Investment Times Newspaper 2023 Edition | Issue 37

Taking the L eap : How to Turn Your Business Idea into a Re gi stered Entit y in Ghana

C entral bank advi ses b orrowers not to hiddenpay fe es on loans

The B oG said borrowers that pay such amounts were entitled to refunds They could also lodge complaints at B oG against their lending institutions for redre ss, the cent ral bank said in the notice i ssued by its Sec ret ar y,

Daniel L arbi-Tieku app ointed as Enterpri se Group CEO

16 0percent in 2024, Fitch Solutions has projec ted.

to average 37 6% in 2023, higher than the 31.5% recorded in 2022.

“As such, we believe that polic ymakers will remain focused on

controlling price grow th in the near term as they aim for a more before concluding the tightening c ycle” it stated in its latest assessment of Ghana.

It said under an expec ted International Monetary Fund (IMF) pro -

Will new trade p olic ies leave the developing world b ehind?

e gy under current Pre sident Joe Biden Thi s st rate gy, which aims to reconstitute Amer ic a s role in the global economy, embodie s t wo imperative s First , the US now re gards China as its main geopolitic al r ival and views its technolo gic al ascendance as a national- secur it y thre at A s the admini svanced chips and chip -making equipment to Chinational t rade and inve st ment to thwar t China’s ambitions Moreover, it expec ts other count r ie s to do the same

Central bank advises borrowers not to pay hidden fees on loans

Sandra Thompson.

It also advised the public to compare the interest rates of their nancial institutions with those of other lenders in making the decision on where to apply for a loan.

BoG said the notice was in line with its mandate to promote transparency and e ective disclosure practices in the nancial sector.

It also urged the public to critically assess their capacity for the loans, including making sure that they are capable of repaying prior to obtaining a loan facility.

“Borrowers are advised not to rush to acquire loans. Where possible, they may obtain and compare o ers from multiple lenders before deciding on the best deal,” the notice said.

In recent times, the bank has stepped up e orts to educate the general public on nancial transactions to help deepen nancial literacy as well as discourage unfair practices by banks and specialised deposit-taking institutions, which it regulates.

Daniel Larbi-Tieku appointed as Enterprise Group CEO

The Board of Enterprise Group has appointed Daniel Larbi -Tieku as the new Group Chief Executive O cer. This follows the retirement of Keli Gadzekpo from the posi-

Mr. Larbi -Tieku’s appointment takes e ect from

Mr. Gadzekpo will now serve as the Group Board Chairman for the Enterprise Group replacing Trevor Trefgarne who steps down after 25 years in the role.  Mr Trefgarne will still remain on the board.

Mr. Larbi-Tieku is a Chartered accountant with over 30 years’ experience in Finance, Corporate Strategy, Risk Management, Audit and Control, Regulatory Compliance and good appreciation of insurance underwriting, product pricing and actuarial valuations.

He joined Enterprise Life Assurance as General Manager, Finance, in April 2011 and was promoted to the position of Group Chief Finance O cer for Enterprise Group in May 2016. In May 2020, Daniel was promoted again to the position of Deputy Group Chief Executive O cer. Prior to joining Enterprise Group, he worked with Ayew Agyeman Turkson & Co, a Chartered Accounting rm and Osei Wiredu and Associates. He moved to UK to pursue his professional accounting quali cation. While in the UK, he worked with several companies including Asante Wiredu and Partners,

gramme, the Bank of Ghana will likely be encouraged to keep the policy rate elevated to “strengthen its monetary policy framework”.

“We forecast in ation will average 16.0% in 2024 – we believe that it is unlikely that the BoG will start easing monetary policy. Indeed, under an expected IMF programme, the BoG will likely be encouraged to keep the policy rate elevated to “strengthen its monetary policy framework”.

“Furthermore, the return of posi-

a Chartered Accounting rm based in London and undertook a number of training programs. He returned to Ghana and joined The Coca-Cola Bottling Company of Ghana as a Management Accountant. He enrolled on the Coca-Cola Fast 1 programme for key Talents in Casablanca, Morocco and was promoted to the role of Finance Director in 2000.

Commenting on his appointment, Mr. Larbi-Tieku said he is humbled and grateful to the Board for the con dence reposed in him to lead the Enterprise Group.

