22
Fri, Mar

GFZA SPARKLES ON THE HORIZON

Business & Economy

The Ghana Free Zones Authority is poised to fire up industries and put an end to “business as usual” The Ghana Free Zones Authority was established by an Act of Parliament (Act 504) on August 31 1995, to enable the establishment of free zones in Ghana to promote economic development and to provide for the regulation of activities in free zones and other related purposes. The actual implementation of the free zones regime began in September 1996.

The Ghana Free Zones Authority is poised to fire up industries and put an end to “business as usual” The Ghana Free Zones Authority was established by an Act of Parliament (Act 504) on August 31 1995, to enable the establishment of free zones in Ghana to promote economic development and to provide for the regulation of activities in free zones and other related purposes. The actual implementation of the free zones regime began in September 1996.

Promotion of Manufacturing

The Ghana Free Zones Regime is intended to promote the processing and manufacturing of goods within Export Processing Zones (EPZs) and the development of Commercial and Service activities at seaport and airports.

Ghana’s Free Zone regime combines both the enclave and single enterprise schemes. Basically, the whole of Ghana is accessible to potential investors to use the Free Zones as a focal point in producing goods and services for foreign markets.

Priority Sectors

Certain sectors have been identified as key because of Ghana’s comparative advantage in these areas. They include Infrastructural Development, Industry and Manufacturing, Agro Processing, Oil and Gas and ICT sub-sectors.  However, these are not exclusive since investors can invest in any other sector of their choice which falls within the mandate of the Free Zones Authority.

Incentives

There are generous Incentives under the Free Zones Regime for investors interested in developing and operating free zones enclaves and single-factory free zones in Ghana. These include: 100% exemption from payment of direct and indirect duties and levies on all imports for production and export from free zones; 100% exemption from payment of income tax on profits for ten years and not more than 15% tax thereafter; and total exemption from payment of withholding taxes from dividends arising from free zone investments.

In addition, there are minimal customs formalities and no import licensing requirements. A 100% ownership of shares in a free zone enterprise by any investor, foreign or national is also allowed.

At least 70% of annual production of goods and services by free zone enterprises must be exported. In other words, up to 30% of annual production of goods and services of any free zone enterprise is authorised for sale subject to payments of applicable duties and taxes on the local market.

Ensuring Strict Compliance to Regulations

Over the years, the Authority has exercised only one Compliance Regime. however, currently, management has introduced two key additional measures to ensure effective monitoring of operations. These include Monitoring and Auditing by Private Auditors.

Mr Michael Okyere Baafi explained that the Authority is not only concentrating on Compliance but has instituted other Monitoring mechanisms aimed at policing the day-to-day activities of investors to ensure their operations fall in line with the Act 504 and its supporting regulations.

New image/ Rebranding

Mr Michael Okyere Baafi’ noted that “It is not for nothing that in recent times, the narrative about the Ghana Free Zones Authority has changed for the better”.

According to him, the Authority though a public entity operates with a private sector orientation and believes the massive turnaround in the GFZA’s operations will be achieved when the institution positions itself strategically to reflect modern trends in investment facilitation.

Speed in service delivery is one of such hallmarks that will place the GFZA on a high pedestal. He cited undue delays as a watchword which every employee within the Authority is mindful of, as delays can be catastrophic to the organisation’s progress.

Service Quality

Mr Okyere Baafi stressed the need for quality service delivery. This is an area he does not compromise on. It is from this perspective that the GFZA has instituted quality control mechanisms to check its staff and to ensure that they adhere to strict service quality guidelines in their dealings with the Authority’s clientele.

Another important catalyst that has helped build the GFZA is enhancing the capacity of its staff. The organisation has extensively built the capacity of the men and women who run the free zones zonal offices across the nation. Management believes that it takes a strong and well-prepared staff to drive the organisation towards its desired and expected goals.

This testimony is reflected at GFZA today as clients visit the offices and are welcomed by smart-looking staff ready to assist them.

Massive Change

The Ghana Free Zones Authority has seen significant improvements since Mr Michael Okyere Baafi took over in 2007. Two successful weeklong investment promotion campaigns have been staged through which twenty (20) businesses (mostly Ghanaian owned) have been licensed as Free Zones enterprises.

The Chief Executive Officer is also confident that the organisations' export drive is on course. He reiterated that setting and meeting targets is one of the goals his administration is directing its attention to. He also said that even though GFZA is a public organisation, it executes its operations like a privately owned company.

He told the Daily Statesman in an interview that all staff have been oriented to perform all their duties like the employees of a private company, in an attempt to shift the diktats and paradigm of public sector performance under the new political leadership of His Excellency Nana Addo Dankwa Akufo-Addo.

Mr Okyere Baafi stated that when the concept of the GFZA starts to be understood by all Ghanaians, irrespective of their ideologies, the prospects associated with the programme will help boost the Ghana Beyond Aid agenda.

The CEO disclosed that over the next three years, the Authority will develop Special Economic Zones and Industrial Park systems, one in the Eastern Region and another in the Northern Region. He said the Eastern Region’s Export Processing Zone will be dedicated to Pharmaceutical Enterprises to drive pharmaceutical exports from Ghana.

Marks of success

As it stands, the Ghana Free Zones Authority has 179 active Free Zones Enterprises and can boast of six chocolate manufacturing companies. Barry Callebaut, the world’s leading supplier of high-quality cocoa products, is one of the notable chocolate producers under the Free Zones.

It is estimated that Free Zones has created over 500,000 indirect jobs and over 30,000 direct jobs and has provided training to citizens in the export, import and manufacturing sectors.

Collaboration is key

The CEO stated that, like any organization, the organisation faces a few challenges with the most pressing being weak collaborations with government Institutions which may have created bottlenecks in investment facilitation.

He advised that all agencies should collaborate to achieve a common goal, bearing in mind that the total development of Ghana is paramount and under no circumstance should one agency try to trespass on another’s mandate, which merely creates confusion.

He is however hopeful that, as stakeholders and the public begin to grasp the Free Zones concept, the GZFA will become the next big discovery in the annals of Ghana's industrial drive.

“Even though we are a government organisation, we at GFZA do our things as a private company; Targets and results have been our goal,” Okyere Baafi says, and adds: “We will certainly get there.”

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