Ghana’s Oil Sector Faces Pressure as High Tax Rates Undermine Competitiveness – Deloitte Survey Says
Ghana’s petroleum sector is facing significant headwinds, with high tax rates and foreign exchange constraints emerging as major concerns, according to Deloitte’s October 2024 Oil and Gas Industry Survey.
The report reveals that 46 percent of industry stakeholders view elevated taxation as the most pressing issue, stifling profitability and eroding competitiveness in a sector crucial to the country’s economy.
In response, 42 percent of respondents are advocating for a tax amnesty, arguing that such measures would foster a more favourable business environment.
Another critical challenge identified in the survey is access to foreign currency, with nearly 80 percent of participants reporting difficulties in securing the necessary foreign exchange to meet payment obligations, exacerbated by high exchange rates with calls for intervention by the Bank of Ghana to address these foreign currency shortages.
Despite these challenges, the Deloitte survey notes that the outlook on local content regulations remains broadly positive, with 91 percent of respondents indicating that the rules are either sufficient or somewhat sufficient in promoting Ghanaian participation without deterring foreign investment.
Environmental, Social, and Governance (ESG) practices also feature prominently in the survey, with top management executives stressing the need for greater transparency.
The report assigns a strong rating of 4.22 to the importance of public disclosure in ESG, highlighting growing expectations for corporate accountability on environmental and social impacts.
