|
BY
(01149117D)
A PROJECT WORK SUBMITTED TO THE DEPARTMENT OF ACCOUNTANCY, ACCRA TECHNICAL UNIVERSITY IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF HIGHER NATIONAL DIPLOMA IN
ACCOUNTING
JULY – 2017
DECLARATION
I hereby declare that
this work is a presentation of my own original research work for the award of
higher national diploma in accounting, except for
references to the works of other authors that have been cited and duly
acknowledged and that no part of it has been
presented by another person to the university or elsewhere for the
award of any other higher national diploma.
Sobori Kwaku
Francis …………………… ……/……/……..
Signature
Date
SUPERVISOR’S
CERTIFICATION
I hereby certify that the preparation of this
project work was supervised in accordance with the guidelines on the
supervision of project laid down by the Accra Technical University.
………………………………. ……../……./……..
MR KOFI
SARFO ADJEI
Date
[Supervisor]
DEDICATION
I dedicate
this study to my siblings to motivate them to aspire to greater heights than I
have done.
ACKNOWLEDGEMENT
I ascribe all the
thanksgiving to the ALMIGHTY GOD;- HE WHO begun a good work and complete it, whom I found grace, mercy and favor before
and HE granted me the brains of the learned and made a way for me where there
seems to be no way to pursue this program.
I greatly appreciate Mr.
and Mrs. Charles Ankoma, Mr. and Mrs. Seth Bonney, Mr. and Mrs. Pastor Stephen
Martey and Madam Vera Addo. May God bless them as HE uses them to be a
blessing to me.
I knowledge my
supervisor, Mr. Kofi Sarfo Adjei for the guidance that he offered me to assist
me from the beginning of this work till the end, GOD bless him.
Not forgetting of
Augustina Collinson; she motivated me to take the whole burden of this work
upon myself and do it alone and Mr. Alpha Abdulah Shaban of GUTA. May GOD you
as well.
ABSTRACT
Foreigners’ invasion of
markets has not been a problem to Ghanaian traders alone, it has been a
problem facing the developing world which emanated from globalization of the
world and inter dependency of nations. This study investigated whether the Act
865, Ghana Investment Promotion Centre Act, 2013 is effectively enforced as
foreigners are still claimed to be invading Ghana markets in the existence of
the act 865 (2013). The intensity of the invasion was examined and the
implications of the invasion on local traders and the economy of Ghana.
Seven local traders, the
Ghana union of traders association and Ghana investment promotion center were
interviewed. The study discloses that there are loopholes in the
implementation of the Ghana investment promotion center act, act 865 2013 as
result of unpatriotic nature of most Ghanaian leaders and citizens and the
foreigners are capitalizing on that to invade the markets of Ghana.
There are foreigners
from various countries especially Chinese, Nigerians, Arabs and Lebanese
trading in almost all the products that the local traders are into such as
electronic appliances, electrical products, footwear, plastics, cosmetics and
so on given an average intensity of the invasion since some meets the
requirements of the GIPC act 865 though it cannot be quantified.
The invasion has had
grave implications on the local traders businesses as well as the economy of
Ghana. The study recommended, among other things,
that Ghanaian leaders and citizens have to change their conduct towards their
country and the problem would be solved.
TABLE OF CONTENT
TITTLE PAGE …………………………………………………………………………………..
DECLARATION
…………………………………………………..……………………………. I
SUPERVISORS CERTIFICATION
………………………………………………………….. II
DEDICATION…………………………………………………………...……………………..III ACKNOWLEDGEMENT…………………………………………..………………………….IV ABSTRACT……………………………………………………...……………………………...
V
TABLE OF CONTENTS………………………………………...…………..…………………. VI
LIST OF
TABLES………………………………………………………………………………. x
LIST OF FIGURES……………………………………………….……………………………... x
CHAPTER ONE ……………………………………..……….………………………………… 1
1.0 INTRODUCTION…………………………………………………………………………...
1
1.1 Background of the
Study…………………………………………………….......................... 2
1.2 Statement of the
Problem……………………………………………………......................... 6
1.3 Research
Questions…………………………………………….……………………………. 8
1.4 Hypothesis ……………………………………..…………………………………………….. 8
1.5 Objectives of the Study………………………………………………………...…………….. 9
1.6 Justification of the Study………………………………………………………………..…… 9
1.7 The Scope of the study …………………………………………….………………………… 9
1.8 Limitation……………………………………………………………………………....…...
10
1.9 Organization ………………………………………………...…….…..……….…………… 10
CHAPTER TWO ……………………………………..………………………………………..
11
LITERATURE REVIEW………………..…………………………………………………....
11
2.0
Introduction …………………………….………………………………………………...... 10
2.1
Trading activities of
Chinese migrants in the central business district (CBD) of Accra……
11
2.2 Demystifying Chinese business strength
in urban West Africa …………………..………… 13
2.3 The enforcement of the GIPC Act,
478 in 2012 ………………………………..…………… 16
2.4 Exploring
the economic implications of an expanding Chinese presence in
Dakar’s informal market
………………………………………………………………………. 17
2.4.1 Why explore China in Senegal?….…………………………….………………………….. 17
2.4.2. Local reactions …………………………………………………………………………… 18
2.5. Summary
………………………………………………………….……………………….. 20
CHAPTER THREE ………………………………………..………………………………….
22
METHODOLOGY …………………………………………..……………………………….. 22
3.0 Introduction …………………………………………..…………………………………… 22
3.1.
Research design ……………………………………….………….….…………………… 22
3.2
Population ……………………………………………………………….………………….. 23
3.3 Sampling technique and sample size ………………………………….……………………
23
3.4 Data collection instruments
…………………………………….…….…………………….. 24
3.4.1 Semi-structured interview
…………………....................…………….………………….. 24
3.5
Data collection procedure ……………………………………………….…………………. 25
3.6
Data analysis ………………………………………...………………….………………….. 25
3.6.1
Transcription ……………………………………...…………….…….………………….. 25
3.6.2
Organizing of data ……………………………………….…………….…………………. 25
3.6.3
Familiarization ……………………………………….………………………….……….. 26
3.6.4
Coding ……………………………………………...…….………………………………. 26
3.6.5
Theme .................................................................................................................................
26
3.7
Limitation …………………………………………………..………………………………. 27
CHAPTER FOUR ………………………...…………………..………………………………. 28
DATA ANALYSIS ………………………………………………….....……………………… 28
4.0
Introduction ……………………………………………………………….…….…………. 28
4.1 The type
of products local traders deals in …………………………………….….………. 29
4.2: Awareness of
foreigners invading Ghana markets ……………………...…………..…….. 29
4.3. Foreigners dealing
in the same products as local traders in the market ………………….... 30
4.4 Why foreigners
succeed in the invasion of Ghana markets …….……………………..…… 32
4.5. Implementation of
the GIPC Act, Act 865 (2013) …………...............................…………. 34
4.6. Effects of
foreigners invasion of Ghana markets on local traders Businesses ………….... 34
4.7. Implications of
foreigners’ invasion of Ghana markets on the economy of Ghana….……. 36
4.8. Foreigners
participation in business ventures in Ghana ….……………….………...…….. 37
4.9 Foreigners refusal
to be interviewed ………………………………………..……………… 38
4.10 Foreigners in Ghana
markets …………………………………….……………………….. 39
CHAPTER
FIVE .......................................................................................................................
40
SUMMARY,
CONCLUSION AND RECOMMENDATION ……………………………… 40
5.0
INTRODUCTION................................................................................................................
40
5.1. Summary
of findings ……………………………………………….……………………… 40
5.2. Conclusion
………...………………………………………………………………………. 41
5.3. Recommendation
………...………………………………….…………………………….. 42
References
……..………………………………………………………………………………. 43
APPENDIX ………..…………………………………………………………..……………… 45
LIST OF TABLES AND FIGURES
Table
4.1: Types of products local traders deals in ………………………..……….……… 29
Figure
4.2: Awareness of foreigners’ invasion of Ghana markets ………………...………. 30
Table
4.3 foreigners trading in the same products as local traders ………………..……… 30
Figure
4.3.1 Dominance intensity of various foreigners ……………………………………. 32
4.4
Why foreigners succeed in the invasion of Ghana markets …………………………… 33
4.6.