He said “I accept in humility to serve as CEO of this great company. I am aware of the enormous task ahead, especially during the current economic challenges that this role must deal with. With the support of the Board, Management, and our hard-working Thoroughbreds”, I am very optimistic that we shall continue to create value for all our stakeholders”.

Outgoing Group CEO, Mr. Gadzekpo noted that his association with the company has not ended and is excited to take up the mantle of Group Board Chairman.

“Leading the Enterprise team has been a pleasure and has been ful lling in my working life. As I hand over the baton to Daniel Larbi-Tieku I am absolutely convinced, based on his sterling track record, that we have picked the best man for the job,” Keli Gadzekpo said.

tive real interest rates will result in more capital in ows, mitigating risks to Ghana’s external position”, it pointed out.

Additionally, it said In ation will ease through 2023 but remain well above the Bank of Ghana’s target range of 6.0-10.0%.

February 2023 in ation slows to 52.8% to sustain downward trend

Year-on-year In ation for the month of February 2023 slowed down to 52.8%, the Ghana Statistical Service disclosed.

This was a reduction from the Jan-

Co-Founder and Managing Director of Zeepay

Ghana’s inflation to average 16percent next year, Fitch predicts

uary 2023 estimate of 53.6%, in uenced by the fall in in ation of transportation and other non-food items.

It was also the second consecutive time that the rate dropped in 20 months. In January 2023, in ation fell marginally to 53.6%, from 54.1% recorded in December 2022.

Atuabo Gas processing maintenance works completed

Ghana National Gas Company Limited says the planned maintenance works on its Atuabo Gas Processing Plant have been completed.

This is contained in a release issued on April 7 and signed by the Head of Corporate Communi-

cations, Ernest Ko Owusu-Bempah Bonsu. According to the release, “the entire maintenance activities ended in the late hours of Wednesday, April 5, 2023, ahead of the scheduled date of comple-

tion.”

It added that the gas processing plant is currently at a ow rate of 90 mmscfd. On March 25, the Atuabo Gas Processing Plant was shut down for maintenance. The shutdown a ected gas supply

to some power plants as well as the power supply to parts of the country. The Electricity Company Limited, as a result, released a load-shedding timetable from March 30 to April 7 between 6 pm

and 11 pm. Load shedding is expected to end now that the maintenance work has been completed. Meanwhile, the Management of Ghana Gas has thanked the general public for their patience and cooperation during the maintenance period.

Vodafone Ghana introduces exclusive special holiday offers for customer

Vodafone Ghana has unveiled the Special Holiday O er, designed to delight customers with unlimited internet access during public holidays. The o er aims to bring families together and provide a seamless browsing experience on special occasions.

Albert Achiaw, Vodafone Ghana's Fixed Business Manager, stated: "Vodafone Ghana is dedicated to creating memorable experiences for our customers during special occasions. With the Special Holiday O er, we are empowering families and friends to stay connected and share cherished moments without worrying about internet limitations. This initiative re ects our commitment to innovation and our passion for exceeding customer expectations in a constantly evolving digital landscape." The Special Holiday O er will be available on holidays such as Easter Monday, Eid

al-Fitr, Labour Day, Eid al-Adha, Founder's Day, and Kwame Nkrumah Memorial Day. The o er is exclusively for customers with an active core bundle and will be valid for 24 hours from12am – 11:59pm. Priced at GHC 20, customers will receive 100GB of data for 24 hours. The o er can be accessed via USSDD * 900#, My Vodafone App, and My Vodafone Web. Customers are advised to activate the o er ahead of time to enjoy the full bene ts during the period.

As a supplementary plan, the Special Holiday O er is one of Vodafone's customer-centric products designed to provide a ordable and reliable xed broadband internet access. By focusing on customer needs, Vodafone Ghana has positioned itself as a leading customer-oriented organisation, constantly developing promotions that cater to the evolving demands of its users.

Will new trade policies leave the developing world behind?

Second, US policymakers aim to make up for decades of neglecting domestic economic, social, and environmental priorities by focusing on policies that promote resilience, dependable supply chains, good jobs, and a clean-energy transition. The US seems happy to pursue these objectives on its own, even if its actions could adversely a ect other countries.

The best example of this is the In ation Reduction Act, the Biden administration’s landmark climate-transition legislation. Many governments in Europe and elsewhere have been outraged by the $370 billion clean-energy subsidies included in the IRA, which favor US-based producers. Pascal Lamy, the former head of the WTO, recently called on developing countries to join the European Union in forming a “North-South” coalition without the US, to “create a disadvantage for [the Americans] that would make them change their position.”

