STORY: Samuel Doe Ablordeppey
THE next three weeks of action at the Africa Cup of Nations — Ghana 2008 — have been estimated to inject some $1 billion into the Ghanaian economy.
This is against the backdrop that the tournament is expected to attract a minimum of one million visitors.
If each person spends a total of $200, it means $200 million injection at the end of the three weeks; $500 spending per each visitor would mean $500 million injection, while a $1000 spending each would directly inject $1 billion in the Ghanaian economy.
This is besides direct investments by FIFA itself in various forms ranging from payment of allowances and logistics to medicals and others.
A cursory look on major streets across the country, particularly at the venues for the tournament — Accra, Kumasi, Sekondi and Tamale, reveals that the sale of promotional materials and paraphernalia has peaked and this is expected to continue for the rest of the tournament.
Many economic analysts have said food vendors would experience a bumper harvest.
“We are going to have a very vibrant economic activity and it will be more visible in the next few days. Food vendors, as well as our hotels, will see a lot of sales,” Mr Yofi Grant, the Executive Chairman of Databank Brokerage Ltd, told the Daily Graphic in an interview.
He said apart from the busy commercial activities around the stadia, the food industry and accommodation were two other areas that would see high demand.
A business executive, who heads the West Africa Business Association (WABA), Mr Sam Poku, said the tourism industry would be the biggest beneficiary of the tournament.
He said Ghanaian entrepreneurs should use the windfall in other investments so that they would not only keep themselves in business but would expand to the benefit of the larger economy.
Asked whether it was rather not too high that the sale of rights to produce certain items cost as much as $500,000, Mr Poku said although that seemed on the high side, Ghanaian business people could have formed partnerships and joined with local or international investors to take advantage of the rights.
Many Ghanaian entrepreneurs have secured the right to produce paraphernalia and merchandise of the CAN 2008 tournament.
These activities could be a good catalyst to grow the economy, considering that the services sector contributes significantly to the Gross Domestic Product (GDP) of the country.
The services sector contributed 29.9 per cent to GDP in 2005; 30 per cent in 2006 and 30.6 per cent last year.
The sector — which includes transport, communication, restaurants and hotels — has maintained an average 6.7 per cent growth between 2005 and 2007 and is expected to cross the seven per cent mark by the close of this year.
However, there have been worries and complaints, particularly from local industrialists, that although economic activity would be robust, the country would only be reduced to the downstream sales aspect of production, as most of the merchandise came in from China.
Mr Grant said that should not be a worry, since in the global economy of today a nation could not master everything, but must concentrate on where its strength lay.
“They may be produced in China but they find the market here and that is good for economic activity,” Mr Grant said, adding that although it was a pity the country could not produce them locally, “we should build on what we can do better and move on”.
He said although the country could do some of those things for itself, it lacked the technology and resources at the moment to meet those lofty demands of producing so many things locally.
After successfully hosting the CAN 2008, Ghana should leverage the experience by combining it with the prevailing peace and economic stability to make the country the preferred destination for international events and conferences, Mr Grant suggested.
“Perhaps we should invest a bit more in conferencing and accommodation facilities. A few sacrifices could be made to achieve this goal for our own long-term benefit,” the investment analyst stated.
Doing that would warrant joint ventures between international investors and the local people who have land to use them as investment.
“We need to separate land ownership from its use so as to unlock the capital in that area.”
Mr Grant’s position is corroborated by a renowned Peruvian economist, with interest in developing economies, Mr Hernando de Soto, who has linked development with property rights, saying many developing economies, including Africa, would not remain poor if they could unlock the resourcefulness of land, which he called dead capital.
However, Mr Grant quickly pointed out that capacity building in the hospitality industry was important, because attitudinal problems were still prevalent in the industry and was taking a toll on it.