Porter’s Diamond can be used to analyze the competitive advantage of nations. At the moment the tourism industry in Ghana is relatively under-developed, compared with tourism in other countries, although it is growing and has government support.

Porter argued that four factors can give one country’s industry a competitive advantage over similar industries in other countries:

1. One factor is the existence of strong and competitive supporting industries. A tourism and tourist hotel industry benefits from a strong and competitive transport industry and a good and reliable food and restaurants industry, for example. These supporting industries are well-developed in other countries, putting tourism in Ghana at a relative disadvantage.
2. The strength of local demand for tourism within a country, particularly when this demand is sophisticated and discerning. Strong local demand can help firms in the country develop products and services that can attract demand from other countries. The demand for tourism within Ghana is not as strong as local demand in other countries.
3. The structure and strategy of firms in the industry, and the rivalry between them. The tourism industry will benefit from the existence of companies with large amounts of resources and efficient management organization, and strong competition between firms. Ghana lacks a sufficient number of large, competing firms in the tourist industry, putting it at a disadvantage.
4. Favorable factor conditions, i.e., advantages in terms of natural resources, climate, labor skills, technological development, and infrastructure such as transport and telecommunications networks. While Ghana has great natural resources like historical sites, game parks, and beaches, further development is needed in terms of infrastructure and labor skills to make the country’s tourism industry more competitive.

ii)

• Expanding into other countries in Africa might be suitable due to growth potential but might not be feasible because Ghanalux lacks experience in other countries and has limited resources. This strategy might not be acceptable to Coffie Oduro, who believes in focusing on Ghana.
• Expanding into the conferencing business might also be suitable given the high-end nature of Ghanalux’s tours. However, the company’s lack of experience in conferencing and its limited resources suggest this strategy might not be feasible.