To be sure, Europe has its own brand of unilateralism, albeit a softer one than America’s. The

EU’s Carbon Border Adjustment Mechanism (CBAM), which aims to maintain high carbon prices within the bloc by imposing duties on carbon-intensive imports such as steel and aluminum, is meant to placate European rms that would otherwise nd themselves at a competitive disadvantage. But it also makes it harder for developing countries such as India, Egypt, and Mozambique to access European markets.

So, developing countries have plenty to worry about. As the US and Europe attempt to isolate China and craft policies in support of their new domestic agendas, they are unlikely to have poorer economies’ interests in mind. For small lower-income countries, multilateralism remains the only safeguard against the solipsism of great powers. But developing countries would do well to recognize that these unilateral policies are driven by legitimate concerns and are often aimed at meeting global needs. Climate change, for example, is clearly an existential threat to human-

ity. If US and European policies accelerate the green transition, poorer countries will bene t, too. Instead of condemning these policies, lowerand middle-income countries should seek transfers andnancing that would enable them to follow suit. For example, they should demand that European countries channel CBAM revenues to developing-country exporters to support these rms’ investment in greener technologies. More broadly, developing countries must remember that their economic prospects are determined rst and foremost by their own policies. Short of a 1930s-style worldwide plunge into protectionism, they will likely not lose access to Western markets. Moreover, export-oriented countries such as South Korea and Taiwan engineered their growth miracles during the 1960s and 1970s, when developed countries were far more protectionist than they are now or likely to be in the foreseeable future.

It is also true that the export-oriented industrialization

By Dani Rodrik

model has run out of steam for reasons that have little to do with the Global North’s protectionist policies. Because today’s manufacturing technologies are so skill- and capital-intensive, it is di cult for latecomers to mimic the success of East Asian tigers (I call this phenomenon “premature de-industrialization”). Future development models would have to rely on service industries and small and medium-size enterprises, rather than on industrial exports, to build a thriving middle class.

Developed countries’ renewed focus on building resilient, equitable domestic economies could also bene t the global economy. Cohesive societies are far more likely to support openness to international trade and investment than those roiled by the inegalitarian forces of hyper-globalization. As many studies have shown, disappearing jobs and regional economic decline can often engender ethno-nationalist politics.

In a 2019 “letter to the next generation,” Christine

Taking the Leap: How to Turn Your B usiness Idea into a Registered Entity in Ghana.

All humans are entrepreneurs not because they should start companies but because the will to create is encoded in human DNA. - Reid Ho man, LinkedIn co-founder

From Idea to Business:

Taking the Leap

Do you have a great business idea that you are ready to turn into a reality? One of the rst steps you'll need to take is registering your business as a legal entity in Ghana. But with several options available, how do you choose the right type of registration for your business?

Fortunately, Ghana has a well-de ned legal framework for incorporating di erent types of business entities, including partnerships, sole proprietorships, and companies. By following the right steps, you can register your business

and obtain the necessary licenses and permits to operate legally and grow your venture.

Starting a business can be a daunting task, but it is also an exciting opportunity to turn your ideas into a reality. In Ghana, entrepreneurs have several options to choose from when it comes to registering their businesses. Whether you are interested in incorporating a partnership, sole proprietorship, or company, the process can seem overwhelming. However, with the right guidance and knowledge, you can successfully navigate the legal requirements and leap to turn your business idea into a registered entity in Ghana.

In this article, I'll take you through the process of incorporating a partnership, sole proprietorship, or private company in Ghana. I'll discuss the key di erences between

Lagarde – then Managing Director of the International Monetary Fund and the current President of the European Central Bank – lamented the rise  of unilateralism and emphasized the bene ts of the post-1945 bargain.

“Bretton Woods launched a new era of global economic cooperation, in which countries helped themselves by helping each other,” she wrote. But the opposite is also true: any successful global regime, including the Bretton Woods system, must rely on the idea that countries could help each other by helping themselves.

In sum, when it comes to achieving stable and sustainable growth, developing countries must ask not what the world’s richest countries can do for them but what they can do to improve their own economic prospects.

each type of registration, the requirements for each, and the steps you need to take to ensure a successful registration process.

So if you're ready to take the leap and turn your business idea into a registered entity in Ghana, read on to learn more!

