Impact Investing and the Power Sector in Ghana

By Godfred Amewu

Despite the positive economic news and encouraging trends that have emerged from Ghana over the past decade, the troubling reality remains that the everyday livelihoods of Ghanaians have not kept pace with macroeconomic growth, and per capita GDP persistently lag behind the rest of the world. There is diverse school of thought deeply explaining why the livelihoods of Ghanaians are not keeping pace with the impressing economics figures quoted over the years. We submit that Impact Investing can address the stubborn income gap because it is vibrant and robust enough to promote sustained economic growth and generate long-term, viable livelihoods across the country.
The very phrase “impact investing” sounds rapacious, but it is an emerging hybrid of philanthropy and private equity that proponents say is about to become more widespread.

The Global Impact Investing Network (GIIN) defines Impact investments as investments made into companies, organizations, and funds with the intention to generate measurable social and environmental impact alongside a financial return. They can be made in both emerging and developed markets, and target a range of returns from below market to market rate, depending upon the circumstances. From the above definition, it could be seen that impact investment has two main effects. Thus, the social effect and the economic effect. The social effects improve the livelihoods of society and also having positive impact on the environment. The economics return rewards the investor and also for the sustainability of the investment. An investment could improve the livelihood of a society and generating huge financial returns but cannot be considered as impact investing if that investment is not friendly to the environment.

More often, impact investing is described by what it is