Effects of foreigners invasion of Ghana markets on local traders businesses
………. 35
4.7.
Implications of foreigners’ invasion of Ghana markets on the economy of Ghana
… 37
CHAPTER ONE
INTRODUCTION
1.0.
Introduction
The world has now become
a global village due to modernization, technological advancement,
industrialization and civilization. All countries are closely connected and
interdependent on one another. Today when you take any country, you can find
almost people from everywhere around the globe residing there. Trading is one
of the major activities that has brought the world together. But there are
still lines between each of these countries because each is having its own
laws and rules by which they are governed and which must be respected and
observed by everyone from elsewhere. Globalization of the world has paved a
way for foreigners to compete with citizens of especially developing countries
like Ghana over sectors of an economy like the marketing sector for trading
activities. This has brought the problem of foreigners’ invasion of markets in
Ghana.
This study assesses the
impact of foreigners’ invasion of Ghana markets on the businesses of local
traders, the economy of Ghana, the intensity of the invasion and also if the
Act 865 which was enacted to overcome this problem is effectively implemented.
This chapter presents the background of the study which defines a market and
discuses historical background of the development of trading activities in
Ghana and grievances of Ghana union of traders association (GUTA) about
foreigners’ invasion of Ghana markets, stating the problem statement of the
study, the objectives of the study, the hypothesis and the research question.
Also, stating the justification of the study which high light on the benefits
of this study, the scope of the study, the limitation of the study and the
organization of the study.
1.1 Background of the study
According to businessdictionary.com, market refers to an
actual or nominal place where forces of demand and supply operate, and where
buyers and sellers interact (directly or through intermediaries) to trade
goods, services, or contracts or instruments, for money or barter. Markets
include mechanisms or means for (1) determining price of the traded item, (2)
communicating the price information, (3) facilitating deals and transactions,
and (4) effecting distribution. The market for a particular item is made up of
existing and potential customers who need it and have the ability and
willingness to pay for it. Market. (n.d.). In business dictionary online.
Retrieve from: http://www.businessdictionary.com/definition/market.html.
Accessed on Thursday, February 02, 2017, 3:35:29 AM.
Trading in the country begun when the first
settlers arrived in the country. Like many countries in Africa,
the main method of trading
was through the barter system. People used to exchange goods and
services for commodities and services that was believed to measure up to what
was being offered. As trade became more liberalized, people used to trade
their goods and services for cowries known locally as "cedie. This later became the country's currency - the cedi.
Now in Ghana, the primitive days markets has been developed into
contemporary markets. Markets in Ghana includes the following; big markets: - Makola Market, Kejetia market
and Kantamanto market; regional markets: - Kotokoraba market, Tarkoradi market
circle and Kantamanto market; small markets: - Agbobgloshie market, Asafo
market, Kaneshie market, Lawra market, Techiman market, Maamobi market, Mallam
Atta market, Nima market and so on.
Markets are very important in the economy of every
country. Ghana, an African country with a population of over 24 million, like
all countries in the world has many markets. Some being major and others being
minor. Unlike markets in other countries across the planet, Ghanaian markets
are unique. Their uniqueness lies in the fact one would hardly find a market
that trades in one particular group of wares. In a typical Ghanaian market one
can find everything from apples to zoot suits.
I suppose because of how business has become
lucrative in these markets, foreigners including Nigerians, Chinese, Lebanese
and many others are claimed invading these markets to compete with the
Ghanaian market women and men.
A lot of concerns has been raised with regards to the
problem over the years including the following;
Ghana Union of traders Association Forces Foreigners
Out of Markets. The Ghana Union of Traders Association (GUTA) has warned all
foreigners engaged in retail trade to stop operating in the country by the end
of this month. President of GUTA, George Ofori, alleged the continuous
depreciation of the cedi was a result of the influx of foreign traders in the
markets. Masahudu K.
(11 June 2014). Ghana Union Forces Foreigners Out of Markets. Allafrica. Retrieved
from http://allafrica.com/stories/201406111515.html. Accessed on Thursday,
February 02, 2017 3:35:29 AM.
Ghana Union of Traders
Association in Ashanti wants foreigners in retail markets out. The Ghana
Union of Traders Association (GUTA) has expressed strong apprehension over the
lack of commitment and will of the Ministry of Trade and Industry and the
Ghana Investment Promotion Centre (GIPC) to enforce the country’s investment
laws which bars foreigners from directly engaging in the retail trade; and in
respect of this has issued 30th June deadline for foreigners to cease their
activities in the retail markets. Kizito C. (June 23, 2014).Business & Financial Times. Asokoinsight.
Retrieved from
https://asokoinsight.com/news/ghana-union-traders-association-ashanti-wants-foreigners-
retail-markets. Accessed on Friday, February
02, 2017, 3:35:29 AM.
Task force to enforce retail trade laws. The Ministry of Trade and
Industry (MoTI) is to dispatch a 13-member task force to the various markets
in the country to ensure the enforcement of laws on retail trading.
Zainabu I. (05 July 2014). Task force to enforce retail trade laws. Graphic.
Retrieved from http://www.graphic.com.gh/news/general-news/task-force-to-enforce-retail-trade-laws.html. Accessed on Friday,
February 03, 2017, 3:35:29 AM.siege
Ghana’s retail trade
under siege. Information gathered by The Chronicle points to a looming threat
in the country, as the executive and members of the Ghana Union of Traders
Association (GUTA) are gearing up for a massive demonstration to hit the
streets of Accra in the next couple of weeks. Indications are that members of
the association have girded up their loins long ago, for what insiders
consider to be probably the worst demonstration ever to hit the capital city
over their dissatisfaction with foreigners' invasion into areas of the retail
sector of businesses, stipulated under our laws to be the preserve of
indigenous Ghanaians. . (9 November 2005). Ghana’s retail trade under siege. Modernghana. Retrieved from
https://www.modernghana.com/news/89792/ghanas-retail-trade-under-siege.html. Accessed on Friday, February 03, 2017, 3:35:29 AM.
GUTA renews calls to get
foreign retailers sacked.
Traders in the various
markets in Accra have renewed pressure on the leaders of the parent body, the
Ghana Union Traders Association (GUTA), to get government to flush out
foreigners in their markets. J. A Aryee. (Tuesday
23rd August, 2016).business news. Citi FM.
Retrieved from
http://citifmonline.com/2016/08/23/guta-renews-calls-to-get-foreign-retailers-sacked/#sthash.rMUIn0xm.dpuf.
Accessed on Friday, February 02, 2017, 3:35:29 AM.
The Ghana Union of
Traders Associations (GUTA) has castigated government for not showing enough
commitment to fighting the influx of foreigners taking over retail business in
the country. (Sunday, January 22, 2017). Retrieved from http://thebftonline.com/business/economy/
20677/ guta-castigates-govt-over-foreign-invasion-of-retail-trade-.html#sthash.SyO9zSOh.dpuf.
Accessed on Friday, February 02, 2017, 3:35:29 AM.
1.2
Problem
statement
The Ghana investment promotion center act, Act 865, 2003
was promulgated to achieve these objectives.
a.
Create
and enhanced, transparent and responsive environment for investment and the
development of the Ghanaian economy through investment; and
b.
Encourage,
promote and facilitate investment in the country.
The conflict between Ghanaian traders and
foreign traders in Ghana markets over the years led to the enactment of the
Ghana investment promotion center Act in 1994 (Act
478) and which was amended in 2013 (Act 865). This Act was enacted to create
an investment enabling environment for both Ghanaians and foreigners to carry
out their various business in harmony. And this will contribute significantly
to the economic growth of Ghana.