Types of Businesses in Ghana

In Ghana, there are three main types of legal structures for businesses and each structure has its advantages and disadvantages. Choosing the right one for your business depends on several factors such as the nature of your business, your growth plans, and your personal goals.

Whether you are a rst-time entrepreneur or an experienced business owner looking

to expand your operations, this guide will provide you with the essential information you need to take the leap and turn your business idea into a registered entity in Ghana.

Before diving into the process of incorporating a business in Ghana, it is essential to understand the di erent types of businesses available. The most common types of businesses are sole proprietorships, partnerships, and companies.

oSole Proprietorship or a Solo Business Man

A sole proprietorship is a type of business owned and run by one individual. This business structure is the simplest and most common form of business entity in Ghana. In a sole proprietorship, the owner has complete control over the business and is responsible for all its debts and liabilities. The owner also enjoys all the profits generated by the business.

To incorporate a sole proprietorship in Ghana, an individual must rst choose a business name that is not already registered with the O ce of the Registrar of Companies. Once a unique name has been selected, the individual must then le an application for registration with the O ce of the Registrar of Companies. The application must include the proposed business name, the nature of the business, the owner’s name and address, and any other relevant information that may be required by the O ce of Registrar of Companies.

Upon successful registration, the sole proprietorship is issued with a business registration certi cate, which is proof that the business is legally registered in Ghana. It is important to note that under the Registration of Business Name Act, 1962 (ACT 151), a sole proprietorship is not a separate legal entity from the owner. This means that the owner is personally liable for any debts or obligations incurred by the business.

In terms of taxation, a sole proprietorship is required to register for tax with the Ghana Revenue Authority (GRA) and obtain a Taxpayer Identi cation Number (TIN). The business is then required to le annual tax returns with the GRA and pay any taxes owed.

It is also important to note that as a sole proprietorship, there may be limitations on the growth and expansion of the business, as well as the ability to access funding and credit facilities.

oA Partnership

A partnership is a business structure where two or more people share ownership of the business jointly to make profits. Partnerships can either be general or limited. In a general partnership, all partners are jointly responsible for the debts and liabilities of the business. In a limited partnership, some general partners have unlimited liability and limited partners have limited liability.

To incorporate a partnership in Ghana, the rst step is to select a business name. The business name must not be identical or too similar to any existing registered business name in Ghana. Once a business name has been selected, a search can be conducted on the Registrar General's Department website to ensure that the name is available for registration.

The next step is to draft a Partnership Agreement which should include; the name of the partnership, the nature of the business to be conducted, the term of the partnership, the amount of capital to be contributed by each partner, the pro t-sharing ratio among the partners, the roles and responsibilities of each partner[ Section 5 of ACT 152].

The partnership agreement must be signed by all partners and witnessed by a Commissioner for Oath and registered in accordance with the law. The Partnership Agreement shall act as a Constitution that regulates and governs the partnership and also serves as a binding contract between the Partners.

Upon submission of these documents, the O ce of the Registrar of Companies shall issue a Certi cate of Registration that con rms the legal existence of the partnership.

It is important to note that Partnerships in Ghana are regulated by the Incorporated Private Partnership Act, 1962 (Act 152).

No partnership consisting of more than twenty persons or of which any body corporate is a member shall be registered under this Act[ Section 4(2) of ACT 152].

oA Company

A company is a separate legal entity from its owners. Subject to the Companies Act, a person of the age of eighteen

years and above may apply for the incorporation of a company.

A company can either be private or public. A private company is restricted to a total number of members or shareholders as well as prohibited from making public invitations to the public to acquire its shares or debentures and also prohibit the company from making invitations to the public to deposit money for a xed period or payable on call. There are other distinguishing features by way of a minimum number of directors and tenure of directorship, especially in public companies.

A Private or Public Company may either be limited or unlimited in terms of rights and liabilities. A private or a public company may be limited either by Shares or Guarantee or may be unlimited. External Companies may also be registered in Ghana. An external Company is a body corporate formed or incorporated outside the Republic but has a registered place of business in the Country. An established place of business is de ned under Section 329 of the Act to mean a branch, management, registered o ce, or factory amongst others.

