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GTI Global Network > GTI Features > Columns > European Comments
European Comments
Ghana:Gaming Industry on the Rise
 
Ghana: Gaming Industry on the Rise
 
■Jim Ke
 
Although the continent of Africa is known by many people, Ghana may sound like a remote and unfamiliar country for some. However, given that the world is changing and the era is shifting, this distant West African country has become one of the emerging countries attracting a lot of attention from international investors. A Taiwanese company, which has been doing business in the country for a long time, even officially acquired the country’s gaming concession. We specially interviewed the responsible person of Milky Way International. Based on what he has seen and learned during these many years of doing business in Ghana, he will lead readers to explore this virgin market.
 
The Gold Coast provides great potential
In the past, Africa was called the “Dark Continent”, which had always given people the stereotypical impression of incessant famine, poverty, unrest and war. Several years ago the movie “Blood Diamond” starring Leonardo Dicaprio profoundly depicted the dismal life of exploited African people. However, over recent years, some African countries have gained political stability and seen a gradual uptrend in economic development. “Global Insight Inc.” pointed out at the “IHS Forum 2013” that Africa’s economic growth rate would be 4.1% and 4.6% for 2013 and 2014, respectively, surpassing the global economic growth rate forecasts of 2.5% and 3.1%.

Situated in West Africa, Ghana used to be called the “Gold Coast”. The country enjoys political stability and is one of the most thriving countries in Africa. Ghana has achieved outstanding economic growth over the past several years and its economic growth rate in 2011 even reached 22%. Rated as one of the world’s 10 fastest growing economies from 2012 to 2015, Ghana even surpasses Taiwan and China. With its GDP per capita exceeding US$3,400, Ghana was predicted by the International Monetary Fund (IMF) to achieve a 6.9% economic growth rate in 2013 and 2014 and has received a lot of attention from many countries accordingly.

Founded by a Taiwanese businessman and registered in Hong Kong and Brunei, Milky Way International mainly targets the international market and is run by one of the few Taiwanese businesspeople who have gone to and invested in Ghana. The company’s responsible person Mr. Chou pointed out that although Ghana greatly welcomes overseas investors, foreign businesspeople still need invitation letters from local enterprises to get a business visa to enter the country. He mentioned “more than 10 years ago, our operation was mainly focused on China and I was fortunate to meet a good number of African diplomats situated in China. Among them there were Ghana diplomats and this has led to the opportunity of doing business in Ghana later on.”
Taiwanese businessman acquires gaming license in Ghana
It is the first time that a Taiwanese businessman has acquired a gaming license issued by the Gaming Commission of the Republic of Ghana.
With many years of operation in Ghana, Milky Way International has established a wide network of interpersonal relationships and gained solid capabilities. The company has finally applied for and acquired Ghana’s fifth gaming license in 2013. Mr. Chou specially explained, “In Ghana, gambling is a totally legal behavior. Before the country became independent, gaming licenses had already been granted; at first casinos were run by Middle Eastern people and then British people took over the administration during the British colonial period. However, at that time gaming licenses were issued indiscriminately. The consolidation of casino licenses didn’t occur until Ghana separated itself from Britain and gained independence in 1957. The number of casino licenses went down to four with two licenses possessed by British people and the other two owned by Middle Eastern people. But, in 2013, we changed the situation and acquired the fifth license after an interval of many years.”

Mr. Chou said, “The fifth license was issued after so many years had passed, which represented that the application process has been strict to a certain level. First, there must be a locally registered company and therefore I established another company, Milky Way Entertainment. I registered the firm with the Ghana government and submitted the gaming license application. Soon afterwards I went to the Ghana Tourist Board to make a presentation of the overall plan. Then I used the slogan ‘Wealthy Ghana, Healthy Africa, Enrich your life’ to conclude the presentation and successfully persuaded the review personnel.”

In the next phase, Ghana entrusted the international police organization with the background investigation of members of Milky Way Entertainment’s organizational structure including the responsible person and shareholders. Each of them went through a complete background check process. Mr. Chou added, “Take myself as an example. Ghana requested Taiwan to provide my background information and police criminal record certificate in order to ensure that investors have no criminal records and to prevent money laundering from happening.” Finally, he went to the Tax Revenue Division to apply for the tax payment certificate and all shareholders completed the registration of tax statement information. Then the task was all completed.

“In 2013 we officially received the license issued by the Gaming Commission of the Republic of Ghana. The registered capital is US$100 million and the paid-in capital is US$1 million, indicating that they hoped to raise more funds from other countries to invest in Ghana.” Although casinos in Ghana are smaller in scale than those in globally famous gambling cities like Macau and Las Vegas, they are complete and well-equipped. Currently, Ghana’s four casinos all are located in the country’s capital Accra. Chou Ta-tsai said, “We also plan to build a casino in the capital and then gradually expand the operation scale.”
Various gaming activities getting popular and thriving
Football is very popular in Ghana and the country has qualified for the 2014 FIFA World Cup finals. Pictured is the Accra Sports Stadium.
Currently Ghana has only four legal casinos. Pictured is one of the casinos, Piccadilly Casino.
Online gaming activities are very popular in Ghana. Pictured is a local internet café.
Gambling is legal in Ghana, so besides casinos, online gaming activities are also prevalent in the country. In addition, the sport of football is very popular, so Ghanaian people are particularly fond of betting on football matches at internet cafes. Mr. Chou stressed “although this is a publicly legal behavior, the essential prerequisite is that football betting must be run by operators with a legal license. Operators must have the Online Game license and unlicensed operations would be severely cracked down.”

