By Godwill Arthur-Mensah, GNA
Accra, Aug. 28, GNA - The Chancellor of the Federal Republic of Germany, Dr Angela Merkel, is slated to visit Ghana on Thursday, August 30, to strengthen the bilateral relations between Ghana and Germany for their mutual benefit.
The German Chancellor would be accompanied by a high-ranking German business delegation to explore business and investment opportunities in the country.
As part of the visit, German Industry and Commerce in Ghana (AHK Ghana), will host a business dialogue to facilitate an exchange on the prevailing business environment in Ghana.
Ghana has had a long historical relationship with Germany ever since official contacts were made after Ghana’s independence in 1957.
Ghana has also enjoyed over fifty (50) years of bilateral relations with Germany since her independence.
The nature of bilateral relations between the two countries has gradually improved over the years.
The good relations between Ghana and Germany, had allowed for beneficial ties in the areas of trade and investment, educational exchange programmes and socio-cultural activities.
The two nations have maintained close and intensive political relations. Ghana is a key partner for Germany in West Africa, as illustrated by the inclusion of Ghana in the G20 initiative Compact with Africa under the German G20 Presidency in 2017, as well as the conclusion of a bilateral reform and investment partnership the same year.
The state visit of Federal President Frank-Walter Steinmeier to Ghana in December 2017, was high point in German-Ghanaian relations. Since taking office, President Nana Akufo-Addo had met twice with Federal Chancellor Dr Angela Merkel: in June 2017 on the occasion of the G20 Africa Conference in Berlin and in February 2018 on an official visit to Germany to attend economic conferences in Dortmund and Berlin.
A wide range of German institutions and intermediary organisations are active in Ghana. The German business sector has been active in Accra since 2011 through a Delegate Office of German Industry and Commerce.
A Germany Trade and Invest (GTAI) correspondent has also been based in Accra since early 2014.
Cultural intermediaries – such as the Goethe-Institute, and also institutions like the German-Swiss International School (GSIS) and the German Academic Exchange Service (DAAD) – promote scientific, academic and cultural exchange between the two countries.
Ghana is one of Germany’s most important trading partners in sub-Saharan Africa. The country’s bilateral trade with Germany amounted €481million in 2017, compared with €584million in 2016.
Germany exported goods worth €266million to Ghana in 2017, while importing goods worth €215million, down from €302million and €281million respectively in 2016.
The Ghanaian Government is seeking to stimulate the country’s economy, in particular by strengthening the private sector, while also aiming to dismantle existing barriers to foreign investment.
German’s annual trade with Africa is estimated at $60 billion, however, Germany had lagged behind other Western countries that have done more in terms of trade opportunities in Africa.
Out of more than $10 billion in German investments on the continent each year, 90 percent is with just three countries – South Africa, Nigeria and Algeria.
Notwithstanding, Ghana had benefited from a number of investments and economic trade activities from Germany. The country had attracted investment from Germany in the areas of construction, agriculture (Shea butter and rice farming project), manufacturing and services.
Ghana had benefited in some form of technical, cultural, and military assistance from Germany.
The government of Ghana continues to receive budgetary support and further receives political assistance from Germany in strengthening democratic governance and various institutions of state.
Ghana is Germany’s third largest trading partner in sub-Saharan Africa, after South Africa and Nigeria, though it is well behind these two countries.
Germany through Deutche Gesellschaft International Zusammenarbeit (GIZ) invested €1.8 million to boost the development of renewable energy.
This effort from German government is to help build capacity in Ghana’s energy sector. It further offers opportunity to diversify energy production. This diversification will help improve Ghana’s energy capacity development.
Germany also supported the Kofi Annan International Peacekeeping Training Centre (KAIPTC). Since its establishment in 2003, KAIPTC has been supported with over €11million, through the German Ministry of Foreign Affairs, Ministry of Defence, Ministry of Interior, and Ministry of Economic Cooperation.
Germany had contributed significantly to the success of the Centre through financing of buildings, logistical support, and deployment of advisors and execution of holistic courses, which help military officers in all manner of activities.
Benefits in Ghana-Germany Relations
Germany has also benefited from Ghana through Ghana-Germany relations. These gains are vastly in the areas of trade and economic activities. The trading activities include, export of cocoa beans and non-traditional export commodities.
Germany further benefits from the repatriation of profit from its investments in Ghana, especially through tax exemption granted to German companies commencing operations in Ghana.
Germany’s contribution to Ghana’s democratic dispensation
In terms of democratic principles, good governance, the rule of law, respect for human rights and maintaining domestic stability, Ghana is in good standing in the West Africa Sub-region and Africa in general.
Ghana’s democracy has been partly supported by the support she enjoyed from German non-governmental organisations (NGOs), such as Konrad Adenauer Stiftung (KAS), Friedrich-Ebert-Stiftung (FES), Kreditanstalt fur Wiederaufbau (KfW) and German International Cooperation (GIZ), that have been promoting development in areas of agriculture, private sector development, capacity building and good governance.
Challenges to Ghana- Germany Trade and Investment Relations
Ghana and Germany offer each other different commodities for trade. Whereas Germany brings more technologically advanced and sophisticated machines and goods to Ghana to trade for high priced revenue.
Ghana, on the other hand, exports mainly primary products, which include cocoa, aluminium ores etc. In 2012, trade exchange between the two countries grew by 56% with a chunk of the trade exchange going in favour of Germany. This disparity creates imbalance between Ghanaian and German imports.
The main challenge, however, has been the minimal influence of Ghanaian trade and investment activities in Germany. Thus, compared to Germany, Ghana is quite disadvantaged on trade exchange between the two countries.
In as much as Ghana provides investment incentive and strategy through Ghana Investment Promotion Centre (GIPC) for foreign investors like Germans to invest in Ghana, same cannot be said of favourable German policy to suit Ghanaian investors.
Ghanaian investors do not have same financial muscles to battle other multi-national companies in investment project.
Ghanaian investors find it difficult to source capital for investment projects. Even though the 1994 Ghana Investment Promotion Act guarantee encourages joint-venture partnership, it’s difficult on the part of Ghanaian investors to raise the necessary capital to put up joint venture investment with foreign investor including Germans.
This capital constraint to an extent holds back bilateral investment and trade relation between the two countries.
Ghana-Germany bilateral relations continue to touch critical areas of paramount importance to both countries. Both countries continue to cooperate in the areas of health, education, agricultural development, military assistance, private sector development, trade, political cooperation, road, and cultural development.
Amidst these efforts, there are emerging challenges of trade imbalances, where Ghana’s domestic market is flooded with German goods and services. Also, financial constraints, cultural differences among others affect bilateral relation between the two countries.
Germany is the world’s third largest exporter and an established leader in technological innovations and industrialization.
In contrast, Africa, as the world’s fastest growing region, is a hotspot for investment and is in need of infrastructure, power and industrialization. With an intertwined history, and perfectly opposing needs, Germany and Africa are poised to create profitable partnerships for their mutual benefits.
Credit: https://accra.diplo.de/gh
http://ugspace.ug.edu.gh/bitstream/handle/123456789/21671/Ghana-Germany
GNA
Read Full Story
Facebook
Twitter
Pinterest
Instagram
Google+
YouTube
LinkedIn
RSS