A Feature by Jones Anlimah
The recent closure of Kentucky Fried Chicken (KFC) in Ho and the discontinuation of African World Airlines (AWA) and other inter-city flights by aviation sector players to the Volta Regional capital paint a concerning picture of the region’s economic realities. Both businesses cited low patronage as the primary reason for their withdrawal, sparking discussions about residents’ purchasing power, the business climate, and the broader economic outlook of the region.
While these closures may not indicate a complete economic downturn, they raise critical questions about the spending habits of the local population, the region’s ability to sustain large commercial investments, and what the future holds for business operations in the area. The Volta Region has always been known for its rich tourism potential, agriculture, and cross-border trade with Togo. However, these recent events suggest that significant structural challenges must be addressed to make the region more attractive to investors and businesses.
The Business Environment in Ho: Growth or Stagnation?
Ho, the regional capital of the Volta Region, has seen infrastructural growth over the years, with new hotels, shopping centers, and road networks improving accessibility. The opening of KFC in the municipality in December 2021, was initially seen as a sign of economic progress, signaling investor confidence in the region’s purchasing power and economic viability. However, its closure suggests that either the expected customer base was not strong enough to sustain operations or that the spending culture of residents did not align with the brand’s pricing model.
Similarly, the decision by African World Airlines and other players in the aviation industry to discontinue flights to Ho came as a surprise to many. Air travel was expected to boost business and tourism, making Ho more accessible to investors and travellers. However, the withdrawals suggest that the anticipated demand for flights was either overestimated or not nurtured adequately. With major roads connecting the Volta Region to Accra and other parts of the country improving, many travelers may still prefer the affordability of road transport over the convenience of flying.
These two cases reveal a fundamental challenge: while infrastructural progress is being made, economic activity must grow at a similar pace to support businesses. The absence of strong commercial activities, industries, and a vibrant middle-class spending culture affects businesses’ ability to thrive in the region.
Purchasing Power and Spending Culture in the Volta Region
A key factor behind these business struggles is the purchasing power of residents. Like many parts of Ghana, the Volta Region has a predominantly agrarian economy, with many people engaged in subsistence farming and small-scale trade. Disposable income levels are generally lower compared to major urban centers like Accra, Kumasi, or Sekondi-Takoradi, where multinational fast-food chains and airline services tend to thrive.
The patronage of brands like KFC depends largely on middle-income earners, students, and young professionals willing to spend extra for convenience and brand appeal. However, Ho’s economic structure does not have a sufficiently large concentration of such consumers. Many residents still prefer affordable local food vendors over international fast-food chains, making it difficult for premium-priced brands to sustain operations.
Similarly, air travel is often seen as a luxury rather than a necessity for many residents of the Volta Region. Despite the convenience of flights, most people still opt for intercity buses or private vehicles for travel between Ho and Accra, which remains relatively cost-effective. This economic reality likely contributed to the decision to halt flights to the region by aviation industry players.
Tourism and Investment: Missed Opportunities?
The Volta Region is one of Ghana’s richest tourism hubs, boasting attractions such as Wli Waterfalls, Tafi Atome Monkey Sanctuary, Mount Afadja (Afadjato), and the beautiful Volta Lake. If well-developed, tourism could drive economic growth, increase local spending, and make the region more attractive to investors. However, the sector has not been fully harnessed to its potential.
With better tourism promotion, the demand for services such as fast-food chains and air travel could increase. A well-marketed tourism strategy could encourage more local and international tourists to visit the region, subsequently creating a stronger customer base for businesses. The presence of universities and other educational institutions should also provide an opportunity for businesses to thrive, but this requires innovative marketing strategies and business models that fit the local economic structure.
The Way Forward: A Call for Economic Transformation
To reverse this trend of business closures, the Volta Region must prioritize economic transformation and strategic investment in key sectors. The following steps could help:
1. Diversification of the Local Economy – The region should explore ways to diversify beyond agriculture and trade. Investments in agro-processing industries, tourism infrastructure, and service-based businesses could create jobs and increase disposable income levels.
2. Stronger Business Support and Incentives – The government and municipal authorities should create incentives for businesses to stay and thrive in Ho. Tax breaks, subsidized rent for commercial spaces, and business development support could encourage investors to remain in the region.
3. Tourism Promotion and Branding– A well-coordinated tourism strategy is necessary to attract more visitors and increase demand for business services. Partnerships between the Ghana Tourism Authority, local entrepreneurs, and hospitality businesses could enhance tourism’s contribution to the local economy.
4. Improved Marketing Strategies – Businesses looking to operate in the region must adapt their strategies to fit local consumption patterns. Affordable pricing models, promotional discounts, and strategic collaborations with schools, corporate institutions, and local influencers could boost patronage.
5. Infrastructure and Accessibility Improvements – While roads have improved, continued investment in transportation, hospitality, and digital connectivity is essential. A more connected Volta Region could attract remote workers, digital nomads, and investors looking for alternative business locations outside Accra.
Conclusion: A Region with Potential but Challenges to Overcome
The closure of KFC and the withdrawal of flights by intra-city aviation companies are not just isolated incidents but symptoms of deeper economic challenges in the Volta Region. These events highlight the need for a stronger economic base, higher disposable income among residents, and a strategic approach to business sustainability.
The Volta Region has immense potential in tourism, agriculture, and trade, but harnessing this potential requires deliberate policies, private sector participation, and an entrepreneurial spirit that aligns with the realities of the local economy. If these structural challenges are addressed, future business ventures in Ho and the region at large will have a better chance of success.
For now, the lesson is clear: infrastructure alone does not drive economic growth—sustained income generation, strategic business planning, and a strong customer base are equally crucial.
