UK Chamber of Commerce reports corruption as topmost challenge for businesses

UK Chamber of Commerce reports corruption as topmost challenge for businesses in 2022

The UK Ghana Chamber of Commerce (UKGCC) has indicated that corruption appears to be the topmost challenge for businesses in 2022.

The Chamber notes that taxation policies as well as the cost of power and land also pose economic challenges to doing business in Ghana.

This was contained in the UKGCC 2022 Business Environment and Competitiveness Survey report signed by the Chairman of UK Ghana Chamber of Commerce, Anthony Pile MBE released in February 2023.

The report further noted that the cost of fuel continues to be the most expensive cost item identified by businesses in Ghana.

The report also attributes the weakness of the local currency to domestic and external factors such as increased demand for foreign exchange, the Russia-Ukraine war, and credit rating downgrades.

Over 300 companies from 16 industries, ranging from small to large companies, participated in the survey.

The survey results however indicate that most businesses perceive that the business environment in 2022 has improved compared to that of 2021.

Business in Ghana, however, continues to be held back by challenges such as corruption, Ghana’s taxation system, the price of land and power, and present additional economic obstacles.

These notwithstanding, businesses highlighted several factors positively impacting their performance in Ghana.

According to the respondents, hiring competent labour has been among the least expensive expenses their companies have ever had to deal with.

Local marketing costs, certification and quality control charges, as well as cost of locally obtained raw materials are also perceived as being low.

These indicators have shown consistency in their ranking of lower costs of doing business in Ghana over prior year’s survey report.

To improve ease of doing business, respondents suggested several reforms. Top of the list is safety and security of investment, followed by lower corruption and improved transparency.

It was observed that for businesses to prosper over time, the government must support successful regulatory reform and guarantee a stable macroeconomic environment.

Respondents were also of the view that improved bureaucracy and quicker approvals would promote ease of doing business.

Regarding readiness for the African Continental Free Trade Area (AfCFTA), sampled businesses believe that the development of appropriate quality standards, and the expansion of their capital base, are the two most important steps they need to take to increase their competitiveness and optimize the full benefits of the AfCFTA.

Anthony Pile MBE, UKGCC Executive Council Chairman, noted that “despite the current turbulent circumstances, there is an encouraging, yet cautious optimism for the future. It is, therefore, important for all business environment stakeholders, especially Government policy makers, and businesses to plan for the risks and uncertainties and build the resilience to withstand any unanticipated shocks in 2023”.

Commenting on the report, Vish Ashiagbor, Country Senior Partner of PwC, a UKGCC member company and consultants/advisors for the report, commended the government for improving perception of cost of land, availability of logistic partners, and access to land from the 2021 survey results. He, however, bemoaned the worsening problem of corruption and its adverse impact on businesses.

“This year, majority of the respondents voted corruption to be the most worrisome business component despite government’s drive to kick out corruption. Inasmuch as some improvements were recorded last year, the regulatory framework, availability of power and legal system have all declined. In PwC Ghana’s view these setbacks are well within Government’s reach to improve, and should, therefore, remain high on the agendas of advocacy groups like business chambers, he added”.

About the Survey

The annual Business Climate Survey was first launched in 2019 and has been conducted every year since then. The main purpose of the survey is to increase the understanding of opportunities and challenges that the Ghanaian market presents for UKGCC members and businesses generally, whether large or small, new or old, and across all sectors.

The survey provides a platform for businesses to provide key feedback on the health, confidence, intentions, and issues of businesses in Ghana and therefore, serves as the foundation for the UKGCC’s advocacy work.

The 2022 edition provides a comprehensive analysis of several important indications of the current business climate, as perceived by businesses, offering a data-driven look at the trends shaping the business landscape.

Original Source: CBN