In essence, there are Seven types of companies in Ghana. By the Companies Act, 2019 (Act 992), all companies in Ghana are required to have a company secretary. The company secretary is responsible for ensuring that the company complies with all legal and regulatory requirements, maintaining the company's records, and providing administrative support to the board of directors. The company secretary must be a resident of Ghana and cannot be a director or shareholder of the company. It is also recommended that the company secretary be a qualied lawyer, accountant, or other professional with relevant experience in corporate governance[ Section 211(3) of Companies Act, 2019 (ACT 992)].

To register a company in Ghana, the following steps must be taken:

1.Choose a business name: The business name must not be identical or too similar to any existing registered business name in Ghana.

2.Prepare the necessary documents: This includes the company's Constitution, the details of the company's directors and shareholders, the company's registered o ce address, GPS Address, Ghana Card Numbers, and TIN numbers of Directors and Shareholders as

well as the details of a Secretary and an Auditor.

3.Pay the necessary fees: The fees vary depending on the registered company type.

4.Obtain a Certi cate of Incorporation: Once the documents have been approved and the fees paid, the O ce of the Registrar of Companies issues a Certi cate of Incorporation, which con rms the legal existence of the company.

A company upon registration shall have full capacity to carry on or undertake any business or activity, do any act, or enter into any transaction; and full rights, powers, and privileges of giving and entering into and be bound by and claiming all rights under a deed or mortgage or other instruments[ Section 18 of Companies Act, 2019 (ACT 992)].

Are there other necessary requirements?

Additionally, if the company is engaged in certain activities such as banking, tourism, mining, or petroleum exploration, it may require additional permits and licenses from relevant government agencies.

Examples are the Bank of Ghana and Securities and Exchanges Commission for the banking and other nancial sector businesses, The Ghana Tourism Authority for tourism and travel & tour Operators, The Gaming Commission for gaming and sport betting ventures, The Mining Commission for the mining of natural resources and so on.

A Ghanaian company with foreign membership

The Ghana Investment Promotion Center Act, 2013, ACT 865, (GIPC Act) mandates that any company with foreign investment or participation must get a GIPC registration certi cate[ Section 24(1) of GIPC ACT]. All domestic businesses with foreign ownership must register with the Ghana Investment Promotion Centre (GIPC) to obtain an investment certicate.

The GIPC Act also stipulates that there must be a minimum amount of capital for foreign participation or investment in Ghanaian businesses. Companies exempt from the minimum equity requirement include Manufacturing, Export Trade, Portfolio Investments, companies owned by Ghanaians (living in Ghana or the Diaspora) and spouses of Ghanaians in marriage for 5 years, and also residents in Ghana.[

Section 28 of GIPC ACT]

Under Section 26 of the GIPC Act 865, companies are granted exemptions from payment of Import Duty, VAT, and NHIL on plant and machinery for their operations including those under the laws mentioned in the Act. Wholly Ghanaian-owned enterprises are also encouraged to register with GIPC to bene t from the incentives provided for in the GIPC Act, 2013 (Act 865)[ Section 23 of the GIPC ACT

THE WRITER IS A BARRISTER AND SOLICITOR OF THE SUPREME COURT OF GHANA AND A MEMBER OF ZOE, AKYEA & CO LAW FIRM IN LABONE, ACCRA. HIS LEGAL INTERESTS INCLUDE BUT ARE NOT LIMITED TO REAL/PROPERTY LAW, CORPORATE AND COMMERCIAL PRACTICE, CONSTRUCTION LAW, AND DISPUTE RESOLUTION. ].

Congratulation, you are in business!

Whether you choose to register a sole proprietorship, partnership, or company, it is important to understand the legal requirements and follow the necessary steps to ensure compliance with Ghanaian laws and regulations.

Remember to carefully consider your business objectives, the structure that best suits your needs, and the minimum capital requirements and foreign participation restrictions that may apply. Seeking the services of legal and business professionals can help you navigate the incorporation process and set you up for success in your new venture.

Taking the leap to turn your business idea into a registered entity in Ghana is a signi cant step towards achieving your entrepreneurial dreams. With a solid plan, a commitment to compliance, and a willingness to learn and adapt, you can establish a thriving business in Ghana. Section 5 of ACT 152

Section 4(2) of ACT 152

Section 211(3) of Companies Act, 2019 (ACT 992)

Section 18 of Companies Act, 2019 (ACT 992)

Section 24(1) of GIPC ACT

Section 28 of GIPC ACT

Section 23 of the GIPC ACT

UCC holds open house for the Design Thinking & Innovation Hub

By Samuel Agyeman-Prempeh

To mark its 1-year anniversary, the University of Cape Coast's Design Thinking & Innovation Hub organised an open house for sta , faculty, students and members of the community on Wednesday 5th April, 2023.