The GIPC Act 865 Section 27 (1) outlines all the activities to
be reserved for Ghanaians and Ghanaian owned enterprises. According to this section, a person who is not a citizen or an
enterprise which is not wholly owned by citizen shall not invest or
participate in:
a. the sale of
goods or provision of services in a market, petty trading or hawking or
selling of goods in a stall at any place;
b. the
operation of taxi or car hire service in an enterprise that has a fleet of
less than twenty-five vehicles;
c. the operation of a beauty salon or a barber shop;
d. the printing of recharge scratch cards for the use of
subscribers of telecommunication services;
e. the production of exercises books and other basic stationery;
f. the retail of finished pharmaceutical products;
g. the production, supply and retail of sachet water; and
h. all aspects of pool betting business and lotteries, except
football pool.
And Section 28 of the Act also makes it clear the enterprises
eligible for foreign participation and minimum foreign capital requirement.
a. in the case of a joint enterprise with a partner who is a
citizen, invests a foreign capital of not less than two hundred thousand
United States Dollars in cash or capital goods relevant to the investment or a
combination of both by way of equity participation and the partner who is a
citizen does not have less than ten percent equity participation in the joint
enterprise; or
b. where the enterprise is wholly owned by that person, invests a
foreign capital of not less than five hundred thousand United States Dollars
in cash or capital goods relevant to the investment or a combination of both
by way of equity capital in the enterprise.
In subsection (2) of section 28 of the Act, it is specified that
a person who is not a citizen may engage in a trading enterprise if that
person invests in the enterprise, not less than one million United States
Dollars in cash or capital goods relevant to the investments. In subsection
(4), an enterprise referred to in subsection (2) shall employ at least twenty
skilled Ghanaians.
The conflict of foreigners’ encroachment of Ghana markets has
been on the increase since the enactment of this GIPC act. The Ghana trade
union of traders (GUTA) is aggressive fighting that foreigners should be
evicted from the markets of Ghana. However there has not been a comprehensive
study into the problem to reveal its reality and provide a solution. This has
necessitated the study to be carried out.
1.3 Research question
1. Why
are foreigners still occupying Ghana markets in the existence of the Act 865?
2. Why
does some citizens supporting foreigners to invade Ghana markets contrary to
the Act 865?
3. What
effects does the invasion of Ghana markets by foreigners have on local traders
businesses?
4. Does
the invasion of Ghana markets by foreigners have any economic implications?
1.4
Hypothesis
1.
The ineffective enforcement of the Act
865, Ghana Investment Promotion Centre Act, 2013 has paved way for foreigners
to invade Ghana markets.
2.
The selfish interest of some Ghanaians
influences the invasion of Ghana markets by foreigners.
3.
The invasion of markets in Ghana by
foreigners is having an adverse impact on local traders businesses.
4.
Foreigners taken over markets in Ghana
does not help the economy of Ghana to grow.
1.5
Objectives of the study
1.
To find out whether the Act 865, Ghana
Investment Promotion Centre Act, 2013 is effectively enforced.
2.
To find out the intensity of the
invasion.
3.
To find out whether the invasion is
having effects on the businesses of Ghanaian market women and men and the
economy of Ghana.
4.
To determine the possible ways of
addressing the problem.
1.6
Justification of the study
This study seeks to bring to light the
reality in the phenomenon of foreigners invasion of Ghana markets; why the
problem, its impact on the businesses of Ghanaian traders in our markets and
the economy of Ghana. And the possible ways of addressing the problem.
Discoveries from the study
would also add knowledge to the existing literature on foreigners’ invasion of
Ghana markets. The academia and the research fraternity would benefit
enormously from the discoveries of this study.
1.7 Scope of the study
The
study was conducted in selected markets in the Accra metropolis in the Greater
Accra region. The Makola, Kantamanto and Agbogbloshie markets was selected
because the problem largely revolves around these markets.
1.8
Limitation
1.
The population size is narrowed due to
time and financial constraints.
2.
Data for the study will be obtained only
from the Makola market, Agbogbloshie market and Kantamanto market.
3.
Sample of the population will be randomly
self- selected as volunteers.
1.9 Organization
The format of this paper begins with chapter one which gives
introduction to the topic and is made up of the following sub-topics, the
introduction of the chapter, the problem statement, the objectives of the
study, the hypothesis, the research question, justification of the study, the
scope of the study, the limitations of the study and ends with the
organization of the study. It is followed by chapter two which deals with
literature review and is made up of these sub-topics; introduction of the
chapter, trading activities of Chinese migrants in the central business
district of Accra, demystifying Chinese business strength in urban west
Africa, the enforcement of the GIPC Act 478 in 2012, exploring the economic
implications of an expanding Chinese presence in Dakar’s informal market and
summary.
CHAPTER TWO
LITERATURE REVIEW
2.0.
Introduction
The problem of
foreigners’ invasion of markets is not a problem in Ghana alone, it has become
a challenge facing most developing countries on the globe. It pops up in the
middle of the twenty-first century when the world started to experience high
speed of technological advancement, industrialization and globalization.
This has led researchers
and academicians to conduct research into it to help bring to light the reality
of the problem and possible ways to overcome it. And authorities has tried
diverse ways to address the problem.
This chapter presents a
review of studies of these people from the perspective of the research
questions and objectives of this study.
2.1. Trading
activities of Chinese migrants in the central
business district (CBD) of Accra.
Business was
generally good for the Chinese traders and they lived in harmony with their
Ghanaian counterparts. The Chinese could own their businesses without much
legal restrictions.
After the
implementation of the Act, businesses of these Chinese are registered with
Ghanaian directors and the Chinese had to pass through the Ghanaian in most of
the things they have to do (J. Ajavon, 2014).
The
opponents group have been hostile to them and want them out of the market area.
The Chinese traders generally attributed the changes in business operations
mainly to the depreciation of the local currency. The implementation of the Act
had not had any major adverse effect on the Chinese traders. They have been
able to secure the services of the Ghanaians in their operations and could add
to their transaction cost (J. Ajavon,
2014).
Jessica Ajavon further added that, the Ghanaian traders could establish a network with some of the
manufacturing companies in China to import directly from them as the Chinese
traders in Ghana do. The study had shown that the Chinese used a well networked
system to operate in Ghana which is seen in the way they deal with public
officials, their families at home and the link existing between them and their
companies. The implementation of the GIPC Act (865), 2013 has not had a
significant effect on the business operations of the Chinese traders. The
supporters of the Chinese traders are ready to follow the Chinese traders if
they are relocated.
Jessica Ajavon argued that GUTA as it
stands now is a divided house from findings in her study and supporters are
against the action of the opponents. One would then ask whether the opponents
group who had enough financial strength and were not giving the supporters
group the relief they wanted prior to the arrival of the Chinese into the
market are fighting this battle for personal gains or for the benefit of all.
The supporters group is saying they do not have a problem with the Chinese
whilst the opponents group has problems. All indications from her study show
that, currently, the Chinese traders cannot be moved entirely from the Ghanaian
market.
Jessica Ajavon gave the following recommendations; first, Ghana is a sovereign country with laws and therefore if the laws
stipulate that trading in the market is a preserve for Ghanaian, then the law
must be enforced to the letter and foreigners must be made to respect the laws
of Ghana in as much as they are investors and Ghana needs investments. Second,
The Ghanaian economy is developing and for that reason the government must
ensure that our investment policies attract more investor ventures into the manufacturing
sector instead of the large scale imports of finished goods which does not
develop the Ghanaian economy but rather kill the local industries and do not
create employment avenues. Third, Measures must be taken to speed up the
availability of the Yuan on the Ghanaian foreign exchange market by Bank of
Ghana in view of the fact that non availability of the Yuan is creating a lot
of pressure on the local currency due to the increased imports from China.
Forth, The Ghana Immigration Service should stiffen the requirement for Chinese
nationals’ entry into Ghana especially where China is experiencing over
population and their nationals are seeking opportunities all over the world
especially in Africa. Relaxing the immigration laws would mean an influx of
Chinese nationals into Ghana. The purpose and intentions of immigrants must be
clear. And lastly, The Ghana Immigration Service should put measures in place
to arrest and punish officials that connive with some of these Chinese to enter
through the country's borders illegally
2.2.
Demystifying Chinese business strength in urban West Africa.
