Ghana’s growing oil and gas sector, investments in infrastructure, rapid urbanisation and a growing housing deficit continue to place demand on the country’s construction sector. However, the rising prices of both electricity and building materials pose long- and short-term challenges. Despite setbacks, the construction sector has continued to grow. According to the Ghana Statistical Service, a government body tasked with compiling economic data and indicators, construction was the largest subsector of industry in 2015, with a growth rate of 30.6% and a 14.8% share of GDP. It has grown consistently over the past five years, up more than 70% since 2010 and employing around 320,000 people.

Oversight & Regulation

A number of government actors are involved in Ghana’s construction sector. The Ministry of Water Resources, Works and Housing (MWRWH) is responsible for housing infrastructure, while the Ministry of Roads and Highways (MRH) directs civil infrastructure projects.

Although many qualified engineers, technicians and architects lead construction projects in Ghana, there is no overarching regulatory body, and there are few legal mandates or enforcement mechanisms currently in place for the industry.

Numerous stakeholders, including the Association of Building and Civil Engineering Contractors of Ghana, have insisted on the establishment of a dedicated regulatory body for the construction sector to ensure safety and increase professionalism in the industry. It could also serve as a watchdog for reported patronage during the awarding of government contracts. The Ghanaian government started exploring the option of establishing a Construction Industry Development Authority in 2014, but had not made significant progress as of late 2016.

Ppp Policy

Public-private partnerships (PPPs) continue to be important for the development of Ghana’s infrastructure, housing and commercial properties, especially given the country’s current budget constraints. Recently, the government outlined frameworks for more clearly articulating the roles of all stakeholders in approved PPPs.

In 2011, in the face of a $1.5bn infrastructure deficit, the government developed a National Policy on PPPs and an accompanying piece of legislation to provide legal guidelines and enforcement mechanisms to support the policy. The bill has already received cabinet approval but has yet to pass through Parliament. This policy framework and bill will help clarify the roles and responsibilities of all parties involved in PPPs, and has the potential to ease the current constitutional requirement that all international transactions be ratified by Parliament. If this provision is eliminated, it will greatly reduce the cost and time it takes to develop a property.

In The Pipeline

In the lead-up to the 2016 election, government-led construction projects picked up, with the government announcing a number of PPP projects for the coming years. Meanwhile, projects led by the private sector slowed down, as many companies took a wait-and-see approach until after the election. Many of the government’s proposed projects are in transportation, which has had limited PPP activity in the last decade.

Both the Tema and Takoradi Ports are undergoing significant expansions. As part of a PPP with Meridian Port Services — a joint venture between the Ghana Ports and Harbours Authority, France’s Bolloré Group and Netherlands-based APM Terminals — Tema is receiving a $2.5bn upgrade, including construction of a $1.5bn facility alongside the existing port. Takoradi will also experience a $450m upgrade to increase capacity and reduce congestion, with funding coming from the China Development Bank (See Transport chapter). However, the Takoradi expansion is facing competition from another port currently under construction, namely the Atuabo Free Port. Initiated by UK-based Lonrho Ports, the new port is located just 100 km west of Takoradi and is intended to be an oil and gas centre. In July 2015 the Chinese Harbour Engineering Company began work on the $700m Atuabo Free Port, which is expected to become operational in 2017 and serve as a one-stop-shop facility for oil and gas businesses in Ghana and the Gulf of Guinea.

The Boankra Inland Port and Eastern Rail Corridor is a much-anticipated project that would bring trade services significantly closer to communities in northern Ghana and its landlocked, inland neighbours. Construction of this dry port is taking place 26 km from Kumasi, on a 161.2-ha site, and will require the refurbishment of 330 km of cape-gauge track. PwC is serving as the transaction advisor on this project, which will be opened for bidding soon.

The government is also hoping to improve Ghana’s roads. “There should be a number of major construction projects between 2017 and 2020, with money devoted to improvements in road infrastructure in Tema and Accra, expansion of the Accra-Tema Motorway as well as the Tema and Takoradi Ports,” Kojo Brompong-Mensah, managing director of BM Construction, told OBG.

The government is considering a build-operate-transfer arrangement for the 245-km coastal Accra-Takoradi Highway. The $600m project will include the installation of toll plazas to generate revenue. The Ghana Airport Company recently secured $400m from a variety of institutions, including Ecobank and the African Development Bank, for the construction of a new $250m terminal at Kotoka International Airport, able to handle 5m-6.5m passengers annually. The contract for this terminal was granted to the Turkish construction company, MAPA and Gunal Construction. The project is planned for completion in the first quarter of 2018 and is the first private sector investment in a Ghanaian airport. Passenger fees are expected to help pay for the project.

