Public Service International, a labour group, says amidst efforts to revive the economy due to the impact of the COVID-19 pandemic, the government must review the country’s Free Zones policy.
According to the group, the policy in its current state has failed over the years to achieve its main objectives.
Daniel Oberko, Tax and Trade Organiser of the Public Service international- Africa and Arab Countries, stated that since its inception, Ghana is yet to make significant gains from its free zones regime.
“If you consider the kind of tax incentives we give out, it’s difficult at the current moment to match those tax incentives. How much we are giving out to how much foreign direct investment we have received as a result of the incentives to how much exports we have been able to make as a result of the incentives we have granted and so it is difficult to even match all these things to do even a cost-benefit analysis.”
“So it’s important that we look at it again because we are losing all these amounts of money at the expense of quality education, quality health services, energy and all the social amenities we lack as a country.”
He further shared some thoughts on the way forward to improve the current situation.
“The reform is critical, it’s important. What should happen is that the various stakeholders especially the Ghana Free Zones Authority should allow other experts to get involved in the reform process. We need to allow academia to get involved, we need to allow workers and civil society to get involved in the reform process and on the reforms, we believe that our tax incentives packages that we have given out should be looked at critically and in fact, if you consider how these models are spread across ECOWAS you should know that our reform approach should be broad.”
The Ghana government as part of efforts to attract Foreign Direct Investment created the free zones enclaves which offer international entities a lot of tax exemptions to establish their operations in the country.
The focus of this was to create employment, generate revenue and technological transfer.
In 1995 the Ghana Free Zone Board was established to oversee the regulation of the various zones.
Click here for a copy of the research released by Public Service International on free zones in Ghana
Source: Ghana Business