GIPC grappling with financial deficit; CEO calls for restructuring of existing funding model

GIPC grappling with financial deficit; CEO calls for restructuring of existing funding model

The Ghana Investment Promotion Center (GIPC) has disclosed a concerning financial deficit spanning the last two years and underscoring challenges to the Centre’s long-term sustainability.

In a testimony before the Public Accounts Committee (PAC) of Parliament on February 20, 2024, CEO of the GIPC,  Yofi Grant, shed light on the organization’s heavy reliance on Internally Generated Funding (IGF), attributing the financial deficit to economic headwinds and a fiercely competitive investment landscape.

Mr Grant emphasized the need for a comprehensive funding restructure, highlighting ongoing dialogues with the Ministry of Finance and international partners like the World Bank to realign the GIPC’s funding model with global standards.

“On a recurrent basis, we manage to take over our liabilities. But if you look at it in terms of the accounts itself, you see a deficit. Now, what happened in those two years is that the deficit was funded by surpluses we had incurred over the previous years. That was when we were able to rake in quite a significant amount of IGF,” explained Mr. Grant.

“So we have actually done a paper to the Ministry of Finance, with the help of the World Bank and other agencies who have supported us to change the funding structure of GIPC in accordance with global standards,” he added.

The CEO’s proposals mark a pivotal recognition of the imperative to chart a sustainable financial course for the GIPC, acknowledging the risks inherent in continued dependence on IGF.

While expressing cautious optimism about meeting operational requirements for the current fiscal year, Mr Grant cautioned against the precarious nature of the institution’s financial standing, likening it to a “hand-to-mouth” scenario.

As stakeholders await developments in the GIPC’s funding restructuring efforts, attention remains focused on ensuring the long-term stability and effectiveness of the organization as Ghana’s premier investment promotion agency.