The government has been actively promoting and facilitating private sector participation in infrastructure delivery, crucial for economic growth and development through revenue generation, affordable housing and employment. The private sector has been providing expertise, innovation and efficiency, greatly enhancing the speed and quality of infrastructure projects within Ghana. Therefore, partnerships between the public and private sectors are crucial in ensuring secure, adequate and sustainable financing to support the implementation and achievement of the Sustainable Development Goals (SDGs), the African Union Agenda 2063 and national development objectives for Ghana.
Private Investment
Traditional funding sources, such as government budgets and international aid, are frequently insufficient in fulfilling the increasing demands of the country’s infrastructure development. As a result, the government has been exploring alternative financing models and attracting private investment to bridge the infrastructure financing gap. An enabling environment has been established through supportive policies, regulations and a legal framework to facilitate private sector involvement in infrastructure development. Confidence among potential investors is being cultivated through clear guidelines for project procurement, transparent bidding processes and the protection of investor rights.
Aligned with the SDGs and the Paris Agreement signed at the COP21 UN Conference on Climate Change, the Ghana Infrastructure Plan 2018-47 seeks to implement sustainable, climate-resilient infrastructure across various sectors. With a dynamic growth prospect, the government continues to play a key role in the country’s planned socio-economic transformation, and provides incentives to private housing developers to develop affordable homes. Tax reductions are a financing mechanism designed to make rents more economical and encourage private developers to reinvest profits in constructing more accessible housing. The Ministry of Works and Housing aims to increase private sector involvement in infrastructure and housing delivery by fostering an environment encouraging investment in the sector. Since the 1990s, more than 120 ha of stateowned land in Accra has undergone privatisation and development with the private sector redeveloping plots to enhance density and housing supply.
Infrastructure Development
The government developed a public-private partnership (PPP) with members of the Ghana Real Estate Developers Association to build affordable housing units for public servants throughout the country. The PPP model was established to promote infrastructure development and accommodate the country’s rapid urbanisation. PPPs are emerging as a solution to the infrastructure deficit, allowing shared risks and responsibilities between the entities; creating a mutually beneficial situation where both parties contribute their strengths towards project success; and ensuring continued infrastructure development nationwide. To regulate PPPs, the PPP Act, 2020 (Act 1039) came into force in December 2020.
In an effort to construct more infrastructure under an increasingly tight budget, the government has welcomed private investors to expedite public infrastructure development and fill existing gaps in service delivery through the PPP model. The government is supporting the PPP model in various sectors in order to promote sustainability and growth, and reduce excess spending on public infrastructure management. Between 1990 and 2020 private investors and multilateral organisations invested an estimated $9.9bn in PPP initiatives in Ghana, according to the World Bank, The 2015 National Housing Policy guides residential development in the country, emphasising private sector participation in affordable housing financing and delivery. The government is incentivising both foreign and private investment in non-prime areas to redistribute economic growth and development throughout Accra.
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