CORONANOMICS: Firms producing essentials should be helped extensively – AGI

Companies that produce essentials such as food, medicines and clothing should be prioritised when it comes to government support for the private sector in the fight against COVID-19, the Association of Ghana Industries (AGI) has said.

To the AGI, as an import-dependent economy, it could become more challenging to provide essentials for the population if the pandemic is not dealt with – as lockdowns are still in place across the globe and thus government must support domestic firms capable of producing those essentials to ensure adequate volumes are produced and made available locally.

“Looking at how we are highly dependent on a lot of imported products, and if these countries have closed their borders, what happens to us? It is a national security matter, so our advice would be that we look into sensitive products that we need as a country and get the right volumes so we are not so foreign-dependent; that for me is very critical,” AGI’s Chief Executive Officer, Seth Twum Akwaboah, told the B&FT.

Due to the virus outbreak, most countries – including big producers like China and the United States of America – have shutdown factories with the exception of key ones, along with their borders, as part of measures to prevent spread of the deadly virus.

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For instance, Ghana is said to be spending about US$600million every year to import rice – a grain that can be grown in all parts of the country – almost half the equivalent of cocoa proceeds. Despite local potential, the country also imports other essentials like clothing, medicines, tomatoes, chicken and onions, among others.

“We have always talked about ways to improve the industrial sector, and one of the ways to do that is to use government procurement of made in Ghana products and encourage the production of made-in-Ghana products,” Mr. Twum Akwaboah stated.

Although he acknowledged there are certain products the country cannot produce, he added that deliberate effort must made to help domestic producers meet the consumption of certain basic essential goods.

Mr. Twum Akwaboah added: “In future, we don’t know what might happen- things might even be worse than this. So, the best is to always be prepared so that food-related items and essentials like medicines, clothing and the rest are adequately produced in Ghana”. Among other recommendations, he called for strengthening the country’s raw material base as well as a strategy to support critical sectors of the economy.

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