Ghana
Ghana is one of the fastest developing nations for Business Process Outsourcing (BPO) today. Ranking thirteenth in the Top Outsourcing Countries in 2010, Ghana is the central leader in the Information and Communications Technology (ICT) sector of West Africa.
There are many reasons why countries from Asia, Europe, India and the U.S. are attracted to Ghana: stable democratic environment; low-cost labor; a strategic position on the equator sharing the same time zone with the United Kingdom; zero taxes and exemptions on customs duty for research and development; and strong of patents and copyright legislation.
Despite this, Ghana needs to improve on exposing itself as a dynamic player in the global sourcing market by taking steps to create visibility and public awareness for its BPO industry. To boost foreign investing, Ghana must also work on improving its infrastructure, increasing the number of skilled workers, improve telecommunications, resolve ethnic issues, and improve education.
In recent years Ghana's ICT BPO sector has grown by 25 percent. Ghana plans to account for one percent of the world's BPO market, which would provide over 37,000 jobs for the youth in 2011 and add USD $750 million to its economy. Ghana has taken steps to make the country more attractive to investors, offiering technology parks at the Free Zone Enclave, University of Ghana, and KNUST University. Ghana also plans to build a Private Public Partnership model and improve the quality of its ICT education.
Country overview
Ghana was formed as a merger between the Togoland trust territory and the British colony of the Gold Coast. It was also the first sub-Saharan colony in Africa to gain its independence.
Ghana has population of nearing 25 million, with around 100 different ethnic groups spread throughout the region. The official language is English, which is used in government, business and educational institutions.
Ghana is mostly dependent on financial assistance even though it is rich in natural resources. It was under the Heavily Indebted Poor Country program in 2002 and was part of the Debt Relief Initiative in 2006. Almost 30 percent of Ghana’s population lives below the international poverty line of $1.25 USD per day, with women who are politically-marginalized or who come from poor northern and upper regions making up most of the majority.
The Gross Domestic Product is low, just USD $18 billion, The World Bank reports that the Ghana's per capita income yes yet to double over the past 45 years. Most of its domestic economy relies on agriculture, particularly gold and cocoa.
Source: CIA Factbook, 2009
Source: World Bank, 2009
Source: World Bank, 2009
Source: World Bank, 2009
Source: World Bank, 2009
Cost competitiveness
Taxes
Corporate tax rates are a primarily component in an outsourcing operation's expense. The corporate tax rate in Ghana is relatively low compared to China (25 percent), the Philippines (30 percent), Canada (33 percent), and India (34 percent). Its indirect tax rates are also relatively low, averaging around 12.5 percent and ranking 9th among the top ten countries with the best rates.
The country's government created free-zone areas in different parts of the country where businesses planning to take on offshore undertakings can set up their operations. One major incentive created is the zero-tax required for companies setting up their business in the free zone area. After the period ends, companies are only required to pay a tax rate of 8 percent.
Source: PayScale, Sourcingline, March 2010
Source: PayScale, Sourcingline, March 2010
Source: KPMG, October 2009
Source: KPMG, October 2009
Source: Doing Business (World Bank), 2010
Taxes : Corporate tax rates vary by industry, location and a range of other factors. The maximum rate is 25% with many sectors getting targeted relief.
Resources and skills
Ghana has a low cost of living, with a stable democratic government. Approximately seven percent of the population speaks English. However, there are many improvements it should pay particular attention to, including its workforce, education, training, and internet connectivity.
Workforce
A nation’s IT and BPO competitiveness can be quantified based on size and effectiveness of the workforce. Ghana has a total workforce of around 10.6, ranking forty-eighth globally.
Education and skills
Ghana’s universities only graduate 10,000 IT students annually. The country is developing programs geared towards the IT and the BPO industry through partnership programs focus on skills including accent neutralization, typing, transcription, and customer service.
Ghana is facing problems with literacy rates, with just sixty-five percent of the total population formally educated. After Pakistan, Ghana holds the title for lowest adult literacy with a rate of 65 percent. Ghana currently invests 5.4 percent of its GDP in education, but the quality provided is low.
Technological readiness
Ghana has the lowest number of internet users with just 4.2 internet users per 100 inhabitants. Ghana also has virtually no broadband Internet connectivity.
Source: CIA Factbook, 2009
Source: IMF, 2008
Source: UNESCO, 2009
Source: UNESCO, 2009
Source: International Telecommunications Union, 2009
Source: International Telecommunications Union, 2009
Business and economic environment
Economic competitiveness and stability
According to the Global Competitive Index, Ghana is at the bottom of the list with a GCI rating of 3.6 compared to Malaysia (4.9), China (4.7), and India (4.3). Similarly, a general measurement of the country's national savings, deficit and debt, interest rate spread, and inflation are also at the very bottom of the list, with a score of 2.7 compared to China (5.9), South Africa (4.6), and the Philippines (4.5).
Infrastructure
The quality of roads in Ghana is rated average in the Global Competitiveness Report, and it follows Mexico, Hungary, Pakistan, and Egypt. However, Ghana has a low quality of electric supply, ranking fourth out of the five countries that were included at the bottom of the list.
Labor market efficiency
According to the annual Doing Business survey co published by the World Bank, Ghana has an average employment market, comparable to the Philippines, Egypt, and India in having an.
Regulation
The overall ease of doing business is a key component that makes up a nation’s competitiveness. This includes contract enforcement, tax payments, investor protection, property registration, worker employment, construction permit processing, and foreign trade. According to a survey conducted by World Bank, Ghana ranks below average, ranking in 92nd similar to China, Vietnam, Jordan, and Egypt. It takes on average 33 days to register a start-up. It is relatively cheap to pursue a commercial case in the country, as its costs are below 30 percent, placing Ghana tenth among the top ten affordable countries for pursuing commercial cases for outsourcing activities.
Source: The Global Competitiveness Report, 2009
Source: The Global Competitiveness Report, 2009
Source: The Global Competitiveness Report, 2009
Source: The Global Competitiveness Report, 2009
Source: International Telecommunications Union, 2009
Source: Doing Business (World Bank), 2010
Source: Doing Business (World Bank), 2010
Source: Doing Business (World Bank), 2010
Source: Doing Business (World Bank), 2010
Source: Doing Business (World Bank), 2010
Source: Transparency International, 2009
Source: Doing Business (World Bank), 2010
Source: Doing Business (World Bank), 2010
Source: Doing Business (World Bank), 2010
Source: The Global Competitiveness Report, 2009