Is Ghana an Attractive Proposition for IT Services and Business Process Outsourcing

During the last 10 years, the Ghanaian government has made a serious effort to increase foreign direct investment (FDI) as a vehicle for export-led growth. Much of the emphasis has been on using technology to fuel the growth engine and as a means of diversifying from Ghana????????????s traditional staple exports, cocoa, gold and timber. The need for improvement is greater now than ever: cocoa prices have tumbled due to global overcapacity, timber production has become increasingly unsustainable and gold????????????no longer the standard it was????????????has fallen in value. As a result, the country????????????s GDP per capita has stagnated.

Ghana believes technological investments are the answer to its export and employment problems and that it has a number of advantages over its West African neighbors. It is seeking to increase investment to make an early push into the sector and, ultimately, to turn itself into a major information and communications technology (ICT) and business process outsourcing (BPO) services player. Some have suggested that Ghana could in time become the ????????????Bangalore of West Africa.????????????

This paper examines Ghanaian efforts to grow its ICT/BPO investment and attempts to determine whether Ghana can be successful. The authors base their conclusions on an analysis of the current investment environment, the labor market, the country????????????s infrastructure, as well as the rule of law, the infrastructure, and government policies and incentives. The authors, who interviewed entrepreneurs and conducted a survey to inform their views, also present a breakdown analysis on the different BPO areas.

The authors conclude that while Ghana cannot compete effectively with India in the foreseeable future, the country is competitive in such low-skill, low-margin areas as transcription services, account activation, surveys and basic customer care. They conclude, too, that current government efforts are justified, since Ghana only needs to be moderately successful to have a positive impact on its economy.