….Executives upbeat as higher oil prices provided economic boost
The vast majority of executives interviewed for the latest edition of the Business Barometer: Ghana CEO Survey carried out by Oxford Business Group (OBG)were bullish about prospects for the coming year, with a return to growth of 8.4percent in 2017 helping to balance out the economic challenges that were hallmarks of 2018.
As part of its survey on the economy, the global research and consultancy firm asked almost 100 C-suite executives from across Ghana’s industries a wide-ranging series of questions on a face-to-face basis over a nine-month period aimed at gauging business sentiment. The results are now available to view in full on OBG’s Editors’ Blog at: https://oxfordbusinessgroup.com/blog/souhir-mzali/obg-business-barometer/ghana-ready-stand-its-own-two-feet.
When asked, 93 percent of respondents described their expectations of local business conditions for the coming 12 months as positive or very positive.
Three-quarters of the business leaders interviewed also viewed the level of transparency for conducting business in Ghana relative to the region favourably, deeming it high or very high.
However, opinions on the country’s tax environment were more divided, with only 35% of interviewees describing it as competitive on a global scale, while more than half (57%) said they felt it was uncompetitive or very uncompetitive.
Ghana’s borrowing climate was viewed as challenging by an even greater number of business leaders. Almost four-fifths (78%) of interviewees told OBG that they thought accessing credit in Ghana was difficult or very difficult compared with just 18 percent who felt the process was easy.
In answer to a separate question, 34 percent of respondents identified leadership as the most pressing skill needed for businesses based in the country, easily outpacing engineering, and research and development, which placed second and third respectively.
Commenting in her blog, Souhir Mzali, OBG’s Regional Editor for Africa,said that even though 2018 had produced a raft of economic challenges for Ghana, which ranged from the country’s scheduled year-end exit from an IMF credit deal, and ongoing fiscal and monetary reforms, to a landmark consolidation agenda for the banking sector, confidence was broadly high among the business leaders interviewed by OBG.
“The prevailing optimism can be attributed to a number of factors including, first and foremost, a recovery in oil prices,” she said. “The fact, however, that 61 percent of OBG’s survey respondents point to the rise in oil prices as the top external event that could impact the economy in the short to medium term demonstrates the vulnerability it is exposed to should prices go the wrong way again.”
Mzali added that the upbeat mood observed among the country’s business community could perhaps also be interpreted as wider recognition that inefficiencies needed to be dealt with, and that the short-term pain resulting from the ongoing reform agenda wasa necessary stepping stone on the path to longer-term benefits.
“With the IMF deal scheduled to end in December 2018, Ghanaian authorities have expressed determination not to resort to the same form of bailout in the future, and commitment to consolidate the macroeconomic gains achieved so far, notably through monetary and fiscal discipline,” she said. “The challenge ahead is no small one, but it is a great opportunity for Ghana to capitalise on lessons learned and independently steer its economy.”
Mzali’s in-depth evaluation of the survey’s results can be found on OBG’s Editor’s Blog,
titled ‘Next Frontier’. All four of OBG’s regional managing editors use the platform to share their expert analysis of the latest developments taking place across the sectors of the 30+ high-growth markets covered by the company’s research.
The OBG Business Barometer: CEO Surveys features in the Group’s extensive portfolio of research tools. The full results of the survey on Ghana will be made available online and in print. Similar studies are also under way in the other markets in which OBG operates.