A Smart City in Accra-Ghana: The Gold Coast Once Again

Accra leads urban transformation in Africa with investment strategies, technological innovation, and sustainable policies to become a benchmark Smart City.

Considering the enormous benefits generated by the development of a Smart City, many plans are being carried out worldwide to develop this concept and implement it in real life. This reality is not only happening in the so-called First World; India, the second most populous country in the world, has realized the countless benefits that Smart Cities provide and has started developing various intelligent cities throughout the country. Africa is not far behind in the Smart City concept, as Kenya and South Africa are working to ensure that several aspects of their capital cities meet some standards of so-called Smart Cities. The author explains in this article what is happening in Ghana (formerly the Gold Coast) and why Accra, its capital, is the ideal place to develop the Smart City concept. It is no surprise that the city's mayor won the World Mayor Prize in 2015. At the same time, Accra has been nominated to host the first Smart City conference in Africa.

Ghana is, politically, a shining example of democracy in Africa. After returning to democratic rule in 1992, the country continues to boast the best democracy on the continent. The political system has allowed the formation of various political and economic think tanks, as well as social organizations that provide input on government decisions and actions or inactions. Ghana is also an active member of ECOWAS and the African Union (AU), with its last three presidents having held the position of ECOWAS director. The last president, John Agyekum Kufour, also served as president of the African Union during his tenure as Ghana’s leader.

There is also growth in various aspects of the country's economy, mainly in the area of information technology. Currently, hiring for government institutions is done through online applications. Additionally, the government delivers payroll online instead of in paper format to civil servants, teachers, and other employees within the national payroll system.

Similarly, the nationwide street naming system helps with accessibility and the easy location of people and properties. The national ID card is also expected to facilitate verification for institutions and individuals dealing with credibility concerns in the country. In the leisure sector, there are parks and clubhouses for children, students, and workers.

Ghana is a democratic country with a peaceful policing environment that fosters social and economic growth. It also has flexible legal frameworks that support business development. Commercial activities in production and exports enjoy tax incentives to encourage growth.

Last year, Accra won the IBM Smarter Cities Challenge grant, which significantly enhanced the city’s social and infrastructure development. Accra was one of four African cities selected from 33 chosen globally. The IBM Smarter Cities Challenge, launched in 2014, is a three-year, $50 million program in which IBM sends expert teams across various disciplines to help cities formulate new strategies for improving residents' quality of life through technology-driven solutions.

The mayor of Accra won the World Mayor Prize in 2015

To boost commerce, the government has implemented several measures to attract and retain national and international investors. This article discusses three of these policies.

Currently, Ghana has introduced various initiatives to ensure that other African countries embark on Smart City projects. Several bills and policies introduced remain in place to inspire innovation and enhance the country's growth.

Three Policies

The first policy discussed is the Public-Private Partnership Project, which has been transformed into law, ensuring several benefits:

• Rapid implementation of necessary infrastructure and public services on time and within budget.
• Encouraging the private sector to provide innovative design, technology, and financing infrastructure.
• Ensuring high-quality public services and widespread availability.
• Financing advantages, reflected in reduced initial public expenditure and better allocation of public functions.
• Economic growth, increased employment, and improved job opportunities.

The second institution, the Ghana Investment Promotion Council, aims to collect, analyze, and disseminate information on investment opportunities, capital sources, available investor incentives, and the overall investment landscape. It also advises on the availability, selection, or suitability of partners for joint ventures. This institution formulates investment promotion policies, incentive plans, and marketing strategies to attract foreign and local investment in advanced technology industries and high-skilled service sectors with strong export market prospects.

The Ghana Free Zone Board is a government organization created to provide incentives for investors in various sectors, including agribusiness (fruits, vegetables, and cocoa), information and communication technologies (data processing, call centers, software development, and computer assembly), textile and apparel manufacturing, fish processing, jewelry/crafts production, light manufacturing, metal fabrication, and floriculture.

Economic and Non-Economic Incentives

Some of the economic incentives provided to these organizations include:

1. 100% exemption on direct and indirect taxes on all imports for production and export within free zones.
2. 100% exemption on corporate income tax for the first 10 years, followed by a rate not exceeding 8% afterward.
3. Total exemption from dividend tax for free zone investments.
4. Double taxation relief for all foreign investors and workers where Ghana has a double taxation agreement.

Non-economic incentives include:

1. No import license requirements.
2. Minimal customs procedures.
3. 100% foreign or local ownership in free zones.
4. No restrictions on repatriation of profits, payments for foreign loans, or fees under technology transfer agreements.
5. Permission for free zone investors to operate foreign currency accounts in Ghanaian banks.
6. At least 70% of annual production in free zones must be exported, with up to 30% permitted for local sale.
7. Guarantees against nationalization and expropriation of free zone investments.

Ghana has introduced several measures to ensure other African countries embark on Smart City projects.

With all these factors, coupled with its institutional, technological, and physical networks, Ghana emerges as an ideal location for the Smart City concept. It is no surprise that Accra’s mayor, Alfred Nii Oko Vanderpuye, was awarded the World Mayor Prize in 2015. Moreover, Ghana has been nominated to host Africa’s first Smart City conference.