According to L. Marfaing and A. Thiel (2011), since
the beginning of the twenty‐first century, Africa has seen the arrival
of a new form of Chinese migration. Largely independent from big Chinese
players, these “new entrepreneurial migrants” come to Africa not as workers in
the highly prestigious state projects, but rather to follow their own economic
interests. Engaging in business activities as diverse as petty manufacturing,
printing, pharmaceutical and medical services, restaurants, beauty salons and
last but not least, general trade, these independent Chinese migrants are often
acknowledged for bringing affordable new commercial services and goods to
low-income households on the African continent. On the other hand, the high
visibility of the Chinese entrepreneurial activities has also sparked anti‐Chinese sentiments among many African entrepreneurs (for example,
see Baah et al. 2009 on Ghana; Bredeloup and Bertoncello 2006 on Senegal;
Sylvanus 2009 on Togo; Ogen 2008 on Nigeria; Kohnert 2010 on Benin and other
cases). Independent Chinese entrepreneurs in Senegal and Ghana face allegations
of endangering indigenous businesses and encroaching on local market spaces.
According to Laurence Marfaing and Alena Thiel, the
Chinese presence has a structural impact on local traders as reduced prices are
now altering consumer behavior more generally. While, during the 1930s, it was
the Lebanese (Filfili 1975), and in the 1960s the Mauritanian (Senegal) and
Nigerian (Ghana) petty traders who spoiled the margins, today it is the Chinese
trader who proverbially “sleeps under his counter” and who, content with a very
humble lifestyle, pushes realizable profit margins in the market towards the
minimum. Senegalese and Ghanaian entrepreneurs have long been taking steps in
the Chinese direction but cannot afford to lower their profit margins any more without
deteriorating their quality of life. This is mainly due to the fact that
African entrepreneurs do not operate far away from relatives and friends but
have to attend to various social obligations in the extended family.
Laurence Marfaing and Alena Thiel added that, having fine‐tuned their commercial strategies to the
West African cultural and entrepreneurial context, local traders have an
important advantage over the Chinese migrant entrepreneurs – that is, the deep
understanding of local consumer tastes and behaviors. Our fieldwork in Accra
and Dakar has shown how local importers still set general consumer trends while
Chinese entrepreneurs only fulfill such a position in the low‐price segment of such commodities. Local traders additionally
benefit from their ability to personalize economic relations, a strategy aimed
at securing the continuing loyalty of regular customers, not least in the
presence of cheaper competitors like the Chinese.
Laurence Marfaing and Alena Thiel further added that, there is a paradox of local businesspeople fighting a virtual
phenomenon, which is the alleged Chinese encroachment on the market, although
they still occupy the top position. Although theories of ethnic niche economies
do not apply to the Chinese entrepreneurs in Senegal and Ghana, since they
arrived only recently and because they enter diverse market segments, their
position as ethnic minorities makes them vulnerable to the spread of such
negative rumors, especially when interested bodies see the potential benefits
in the presentation of the anti‐Chinese discourse in various policy
arenas. Sustained by a myth of an essentially destructive Chinese presence in
Africa in general and further reinforced by the circulation of rumors, local
traders conceptualize their environment in terms of a dominant myth that
defines their situation as threatened even though the empirical reality is at
most ambiguous in this respect.
Laurence
Marfaing and Alena Thiel also added that, Considering that this myth of
Chinese industriousness is spreading not only in Africa, it is not surprising
that traders in Ghana and Senegal feel threatened by an ethnic community that
is feared for its economic success even in Europe and Latin America.
2.3. The
enforcement of the GIPC Act, 478 in 2012.
Ghana Investment Promotion Centre Act 478 1994 was enforced on the 20th June 2012. To effect its enforcement, the Ministry of Trade and Industry first constituted a special task force in February 2012. The task force was composed of personnel of the Ghana Police Service, Customs Exercise and Preventive Services (CEPS), Immigration, Trade Ministry, as well as the affected Municipal and District Assemblies. The task force was tasked with sensitizing and informing foreigners involved in retail trading activities that did not meet the minimum capital threshold to cease their activities. Additionally, they were to ensure that the residence permits and tax payments of foreigners were current. The task force consequently issued an ultimatum to all foreigners who fell short of the stipulated requirements of the GIPC Act to cease their activities after a “grace period” of four months. Mr Kofi Larbi, a Director at the Trade Ministry and the Chairman of the task force, while addressing the media said thus, “at the expiry of the grace period, we are going to be very firm. If it means closing down shops, we will ensure that non-Ghanaians do not operate from markets, kiosks and that they do not engage in any of the businesses which have been reserved for Ghanaians”. Consequently, at the expiration of the grace period the Act was duly enforced. The first round of closure of shops took place on June 20th 2012 (Quakers K. G, 2014).
Ghana Investment Promotion Centre Act 478 1994 was enforced on the 20th June 2012. To effect its enforcement, the Ministry of Trade and Industry first constituted a special task force in February 2012. The task force was composed of personnel of the Ghana Police Service, Customs Exercise and Preventive Services (CEPS), Immigration, Trade Ministry, as well as the affected Municipal and District Assemblies. The task force was tasked with sensitizing and informing foreigners involved in retail trading activities that did not meet the minimum capital threshold to cease their activities. Additionally, they were to ensure that the residence permits and tax payments of foreigners were current. The task force consequently issued an ultimatum to all foreigners who fell short of the stipulated requirements of the GIPC Act to cease their activities after a “grace period” of four months. Mr Kofi Larbi, a Director at the Trade Ministry and the Chairman of the task force, while addressing the media said thus, “at the expiry of the grace period, we are going to be very firm. If it means closing down shops, we will ensure that non-Ghanaians do not operate from markets, kiosks and that they do not engage in any of the businesses which have been reserved for Ghanaians”. Consequently, at the expiration of the grace period the Act was duly enforced. The first round of closure of shops took place on June 20th 2012 (Quakers K. G, 2014).
Quakers Karibo George added that the affected
Nigerian traders likened their treatment to that experienced by Nigerians
during the promulgation of the Aliens Compliance Order in 1969. Nigerians were
the most affected by the enforcement, a point that is highlighted by the
President of the National Association of Nigerian Traders, Deacon John Igwe Ukala.
On the day of the enforcement, the Nigerian traders on sighting members of the
task force locked up their shops. The officials of the task force, however,
also locked the shops with special security padlocks placing notices signed by K.N. Atuahene, which was pasted on the shops with the
heading addressed to non-Ghanaians that were engaged in retail trading in
market places. The notice read thus:
[It has come to the notice of the taskforce that you are engaged in trading activities in the market place. Your activity contravenes section 18 of the GIPC Law 1994 (Act 478). Please take notice that your continuous operations from the market will no more be countenanced and that your shop has been permanently closed from today. In case you have any difficulties related to the actions of the task force please do not hesitate to contact the undersigned at the Ministry of Trade and Industry.]
This enforcement action came as a surprise to Nigerians who had been involved in this trade for decades. Similar warnings had been issued in the past but they had not been carried out.
[It has come to the notice of the taskforce that you are engaged in trading activities in the market place. Your activity contravenes section 18 of the GIPC Law 1994 (Act 478). Please take notice that your continuous operations from the market will no more be countenanced and that your shop has been permanently closed from today. In case you have any difficulties related to the actions of the task force please do not hesitate to contact the undersigned at the Ministry of Trade and Industry.]
This enforcement action came as a surprise to Nigerians who had been involved in this trade for decades. Similar warnings had been issued in the past but they had not been carried out.
2.4. Exploring the economic implications of an expanding Chinese
presence in Dakar’s informal market.
This
literature reflects directly to the research topic though from a different
jurisdiction, it is considered relevant to this study.
2.4.1. Why explore China in Senegal?
China’s economy has grown exponentially since market-oriented reforms were first initiated in 1978, and is now the world’s fastest-growing major economy. Since the 1990s, China has invested significantly in the African continent to gain access to raw materials and new markets, to exert political influence. As investments and development aid become more extensive throughout the continent, the global controversy over China’s intentions is intensifying (G. Hurst, 2013).
