Japanese automobile company, Toyota Tsusho Corporation has signed a deal with the Ghanaian government to establish a car assembling plant in the country.
According to the Chief Executive Officer of the company, Ichiro Kashitani, who also signed the required Memorandum of Understanding (MoU), operations will commence fully by August 2020.
Speaking on this, President Nana Akufo-Addo stated that the signing of the MoU with Toyota was in line with his government’s vision of making Ghana an automotive hub for West Africa and the larger African market.
“We are attaching a great deal of importance to the initiative and development… We want to assure you that, whatever it is we can do on the side of the Ghana government to provide you with the necessary support and assurance that the investment you are going to make in our country will be worth your while, you can count on us to do that,” the Ghanaian leader said.
Toyota’s decision to invest in Ghana comes is surprising considering Nigeria’s President Muhammadu Buhari had earlier urged the automobile company to establish its plants in Nigeria. Instead, the company announced Ghana as its choice during the 7th Tokyo International Conference on African Development (TICAD 7) held in Japan.
This definitely is a huge disappointment for Nigeria. But the automaker insists that Ghana was a more strategic destination to propel growth for the company. Toyota’s Chief Operations Officer in charge of the Africa Division, Imai Toshimitsu, said Ghana was chosen due to its “favourable economic climate.”
In a report which makes a comparison of business ecosystems in Ghana versus Nigeria, Kpakpakpa, an information and advisory service, states that although Nigeria has a larger market size than Ghana, the latter makes up for this in better governance, higher social development and other business pointers.
The deal with Toyota is also one of the ways Ghana intends to maximise benefits from the African Continental Free Trade Agreement (AfCFTA). The country will become a producer and exporter of Toyota vehicles to other African countries. Therefore, Toyota’s decision was a well mapped out idea for both parties.
Meanwhile, the company which has a functional car assembling plant in South Africa is equally considering expanding into other West African markets like Ivory Coast.