Interview: Nana Kwame Bediakob
How can Ghana increase its use of domestically sourced construction inputs?
NANA KWAME BEDIAKO: The opportunity for Ghana to increase domestic inputs relates not just to training our large pool of affordable labour, but also to increasing production of materials needed to fuel the country’s evolution. Having to import all of the materials necessary for major construction projects hampers development, as it causes a lot of delays and leads to extra costs in the form of taxation. Therefore, the government and private sector both need to apply a development-driven approach to their operations.
There is no reason why the materials that Ghana currently imports cannot be produced locally. For example, we have abundant supplies of iron ore, so we ought to have local plants that can turn this iron ore into steel and other factories that can produce iron rods. Ghana has stone and quarries, yet because concrete is not produced locally in significant quantities, we are forced to pay rates substantially higher than those faced by international developers. Free zones and tax exemptions act as incentives to kickstart manufacturing to some extent, but the lack of human resources development and financial capital are where the real bottlenecks lie.
To what extent will urban growth impact the supply and demand of real estate developments?
BEDIAKO: Current town planning does not suit development needs in Ghana’s major cities, nor in the country as a whole. All developments from low- to mid- and high-end have to be integrated. Without the right infrastructure in place, foreign individuals and businesses looking for places to buy or rent in the region are going to be deterred from coming to Ghana. A system where clients are charged the full rental amount one year in advance is unsustainable and prices in the luxury segment remain too high. All this has created strong demand for greater affordability in the high-end segment. In particular, serviced apartments, which provide a home with all the amenities alongside payments in monthly – or even weekly or daily – instalments, have proven to be very successful investments. This need for affordability among high-end offerings has spurred new real estate development models that will eventually be brought to the mid- and low-end segments. For this transformation of the market to occur, a different perspective on management and operations is going to be very important.
The mixed-use segment is another interesting class of projects that will see an increase in demand in the near term, but once again, this will require the right infrastructure to succeed, which means more forward-looking town planning and a road system that can accommodate increased population density without congestion. In the near term, more mixed-use projects near centres of activity, such as universities, would provide good opportunities. Ultimately, ensuring people live close to where they work is very important if we want large cities to experience sustainable urban development. If properly implemented, sustainable city planning could lower density constraints and spur the construction of more affordable high rises.
Another way to take pressure off cities such as Accra is through investing in the development of rural areas near cities – not just by building more roads, but also by creating industrial communities that spur growth and provide jobs that will allow families to pay mortgages and move to formal housing. Public-private partnerships are key to encouraging such developments. When it comes to the lower end of the real estate spectrum, it is important for affordable housing initiatives to focus less on a target number of units and more on the industrial environment that would enable affordable housing developments to attract the right population.
Read More from OBG
Driving ESG in Ghana’s mining industry
In this Global Platform video, Oxford Business Group speaks with Edward Koranteng, CEO, Minerals Income Investment Fund (MIIF), on Ghana’s mining industry. While Ghana is Africa’s largest gold producer, it has yet to fully benefit from its resources compared to countries with similar output. The government aims to enhance the country’s global competitiveness by investing in projects focused on extracting minerals such as salt and lithium, while simultaneously bolstering ESG pract…
Community development: Hamad Hareb Al Muhairi, Director-General, Abu Dhabi Housing Authority (ADHA), on financially and environmentally sustainable initiatives to meet rising demand for housing
Interview: Hamad Hareb Al Muhairi In what ways has recent population growth affected the housing market, and what strategies can address increased demand? HAMAD HAREB AL MUHAIRI: Abu Dhabi is committed to maintaining growth in all economic sectors, including government housing. Based on its role in developing and implementing housing programmes for UAE citizens, and setting related regulations and legislation, ADHA has adopted a flexible business strategy that considers the impact of popula…
Sharjah’s path to a sustainable future through sector diversification and green investment
Oxford Business Group will soon be launching The Report: Sharjah 2023. The report explores the emirate’s economic diversification initiatives, as well as efforts to attract investment, and advance environmental and socio-economic sustainability, coinciding with the COP28 UN Conference on Climate Change taking place this year in the UAE. In 2022 Sharjah's GDP witnessed notable growth, reaching 5.2%, attributed largely to sector diversity and integration. The 2023 budget of $…
“High-Level Discussions are Under Way to Identify How We Can Restructure Funding For Health Care Services”
Popular Sectors in Ghana
Popular Countries in Construction
Recent Reports in Ghana