China’s economy has grown exponentially since market-oriented reforms were first initiated in 1978, and is now the world’s fastest-growing major economy. Since the 1990s, China has invested significantly in the African continent to gain access to raw materials and new markets, to exert political influence. As investments and development aid become more extensive throughout the continent, the global controversy over China’s intentions is intensifying (G. Hurst, 2013).
2.4.2. Local reactions
In July 2004, a local Senegalese trade union UNACOIS staged a protest against Chinese petty merchants in the Centenaire, accusing them of not respecting the law by participating in bribery, tax evasion and importation fraud. UNACOIS strongly believes the Chinese pollute low-income family households with valueless and dangerous items whereas the Senegalese import essential Chinese products, such as furniture. UNACOIS demands the Senegalese government become involved. Extremists even demand a complete expulsion of all Chinese merchants from Dakar in an effort to reestablish the old economic order (G. Hurst, 2013).
In July 2004, a local Senegalese trade union UNACOIS staged a protest against Chinese petty merchants in the Centenaire, accusing them of not respecting the law by participating in bribery, tax evasion and importation fraud. UNACOIS strongly believes the Chinese pollute low-income family households with valueless and dangerous items whereas the Senegalese import essential Chinese products, such as furniture. UNACOIS demands the Senegalese government become involved. Extremists even demand a complete expulsion of all Chinese merchants from Dakar in an effort to reestablish the old economic order (G. Hurst, 2013).
Since 2004, there have been a series of other
protests staged by UNACOIS as recently as 2011, but with limited success, which
seeks to educate, inform and protect consumer interests, staged a
counter-protest in 2004 asserting UNACOIS is racist and xenophobic towards the
Chinese. They note that the Chinese are actually not that different from the
Senegalese retailers. Senegalese merchants cheat customers with grossly
inflated prices. The Chinese, on the other hand, increase the standard of
living by diversifying consumption at lower cost to consumers. They contend
that the goods Chinese sell are no more dangerous than the goods the Senegalese
offer as a majority of the merchandise sold by Senegalese retailers comes from
the same source. ASCOSEN also points out that by definition the informal sector
activity is outside the fiscal reach. Therefore the Chinese do not engage in a
higher level of tax evasion and informality than the local Senegalese retailers
in Sandaga Market. And, although not consumer related, ASCOSEN claims the
Chinese provide jobs directly and indirectly for the Senegalese, and provide
and alternative for employment where the government cannot. Essentially,
ASCOSEN regards UNACOIS’s aggression towards the Chinese as a human rights
issue violating international consumer rights. Consumers have a right to access
basic goods available in a given market and their choices must be respected and
protected, as a United Nations principle established in 1986 declares. In 2004,
ASCOSEN, in collaboration with various local human rights and consumer rights
organizations, initiated a movement to protect Senegalese consumer liberties
and entitlements against UNACOIS’s hostile measures targeting Chinese merchants
in Dakar (G. Hurst, 2013).
Georgina
Hurst further added that, together they contended that aggression towards
foreigners would lead to social imbalance with potential catastrophic
consequences. It would also question how international law applies to Senegal’s
freedom of trade, freedom of competition and freedom of establishment. Lastly,
ASCOSEN asks that the government protects consumers in stating, “We ask the
Senegalese authorities competent in the matter to be vigilant, to resist
commercial terrorism, to refuse blackmail and to be intransigent towards any
attitude that may be a source of division for the Senegalese people”
Georgina Hurst added that, Aside from trade union resistance, the Chinese have also suffered from prejudicial assertions due to their high visibility and rumors that the media and critics use to create anti-Chinese sentiment. The media present reality as interest-led, and win-lose as opposed to win-win. The most common claim is that the Chinese have endangered thousands of Senegalese by feeding the market and thus the population with poor quality goods, and engaging in tax evasion and bribery. Secondly, critics say the Chinese invade local markets, jeopardizing indigenous businesses. This is seen as a human rights issue and a violation of local labor laws. The Chinese remain an isolated community, importing everything from food to clothing and games. Their unwillingness to engage in Dakar’s social life is often interpreted as intended invisibility and living in secret. There has been much speculation over how poor Chinese traders from rural Henan are able to afford the cost of transportation to Senegal, on top of paying customs fees and rent up to five times above-market rates. Locals suspect money laundering and illicit activities such as prostitution and boutiques serving as drug fronts.
The Chinese
Embassy in Dakar has also reacted to the inundation of the market with Chinese
merchants. In response to UNACOIS protests, Chinese merchants contacted the
Embassy for help and security amid high tension. The Embassy did little in
response, fearing the merchants tarnished China’s prestigious image and
reputation in Senegal. How has the Senegalese government responded to all of
this? Basically, officials appear rather helpless. The federal government has
done little to address issues of extreme poverty and incorporating the informal
sector into the economy. It is not an easy process, and starts with education
reform and improved access to healthcare and other basic needs. So it seems the
government is, in a way, grateful for the presence of the Chinese and the
economic opportunities the entrepreneurs have provided for an otherwise
unemployable group of Senegalese. The government cannot, at this point, provide
an alternative to the opportunities presented by the Chinese and therefore have
done little to address the complaints of UNACOIS (G. Hurst, 2013).
2.5. Summary
In the light
of the research question and objectives, literatures were reviewed which
relates to the topic foreigners invasion of Ghanaian markets from diverse
viewpoints.
It was
reviewed that implementation of the Ghana Investment Centre Act, Act 865 is
having a minimal impact on the business activities of foreign traders in the
markets. Also, it was reviewed that the intensity of the invasion of Ghana
markets has been exaggerated by rumors circulating by interested bodies.
Further, it was reviewed that the presence of foreigners in the markets is
having structural impact on local traders. Last but not the least, it was
reviewed that some members of GUTA are in support of the foreign traders to
continue with the invasion of the markets and others are fighting against it
and due to that there is controversy in dealing with the problem.
CHAPTER THREE
METHODOLOGY
3.0.
Introduction.
This section describes the rationale for the application of
specific procedures or techniques used to identify, select, and analyze
information applied to understanding the research problem, thereby, allowing
the reader to critically evaluate the study’s overall validity and reliability.
This chapter presents the research design, the population of the study, the
sample size and sampling technique employed in this study. The data collection
instruments, data collection procedures, data analysis and limitations of this
study are also discussed.
3.1. Research design.
This study is
characterized by both qualitative research type and quantitative research type
and so therefore approaches, methods and techniques in both types of research
will be employed in the data collection and analysis in this study.
The research was
conducted in the Makola market, Agbogbloshie market and Kantamanto market, the
Ghana union of traders association and the Ghana investment promotion Centre.
The market women and men including foreigners of the above listed markets and
some customers who patronizes them, the Ghana union of traders association and
the Ghana investment promotion Centre were conveniently interviewed.
Questions were been
proposed in the light of the objectives of the study followed by the collection
of data using semi-structured interviews. The data collected was
analyzed to generate findings based on which conclusion was drawn and
recommendations were given. This method was chosen
due to the entities under exploration, the purpose and questions of the study
and the efficacy of these methods in gathering the necessary data.
3.2 Population.
The study population encompasses
the Ghana investment promotion Centre, the Ghana union of traders association,
traders and customers of the Makola market, Agbogbloshie market, and Kantamanto
market. These markets are dominated by women traders who deals in clothes,
shoes, bags, provisions, cosmetics, food stuffs, logistics, second hand wares,
utensils to mention but few in both retail and whole sale.
3.3
Sampling technique and sample size.
Seven local traders were interviewed, seven foreign
traders were approach but all refused to be interviewed. In addition the Ghana
investment promotion Centre and the Ghana union of traders association were
also interviewed.
Stratified sampling technique was used where the
population was divided into groups as follows; local traders, foreign traders,
customers, the Ghana investment promotion Center and the Ghana union of traders
association. Then the participants was been selected from the various strata
(groups) using judgement sampling. Judgement sampling is a non-probability
sampling technique in which an experienced individual selects the sample based
on his or her judgement about some appropriate characteristics required of the
sample member.
