This report on the construction industry in Ghana focuses on conditions in the local sector as well as market opportunities for construction companies in all the sectors of the economy. It investigates government initiatives as well as recent developments and factors influencing the success of the sector. The report also profiles 25 foreign and local construction companies, ranging from South African subsidiary, Group Five Construction Ghana Ltd, which has operated in Ghana for the last 15 years and was recently awarded a US$374m tender to design and construct a 350MW gas and oil-fired power plant in Ghana’s Kpone municipality, to wholly-owned Ghanaian company, Proconsult Ltd, headquartered in Accra.
The Construction Industry in Ghana
The Ghanaian construction industry valued at US$4.5bn has been identified as a cornerstone of the West African nation’s national development agenda, accounting for more than 12% of Ghana’s annual GDP in 2014.
Opportunities and Challenges
Opportunities in the construction sector abound. The provision of houses is critical, with Ghana’s housing deficit estimated to be in excess of 1.7 million units. The development and rehabilitation of transport networks linking Ghana’s key cocoa production areas to buying centres has been prioritised. Projects to develop railway infrastructure as well as Transit Oriented Developments (TOD) in Accra and Kumasi that will comprise retail developments, commercial space, hotels with conference facilities, as well as residential units are also envisaged. The construction of the US$600m Atuabo Free Port will reduce the operational costs of companies operating in Ghana’s oil and gas fields and the approval by the World Bank of an investment of US$700m in guarantees for Ghana’s offshore Sankofa Gas Project is also viewed as a promising development. Despite the Ghanaian government’s attempts to develop a policy framework that is conducive to enterprise development and foreign investment, growth has been constrained by external and domestic challenges. Ghana Statistical Service (GSS) predicts that GDP will continue to shrink, declining from US$38.5bn in 2014 to around US$36.6bn in 2015. This has largely been attributed to poor macro-economic fundamentals, specifically the weakness of the local currency, which has devalued by more than 20% against the US dollar since the beginning of 2015. Inflationary pressures are also cause for concern with Ghana’s headline inflation reaching 17.3% in August 2015.