Review Free Zones Act for more investments — Annoh-Dompreh

The Chairman of the Foreign Affairs Committee of Parliament, Mr Frank Annoh-Dompreh, has called for the amendment of the Free Zones Act 1995 to position the country to attract more local and foreign investments.

He said the amendment of the Act would promote technology transfer, diversify the country's export products, create more employment and increase foreign earnings.

Proposals

Mr Annoh-Dompreh made the call in a statement he presented in Parliament last Tuesday on "Proposals on Amendment of the Free Zones Act 1995 (Act 504)”.

The statement touched on the weaknesses of the free zones scheme and indicated that worldwide, the scheme had undergone changes to attract the required investments to propel economic growth.

The Free Zones Act was enacted in 1995 to enable the establishment of free zones in Ghana for the promotion of economic development and to provide for the regulation of activities in free zones and for related purposes.

Mr Annoh-Dompreh, who is also the Member of Parliament (MP) for Nsawam-Adoagyiri, said Ghana's free zones scheme had not seen any appreciable remodelling to align it with modern trends and international best practices.

He stated that there had not been any major legislative initiative to address challenges the free zones operators were being confronted with in their business environment.

He said a review of the legislative provisions was needed to ensure that there was enhanced monitoring for the country to derive the needed benefits from the scheme.

"In the era of globalisation and Internet, greater emphasis should be placed on paperless modes of business transaction, enhanced monitoring mechanisms to ensure strict compliance to regulations by investors and quality delivery of service by regulator," he said.

Corporate identity

Mr Annoh-Dompreh noted that a review should seek to enhance the mandate of the Free Zones Authority to act as a true authority.

He recalled that the general consolidation of laws in 2004 merely changed the name of the Ghana Free Zones Board to Ghana Free Zones Authority (GFZA) without any enhanced mandate.

"The GFZA's lack of corporate identity and legal personality incapacitated it from transacting business independently," he said.

Legal provisions

Mr Annoh-Dompreh added that the act allowed for the declaration of free ports but there were no provisions and regulations to handle that regime, so legal provisions should be made to address that lacuna.

Besides, the act should also prescribe stiffer penalties for non-compliance by companies that abused the incentive regime administered by the regulator.

Mr Annoh-Dompreh said the current situation in which the free zone companies located within the Tema export processing zone paid electricity tariff over and above the Public Utilities Regulatory Commission (PURC) approved rates needed to be addressed.

Contributions

Commenting on the statement, the Deputy Majority Leader, Ms Sarah Adwoa Safo, said the Business Development Ministry was expected to create more companies.

She asked the companies to take advantage of the opportunities offered in the free zones area.

The Minority Leader, Mr Haruna Iddrisu, said the free zones concept had contributed significantly to job creation in the country.

He said conferring legal identity on the GFZA was appropriate as it would give it power to sue and be sued.