Exit of multinational companies will hurt Ghana's economy, hinder job creation - Banking consultant

Banking consultant, Dr. Richmond Atuahene, has expressed concerns about the effects of the exit of the French bank, Société Générale, from Ghana and how it will have a negative impact on the domestic economy.

He argued that the bank's decision to withdraw its operations from the country will lead to further job cuts in an economy already struggling with high unemployment rates.

Dr. Atuahene further pointed out that Société Générale's departure may prompt other banks to reconsider their operations in Ghana due to unfavorable business conditions, especially for financial institutions.

Overall, Dr. Atuahene believes that the departure of multinational companies from Ghana will have a detrimental effect on the economy and hinder job creation efforts.

“It is going to make our unemployment situation worse and you know, SG [Société Générale] has been in the country for twenty years and they have participated in the cocoa syndication and some other businesses but now they are going.

“It means that they are no more there with the cocoa syndication and they are going with their taxes and so we are not going to get corporate taxes from them and so it will affect our fiscal situation,” he explained.

The banking consultant warned that the exits of multinational companies like Glovo and BIC are evidence of the limited economic progress made despite Ghana being under an IMF program.

“With all the literature that the World Bank and IMF, especially the Bretton Woods institutions, saying the economy is turning around, these international banks have strong research departments and they have studied the variables that make economic indications very stable and they have seen it and they know it is not going to happen today or tomorrow. So, the earlier they pack their bags, the better for them,” Dr. Atuahene explained.

Since 2022, unstable economic conditions in Ghana have led many international corporations to relocate their operations.

Factors such as the fluctuating value of the Ghanaian cedi, high inflation rates, and expensive imports have contributed to this trend.

In addition, energy challenges like frequent power outages, known as "Dumsor," and rising utility costs have further complicated the business environment.

As a result, several multinational companies have ceased operations in Ghana, citing strategic realignment and unfavorable operating conditions.

These departures have not only impacted job creation and Ghana's GDP, but have also hindered overall economic growth and tax revenue.

MA/AE

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