The one-day event which took place at the Emmanuel Adow Obeng central administration building, featured impressive activities including showcasing of businesses in its incubation programme, indoor entrepreneurship games, a clinic o ering one on one advisory service on issues of entrepreneurship, nancial management, career guidance and psychosocial support. The over 200 participants present were enchanted and inspired as they interacted with

bene ciaries of the digital hub who in themselves are members of UCC teams winning $30000 and $40000 respectively at the just ended Kosmos Innovation Centre Agritech Challenge Pro.

Perhaps, the all-important essence of the digital hub was underscored with the presence of key stakeholders namely; Vice Chancellor, Professor Johnson Nyarko Boampong and other directors & ofcers passing honoring the house.

Addressing participants on the purpose of gathering, director of the Design Thinking and Innovation Hub, Dr Mrs. Keren Naa Abeka Arthur indicated that the event had been created to share successes

and key achievements of the hub in the past year and very importantly to unveil the many opportunities available at the hub to many who are yet to interface with it.

With a BSc from Ashesi University, MBA and PhD from University of Exeter, UK Dr. Keren is convicted that through its programmes, the hub has already started transforming individuals, businesses and very importantly students of the University who in themselves form a critical mass of society.

Acknowledging its partners; SIC, Hollard Insurance, Prudential Bank, Kosmos Innovation Centre, the director advocated for more organisation to reach out in funding, sponsor-

ship and mentorship for the hub.

As a senior lecturer of the University of Cape Coast, she commended management and all sta for the mandate of the hub to provide professional skills development, business development support, business incubation and acceleration services, career support and community service through solving societal problems using entrepreneurship, design thinking and continuous improvement.

Moving forward, the hub is looking forward to working with more young entrepreneurs and focusing on the commercialisation of inventions and creative outputs in the University community. Interested person may contact the hub via d-hub@ucc.edu.gh & 0312299862.

Eni, PetroCi celebrate FPSO to develop Ivory Coast largest offshore field

Italian oil rm Eni, with its partner PetroCi, has celebrated the sail away of the FPSO Firenze to the giant Baleine oil and gas eld oshore Ivory Coast.

The FPSO Firenze, which sailed away from Dubai, will allow the production start-up of the Baleine eld, Ivory Coast’s largest hydrocarbon discovery.

According to Eni, the Baleine eld, “Whale” in French, has an estimated oil in place of 2.5 billion barrels and 3.3 trillion cubic feet of associated gas.

“The development of Baleine will also be Africa’s rst net-zero emission project (Scope 1 and 2),” Eni said.

The FPSO Firenze, to be renamed Baleine after arrival in Ivory Coast, has been refurbished and upgraded in order to allow it to treat up to 15,000 bbl/d of oil and around 25 Mcfd/d of associated gas.

The entire gas production will be

delivered onshore via a newly built export pipeline.

Eni said Thursday, April 6, 2023 that the installation of the subsea production system and well completion campaign were underway and to ensure production start-up by June 2023.

“Eni’s phased development model and fast track have proven to be effective, as the project is set to start production less than 2 years from the Baleine 1X discovery well and one and a half years after the FID.

Eni is already progressing swiftly on the second phase of the project forecasting a start-up of production by December 2024 after having taken the FID in December 2022,” Eni said.

The Baleine eld extends over blocks CI-101 and CI-802. Eni also owns interests in four other blocks in the Ivorian deep water: CI-205, CI-501, CI-401, and CI-801, all with the same partner, PetroCi Holding.

The promise and peril of generative AI

By Diane Coyle

Ever since OpenAI released its ChatGPT chatbot last year, a growing number of analysts have been predicting that generative arti cial intelligence will displace millions of workers and cause widespread economic upheaval. But how exactly will generative AI a ect the global economy?

Recent estimates provide an indication of the looming labor-market disruption. Goldman Sachs economists, for example, anticipate that as many as 300 million full-time jobs could be automated as a result of the latest AI breakthroughs and that two-thirds of workers in Europe and the United States could be exposed to AI-based automation. A working paper by researchers at OpenAI nds that roughly 80% of the US workforce could see at least some of their tasks automated by the introduction of large language models (LLMs) such as ChatGPT. And some law rms

and marketers have already begun to use generative AI tools.

