Chief Executive Officer of Dalex Finance Company Ken Thompson has launched a harsh attack on the Ghanaian government’s business policies, clearly connecting its actions to the recent wave of international corporations leaving Ghana. During an interview on JoyFM’s Super Morning Show, he shared his forthright thoughts, expressing great anger with the government’s disregard for the private sector and its effects on the economy.
Thompson’s critique coincides with a worrying trend of foreign companies closing their doors in Ghana as a result of the difficult economic environment. Famous companies that have suspended business in Ghana include Nivea, Jumia Foods, Lipton Tea, Dark and Lovely, BET 365, Game, and BIC. They have all cited financial challenges that have been made worse by government actions. Most recently, the Spanish food delivery service Glovo announced it would exit the Ghanaian market by May 10, 2024, pointing to profitability challenges and a shift in investment priorities.
Thompson captured in his interview the sense of desperation felt by local business leaders and entrepreneurs who are struggling with rising interest rates, uncontrollably high inflation, and declining value of their currency. He maintained that these elements result in a prohibitive cost of borrowing, which when paired with high taxes, renders it practically hard for companies to turn a profit in Ghana.
“The private sector is of no concern to the government of Ghana. It is not concerned with creating jobs,” Thompson said vehemently. The government’s reaction to business concerns, he said, is tone deaf, concentrating on infrastructure projects that do not directly address the main issues that firms are currently confronting. “We do not know where to invest, we can not plan, and we are just living day to day. The administration does not seem to care that our hard-earned savings are gone,” he added.
Thompson’s frustrations are echoed in the broader business community, which sees the exit of multinational corporations not just as a loss of jobs but as a significant blow to Ghana’s credibility as a destination for international investment. He pointed out that these exits also lessen market competition, which could result in fewer options and higher prices for consumers.
Despite some opinions suggesting that the departure of these multinationals could open opportunities for local businesses, Thompson is skeptical. He pointed out that Ghanaian enterprises would still face the same debilitating economic climate that the fleeing multinationals could no longer bear. “I’m fine for indigenous enterprises expanding, but even if they take over, we would have the same problems,” he explained. In this case, there would probably be more degradation of capital among local businesses, stifling growth and innovation.
Thompson made a strong case for action, saying that the government should give economic policy reform first priority in order to create a more welcoming atmosphere for businesses, which will boost investment and maintain growth. He stressed the need for a solid framework that addresses the underlying problems that currently impair company operations in Ghana and enables companies to plan beyond the day-to-day.
