Turning crises into cash: the path to prosperity

By Samuel Lartey (Prof.)

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Ghana, once lauded as an African success story, has faced significant economic hurdles in recent years, from overburdened national debt to the volatile depreciation of the cedi, sky-high inflation, and the environmental destruction caused by illegal mining (Galamsey).

As the country nears the 2024 General Elections, signs of economic recovery are beginning to emerge, with international praise for efforts to stabilise the currency and restructure debt.

Despite these positive signs, many Ghanaians remain frustrated, facing persistent unemployment, price hikes, and a declining quality of life. And with loads of open and unending talks and protests.

Yet, within these crises lie opportunities. By adopting innovative strategies and turning challenges into commercial opportunities, Ghana can not only stabilise its economy but also thrive. This feature explores how Ghana can capitalise on its socioeconomic challenges, attract foreign investment, and generate new income streams for citizens, businesses, and the government.

Ghana’s Economic Struggles: A Brief Overview

The roots of Ghana’s economic difficulties can be traced to the mid-2000s, when heavy borrowing began to outpace the country’s economic growth. As a result, public debt ballooned, reaching GHS 450 billion by the end of 2022, an alarming 93.5% of GDP.

Currency depreciation became a major concern, with the cedi losing over 50% of its value against the U.S. dollar in 2022 alone.

Combined with a global pandemic and the impact of the Russia-Ukraine war, inflation spiked to a record 54.1% in late 2022, making daily necessities increasingly unaffordable for the average Ghanaian.

Despite these challenges, Ghana’s outlook for 2024 is cautiously optimistic. In 2023, the IMF granted the country a $3 billion Extended Credit Facility, providing the fiscal breathing room needed to restructure debt and stabilise the economy. Economic growth is projected at a modest 3.2% for 2024, signalling that the worst of the downturn might be behind us. However, for the majority of citizens, insecurity remains palpable, with high unemployment and stagnant wages continuing to impact daily life.

Tapping into Tourism: Marketing Ghana on the Global Stage

One of Ghana’s most untapped potential sectors for turning crises into economic opportunities is tourism. With rich cultural heritage, historical landmarks like the Cape Coast Castle, and natural wonders such as Kakum National Park and the Volta Region’s waterfalls, Ghana can attract tourists from around the world, thus bringing in valuable foreign exchange.

The tourism industry was already given a major boost in 2019 with the highly successful Year of Return, which attracted thousands of tourists from the African diaspora, injecting millions of dollars into the economy. This momentum can be revitalised.

1. Opening Up for Foreign Tourists

To fully capitalise on its tourism potential, Ghana must prioritise making travel to the country more accessible. Simplifying visa processes, improving air connectivity, and ensuring the safety and convenience of tourists are essential.

For instance, the government could introduce more streams of visa-on-arrival programs or offer travel incentives for groups from target regions like the United States, Europe, and the African diaspora.

2. Leveraging Media and Advertising

In today’s digital world, visibility is key. Ghana needs to invest in strategic, high-impact marketing campaigns that showcase the nation’s rich history, culture, and tourism assets to a global audience.

This could be achieved through partnerships with globally recognised media outlets such as CNN, BBC, and Al Jazeera, as well as influential travel platforms like TripAdvisor, Lonely Planet, and Instagram influencers who focus on Africa and travel content.

Programs such as Ghana Beyond the Year of Return could be launched, where Ghana’s beautiful landscapes, cultural festivals, and historical significance are showcased in compelling visuals and storytelling on international platforms. Highlighting Ghana as a safe, affordable, and culturally rich destination would position it as a prime location for tourists seeking both adventure and heritage experiences.

Ghana’s Ministers, Parliamentarians and top officials could hook on official social media platforms to deliberately market the country.

3. Developing Tourism Infrastructure

While advertising is crucial, the tourism sector will need to accompany infrastructural upgrades. Investment in roads, airports, and hospitality services across the country, particularly in regions like the Northern and Volta regions will ensure tourists have smooth enjoyable experiences.

Encouraging both local and foreign private investment into resorts, eco-tourism facilities, and tour guide services can transform areas that have been previously underdeveloped into tourism hubs.

4. Creating Cultural Tourism Packages

Ghana can offer curated travel experiences that delve into the country’s rich cultural and historical assets. Initiatives such as historical tours of slave trade routes, authentic cultural experiences in Ashanti and Ewe traditions, and nature-based eco-tourism could appeal to travelers looking for a deeper connection to Africa.

These packages could be marketed through embassies and international tourism fairs, allowing Ghana to tap into niche markets such as heritage tourism, adventure tourism, and eco-conscious travel.

5. Engaging the African Diaspora

The Year of Return proved the power of engaging the African diaspora, and this momentum can be built upon. Ghana should create a yearly event series that encourages those of African descent to visit, invest, and even repatriate.

By providing incentives like reduced property taxes for diaspora investors and promoting programs for returnees to establish businesses, Ghana can generate significant foreign direct investment (FDI). This effort could be further supported by bilateral agreements with other countries that have large African populations, fostering tourism and long-term economic ties.

Commercialising Ghana’s Crises

Beyond tourism, Ghana has multiple avenues through which to commercialise its crises and create new streams of revenue.

1. Agriculture and Agro-processing

Food inflation and supply chain disruptions offer an opportunity for Ghana to reinvest in agriculture. With agriculture contributing approximately 20% of GDP, there is untapped potential for growth.

The government can support smallholder farmers by providing agricultural technology and financial incentives, boosting productivity and making Ghana more competitive in international markets. Value addition through agro-processing such as producing chocolate from cocoa and cosmetics from shea butter could turn Ghana into an agro-industrial hub.

2. Digital Innovation and Fintech Expansion

Amidst the economic downturn, mobile money and fintech services experienced exponential growth. With transactions exceeding GHS 1 trillion in 2022, Ghana is positioned as a leader in digital finance in Africa.

To commercialise this strength, the government can provide more robust regulations and financial backing to fintech startups, encouraging innovation and attracting international investors. Partnering with global tech companies could further amplify Ghana’s role as a digital finance hub on the continent.

3. Sustainable Mining

Illegal mining (Galamsey) has caused massive environmental destruction and economic losses, but formalising and regulating the artisanal mining sector could transform this issue into a revenue stream.

By taxing legal miners and implementing strict environmental standards, the government could generate funds to be reinvested into community development projects, while also attracting responsible mining companies that prioritise sustainability.

4. Green Energy and Infrastructure Development

Ghana’s power sector has long been plagued by instability, yet renewable energy offers a path to sustainable growth. Investing in solar, wind, and hydroelectric power projects could both stabilise Ghana’s energy supply and provide job opportunities for locals.

With global interest in green energy at an all-time high, Ghana could market itself as a leader in renewable energy development in West Africa, attracting foreign investments in this emerging sector.

Conclusion

The road to economic recovery in Ghana is long, but it is also paved with opportunities. By turning crises into cash, whether through tourism, agriculture, digital innovation, or sustainable mining, Ghana can create a more resilient, diversified economy.

Through deliberate advertising on global platforms and offering incentives to tourists and investors, Ghana can build a future where socioeconomic insecurity is a thing of the past and prosperity is accessible to all.

In the face of uncertainty, Ghana’s potential remains untapped, ready to be harnessed through bold, strategic moves. By embracing a forward-thinking approach, the country can turn current challenges into thriving industries, ultimately benefiting its people and the global economy alike.

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