The only way Ghana can benefit fully from trade agreements with other countries across the world is when it increases it production of goods for export, Trade and Industry Minister, Alan Kyerematen, has said, asking industrialists to up their game.
The country’s low level of production, the Trade Minister said, remains a major challenge confronting exports.
“We are talking about the Continental Free Trade Area, but we already have market access opportunity to the United States of America and the European market. We can export duty free, quota free, over 6400 products to the USA,” he said at the 28th anniversary celebration of the African Industrialisation Day, in Accra.
“Intra-African trade is the lowest amongst all the regions of the world, slightly over 12 percent, but we cannot trade without having the goods to trade in and take advantage of that market, and I think this is really the challenge that confronts us.”
The event, held under the theme: “African Industrial Development: A Pre-Condition for Effective and Sustainable Continental Free Trade Area (CFTA), was put together by the Association of Ghana Industries (AGI) and the United Nations Industrial Development Organisation, (UNIDO), in collaboration with the Ministry of Trade and Industry.
It sought to examine the level of industrialisation on the African continent, to highlight the challenges in the area, and to engage stakeholders on ways to deal with those challenges.
Mr. Kyerematen also encouraged African countries to take steps towards enhancing intra-African trade, particularly, by adding value to the continent’s natural resources for export.
He said: “The development experience of all the matured economies in the world point to one thing, that they developed on the back of their own regional economies.
As Africans and as Ghanaians, I hope we will begin to appreciate that our natural resources, in and by themselves, cannot bestow prosperity on us, unless we add value to them through industrialisation, that we will begin to see prosperity.”
The African Economic Outlook 2017, a flagship report of the African Development Bank, indicates that trade among African countries has the greatest potential for building sustainable economic development and integration.
The report, however, cites low manufacturing and processing capacity as a major limiting factor for trade among African countries. Intra-African trade in manufacturing declined from 18% in 2005 to about 15% between 2010 and 2015.
According to the report, most of Africa’s primary exports undergo little processing before they are re-exported, citing cocoa beans from Côte d’Ivoire and Ghana and crude oil and petroleum products from Nigeria as examples.
“Petroleum exports from Africa to the rest of the world stood at US $85 billion, yet Africa’s fuel imports from outside the continent ranged between US $63 billion and US$84 billion from 2010 to 2015,” it said.
Speaking at the event, Prince Kofi Kludjeson, past President of the AGI, appealed with government to strengthen structures in support of industry to improve statistics in the sector.
“Ghana can take advantage of the CFTA to create a pool of industries that would look more at exports in order to generate enough foreign exchange to shore up our trade balance,” he said.