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 Mr Abdul-Rahman Abdul-Hanan Gundado (right) receiving a document from Mr Pierre de Gaëtan Njikam Mouliom, while Mr Bernard Lauret (left) and Mr Pierre Goguet (right) looked on.

Tamale Municipal Assembly offers free land to investors

The Mayor of Tamale, Mr Abdul-Rahman Hanan Gundadow, has disclosed that the Tamale Municipal Assembly has acquired a 42-acre land which it intends to offer freely to companies ready to set up their operations in the area.

He explained that the decision was meant to attract investments into the region which has been starved of investments over the years.

Mr Gundadow said this when the assembly signed a memorandum of understanding (MoU) with the Bordeaux Chamber of Commerce in Accra.

He said Tamale had a very young population who were ready to explore investment opportunities and transform the city.

“Education is very key if we are to take advantage of the opportunities which will come with increased investments in the city, and luckily we have the University for Development Studies which is providing excellent education to the youth,” he said.

He said the city was also committing about 70 per cent of its budget this year to improve basic education, which is the foundation of every child.

Vegetables production

The Mayor also added that Tamale central was transforming into a business centre as the USAID had commenced work on an irrigation system which would ensure Tamale grows enough vegetables to feed the country and even export some.

“Ghana currently imports lots of vegetables from Burkina Faso but if you look at the environment in Burkina Faso and that of Tamale, there is no difference. This means that, with the right mechanism and proper management, we can also produce vegetables in large quantities,” he stated.

Bordeaux delegation

A business and investment delegation from the French city Bordeaux was in the country to explore trade and investment opportunities and partnerships towards deepening the co-operation between Ghanaian and French businesses.

The visit by the delegation is a reciprocal one to one made by President John Mahama to Paris and Bordeaux in France, in October 2015.

The delegation is seeking to invest in, particularly, the oil and gas, energy and the manufacturing sectors, which are considered critical development areas of the economy.

The President of the Bordeaux Chamber of Commerce, Mr Pierre Goguet, said he hoped the business delegation would find ways of exploring the business opportunities in Tamale.

He believed this will help scale up trade between Ghana and Bordeaux.

Trade statistics

Bilateral trade between Ghana and France exceeded US$1.5 billion in 2013, with exports of US$1.2 billion made up of mainly cocoa, fish and fruits and approximately US$340 million worth of imports.

Trade with France, however, declined in 2014 as export earnings were in excess of US$1 billion, while imports were US$270 million.

In 2015, there was a further decline in exports to about US$650 million while imports were US$268 million.

GIPC

The trade delegation was hosted by the Ghana Investment Promotion Centre, whose Chief Executive, Mrs Mawuena Trebah, speaking in an earlier forum expressed the optimism that the mission would yield a win-win outcome for trade and investment for both countries.

Mrs Trebah said the GIPC had pre-qualified local companies which it believes could partner with the French companies for partnerships and joint ventures in Ghana or France.

Gov’t sacrifices growth for more revenue

Cent or more of it would be taxed away, they will say that there is no point in expanding, and that can have a depressing effect on growth,” he told the paper on January 7.

His comments, which are shared by many economists and business groupings, come on the back of the new Act that introduced changes to the various tax types, including those on pay as you earn (PAYE), withholding, thin-capitalisation and gift tax.

Postponed taxation

Already, many business associations have kicked against the new Act which has been in place for more than 15 years; describing it as inimical to the progress of their survival and plans of expansions.

One of those institutions is the Ghana Chamber of Mines.

“The truth is, it is not going to be good for us because we are already dealing with falling gold prices and high cost of production. Now, if you add this (the new taxes), then it is going to disadvantage us even more and our members will be wondering if it is still prudent to mine,” the CEO of the Chana Chamber of Mines (GCM), Mr Suleiman Koney, said.

The chamber comprises mining companies in the country and their sub-sector – mining and quarrying – is the biggest sub-sector in industry.

The Association of Ghana Industries (AGI), the umbrella body of manufacturers and related service providers, hold similar views, although it is yet to fully react to the development.

Basing their comments on the reaction of the business community on the new Act, Dr Asibey and a tax expert, Mr Abdallah Ali-Nakyea, said it was obvious that the government was sacrificing growth in the short term for revenue, which it needs to repay previous debts and meet expenditures.

“In reality, the taxes will affect growth but we also need it so we do not continue borrowing and heating the system up,” Mr Ali-Nakyea, who is also the Director of tax consulting firm, WTS, said.

“I have always said that if government wants money and you say they should go and borrow, then you have to know that borrowing is postponed taxation. Because the government cannot raise the revenues domestically, it has to go and borrow, but in future, taxes must go up to repay the loan," he said.

The country's debt burden remains a major source of concern to economic stability, partly forcing the government to seek help from the International Monetary Fund (IMF) through the three-year extended credit facility (ECF).

The debt burden rose by 21 per cent between 2014 (GH¢76.1 billion) and September last year (GH¢92.16 billion), on account of new loans procured to make up for declining revenues.

"If we want to free the economy from debt, then we need to swallow this bitter pill of paying high taxes because it is the only way we can repay the loans and develop our own," the Director of WTS said.

He, however, bemoaned the various leakages in the system and called for prudent measures to help save revenues.

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