This technique was been employed
because of the diversity nature of the study. It conveniently facilitated in
ascertaining the appropriate information needed to draw an informed conclusion.
3.4 Data collection instruments.
The nature of this study has
necessitated it to use semi-structured interview to collect data needed to meet
the objectives of this study. Different semi-structure interviews was been used
to collect focused, quantitative data and qualitative textual data from the various
sample members in each strata in the population. A mixture of close ended and
open ended questions were been used. The close ended questions was used with
the rational of getting the participant into the net. Then the open ended
questions will allow the participant to define and describe the situation.
3.4.1 Semi-structured interview.
Semi-structured
interviews offer topics and questions to the interviewee, but are carefully
designed to elicit the interviewee’s ideas and opinions on the topic of interest.
3.5 Data collection procedure.
Letters
was been first sent to the office of the Ghana investment promotion Centre and
the Ghana union of traders association to seek a formal permission to undertake
the interview. But the markets women, men and customers was been personally
approached at the market to seek their permission to interview them. This was
been done on days in which the market is less busy so that the traders whose
permission was been sought could have ample time to be interviewed to provide
all necessary information that is needed. Writing and audio recording was been
used to facilitate speedy and accurate data collection.
3.6 Data analysis.
After
the collection of data from the field of study, the data was passed through the
following stages to be analyzed.
3.6.1 Transcription
The
audio recordings was played, listen to attentively and translated into writing.
3.6.2 Organizing of data.
After
the transcription, the data was been organized in an easily retrievable
sections.
3.6.3 Familiarization.
This
is the process of becoming increasingly familiar with the data you have
collected. This initially takes place in several ways, for example through
undertaking transcription, reading the transcripts, field notes or observation
notes gathered, producing summaries of interviews, or re-listening to tape
recordings.
3.6.4 Coding.
This
is the process of deciding how to conceptually divide up raw qualitative data.
Sections of text transcripts, for example, may be marked by the researcher in
various ways (underlining in a colored pen, given a numerical reference, or
bracketed with a textual code in the margin). These sections contain data which
the researcher is interested in exploring and analyzing further. As the
analysis progresses these codes will be refined or combined to form themes or
categories of issues.
3.6.5 Theme.
A
theme is generated when similar issues and ideas expressed by participants
within qualitative data are brought together by the researcher into a single
category or cluster. This ‘theme’ may be labelled by a word or expression taken
directly from the data or by one created by the researcher because it seems to
best characterize the essence of what is being said.
The
analysis of the data collected will be presented in detail in the next chapter.
3.7 Limitation.
This
study was be constrained by the time available for the study to be conducted.
The study also encounters some financial constraints since it is financed solely
by the researcher. The foreigners’ refusal to be interviewed and also the busy
nature of the market almost all the time was also limitation to the study.
CHAPTER FOUR
ANALYSIS OF DATA
ANALYSIS OF DATA
4.0 Introduction
This chapter
of the study presents the data collected through the interview from the various
participants involved in the study. The data collected for the study involved
mainly primary data that was collected by the researcher through interviews and
interaction with the participants. The views were sought from the Ghana
Investment Promotion Centre, Ghana Union of Traders Association and seven
Ghanaian traders.
The main
objective of this study was to examine to find out whether the
Act 865, Ghana Investment Promotion Centre Act, 2013 is effectively enforced,
to find out the intensity of the invasion, to find out whether the invasion is
having effects on the businesses of Ghanaian market women and men and the
economy of Ghana and to determine the possible ways of addressing the problem.
In this
chapter, the data collected for the study were analyzed and interpreted. The
data is partly presented in the form of simple graphs and tables to boost
clarity. The chapter considered the type of products the local traders’ deals
in, focusing on whether the local traders are aware of foreigners invading the
Ghana markets, whether there are foreigners who also deals in the same goods as
theirs. Also, it presented the findings from the study in relation to the
research question.
4.1 The type of products local traders deals in.
The researcher
strategically selected participants engaging in various types of products using
judgement sampling technique which enabled me to find out the trend of the
invasion across board. This is presented in the table 4.1 below.
Table
4.1: Types of products local traders deals in.
LOCAL
TRADERS
|
TYPES
PRODUCTS
|
RETAIL
|
WHOLE
SALE
|
BOTH
|
Iredei
Enterprise
|
Cosmetics
and hair products
|
ü
|
||
Fairyland
Ent.
|
plastics
|
ü
|
||
Raltem
ltd
|
Electrical
products
|
ü
|
||
Grace
fabrics
|
fabrics
|
ü
|
||
Utensils
shop
|
utensils
|
ü
|
||
Fripsther
Ent.
|
luggage
|
ü
|
||
Madam
Tawiah
|
Ladies
footwear
|
ü
|
Source: field survey.
4.2:
Awareness of foreigners invading Ghana markets.
The respondents were
interviewed to ascertain whether they are aware of foreigners taken up the
markets. All the respondents dealing in the various products were aware of this
which represents a 100% awareness. This is depicted in table 4.2 below.
Table
4.2: Awareness of foreigners’ invasion of Ghana markets.
Respondents
|
Awareness of
foreigners invasion of Ghana markets
|
|
aware
|
unaware
|
|
Fripsther enterprise
|
ü
|
|
Madam Tawia
|
ü
|
|
Iredei enterprise
|
ü
|
|
Fairyland enterprise
|
ü
|
|
Raltem Ltd
|
ü
|
|
Mr. kofi
|
ü
|
|
GUTA
|
ü
|
|
Percentage
{%}
|
100%
|
0%
|
Source; field survey.
4.3.
Foreigners dealing in the same products as local traders in the market.
The researcher examined
the respondents to determine whether there are foreigners in the market dealing
in the various products that the local traders deals in. This enabled the researcher
to know the trend and the intensity of the invasion. Also the nationals which
are dominating in this invasion. This is portrayed in table 4.3 and figure4.3.1
below.
Table 4.3 foreigners trading in the
same products as local traders.
Respondent
|
Products
|
Foreigners
who trade in the same goods as Ghanaians
|
Iredei
Enterprise
|
Cosmetics & hair products
|
Does
not know their nationality
|
Fairyland
Ent.
|
plastics
|
Chinese
and Arabs
|
Raltem
ltd
|
Electrical products
|
Nigerians,
Chinese, Indians and Lebanese
|
Grace
fabrics
|
fabrics
|
Chinese
|
Utensils
shop
|
utensils
|
Chinese
and Indians
|
Fripsther
Ent.
|
luggage
|
Lebanese,
Indians and Israelis
|
Madam
Tawiah
|
Ladies footwear
|
Chinese
|
GUTA
|
Chinese
and Nigerians
|
Source: field survey.
From table 4.3 above, the
foreigners engage in all the types of products that the local traders are
dealing in. Which represent a high degree of invasion across the market. From
figure 4.3.1 below, the Chinese are the leading foreigners with 100% domination
in the invasion, trading in all the products that the local traders are into.
The next is the Nigerians, Indians and Lebanese with 37.5% domination in the
invasion followed by the Arabs and Israelis with 25% domination in the
invasion.
Figure
4.3.1 Dominance intensity of various foreigners.
Source: field survey.
4.4
Why foreigners succeed in the invasion of Ghana markets.
The researcher was
interested to be abreast with the reasons why these foreigners would come from
their own countries to take up activities reserved constitutionally for
citizens. The local traders attributed this problem mainly to the unpatriotic
nature of most Ghanaian leaders and citizens. According to one respondent,
madam Awurama of Iredei enterprise, most Ghanaian leaders are not playing their
leadership roles in the country, they do not bother about whatever that is
going on, whether good or bad. But they rather receives bribes from these
foreigners and allow them the freedom to do things contrary to our laws which
affects the ordinary Ghanaian adversely. Interviewing the local traders, they
disclosed that some Ghanaians allow these foreigners to hide under their
shadows to unlawfully engage in activities reserved for only Ghanaians
participation for their selfish interest. Since they do not meet the
requirement of the GIPC Act, Act 865 (2013) for foreigner’s participation in
business Ghana, they get Ghanaians and used them as forefronts in disguise to
obtain permits and other documents to carry out their business in the name of
the citizen. 62.5% of the interviewees affirmed this.
