Why Hyundai, KIA Chose Ghana Over Nigeria For Car Assembly Plant- Alpha African Advisory
Africa is currently seeing investment inflow from the biggest companies across the globe, but Nigeria with the biggest market in the continent is not having the largest share of the influx of the multinational firms due to harsh operating environment, Sanyade Okoli, Chief Executive Officer, Alpha African Advisory Limited said on Friday.
Ghana’s Minister for Trade and Industry, Alan Kyerematen, on Thursday announced that Hyundai and KIA are set to establish assembly plants in Ghana, in what analysts see as another round of snub for Nigeria.
The companies are joining Toyota-Suzuki, Nissan, Kantanka, Volkswagen and Sinotruck in the country’s automobile industry.
On Wednesday, authorities in Cape Town, South Africa announced that it has reached an agreement with Amazon Inc to build its African headquarters in the country. Just before that, Twitter had selected Ghana as the best choice for its first African headquarters.
Speaking on the development Okoli said the country has a difficult operating environment which is scaring multinational firms.
“There is always competition for capital and if you want to attract capital, you have to make yourself as attractive as possible. The reality is when you look at key metrics, for ease of doing business, Ghana is significantly higher compared to Nigeria.
“So, something like car assembly which you expect to require quite a bit of power, Ghana in terms of power generation per capita is more than doubled Nigeria’s. So you can see how it becomes more attractive,’ Okoli said, on Arise Tv.
She said despite the pandemic Ghana’s economy slightly grew when the Nigeria went into recession.
According to her, Ghana has an advantage over Nigeria as the economy is forecasted to grow almost double the rate that Nigeria is forecasted to grow.
The “literacy rate is higher. So, yes Nigeria has a large market, but we need to find a way to ensure that we actually optimise the size of our market. Not being the largest is not enough,” she added.