Moreover, lottery betting is also popular in Ghana and the gameplay is similar to the combination of Taiwan’s Big Lotto and Scratch-Off Lottery Tickets. Consumers can purchase lottery tickets which already contain numbers at betting stations and players cannot freely select numbers. Then the operating entity will draw and announce winning numbers. Besides casinos, these all are commonly seen legal gaming activities in Ghana.

The so-called gaming in Macau and Las Vegas, which is well known, is actually a general term for a type of entertainment business that covers hotels, conferences, SPA, family activities, vacation, and gaming tables with dealers distributing cards. In Ghana, gaming tends to be about pure casinos and is not like the former which includes abundant elements but rather similar to the business model of Paradise Walker Hill Casino in Korea and casinos in Subic Bay in Philippines.

Regarding consumers, the Ghanaian people that go to casinos are mostly the middle class with good incomes and other customers include guests from Europe, the Middle East and China; those with lower incomes tend to select online gaming for recreation. About 70% of Ghana’s population is Christian and the rest belongs to Muslim and other religions. People of different regions get along and live peacefully together. Ghanaian people are friendly to foreigners, so foreign businesspeople enjoy living and working there and are willing to invest. Mr. Chou said, “Politically Ghana offers a high level of democracy and liberty and Ghanaian people are of good character. And public order is sound. South Africa enjoys good economic development, but is also famous for lack of public order. Therefore, comparatively Ghana is more suitable for gaming business investment.”

Economy taking off with a promising market outlook
Ghana has been enjoying fast economic growth over recent years. Pictured is a street scene in Accra, the capital of Ghana, and a Ghanaian woman is peddling goods on the street.
Mr. Chou noted, “Currently, the whole world including China and Japan all are actively courting African countries. As the development of economic entities like China, Europe and South America has become saturated, Africa is the last business virgin land on earth.” Possessing abundant natural resources, Ghana is the world’s second largest gold producer and has an oil field containing about 2 to 3 billion barrels in potential production capacity based on an initial estimate. Politically, Ghana was ranked by Reporters Without Borders the 27th most democratic country in the world. Compared to North Africa where the Jasmine Revolution is widespread, South Africa with a deteriorated public order and the impecunious and backward Central Africa, the Economic Community of West African States (ECOWAS) with Ghana playing a leading role is like the jewel of Africa.

For the gaming industry especially, Ghana, whose economy is in a stage of fast growth, has the opportunity to implement the business model of Las Vegas and Macau in the future. After the country’s national income increases, there would be considerable potential consumption. When Ghana drives the ECOWAS countries to grow together, the future customers from the neighboring countries and the existing guests from Europe and the Middle East as well as hundreds of thousands of Chinese workers currently in Africa engaged in construction would help transform Ghana into the casino city of West Africa. This tremendous potential is eagerly awaited by many.
Targets West Africa and centers on Ghana
Besides gaming business, Ghana provides rich natural resources and football is very popular. The country is also a regular contestant in each FIFA World Cup. Therefore, local children and teenagers tend to participate in outdoor sports more. Mr. Chou believed, “Because of all these factors, Ghana does not have the educational-type game centers which Taiwanese people are familiar with. To make our casino operation more diversified, we will also consider including playground business into our operation.”

Currently, Milky Way Entertainment is scouting a suitable location in the capital Accra and plans to start casino construction in the near future. “As for the game machines in our casino, we will give priority to the products developed by Taiwan. We also welcome those who are interested in investing in Ghana to contact us through “Taiwan Slot” or “Game Time International”. We would be very happy to cooperate with and assist them.” Mr. Chou noted again, “The Taiwan External Trade Development Council has recently organized a West African trade delegation and Ghana will be one of the stops visited. This represents that Taiwan no longer ignores this emerging market.” We now live in a global village. Taiwanese businesspeople, who used to walk through the whole world with a briefcase in the past, of course should not be absent from this emerging market of Africa.
About Ghana
1. Total land area: 238,533 square kilometers
2. Population: about 25 million
3. Located in West Africa and bordered by Ivory Coast to the west, Burkina Faso to the north, Togo to the east, and the Gulf of Guinea to the south
4. Ghana has abundant natural resources and was best known for its gold in colonial times. Therefore, it was called the “Gold Coast” in the past and today it remains one of the world’s top gold producers.
※The article is published in the GTI Magazine Issue No. 123 in February, 2014.
 
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