Global Expansion and Ghana

Global Expansion

Developing countries, particularly those in Africa, are increasingly presenting significant opportunities for global expansion in the wake of increased maturation and saturation of developed markets. Ghana is one of the countries in Africa that offer an ideal environment for the establishment of a ball-bearing manufacturing factor. The rapidly growing country provides attractive cultural, economic, and political environments.

Ghana is one of the booming economies in Africa. With a gross domestic product (GDP) of approximately $114 billion (in terms of purchasing power parity) as of 2015, the country has recorded impressive economic growth in the last five years, with growth averaging 8% (Central Intelligence Agency [CIA], 2016). This is one of the highest GDP growth rates in the region and Africa at large, an indication of a robust business environment. The attractiveness of the Ghanaian economy further stems from fair trade and investment policies as well as a relatively stable macroeconomic environment. This is indeed an important point of consideration when selecting a country for global expansion.

Ghana's economic growth has particularly been driven by the advancement of the industrial sector, which accounts for approximately 28% of the country's total GDP (CIA, 2016). Against the backdrop of favourable government policies, Ghana's industrial sector is growing by more than 7%, one of the highest industrial growth rates not only in Africa, but also worldwide. Major industries in the country include electronics, automotive, textile, cement, and glass manufacturing. These industries provide a large market for ball bearings. Automotive manufacturing has particularly become an important source of economic growth for Ghana in recent times. The country now assembles sport utility vehicles customised for the African terrain. The application of ball bearings in automotives is extensive. On the whole, Ghana's economic environment is ideal for investment.

Ghana also provides an attractive political environment. In 1992, the country adopted a new constitution that paved way for a democratic regime. Over the years, the government has been committed to improving the economic environment by making it more favourable for business. This is particularly evidenced by the country's fair trade and investment policies founded on the principles of a market economy. Owing to the underlying democratic regime, Ghana has been one of the most politically stable countries in Africa. As per the 2015 Global Peace Index, Ghana is ranked as the 54th most peaceful nation in the world. This makes it the fifth most peaceful country in Africa (Institute for Economics and Peace, 2015). Further, as per Transparency International's 2015 Corruption Perceptions Index, Ghana occupies position 56 out of 168 countries, making it one of the least corrupt countries in Africa (Transparency International, 2015). Political stability is certainly good for business. It minimises the risk of property destruction that may occur as a result of politically-motivated violence. Absence of corruption is also favourable for business as it reduces the cost of doing business.