VZCZCXRO5890
RR RUEHMA RUEHPA
DE RUEHAR #0499/01 0640735
ZNR UUUUU ZZH
R 050735Z MAR 07 ZDK ZUI RUEHCB 1020 0641219
FM AMEMBASSY ACCRA
TO RUEHC/SECSTATE WASHDC 3879
INFO RUEHZK/ECOWAS COLLECTIVE

UNCLAS SECTION 01 OF 02 ACCRA 000499 
 
SIPDIS 
 
SIPDIS 
 
STATE PLEASE PASS TO USTR; AF/EPS FOR J.POTASH 
 
E.O. 12958:  N/A 
TAGS: ETRD ECON GH
SUBJECT: GHANA: INPUT FOR ANNUAL AGOA REPORT TO CONGRESS 
 
Ref: State 22438 
 
ACCRA 00000499  001.3 OF 002 
 
 
¶1.  In response to reftel, this cable transmits embassy Ghana's 
submission for the 2007 President's Report on AGOA. 
 
¶2.  Begin Text 
 
Status 
------ 
 
AGOA eligible, including for textile and apparel benefits. 
 
Market Economy/Economic Reform/Elimination of Trade Barriers 
--------------------------------------------- ------ 
 
Ghana has a market-based economy with few barriers to trade and 
investment.  Sound macroeconomic policies and generous debt relief 
have resulted in declining inflation and interest rates, a stable 
currency, and real economic growth averaging 5-6 percent per year. 
In October, 2006, Ghana successfully completed a USD 274.2 million 
IMF Poverty Reduction and Growth Facility that supported the 
government's poverty reduction and reform efforts. 
 
The business climate remains somewhat challenging.  For example, 
according to the World Bank, starting a business in Ghana takes an 
average of 81 days, well above the median for low income countries 
globally.  Ghana requires foreign investors to satisfy a minimum 
capital requirement and a few areas of investment are reserved for 
Ghanaians including small-scale trading, operation of taxi services 
(except when a non-Ghanaian has a fleet of at least 10 vehicles), 
pool betting businesses and lotteries (except soccer pools), beauty 
salons and barber shops.  There are no major investment disputes 
with the government but fraud and business scams in the private 
sector are a common and growing problem. 
 
Ghanaian law protects private property rights, although disputes 
over land tenure are common.  Ghana has divested all or part of its 
holdings in all but a handful of the more than 350 enterprises it 
once controlled.  Few divestitures have been made since 2001 and a 
number of the remaining SOEs are in poor financial condition.  Ghana 
has passed the six bills designed to bring it into compliance with 
TRIPS requirements but implementing legislation necessary for fully 
effective implementation has not yet been passed. 
 
Political Pluralism/Rule of Law/Anti-Corruption 
--------------------------------------------- -- 
 
President John Kufuor was reelected in December 2004 in an election 
that was generally considered free and fair by international 
observers, despite a few incidents of intimidation and minor 
irregularities.  Presidential elections are scheduled for 2008. 
Ghana has eleven political parties, three of them newly created in 
the past year, although two parties are dominant. 
 
Corruption in the judicial system and lengthy pre-trial detentions 
remain serious problems. "Fast Track" High Courts are dealing with 
routine commercial disputes and high profile corruption cases.  The 
integrity of the legal system is limited by a lack of financial, 
human, and material resources.  The judiciary is occasionally 
subject to executive influence and corruption, and long delays.  The 
government's Zero Tolerance policy on corruption yielded a few 
prosecutions.  Government anti-corruption institutions continue to 
be weak and under-funded.  The government passed a law governing 
transparency in government procurement.  However, there are 
loopholes in the law and in some cases winning bidders have seen 
contracts awarded to competitors with little or no explanation.  The 
government passed a Whistleblower law in 2006 but has not yet 
implemented it.  Police corruption remains a problem. 
 
Poverty Reduction 
----------------- 
 
In partnership with donors, including the United States, Ghana is 
implementing its second (2006-2009) poverty reduction strategy (GPRS 
II).  GPRS II focuses on enhancing private sector competitiveness, 
investing in human resource development, and improving governance. 
There is strong donor coordination and on March 1, donors signed a 
Joint Assistance Strategy that outlines how each will contribute to 
Ghana's efforts to achieve the GPRS II goals.  The government's 
anti-poverty efforts are bolstered by significant debt relief Ghana 
is receiving under the HIPC Initiative and the Multilateral Debt 
Relief Initiative.  During the GPRS period, Ghana is expected to 
benefit from about USD 1.3 billion in debt relief.  Progress on 
quality and access to health services has been stagnant.   Access to 
primary education is over 90% but there are significant challenges 
related to quality. 
 
Labor/Child Labor 
----------------- 
 
Ghana has ratified all of the fundamental ILO Conventions, except 
 
ACCRA 00000499  002 OF 002 
 
 
ILO Convention 138 on minimum age.  The Labor Act of 2003 amends and 
consolidates previous labor laws, conforms to ILO conventions, 
enhances the right of every worker to form or join a trade union, 
and creates a National Labor Commission to help resolve labor 
disputes.  The Constitution prohibits forced or compulsory labor; 
however there were reports that such practices occurred.  The 
government has set a minimum employment age of 15 years and 
prohibits night work and certain types of hazardous labor for those 
younger than 18 years of age.  However, child labor remains a 
serious problem in the informal sector.  Children are trafficked 
both within and outside Ghana for forced labor in a variety of 
sectors.  The government supports an ILO-IPEC Timebound Program that 
aims to eliminate child labor in targeted sectors, and a regional 
ILO-IPEC project, along with international chocolate manufacturers, 
that aims to eliminate the worst forms of child labor in the cocoa 
sector. 
 
End Text. 
 
BRIDGEWATER