Policy uncertainty and high legal risks are key structural factors which continue to weigh on the business climate in the extractive sectors in sub-Saharan African countries including Ghana, over the medium-term.

This is highlighted by the region's average score of 34.6 out of 100 in the Operational Risk Index, below the global and developed states averages of 49.7 and 72.2, respectively.

According to ratings agency, Fitch, increased government intervention complicates business climate in mining sectors

“We believe that these regulatory shifts place additional barriers to foreign businesses with mining interests in SSA.”

In January 2020, the Chief Executive Officer of the Ghana Chamber of Mines declared that VAT and other taxes on mining exploration should only be paid once commercially viable finds are made, otherwise greenfield investment will be impacted.

This incentive, Fitch said, bodes well for additional exploration activity in the country and will attract more foreign investors into the industry, given the country's largely untapped extractive sector as well as its actions to reduce the risk of illegal mining and business friendly regulations.

“Given the need for SSA to attract more foreign direct investment and the abundance of natural resources in the region, we expect a few more countries to phase in business-friendly reforms that will help boost productivity and grow their economies”, Fitch explained.