Statement of intent and Background information
V. Business compact and lobbying organization
Capitalism is an economic and political system where a country’s commerce and industry is dictated and controlled by private owners. In many developing countries, capitalism can lead to foreign corporations penetrating and taking over different markets and squeezing out the local entrepreneurs. Ghana which is official known as the Republic of Ghana is a west African country with abundant natural resources. These natural resources are a target of international commerce, corporate investments, and exploitation by the developed nations. In this essay, I will examine the relationship between the Unites States of America and the Republic of Ghana focusing on investments and trade.
The land, labor, capital, space, and abundant resources in Ghana plays a key role when focusing on the international relationship with the United States. Approximately 56 percent of the workforce consist of farming, and the agricultural sector makes up 37 percent of the nation’s gross domestic product (GDP). In addition, 70 percent of the land is arable, fertile, and forested. The natural resources consist of gold, oil, timber, diamonds, bauxite, manganese, rubber, cocoa, wood manufactures, pineapples, cashews, spices, fish, and other food crops. The USA is one of the primary trading allies with Ghana, mainly, through gold mining, wood products, and petroleum; however, they trade other items such as yams, cassava, and cocoa paste. In 2007, there was a discovery of oil in the Jubilee Field of the coast of Ghana by the Ghana National Petroleum Corporation (GNPC) and productions began in December 2010, and it is projected that Ghana would be one of the largest producers of oil. Currently, Ghana is producing approximately 85,000 barrels of oil a day and holds an estimated 1.5 billion barrels of oil. The current exchange rate is 1 USD = 1.7588 GHS (Ghanaian Cedi) their exchange rate is a reflection of there economic sustainability. The 2011 GDP is 38.6 billion in US dollars.
Ghana is a favorable destination for different companies and nations since the country has a stable environment as well as a democratic government. In 1999, the United States and Ghana developed a Trade and Investment Framework Agreement (TIFA) that improves cooperation and enhances opportunities for trade and investment such as “market access issues, labor, the environment, protection and enforcement of intellectual property rights, and, in appropriate cases, capacity building.” (ustr.gov) In Accra (the capital of Ghana), there is a United States Chamber of Commerce which is an advocate group for small businesses and corporations to get there voices heard to the U.S. government. Through the U.S. Chamber of Commerce, there is an African Business Initiative (ABI) their mission is to engage the U.S. Businesses on the legislative policies that involve direct investment in Africa, to facilitate trade between the United States and African countries, as well as introduce U.S. companies the economic opportunities in the continent. The main reason the Chamber of Commerce is located in Ghana is because there are an array of U.S companies operating in the country, such as Newmont, Cargill, ADM, Kosmos Energy, Anadarko, DHL, FedEx, UPS, KPMG, ACS, Coca Cola, S.C. Johnson, Ralston Purina, Star-Kist, A.H. Robins, Sterling, Pfizer, IBM, 3M, Motorola, Stewart & Stevenson, Price Waterhouse Coopers, United Airlines, Delta Air Lines, General Electric, and National Cash Register (NCR). These companies are operating in Ghana as a means to expand the revenues of the corporations and the employment for the citizens, as well as for the different governments to...