Ghana is a signatory to the World Bank’s Multilateral Investment Guarantee Agency (MIGA) Convention.
- Double Taxation Agreements (DTAs) – to rationalize tax obligations of investors in order to prevent double taxation. DTAs have been signed and ratified with France and the United Kingdom. DTAs have been signed with Germany and concluded with Belgium, Italy and Yugoslavia.
POTENTIAL SOURCES OF FUNDING
Viable companies and projects can easily attract financing both on the local and international financial markets. The main sources of funding are as follows:-
- 30 Banks (Including Two Liaison Banks)
- 60 Non-Bank Financial Institutions
- 138 Rural and Community Banks
- 396 Forex Bureaux
- The Ghana Stock Exchange – note that in the last four years, many issues of shares on the GSE have been oversubscribed by 100% - 300%, meaning that there is a lot of money for investment purposes
- Ghana Venture Capital Fund
- International development finance institutions based in Ghana, such as the International Finance Corporation (IFC) and the African Development Bank (AfDB)
A number of foreign financial institutions also provide off-shore financing directly to companies in Ghana.
GHANA’S COMPETITIVE ADVANTAGE
Ghana is one of the most attractive locations in Africa to invest and do business in. To make the Ghanaian environment more business friendly, there are efforts to reduce the occupancy costs for commercial and industrial properties and the general cost of doing business in the country.
The Ghana Investment Advisory Council (GIAC), which was established with the help of the World Bank, helps shape government policy aimed at creating an enabling investment environment. The GIAC consists of multinational and local companies and institutional observers - International Monetary Fund (IMF), World Bank (WB), and United Nations Development Programme (UNDP).
Also, there is a liberal investment environment in Ghana that offers a number of special benefits such as foreign investor ownership of local companies, participation in joint ventures with the minimum required equity of $200,000 and companies wholly-owned by non-Ghanaians at $500,000.
The other factors that make Ghana a favourable place for investors in Africa and among developing countries in general, include the following:
- Stable Political Environment
Ghana is a politically stable country. This is recognized with former leaders such as US President George Bush and British Prime Minister Tony Blair who have expressed appreciation for the political stability in Ghana.
- Macro-economic Policies
The Government of Ghana has initiated a number of sound macroeconomic policies designed to accelerate the process of growth and transformation of the economy under competitive conditions. The rate of inflation is hovering around 15.8% as at November 2016, in the face of record prices of crude oil in the world market and acute shortage of cereals. The management and access to foreign exchange in Ghana continues to improve.
- Foreign Ownership
In the on-going privatization program, hundred per cent (100%) foreign ownership is permitted.
- Access to ECOWAS Market
Ghana is easily accessible to the markets of all the member states of the Economic Community of West Africa (ECOWAS) with its population of approximately 250 million people.
- Good Physical Infrastructure
Ghana possesses well developed seaports, airports and road networks capable of meeting the needs of business in the 21st century. There is an effort to upgrade the rail network to make it easy to get to the ports from the inlands. Telecommunication facilities in Ghana are excellent with more private service providers offering telephone, internet and other telecommunication services. Basic utilities such as water and electricity are readily available at relatively cheap rate.
- Excellent Labour Force
The country has some of the best teachers, lecturers and researchers in the continent, who have excelled not only in Ghana but in the African continent and other parts of the world. There is also a large human resource base of both skilled and unskilled labour which can be sourced at competitive rates.
- Access to International Markets
Ghana has easy access to the USA and European Union Markets. The flight time to almost all European Union countries is about 6 hours and 9 hours to the USA.
- Availability of Fund Sources
Ghana has a large number of fast developing financial institutions available to raise long-term capital at competitive rates. These institutions include banks, insurance and venture capital companies and a stock exchange market (Ghana Stock Exchange).
- High Safety Standard
There are high standards of health and safety measures in the country.
- Warm and Friendly People
Ghana is internationally acclaimed for her hospitality to her investors and foreigners as a whole.
- High Quality of Life
The quality of life of Ghanaians is fairly high.
- Availability of Land
Ghana has a wide expanse of land around the country that can be acquired with little difficulty through appropriate agencies and owners.