But it is still unclear whether the new AIs will improve existing employees’ productivity by taking routine tasks o their hands, or simply make workers technologically redundant. To be sure, many white-collar workers would be delighted if AI tools could take on dull tasks like keeping minutes during meetings, answering routine queries, or ling expense claims. But many believe – as Daron Acemoglu and Simon Johnson recently argued – that the current generative AI arms race is geared toward reducing costs by replacing workers with algorithms, rather than harnessing the power of these technologies to augment  human labor.

Another possibility though is that most companies will be slow to adopt this powerful technology because of a lack of skills and know-how. This is not neces-

sarily reassuring either. While new technologies often disrupt livelihoods and industries, they could also bring about the productivity growth needed to boost incomes and living standards. After almost two decades of extremely slow productivity growth in most advanced economies, generative AI has emerged right when we need it. But to ensure that it delivers widely shared bene ts, we must heed the lessons of the previous wave of digital innovation. Over the past 20 years, innovations like the smartphone and communication technologies like 4G and 5G wireless networks have transformed everyday life, leading to the creation of new sectors and business models. As of 2021, the average American spent roughly eight hours a day  online, more than double the 2011 gure. The cloud computing and the e-commerce industries have grown rapidly, re ecting a labor market in which digital skills are increasingly a prerequisite for landing a high-paying job. Yet despite these technological advances, productivity growth has been dismal since the mid-2000s.

What explains this economic puzzle? While it is possible that digital technologies are simply not very productive, their widespread adoption suggests otherwise. A more plausible explanation is that it takes time to gure out how best to use new technologies. As a result, only a small minority of companies in the US  and the United Kingdom have been able to use digital tools to boost their productivity and pull ahead. In his 2022 book The New Goli-

aths, Boston University’s James Bessen explores why companies are having trouble adapting to digital technologies. The complexity of advanced software, he argues, confers an advantage on the largest and most technologically sophisticated companies, because only they have the resources and know-how needed to adopt such tools and bene t from them.

Given the massive (and costly) computing power needed to use and maintain generative AI tools, it seems inevitable that this new technology will follow a similar path. If a handful of dominant companies use deep-learning algorithms like OpenAI’s GPT-4 to build new services and products, they could enhance their market power and erect insurmountable barriers to entry.

But the true potential of these new technologies goes beyond their ability to enable a few companies to become more e cient or develop new products. To provide widespread productivity gains and create real value, generative AI models must change the way we produce things. After all, the most sustained productivity booms of the past 200 years have been the result of new technologies reshaping and rewiring our economic systems.

Consider, for example, how the introduction of interchangeable parts in the nineteenth century revolutionized manufacturing, or how Henry Ford’s assembly line extended the division of labor inside the factory during the early twentieth century. In the 1980s, the just-in-time revolution reduced the need for massive inventories, and the globalization of supply chains during the

2000s allowed for greater specialization. These process innovations, made possible by the emergence of new energy and communication technologies, drove economic growth by changing not just what companies produced, but how they produced. Before the long-term usefulness of generative AI can become apparent, the hype – and the panic –must subside. Whatever its shortcomings, its introduction clearly represents an astounding technological leap. To ensure that it bene ts all of us as workers, consumers, and entrepreneurs, we must provide all businesses with access to these revolutionary tools, rather than hand the key to the next great economic transformation to a few large incumbents and hope they don’t lock out everyone else.

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Why investing in Africa's entertainment industry is a worthwhile financial decision

By Melvin Tarlue

The entertainment industry in Africa, especially music and movie, present enormous investment opportunities.

However, it's still di cult to make investors understand why they need to focus attention also on the entertainment industry on the continent. Mostly, foreign investors looking to invest in Africa are mainly looking at sectors like agriculture and agro-processing, mining, energy, technology, construction, etc.

“Many investors andnancial institutions don't understand the business of music and as a result, are unable to properly fund musicians," award-winning Nigerian musician, Mr. Eazi, says in 2020 as he launched a $20 million fund to invest in Africa's stars of the future.

Of course, there are few foreign investors now tapping into the entertainment industry in Africa and investing in this sector.

Between March 2020 and December 2022, I worked with an entertainment news website, which has Instagram, Facebook and Twitter handles on which my Whatsapp contact was placed. And on a daily basis, I was receiving loads of messages from young artists from all over Africa who wanted help to either promote their music, record new songs

or shoot music videos for their new songs.

