Exodus of foreign companies: Results of economic mismanagement

The concept of foreign Investment (FDI) is essential in the achievement of
economic growth for a developing country such as Ghana.

FDI has three potentials that are crucial for any developing country; these potentials are the “investment gap," which provides investment capital; second developing gap is the “foreign exchange gap," which provides opportunities for foreign exchange earnings through exports and investment; and finally, it fills the “tax revenue gap” by “generating tax revenue through economic activities.” (Quazi et al., 2014).

FDI has the capability to transfer technology, generate facilities, and manage
skills; it also stimulates domestic investment in equivalent funds, generates
contemporary employment prospects, enhances competition in the local market, and escalates market accessibility for export goods and services globally (Quazi et al., 2014). All things being equal, all the above should eventually contribute to the economic development of the host country, in this case, Ghana.

However, recent events in Ghana should be of major concern to us and must be spoken against by all well-meaning Ghanaians. The consequences of recent events will be felt by current and future generations, if not curtailed.

Ghanaians have been hit with the news of the exits of several multinational
companies (MNCs) in recent years, including Societe Generale, Glovo, Nivea,
Jumia Foods, Lipton Tea, Dark and Lovely, Bet 365, Game, and Bic.

These are companies that were doing very well under previous regimes; they
have been able to operate and make profits in this country for decades,
employing and providing sources of livelihood for a lot of Ghanaians and
subsequently contributed to the economic development of this country.

Over the years, civil society organizations (CSOs), the business community, the
oppositions and a section of the media have consistently raised serious
concerns about the country’s economy and how the Akufo-Addo-Bawumia government has been managing the economy, yet the government has consistently refused to heed the warnings from all the above.

They have continued to use propaganda to dispel the concerns raised by the above-mentioned entities, dismissing them as “noises from political opponents.” Now the chickens have come home to roost. Foreign companies are also singing
from the same rhythm book.

These foreign companies cannot be said to be politically exposed; they are
profit-oriented entities that invest and operate based on favourable business
environments and the presence of potential returns on investments in
specific location.

The exits of these foreign companies from the country are a clear indication
that the country is not heading in the right direction. It indicates that the economy is not being well managed by the current government, that there is no future for the 14% of Ghanaians who are currently unemployed, and that there is no future for the country’s socio-economic development and growth.

Since 2017, the Akufo-Addo-Bawumia government has not been able to attract any significant amount of foreign direct investment into the country. Their policies and economic mismanagement have led to the exits of the already existing ones. This is sad and reprehensible and must be condemned.

Despite the denials of the current government, these companies are leaving
the shores of Ghana due to economic challenges and unfavourable business
environments. The government is undoubtedly committing “crimes of denial”. This trend raises concerns about the country’s economic stability and highlights the need for serious measures to address the same.

If foreign companies, with all their strong financial muscles, are folding up and leaving the shores of this country because they have no hope in the economy,
what will be the fate of the indigenous ones who have limited financial strength?

These are worrying times for Ghanaians because the exits of these foreign
companies have the propensity to negatively impact the economy, which will lead
to significant job losses, decreased economic activities, reduced competition and innovation, decreased availability of products and services, increased prices for consumers, and struggles for local businesses to fill the gap.

It will also affect the standards of living of the citizenry, economic growth,
human capital development, technological advancement; the exchange rate
will be greatly hit.

Clearly, as Ghanaians, we cannot continue to allow ourselves to be treated as if
we don’t matter; we cannot afford to allow the current status quo to continue beyond 2024. We have to vote against this Akufo-Addo-Bawumia government to safeguard the future of our children and Ghana.