Beyond transportation, the government has reached a lease agreement with Aikan Capital to design, build and operate a $1.2bn ecotourism project to boost the tourism sector (see Tourism chapter). The project includes construction of an amusement park, orchards, an arboretum, safaris, museums, eco-lodges and a spiritual retreat space in the Achimota forest, where 180,000 people come to worship annually.

The first phase of the project is expected to be completed by 2018. Construction of the park is projected to create over 4000 jobs. According to the agreement, Aikan Capital will operate the park for 10 years following construction.

Power & Energy

Demand for construction is propelled by the oil and gas sector. In 2016 then-President John Dramani Mahama inaugurated construction of the Offshore Cape Three Points (OCTP) integrated oil and gas project (see Energy chapter). The OCTP project, which is being developed by Italian oil company Eni in partnership with Vitol Group and Ghana National Petroleum Corporation, is set to cost $7bn, representing the single-largest foreign investment in Ghana to date. The project includes the combined development of the Sankofa Main, Sankofa East, Gye Nyame, Sankofa East Cenomanian and Sankofa East Campanian fields. Together, the fields hold an estimated 1.5trn cu feet of gas and 500m barrels of oil. The fields are located 60 km from the coast of Ghana in the Tano Basin. Receiving facilities for the gas, expected to come on-line in 2018, will be built in Sanzuley and connected to the Ghana Gas Pipeline to transport output to Aboadze and Tema power plants. The project is expected to create 2000 jobs and received a partial risk guarantee from the World Bank.

Work has also begun on Ghana’s $1.5bn coal plant, which is to be located at Ekumfi Aboano in Ghana’s Central Region. Construction, funded by the China-Africa Development Fund and built by China’s Shenzhen Energy Group, began in April 2016 and is expected to last three years. Phase one of this project will install two 350-MW plants. The government hopes to expand its generation capacity to 5000 MW by 2020, up from 2000 MW at present. According to local media, Ghana has recorded a 7% annual growth rate of demand for electricity.

Bilateral Agreements

Chinese investment in large projects and infrastructure across Africa has been decreasing in recent years, as growth has slowed. According to media reports, direct Chinese investment in Africa fell by 40% in the first six months of 2015. Nonetheless, Ghana still relies on the country for 25% of its imports and China continues to support construction projects in Ghana.

In May 2016 then-President Mahama inaugurated a new $30m, 16,700-seat stadium in Cape Coast and announced that five additional stadiums would be built in five different regions by 2020. The project was funded by a Chinese government grant and built by the China Jiangxi Corporation for International Economic and Technical Cooperation. Sun Baohong, China’s ambassador to Ghana, highlighted a number of other Chinese-backed projects, including the National Theatre, the offices of the Ministry of Foreign Affairs and Regional Integration and the Ministry of Defence, the expansion of the New Century Career Training Institute and the University of Health and Allied Sciences. While these projects are welcomed by Ghanaians, the current environment of lower Chinese investment across Africa could pose near- to medium-term challenges.

Financing Projects

Financing still remains a significant concern for private sector construction companies operating in Ghana. “The single most pressing issue for the construction and real estate sector is access to capital,” A Y Abebrese, managing director of Taysec Group, told OBG. “Financing an investment once the land has been bought, blueprints have been drawn up and permits are obtained can take up to two years.” Construction project delays are not unique to the financing stage. In order to attract more private investment, the government established the Ghana Infrastructure Investment Fund (GIIF) in 2014. This fund pools together government resources from the budget, value-added tax revenue and profits from state-owned companies, along with other sources, for priority infrastructure projects.

The GIIF is responsible for managing the Ghana Industrial Development Initiative, which is a multi-billion-dollar scheme aimed at revamping the country’s industrial capabilities, including renovating an existing aluminium smelter, the creation of a bauxite plant and the production of industrial salt, among other developments. As of December 2016, these projects were still in the planning stages. In 2013 the state announced plans to create a viability gap funding programme to support projects that are socially and economically necessary, but not financially viable. Once investors have committed equity to a socially justifiable project, the government will disburse a grant to ease the upfront capital investment. While both this scheme and the GIIF should help facilitate greater private sector investment, no projects have been implemented as of yet.

Machinery & Maintenance

According to Isaac Adjei-Mensah, former deputy minister for roads and highways, 80% of local contractors do not complete projects by the agreed-upon dates due to inadequate machinery. According to Adjei-Mensah, most contractors purchase 10-to-15-year-old machinery at auctions in Europe and the US without access to spare parts or sufficient maintenance training. As a result, machines have a tendency to break down and sit out of service. These challenges lead many contractors to miss deadlines. To improve local knowledge of machinery, the MRH has established a training centre in the southern city of Koforidua.

