Could you briefly introduce N. Dowuona & Company to our audience?

N. Dowuona & Company is a predominantly female-owned and led law firm that I founded 10 years ago. We are leaders across our key practice areas, including corporate and commercial law; mining, energy and infrastructure; and banking and finance. Our young team of lawyers are known for their expertise and dynamism. I am specialized in M&A, having started my career with Simpson Thacher & Bartlett LLP in the US before returning to my home country, Ghana.

What do you make of current M&A activity in the mining space?

2021 has seen a significant amount of M&A activity in the mining sector in Ghana.

A large portion of this activity has been driven by Chinese investment. At the start of the year, Shandong Gold, the partly Chinese state owned gold miner, completed its takeover of Cardinal Resources, the Australian listed Ghana-focused gold miner, following its hard-fought bidding war with Russia’s Nord Gold in 2020. In April, Chifeng Jilong Gold Mining Limited, the Chinese based gold group, announced that it would be withdrawing from its proposed acquisition of the Bibiani gold mine owned by Resolute Mining on the grounds that the Bibiani mining lease had been revoked or challenged.

However, Chifeng’s ambitions to take a foothold in the Ghanaian gold market were not to be frustrated. In October 2021, Chifeng announced that it had entered into an agreement to acquire Golden Star Resources, the Canadian listed mining company that owns the Wassa gold mine in Ghana.

These transactions demonstrate the continued strength of China’s interest in access to gold and other raw materials in Ghana, and the larger trend of Chinese activity in Ghana and the continent more widely.

Golden Star Resources had itself completed the sale of its Bogoso-Prestea mine to Future Global Resources at the end of 2020, and the issues faced by that transaction illustrate the importance of the social license to operate and labour issues in Ghana. In a protracted dispute, mine staff argued that they were entitled to a severance package as part of the transaction (notwithstanding the share sale structure) and formed an employee group to push for this. Following claims filed in the Ghana High Court, this dispute was finally settled out-of-court in July 2021. In addition the Bogoso-Prestea mine was subject to protests in July 2021, which reportedly saw two individuals shot in relation to an alleged default of resettlement obligations agreed by Golden Star back in 2013.

For any investors coming in to Ghana, ensuring a social license to operate and carefully navigating ESG concerns, including genuine workforce and community engagement, is critical.

Ghanaian SMEs often quote access to capital as one of the biggest challenges of operating in the country. Why do you think that is?

Banks are not able to carry out proper credit risk analysis on SMEs. On the one hand, this is a function of the banks’ own capacity and reduced appetite for risky loans, when there is scope to be profitable at lower risks with a selected and well-known client base instead of being exposed to greater risks for a relatively less profitable clientele.

On the other hand, the SME sector is not helping itself; especially when they start out, SMEs tend to have an informal structure in the marketplace, and they are unable to provide all the necessary corporate governance and documentation expected of them. These housekeeping lapses are a big issue for banks. In a nutshell, banks prefer to service the same top clients, while the SMEs are being squeezed out.

There are, however, many incubators in support of SMEs, and microfinance providers are also entering the market to take advantage of the opportunity of doing a credit risk analysis of SMEs, so there is some light at the end of the tunnel.

How did ND&C Launchpad come about? What is its mission?

Our own journey as a business and the struggles we faced were the main motivators behind our decision to start the Launchpad. We wanted to be able to give back to smaller businesses and women-led organizations like ourselves. Launchpad is aimed at empowering these small companies to help themselves – for instance, we supply information, checklists, and templates to educate the market on how to set up an agreement between different founders, how to negotiate your lease with a landlord, what to take into account when bringing on new employees, and how to position yourself for growth right from the beginning. Offered at an accessible rate, we think of this service as a value driver whereby clients have access to experienced support without hurting their budgets.

What is your assessment of Ghana as a place for doing business?

When you take the bird’s eye view, Ghana is truly a very exciting place and a relatively easy place to do business, particularly when compared to our African peers. That said, there are a few challenges we need to be straightforward about: on the ground, inflation rates feel higher than on paper, and the macro-economic picture is not rosy. Investors should also be aware that things can take time in Ghana. One particularly problematic area is land acquisition, especially in the mining or agriculture sectors. Land acquisition requires special assessments and expert advice, in particular because Ghana operates a traditional, communal land tenure system on top of the common law system.

Then, Ghana is seeing a rapid digitalization uptake, which is ultimately great news for the future, but it can be painful until the right developments and transitions are realized.

On the brighter side, the establishment of credit bureaus and credit rating agencies is very encouraging and should make it easier for financial institutions to lend money with confidence.

What are your key objectives in the next few years?

We want to continuously improve our client service and leverage technology to provide legal services to a broad market segment, including FinTech, pharmaceuticals, and infrastructure, be it soft infrastructure, like schooling or the hospitality sector, or hard infrastructure, including roads and power.