I received loads of demos from underground artists from Sierra Leone, Uganda, Tanzania, DR Congo, Nigeria, Rwanda, etc., with all of them asking for one thing, investment support to advance their careers. Not only music, but I was also being contacted by young men and women who were looking for opportunities to become actors and actresses, asking whether we could invest in their talents or manage them.

My working experience in the entertainment space over the period, made me realize that there are hundreds if not thousands of young people roaming the streets across the continent; whom when given the opportunity and necessary investment support, could become the future stars of Africa in particular, and the world in general.

Historically, Africa as a continent has experienced less interest as a market-pool for the global music and movie industries. But in recent years, the narrative has changed.

The rise of Nigeria's Burna Boy, Wizkid, Tems, Davido, Rema, Ghana's Sarkodie, Stonebwoy, Black Sherrif, King Promise, and Tanzania's Diamond Platnumz, among others, on the global music scene, has contributed immensely to changing the narrative and rewriting the African music story at the world stage.

Afrobeats, a new music genre originating from Ghana and Nigeria in 2010, described as the 'new oil of Africa' because

of its potential to generate wealth for the continent and its young music talents, has sold the continent’s music industry to the rest of the world. Music today, is rewriting the destinies of several African youth. Young people from poor backgrounds like Ghana's music trio Fameye, Quamina MP and Ko Mole, are today hitting the limelight and becoming breadwinners for their families, and contributing their quota to the continent’s development.

And it is not only music that is rewriting the story of African youth, moving them from grass to grace, but the entire entertainment industry, is a ording many more young people the opportunity to excel in life, thanks to advancement in technology, especially the introduction of streaming services like YouTube, Net ix, Amazon Prime Video, ShowMax etc., which are providing opportunities for entertainers in Africa to sell their crafts to a global market.

Touching on the huge impact the advancement in technology is having on marketing African music and movie to the rest of the world, Jonathan Jules, Senior Director of international marketing with EMPIRE, says “In the age of TikTok and Triller, we’re seeing 12, 13-year-old white girls in Yorkshire dancing to Afrobeats. There was always a love for it."

EMPIRE, an American music company known for their work with artists such as T-Pain, Cardi B, and Kendrick Lamar, are already spending massively on African musicians.

But there is still room for Africans in the diaspora and people from around the world to consider exploiting investment opportunities in the entertainment industry in Africa.There are opportunities to invest in underground artists to expand their music careers. There are opportunities to invest in setting up modern recording studios, to set up management rms to manage artists. There are opportunities to set up movie production houses, to nance the production of authentic afro-centric movies for the global market.

Reasons to invest in the continent’s creative folks

Across Africa today, music streaming platforms are on the increase. According to the GSMA which represents the interests of mobile operators worldwide, the number of smartphone connections in Africa reached 302 million in 2018; this will rise to nearly 700 million by 2025, an adoption rate of 66%. Widespread smartphone usage across Africa will increase revenue per stream, platform subscriptions and music video views.

It has to be noted that investing in growing the music and movie industries in underdeveloped African countries can give people hope and an opportunity to pull them out of poverty. It has been stated in the past that a signi cant number of musicians, actors and actresses do not reach their goals because they lack

the proper team or funding to continue careers. It is therefore imperative to state that proving funding to improve the development of the entertainment industry will give communities a chance to prosper.

Music and lm are key driving factors to economic growth and development. A well-developed entertainment sector can create a multitude of jobs from, directors, dancers, managers, set designers, publicists, among others.

Investing in managing musicians, actors and actresses can result in other business activities, including brand deals. Musicians, actors and actresses could stand the chance of partnering with product companies, clothing companies, social media, among others, to  promote themselves and other businesses.

In conclusion, I must state that investing in the creative arts industry in Africa is not risk-free. There are young talents with no clear business plan, no clear vision as to where they want to take their craft, and lack the right strategies to properly position and market themselves. But aside that, the industry is still worth investing in because examples abound that investing in the industry has the potential to pay o . The likes of Wizkid, Davido, Burna Boy, Tems, Ayra Starr, Sarkodie, Stonebwoy, Gambo, Diamond Platnumz, and Rayvanny, are all testaments to the fact that investment in the entertainment industry in Africa is a worthwhile nancial decision.

Writer's email: tarluemelvin12@gmail.com

EDITOR: BENSON AFFUL