Companies selling construction machinery are also being encouraged to provide local contractors with more favourable and flexible payment terms and after-sales service to enable them to meet infrastructure project deadlines.

In order to better position itself to service the oil and gas industry, Mantrac, the sole authorised Caterpillar dealer in Ghana, is constructing a $40m CAT’s Engine Centre in Takoradi. The 4.5-ha project includes a 10,000-sq-metre repair shop and 5000-sq-metre warehouse, and is expected to be completed by the end of 2016.


In addition to facing equipment challenges, the sector has suffered from an ongoing skills gap; in 2014 the World Bank estimated a shortage of 60,000 skilled artisans and tradesmen in Ghana. A commonly cited challenge for the industry is hiring and retaining qualified labour. Most construction and real estate companies operating in the country say that local hires are able to learn skills quickly even without formal training, but need close supervision and often work short hours. Brompong-Mensah, explained that local staff has improved. “In the last two years, as the economy has grown, the design-and-build segment has also expanded appreciably. Five to six years ago, design plans were done outside of the country, but now the building consultants are based in-country, overseeing and executing projects.” The construction sector employs 2% of young people in Ghana, and, according to local media, is expected to create between 700,000 and 1m jobs in the next 10 years.

Skilled Labour

To meet that need, the government is working to expand qualified labour in the country. At the National Youth in Construction Summit in August 2016, Abdul-Rashid Pelpuo, then-minister of state in charge of private sector development and public-private partnership, said all stakeholders must prioritise the development of skills and professionalism for young people entering this industry. Under the newly established Youth Inclusive Entrepreneurial Development Initiative for Employment, a programme run in partnership with the MasterCard Foundation, Ghana is hoping to train over 23,000 Ghanaians for jobs in construction and related industries over the next five years.

While there is no official local content law requiring that a certain percentage of workforce on construction projects be Ghanaian, Clovis Abi-Nader, area general manager of MAN Enterprise, a Lebanese construction firm, said that employing local staff is a common practice. He said the Ghana Investment Promotion Centre (GIPC) only allows companies to hire a certain number of foreign workers and that while his company brought foreign engineers and supervisors in at the beginning of the Ambassador Heights Project, there were almost no expatriates who were working on the project in its final phases.

Additionally, hiring a large number of local staff may help a company receive a strategic development certification, which would allow a company to apply for exemptions like duty-free imports and materials.


While the construction sector has experienced significant growth in the last few years, especially relative to other parts of the economy, it still faces a number of challenges, including unfavourable foreign exchange rates, issues of land tenure, high interest rates and the rising costs of utilities and building materials.

One symptom of its growth is that the industry is now highly competitive. “Although the construction sector is small in Ghana, it has already become very competitive, with major players and several market entrants from Benin, Togo, Chad, Nigeria and Mali,” Edward Afenya, CEO of Trust Group, told OBG.

Access to land is a hurdle for construction companies in Ghana. Roughly 80% of land in the country belongs to traditional local authorities or individual families, and the current land registration system is expensive, complicated and often drags out through lengthy litigation. Construction companies and developers are often concerned about buying land only to have it challenged by another titleholder claiming it was illegally sold. Furthermore, it is also constitutionally prohibited for foreign companies to own land, rather, they are allowed to lease land for 50-year renewable contracts.

According to the GIPC, leasing land over a 49-year contract for industrial development costs anywhere from $30,000 to $150,000 per acre (0.4 ha) while farmland costs $35 to $50 per month. However, as Abi-Nader told OBG, “It isn’t the cost of the land but the legality of the land that is a problem.”

Despite these challenges, according to the Centre for Affordable Housing Finance in Africa (CAHF), Ghana outperforms neighbouring countries like Togo, Benin, Burkina Faso and Nigeria in the procedures necessary to register a property. The CAHF reported that there are five steps to register a property in Ghana. The process takes around 46 days, and it costs 1.1% of the property value.

However, the rising cost of utilities and building materials is contributing to higher construction costs. At the end of 2015 electricity prices increased by 59.2% and water increased by 69-89%. Additionally, since most of Ghana’s construction materials and equipment are imported, the devaluation of the cedi has had a profound effect on prices.


The construction sector in Ghana has demonstrated consistent growth over the past few years, with little sign of slowing, as opportunities in infrastructure and low-cost housing projects are likely to be available in the coming years. Ghana remains an attractive location for investment, due to its political stability. As political transitions have the potential to introduce uncertainty around multi-year projects, the ease and continuity of any political transition following the 2016 election will be critical to the success of projects and for building confidence among the investment community.