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Ghana’s Parliament on March 26, 2026 passed the long-anticipated Ghana Investment Promotion Authority (GIPA) Bill, 2025, a landmark legislation that fundamentally reshapes the country’s investment regime and directly addresses one of the most contentious barriers to foreign direct investment (FDI) – minimum capital requirements. And on Thursday, last week, April 2, President John Dramani Mahama, as was widely expected, assented to the new law.
The new law, which replaces the Ghana Investment Promotion Centre Act, 2013 (Act 865), is widely seen as a decisive pivot in policy thinking. It reflects the government’s growing concern that Ghana has lost competitiveness within West Africa’s increasingly liberal investment landscape.
At its core, the new Act establishes the Ghana Investment Promotion Authority (a direct replacement to the three decade old Ghana Investment Promotion Centre, GIPC) as the central agency to “encourage, promote, facilitate and regulate investments into and within Ghana,” while also providing a more coordinated and transparent investment framework.
The law goes beyond a simple amendment. It re-enacts and modernises the entire investment code, covering areas such as: investor incentives and guarantees; enterprise registration and regulation; technology transfer agreements; expatriate labour provisions; and investment facilitation and aftercare.
It also strengthens coordination among state institutions involved in investment promotion, addressing long-standing complaints about fragmentation and regulatory overlap.
According to Simon Madjie, CEO of the newly renamed GIPA, the reform aims to create “a legal framework that responds to the realities of Ghana’s investment climate,” particularly in an era of intensified global and regional competition.
Scrapping minimum capital requirements
The most far-reaching provision—and the one generating the greatest debate—is the removal of minimum capital requirements for most categories of foreign investors.
Under the old GIPC Act 2013 (Act 865), foreign investors faced a rigid tiered structure.
A minimum of US$200,000 was required of direct foreign investors, for joint ventures with Ghanaian partners, a minimum of US$500,000 for wholly foreign-owned enterprises and at least US$1 million for trading companies.
These thresholds were originally designed to protect indigenous businesses and ensure that foreign investors brought significant capital into the economy. However, over time they became widely criticised as prohibitive barriers to entry—especially for small and medium-sized investors.
The new Act removes these blanket requirements (with some safeguards expected in sensitive sectors), effectively allowing investors to determine their own capital levels based on business needs.
President John Dramani Mahama had earlier justified the reform in August last year, stating that “We’re removing those minimum capital investments… any investor… can come in and set up a business.
The Ghana Investment Promotion Centre (now Authority) has been explicit in its rationale for this pointing out that Ghana is no longer competitive relative to its West African peers.
Many countries in the sub-region—including Côte d’Ivoire and Senegal as well as Rwanda, further afield—either have no minimum capital requirements or enforce far more flexible entry conditions. By contrast, Ghana’s high thresholds have been seen as outliers that deter investors, particularly in non-extractive sectors such as services, technology and agribusiness.
A memorandum to the Bill noted that removing these restrictions is intended to “put Ghana at par with other countries in the sub-region” and attract a broader spectrum of investors.
The implication is clear: in an era where capital is highly mobile, regulatory barriers—even well-intentioned ones—can quickly redirect investment flows elsewhere.
Implications for Ghana’s FDI drive
The removal of minimum capital requirements is expected to have both immediate and long-term implications for Ghana’s FDI strategy.
One is that lower entry barriers means a broader investor base. The reform opens the door to smaller investors, including startups, diaspora entrepreneurs and SMEs who were previously priced out. This could significantly increase the volume—if not immediately the value—of FDI inflows.
Another is sectoral diversification. By easing entry into services, manufacturing and digital sectors, the policy aligns with Ghana’s broader economic diversification agenda. Previously, high capital thresholds effectively skewed foreign investment toward capital-intensive industries.
A third implication is the potential for increased competition and innovation. Greater participation by foreign firms could drive innovation, technology transfer and productivity gains, particularly if supported by stronger regulatory oversight.
But all this makes it imperative for a shift from “quality control by capital” to regulatory oversight. Under the old regime, minimum capital requirements served as a proxy for seriousness and capacity. The new framework shifts that responsibility to regulatory monitoring, licensing and compliance enforcement.
Concerns from local industry
Despite its potential benefits, the reform has triggered concern among sections of the private sector.
The Association of Ghana Industries has cautioned that liberalisation must be balanced with protections for local firms, warning that Ghanaian businesses could be exposed to intense competition from better-capitalised foreign entrants.
Some analysts argue that the removal of capital thresholds could lead to an influx of “briefcase investors” with limited long-term commitment, potentially undermining market stability.
Others fear that small-scale sectors—particularly retail and trading—could be dominated by foreign players unless safeguards are maintained.
To address these concerns, policymakers are expected to retain targeted protections in specific areas. These include maintaining capital thresholds for certain trading activities and enforcing local content and partnership requirements. Other safeguards comprise strengthening anti-fronting provisions and enhancing monitoring of technology transfer agreements
The new law also introduces stricter penalties for regulatory breaches and aims to improve transparency in investment operations.
Implementing a plethora of regulatory reforms
Beyond capital requirements, the Act introduces important reforms to technology transfer agreements (TTAs), a critical channel for skills and knowledge inflows.
According to industry officials, the new framework will require stricter verification of agreements by financial institutions before foreign exchange remittances are approved—closing loopholes that previously allowed unregistered agreements to bypass oversight.
This reflects a broader shift toward ensuring that foreign investment delivers tangible developmental benefits, not just capital inflows.
Following its passage by Parliament on March 26, 2026, the Bill was assented to by President John Dramani Mahama on April 2. Implementation is likely to follow in phases
The new law has taken immediate legal effect upon presidential assent. The next step is the drafting of transitional guidelines for existing investors and pending applications, and this will be followed by regulatory legislative instruments (LIs) to operationalise specific provisions
The Ghana Investment Promotion Authority is expected to issue detailed regulations and administrative guidelines in the months following assent.
A strategic gamble on openness
Ultimately, the Ghana Investment Promotion Authority Act represents a strategic gamble: that reducing barriers to entry will attract a wider pool of investors and restore Ghana’s competitiveness as an investment destination.
For policymakers, the bet is that volume, diversity and dynamism of investment will outweigh the risks associated with liberalisation.
For critics, the concern is that without strong safeguards, the reform could erode the position of local enterprises.
What is clear, however, is that Ghana has decisively shifted its investment philosophy—from protection through restriction to competitiveness through openness.
As one policy analyst put it during stakeholder consultations, the new law signals that Ghana is “open for business at all scales”—but whether that openness translates into sustainable, inclusive growth will depend on how effectively the new regime is implemented.
By: Toma Imirhe / businesspostonline
