In the 1950s, Ghana had a plethora of industrial establishments producing locally to meet its demands.
Across the country, the Osagyefo, the country’s leader had set up factories to produce items such as aluminum products in Tema, Poultry products at Pomadze,Textiles and Clothes at Juapong among others.
There were State Farms in places like Ejura to engage in large scale commercial farming to meet the feeding needs of a growing nation. But those days are long gone. Today, Ghana serves as a market for other nations where goods and products are imported from. The Economists measure the levels of import and export in a country with the bar called Balance of trade.
In the instance where a country’s exports supersedes its imports, the country has a balance of trade surplus. Where the inverse is the case, the country has a balance of trade deficit. A look at the country’s balance of trade statistics reveals the true state as far as local production and self reliance are concerned.
In 2020, Ghana’s trade deficit was $2.05 billion, indicating a significant decline of 255.7% compared to 2019. The trade deficit for Ghana in 2021 was $1.10 billion, reflecting a decline of 46.48% from the previous year and in 2022, Ghana recorded a trade deficit of $1.82 billion, which marked a 66.11% increase compared to the previous year. The effect of such numbers is a weakened currency which affects the overall strength of the economy.
A VIABLE SOLUTION?
In a bid to improve Ghana’s position in relation to imports, government intends to legislate the restriction of imports of about 22 selected items. The items are; Rice,Guts, bladders and stomach of animals, Poultry, Animal and vegetable Oil, Magarine, Fruit Juices, Soft Drinks, Mineral Water, Noodles and Pasta, Ceramic Tiles , Corrugated Paper and Paper Board, Mosquito Coil and Insecticides, Soaps and Detergents, Motor Cars, Iron and Steel, Cement, Polymers (Plastics and Plastic Product), Fish, Sugar, Clothing and Apparel, Biscuits and Canned Tomatoes.
The proposal has received both commendation and opposition in a stroke of the brush.
RESOLVING THE PARLIAMENTARY TUSSLE
The stiffest opposition to the proposal so far has come from the Minority in Parliament. They have managed to block it twice and insist they will not allow it to be laid in it current shape and form.
The Minority Leader, Dr Cassiel Ato Forson told the press in Parliament ‘to import
Rice, sugar, diapers, poultry and a number of items approximately 22 selected items you will need to go to the Ministry of Trade and Industry and to see a committee that will be constituted by the Minister before a permit will be given to you.
This, I think is a dangerous practice. It has happened before in this country. What they’re seeking to do is to create business for their supporters okay?And financiers. So, what it’ll mean is that today if you’re not an NPP supporter, they’ll not give you the permit to be able to bring sugar and where are we going as a country?‘
An important aspect of the unfolding saga is that, because this is a legislative instrument, it will mature in 21 days and become law once it is laid in Parliament. It will take two-thirds majority in Parliament to annul it before it passes. That is more than 180 MPs voting against.
With the current numerical and political analysis of our current Parliament, that is a tall order. This is why the Minority will do all it can to block it from being laid, at least until their concern about corruption and violation of International Trade Protocols are addressed.
Tensions flared on the floor of Parliament, the second time laying was blocked. In principle, the idea of regulating imports is supported by many, but Ghana has been there before.
Import licensing regime in the 60s and 70s bred premium corruption and the records from all the commissions of inquiry set up to investigate such abuse are still available. A more tempered approach through the institution of a body that has a broader meritocratic appeal than the current one as envisaged by the L.I may be a good place to start from. The composition of the committee as proposed by the draft L.I are: Representative of
(a) the Ministry of Trade and Industry not below the rank of a deputy minister as chairperson, nominated by the minister
(b) the Ministry of Food and Agriculture not below the rank of a Director, nominated by
the Minister responsible for Food and Agriculture
(c) the Ministry of Finance not blow the rank of a Director, nominated by the Minster
responsible for Finance
(d) the Ministry of Employment and Labour relations not below the rank of a Director,
nominated by the Minister responsible for Employment and Labour Relations
(e) the Ministry of the Interior not below the rank of a Director, nominated by the
Minister responsible for the interior
(f) the Bank of Ghana not below the rank of a director, nominated by the Governor of
of the Bank of Ghana
(g) the customs Division of the Ghana Revenue Authority not below the rank of a
Director, nominated by the Commissioner-General of the Ghana Revenue Authority
(h) the Food and Drugs Authority not below the rank of a Director, nominated by the
Chief Executive Officer of the Food and Drugs Authority
(i) The Association of Ghana Industries
(j) the Ghana National Chamber of Commerce and Industry
Clearly, majority of the committee members are from government agencies. The concern about this being a recipe for corruption may be valid. What about a structure like the parliamentary committee on Trade and Industry which is bi-partisan and can place relevant checks and balances required for such a licensing regime?
The committee may seek advice from the relevant state agencies for the purpose of conducting their work.
For now the L. I has not been laid in Parliament. Hopefully, the consultations in Parliament will yield an agreeable path in the quest for Ghana to improve its local production and balance of trade of position.