The executive GUTA claims
that the laws of Ghana are relaxed; they are not enforced and that GIPC does
not monitor the business activities in the markets to ensure foreigners are
complying with the act 865. Madam Awurama of Iredei enterprise said the
immigration service of Ghana is not doing their work effectively. They supposed
to ensure that immigrants in the country are abiding by the said purposes for
which they were granted visas to come into the country. The researcher
acknowledged that at times these foreigners come as tourists, visitors and even
students and later take advantage of the loopholes in our system to do whatever
they want not mining it been lawful or unlawful. 25% of the respondents
asserted this.
62.5% of the respondents
also attributed this to loop holes in the implementation of our laws especially
the GIPC Act 865.
By inference, the reason
is directly the unpatriotic conduct of most Ghanaians towards our country and
ourselves.
Table
4.4. Why foreigners succeed in the invasion of Ghana markets.
Respondent
|
Why foreigners succeed
in invasion
|
|
GUTA,
Fairyland ent. , Raltem Ltd, Iredei ent. and Madam Tawia
|
Laws
not enforced (GIPC Act 865)
|
62.5%
|
Raltem
Ltd, Mr. Kofi, Iredei ent. , Grace frabrics and frimsther ent.
|
Some
Ghanaians allowed themselves to be used as forefront by foreigners for
selfish gain.
|
62.5%
|
GUTA
and Iredei ent.
|
Lack
of monitoring and tracking of foreigners in markets
|
25%
|
Source; field survey
4.5.
Implementation of the GIPC Act, Act 865 (2013)
The researcher was
confused as to why with the GIPC act been promulgated in 1994 and had passed
through so many amendments to the current act to create an investment enabling
environment for both citizen and foreigners and yet foreigners are claimed not going
by this act. According to the president of GIPC, they ensure that foreigners
who want to engage in trade in any market meets the requirements of the GIPC
act before granting them the license to carry out their business. They have a
division which monitors and tracks foreigners who are engaging in trade in the
various markets to ensure that they comply with the Act 865. They are also part
of the national task force.
4.6.
Effects of foreigners invasion of Ghana markets on local traders businesses.
The researcher was
concerned to bring to light the consequences of the invasion on the Ghanaian
trading activities. According to the
local traders, the foreigners are drawing
all their customers through selling at very low prices. The GUTA official
indicates that, these foreigners raise capital at low interest rates in their
home countries and bring it here to do business. And as a result of that they
are able to sell at cheaper prices without running into losses. Where as in
Ghana here the interest rates of raising capital is very high and due to that
the local traders cannot afford to sell at the same prices as the foreigners.
Some of these foreigners also are representatives of some of the manufacturing
companies in their home countries. Because they are able to produce at cheap
cost, they push it to their representatives here to sell cheaper prices. Others
also have direct links with the manufacturing companies in their home countries
and they import from them at lower prices and are able to reduce their prices
low and still make huge profits. Low quality goods are also brought in by these
foreigners to sell at cheaper prices. 75% of the respondents emphasize on this
effect.
The researcher point of
view, this has made it very difficult for the local traders to compete with
these foreigners in the markets. By inference sales reduces drastically which
results in loss of capital at the long run which 25% of the respondents
affirmed.
It was disclosed by the
researcher from the GUTA official that these foreigners are causing hike in the
prices of shop rent. Because they have the financial strength over the local
traders, they offer to pay high prices for shops which the local traders cannot
afford. The local traders are losing their shops to these foreigners. 12.5% of
the respondents interviewed claim this.
Table
4.6. Effects of foreigners invasion of Ghana markets on local traders
businesses.
Respondent
|
Effects of invasion on
local trading disclosed.
|
||
GUTA,
|
Lose
of shops to foreigners
|
 |
12.5%
|
GUTA,
|
Hike
in shop rent
|
 |
12.5%
|
Madam
Tawia, Raltem Ltd
|
Lose
of capital
|
|
25%
|
Grace
fabrics, Raltem Ltd
|
Sales
reduction
|
25%
|
|
Madam
Tawia, GUTA, Grace fabrics, Fairyland ent., Iredei ent., Raltem Ltd
|
Lose
of customers to foreigners
|
 |
75%
|
Source: field survey.
With reference to table
4.6, each effect that the invasion brings, it leads to another.
4.7.
Implications of foreigners’ invasion of Ghana markets on the economy of Ghana.
The researcher sought to
explore the implications that the invasion of Ghana markets by immigrants had
on the economy of Ghana. The GUTA official indicates that it leads to the
following effects; ‘‘trade balance deficit”. The GUTA official indicate that the products
that the foreigners trade in are not manufactured here in Ghana but are imported
from outside Ghana which increases the countries imports as against exports and
this affects the gross domestic product of Ghana adversely. ‘‘The Ghana cedi is weakened’’. The GUTA
official said that since the foreigners do business in the local currency, they
accumulates profits and change them into their home currencies for the
importation of their products. And the remaining profits are repatriated back
to their home countries to invest and make properties there leaving Ghana’s
currency at its valueless value.
The GUTA official claims
that local industries are collapsing due to the invasion of Ghana markets by
foreigners on fact that the products they manufacture locally are been imported
here at cheaper prices by these foreigners which makes it difficult for the
local industries to survive. By inference the gross domestic product of Ghana
is affected adversely.
The researcher found out
from the GUTA executive that the invasion of the business activities reserved
for citizens’ participation by foreigners is creating revolt and animosity
toward foreigners in the country and that this can lead to uprising in the
Ghana.
He added that if this
foreigner’s invasion of Ghana markets is not curb now, the future of Ghana’s
economy is at stake and would lead to a total breakdown of the economy as they
are now not invading only markets but are enlarging their cost into every
sector of the economy of Ghana; example is illegal mining (galamsey).
The GIPC executive claim
that the presence of foreigners in Ghana markets will bring these positive
effects to the economy of Ghana.
v It
enhances business skills of the local traders.
v The
country will be recognize internationally for fair trade.
v Creation
of employments in the economy.
v And
it promote joint venture.
The researcher point of
view, considering both sides of the effects as disclosed by the respondents, it
is clear that the negative implications over weighs the positive.
Table
4.7. Implications of foreigners’ invasion of Ghana markets on the economy of
Ghana.
respondent
|
Economic implications of foreigners
invasion of Ghana markets
|
respondent
|
||
positive
|
negative
|
|||
GIPC
|
Enhances
business skills of the locals.
|
Balance
of trade deficit
|
GUTA
|
|
Promotes
joint venture
|
Weakens
local currency
|
|||
International
recognition for fair trade.
|
Local
industries are collapsing
|
|||
Creation
of employment.
|
Social
vices
|
|||
Source; field survey
4.8.
Foreigners participation in business ventures in Ghana.
The GUTA executive
indicates that GUTA is not against foreigners engaging in businesses in Ghana
but they are against foreigners contravening the supreme laws of Ghana that
regulates investments in the country. In addition, he said if they want to do
business in Ghana, it must be done in accordance with the GIPC act (act 865-
2013) or other than that GUTA would stood for the right thing to be done as far
as business is concerned in Ghana. By inference, foreigners are needed to
invest in the economy of Ghana to create jobs for Ghanaian and boost
productivity to bring economic growth to Ghana.
4.9
Foreigners refusal to be interviewed.
The researcher intended
to examine all those that the problem revolves around to be able to draw an
informed conclusion and propose recommendations to help address this problem
that has been between Ghanaian traders and foreign traders. Stratified sampling
technique was employed where the population was divided into strata as local
traders, foreign traders, Ghana union of traders association and Ghana
investment promotion center. All the other strata were conveniently interviewed
to obtain the necessary information pertaining to the problem needed with the
exception of the foreign traders who refused to be interviewed. The researcher
approached ten of them to seek for permission to interview them but they all
said they were not interested. They engage in electronics and home appliances,
electrical products, carpets, footwear and other general products. Then I asked
myself this question, that if they are genuinely engaging in business, why then
should they be afraid of been interviewed for information concerning their
business. By inference they are into business contrary to GIPC Act and
therefore are afraid to be exposed.
