A new continental study has identified Ghana as a prime candidate to host Africa-based investment funds, a move analysts say could unlock critical financing for SMEs and drive growth in emerging sectors such as automobile manufacturing and component production.
The report, titled “Study on Africa as a Jurisdiction for Domiciliation of Investment Vehicles,” warns that Africa is losing vast sums of capital because 60 percent of all Africa-focused investment funds are domiciled offshore, primarily in Europe and the Caribbean.
The study, released during a pan-African webinar co-hosted by MEDA and the Africa Impact Investing Group, argues that redirecting those funds to African jurisdictions like Ghana could fuel industrial transformation.
“When investment vehicles are based outside Africa, SMEs lose out on the affordable financing they need to scale,” said Dr. Dorothy Nyambi, President and CEO of MEDA. “Local domiciliation can power the next generation of entrepreneurs from agribusiness to automotive assembly.”
The study’s findings come at a time when Ghana’s automotive industry, buoyed by new assembly plants and a growing auto parts market is struggling with limited financing options for local suppliers, garages, and component manufacturers.
Most SMEs in the sector lack access to long-term, low-interest funding to modernize operations or meet global standards.
Maame Tutua Dadson of Stafford Law explained that smaller enterprises often fall between financing categories: “They’re too large for microfinance but too small for big commercial loans.
Many local automotive SMEs, especially those producing spare parts or offering digital mobility services, cannot access the credit they need to compete.”
By establishing a strong regulatory and legal framework for fund domiciliation, Ghana could attract impact investment funds that focus specifically on industrial value chains, including auto parts, logistics, battery recycling, and after-sales services.
The study launches a three-year initiative to reform Africa’s investment policies, with Ghana identified as one of the key focus countries. The goal is to make local domiciles more attractive to global and African investors while mobilizing domestic capital for productive sectors like manufacturing and mobility.
Diana Smallridge at Momentus Global said ongoing consultations with finance ministries and investment regulators aim to create clear, investor-friendly policies. “The more capital we retain in Africa, the more we can channel into growth sectors that create jobs and Ghana’s automotive SMEs fit that profile perfectly,” she noted.
For Ghana, improving its investment environment aligns with its Automotive Development Policy, which seeks to promote local component manufacturing and reduce dependency on imports.
Access to dedicated SME financing could enable small firms to produce car seats, electrical systems, tyres, and lubricants locally, feeding into assembly plants operated by brands such as Toyota, Volkswagen, Nissan, and Kantanka.
Kofi Fynn, CEO of Petra Trust, urged a collaborative approach to building Ghana’s financial ecosystem. “We must align policy with industry needs,” he said. “With better fund domiciliation rules and investment incentives, Ghana can become both an automotive and financial hub for West Africa.”
The African Crowdfunding Association also announced plans to advocate for updated crowdfunding regulations, giving smaller automotive startups and service providers access to digital financing platforms.
This would complement traditional investment vehicles, providing innovative capital pathways for SMEs developing car diagnostics, EV conversion kits, or green logistics solutions.
Industry analysts believe such reforms could help bridge Ghana’s industrial financing gap where many SMEs operate below capacity despite rising regional demand for vehicles and spare parts.
Dr. Nyambi said the time for reform is now. “If Ghana aligns its regulatory systems and strengthens fund management capacity, the flow of capital into SMEs will increase tenfold.”
“That is how local businesses especially in manufacturing and mobility will drive Africa’s economic future,” she emphasized.
As Africa’s economies diversify, Ghana’s twin opportunity to reform investment policy and empower SME-driven industries like automotive manufacturing could set the country on course to become not just a production base, but a continental hub for investment and innovation.
