Industrialisation of Ghana’s Economy
The current New Patriotic Party (NPP) took over the reins of governance from the National Democratic Congress (NDC) in January 2017. For the eight years of the National Democratic Congress (NDC), Ghana had contracted a total trade deficit of -$36.42 billion at an average of -$4,552,500,000.00 on each of its eight years in government. In 2013, Ghana recorded the worse trade deficit ever, with -$6.21 billion. In 2016, our trade deficit of -$3.08 billion.
The NPP took over governance in 2017, ending that year with -$1.69 billion trade deficit. In 2018, it recorded a further lower trade deficit of -$710 million. In 2019, Ghana recorded a higher deficit of -$1.32 billion.
And in 2020, Ghana recorded its first trade surplus since 1982, with a surplus of $2.05 billion. Ghana continued recording trade surpluses in 2020 and 2021, with $1.07 billion and $450 million, respectively, with an average of -$25 million over the six years of governance or -$150 million in total.
Trade balance is the difference between a country’s exports and imports of goods. It is therefore evident, that the current NPP government is doing a fantastic job in international trade. The only way this could be possible is that during this regime, either Ghana exported more than it used to or imported less than it used to or both.
It is obvious that productivity, had increased over the period under review. This was through two major policies, Planting for Food and Jobs (PFJ) and One District, One Factory (1D1F).
The major effect is Import Substitution Industrialization (ISI), which translates as the boosting of domestic factories to produce locally more Made-In-Ghana products and the reduction of Ghana’s reliance on manufactured imports.
1D1F is the dream of Hon Alan John Kwadwo Kyerematen. Alan is known for initiating projects that not only enhance development but also put wealth in the pockets of the people directly and indirectly working under those projects.
This fine gentleman, would see anyone and anything as a crude precious mineral, and would know how to refine them and add values.
He started among others with Empretec, where people were trained to be entrepreneurs. Today, most of the beneficiaries, are now owners or managers of top businesses and industries in Ghana and overseas.
Ghana was heading towards becoming a top industrial hub in Africa in the seventies, until Jerry John Rawlings came and crushed almost all the Ghanaian owned businesses and industries.
For a long period, Ghana lost its industrial base. And in the limbo, Alan Kwadwo Kyerematen appeared to restore that golden opportunity lost out of recklessness of pro-socialists led by Jerry John Rawlings.
When President Kufuor led this country, Alan, who was industry-minded, started the Presidential Special Initiatives, which included cassava processing for industrial purposes and for export. The PSI also had garment production and Ghana exported African wear, which were sold abroad.
Alan Kyerematen had great ideas for business and he used his contacts with people he trained at Empretec who were business and industry owners, to help him develop a scheme for his party’s grassroot faithful.
That was how the Constituency Business Venture came about. Some constituencies had corn-mill, others had block factories and others had transport businesses, among others.
In first and second world countries, mini-industries and businesses are set up in the rural communities. This reduces rural-urban migration and puts wealth in the hands of people in those rural communities.
With industrialisation evenly spread across the country, sooner than later, total developments will be everywhere and Ghana can start rubbing shoulders with second world countries.
Alan looked at pushing Africa to start cross trading among the nations. It is a way to establish a sound market for Ghana. The problem we face as a developing country, is that our trading partners will decide how much they will pay for our products. This unfair trading, can be seen in what the top two world producers of cocoa are receiving.
Producing over 65% of total production of this crop, La Cote d’Ivoire and Ghana earns about $2 billion annually from a $110 billion a year cocoa industry.
Once African countries start trading among ourselves, they can bargain for real market prices of their produce. Furthermore, primary industries established within the rural areas can add value to produce that will be sold to larger industries in the countries and abroad for final processing. This is what Alan’s brainchild of Africa Continental Free Trade Area (AfCTA) is going to achieve.
With Alan, Ghana will no longer export raw materials, but will always add value to them through primary processing before exporting.
The revenue to be yielded would be enough to keep the country out of financial crunches. Industrialization is the key to wealth creation anywhere in the world.
Dr. Kwame Nkrumah started industrialization, but unfortunately, our industrial policy then was not supported by the easily available raw materials.
Acheampong’s era came with boosting of state industries and Ghana Industrial Holding Corporation (GIHOC) had about twenty-four divisions. At that period, the private sector also came out with industries, like Mattress and Foam, Tata Brewery, Industrial Chemicals, Nkulenu among many others.
The Rawlings era which spread to over nineteen years, saw the collapsing of GIHOC which was dissolved on January 1, 1993 by the Ghana Industrial Holding Corporation (Dissolution) ACT 1993 (PNDCL 324) and with that completed the institutionalised collapsing of most of the Ghanaian owned industries.
Rawlings went on to sign Ghana into a binding trade agreement which saw us importing produce we used to produce locally and even export. Apart from Ghana been barred, by international trade laws, from subsidizing local production of rice, poultry etc., etc, foreign businesses and industries were given tax waivers some for ten years while the local Ghanaian investors are saddled with back-breaking taxes even before they start production.
It is therefore not surprising that after recording a trade surplus of $10 million in 1982, Ghana never recorded any trade surplus until 2020 when she recorded a trade surplus of $2,050,000,000.00. This was in the era when industrialisation, introduced by Alan Kwadwo Kyerematen, started booming in this country.
With the local production of raw materials, Ghana’s industrialization will become cost effective. Soon, less and less essential products will be imported and this will grow wealth.
The potential of more industries springing out to process bye-products of the food production sector like fish, rice, maize, poultry etc., etc, our local markets will be more of locally manufactured products and less of imported ones.
And how proud a Ghanaian abroad will feel, when he purchases a chilled fruit drink in the hot summer streets of New York or London, and see on the label, “Produced in Ghana.”
Today, the NDC are finding ways of rubbishing this 1D1F, with some saying that the Mahama NDC regime started it. Well, the NDC in 2001 was against the National Health Insurance Scheme (NHIS0 and worked out of Parliament the day the bill was going to be passed. After seeing its success, the NDC came out to say, health insurance in Ghana was started by it, when all Ghanaians know that it was the Catholic Church of Ghana which started such a scheme.
Today about 278 factories can be said to be operational under 1D1F, with 58 of them solely owned by youth enterprises. And almost 300,000 jobs have been created through this policy.
This is what the dream of Alan John Kwadwo Kyerematen will lead Ghana to. Alan knows that one way which Ghana can make it at the top and move from a borrower nation to a lending nation is through industrialization. With this, the youth will go into higher education in the field of high-tech, IT and modern technology.
India started this way and today, it is the leading nation in IT in the world. Ghana must learn from India and embrace Alan Kyerematen’s policies in business and industrialisation. This is one of the only ways to heal our economy.
Alan has shown how Ghana can become one of the top countries in the world. Ghana must adopt his policies and we shall be where we always dream to be. What Rawlings came to destroy, Alan came to restore.
Hon. Daniel Dugan