4.10
Foreigners in Ghana markets.
The GIPC president claim
that the foreigners in the markets have met the requirements of the act 865 and
that they are not into petty trading. In addition he said, some of these
foreigners are married to Ghanaians and therefore have the right to engage in
trade in any market in Ghana. Further, he claim that even some of these
foreigners who are claimed to be invading Ghana markets are engaging in trade
outside the markets.
CHAPTER FIVE
SUMMARY,
CONCLUSION AND RECOMMENDATION
5.0.
Introduction
This chapter
gives a summary and conclusion of all that have been discovered and the
findings of the study. And provides recommendation for policy makers, leaders,
citizens and major stakeholders in Ghana.
5.1. Summary of findings.
This study
had four main key objectives which are to understand
whether the Act 865, Ghana Investment Promotion Centre Act, 2013 is effectively
enforced, to find out the intensity of the invasion and to determine whether
the invasion is having implications on the businesses of Ghanaian market women
and men and the economy of Ghana.
The study revealed
loopholes in the implementation of the GIPC Act 865. The Ghana promotion center
does not monitor what businesses are carried out in the various markets and by
whom to ensure compliance with the act 865. Alarms of alleged flouting’s of the
act are not investigated.
It was discovered through
the study that there is average degree of invasion of the markets of Ghana by
immigrants. There are foreigners from different countries who trade in all the
various types of products that the local traders are dealing in in the market.
The implications of foreigners invasion of
Ghana markets on local traders businesses was also discovered through the
study. Local traders’ customers are drawn by foreign traders through their
advantage to sell at lower prices than the local traders. This leads to
business slow down, sales reduction ending up in capital loss. Local traders
loses shops to foreigners due to hike in shop rent caused by these foreigners
through their financial muscles.
Lastly, the study
discovers the consequences of this foreigner’s invasion of Ghana markets on the
economy of Ghana. The economy suffers balance of trade deficit due to huge
imports into the country by these foreign traders. The Ghana cedi surfers’
depreciation in value. Local industries are collapsing due the foreigners’
invasion of the markets of Ghana. This could lead to uprising in the nation
where citizens would want to fight for their constitutional rights. Aside this
negative effects these positive effects were discovered, enhancing of business
skills of the local traders,
international recognition of Ghana for fair trade, promotion of joint
venture in the country and creation of employments.
5.2.
Conclusion.
Our predecessors foresaw
the grave implications of foreigners invading the markets of the country on the
businesses of Ghanaian traders, local industries and the economy of Ghana as
whole in advance and in their numerous intelligence promulgated the GIPC Act to
create an investment enabling environment for both citizens and foreigners
participation such that it would bring improvement to the economy of Ghana. The
findings indicate that the unpatriotic habit of most Ghanaian leaders and
citizen had left the objectives of the GIPC act unrealized leaving the Ghanaian
traders and economy to surfer unquantifiable draw backs to foreigners today. So
therefore Ghanaians need to change their attitude to be able to overcome the
problem.
5.3.
Recommendation.
Following the
discoveries of this study, the below stated recommendations have been proposed
for Ghanaian leaders and citizens.
1. The Ghanaian leaders and citizens have to change their unpatriotic
attitude towards Ghana. We have to love our country Ghana and stand for the
wellbeing and progress of the nation as a whole for the benefit of all avoiding
selfish interest.
2.
Ghana is a sovereign country
with laws which are supposed to be respected by all whether been citizen or
foreigner. Therefore the GIPC Act have to be effectively implemented by those
who has been given the mandate to do that to achieve its’ intended objectives.
Measures has to be put in place by GIPC to monitor each and every business that
is carried out in all the markets of Ghana to ensure compliance with the act
865.
3.
Importations into the country
by these foreigners has to be limited to check balance of trade and currency
value and some has to be stopped to protect local industries.
4.
Foreigners should be
encouraged to invest into the economy of Ghana in accordance with GIPC act,
especially in the manufacturing sector to create jobs and increase productivity
to promote economic growth.
References
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APPENDIX
SEMI-STRUCTURED INTERVIEW GUIDE
SEMI-STRUCTURED INTERVIEW GUIDE
SEMI-STRUCTURED
INTERVIEW
NAME
OF INTERVIEWEE…………………………………………………………………….
NAME
OF BUSINESS……………………………………………………………………………
CONTACTS…………………………………………………………………………………………………………………………………………………………………………………………….
DATE
OF INTERVIEW ………. /………../……………..
QUESTIONS;
1. What
type of goods do you deal in?
......................................................................................
……………………………………………………………………………………………….………………………………………………………………………………………….......
2. 
What is your
business form type, retail , wholesale or both
What is your
business form type, retail , wholesale or both
3. Are you aware of
foreigners’ invasion of the market? Yes No
Are you aware of
foreigners’ invasion of the market? Yes No
4. Why
are the foreigners been able to succeed in the invasion?
………………………………………………………………………………………………………………………………………………………………………………………………
……………………………………………………………………………………………
Are
there foreigners’ in this market who also deal in the same goods as yours?
Yes No
5.
They are natives of which countries?
………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………………………………………………
The presence of
these foreign traders in the market, does it have any effects on your business
as well as your fellow local traders? Yes No
6.
What are the effects?
………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
7.
What possible ways would you suggest to be
adopted to address the problem?
………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
SEMI-STRUCTURED
INTERVIEW FORM
NAME OF INTERVIEWEE………………………………………………………….…..
NATIONALITY……………………………………………………………….…………..
NAME OF BUSINESS……………………………………………………………………
CONTACTS……………………………………………………………………….………………………………………………………………………………………………………
DATE OF INTERVIEW ………../
………… / …………..
QUESTIONS;
1. What type of
products do you deals in?
................................................................................................................................................
………………………………………………………………………………………………
2.
What
is your business type? Retail Wholesale Both
3. Why do you choose
this location for your business?
................................................................................................................................................................................................................................................................................................ 4. How did you have your business
established to start and has gotten to this far?
………………………………………………………………………………………………………………………………………………………………………………………………5. What challenges do you face as a
foreigner in carrying out your business?
………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
6. Do you have any
business(es) besides this? ………………………………………………………………………………………………
SEMI-STRUCTURED
INTERVIEW
INTERVIEWEE………………………………………………………………….
CONTACTS………………………………………………………………………………………………………………………………………………………………
DATE OF INTERVIEW ………. / ……… / ………
QUESTIONS;
1.
Is
it true that foreigners are invading Ghana markets? Yes No
Is
it true that foreigners are invading Ghana markets? Yes No
2.
These foreigners
are natives of which countries?
………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
3.
Why and how are
they been able to succeed in the invasion?
……………………………………………………………………………………………………………………………………………………………………
4.
What are the
effects of the invasion on the businesses of the local traders?
……………………………………………………………………………………………………………………………………………………………………
5.
What effects does
the invasion is having on the economy of Ghana?
……………………………………………………………………………………………………………………………………………………………………
6.
How can the
problem best be overcome? ………………………………………………………………………………………………………………………………
…………………………………..
SEMI-STRUCTURED
INTERVIEW
INTERVIEWEE…………………………………………………………………………………………………………………………………………………
CONTACTS………………………………………………………………………………………………………………………………………………………..
DATE
OF INTERVIEW ……… /……… /…………
QUESTIONS;
1. 
Are you aware of
the grievances of foreigners’ invasion of Ghana markets? Yes No
Are you aware of
the grievances of foreigners’ invasion of Ghana markets? Yes No
2. What
steps and measures have you taken to find out the reality of the problem?
………………………………………………………………………………………………………………………………………………………………
3. The
problem, how is it actually? ........................................................................................................................................................................................................................
4. What
measures do you have in place that ensures that the section 27 and 28 of the ACT
865 is complied with?
………………………………………………………………………………………………………………………………………………………………
5. If
the markets of Ghana are been invaded by foreigners, what are the economic
effects on the economy of Ghana?
………………………………………………………………………………………………………………………………………………………………………………
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