Despite the hullaballoo made on the Africa Continental Free Trade Area (AfCFTA) agreement stressing that it is an avenue to propel Ghanaian indigenous companies to be competitive, in actual sense, a survey conducted this year by the AfroChampions Initiative – a regional public private partnership of Africa’s largest multinationals, indicates that Ghanaian companies fall below the belt of being competitive enough with multinational competitors domiciled in the other countries on the continent.
Importantly, it is disheartening to have learnt that out of the top 100 indigenous African multinational companies rated on the continent, no Ghanaian company made the cut. Meanwhile, the country is ranked second to Zambia as the largest destination for products from these African multinational companies.
This implies that the expected benefits from the new pan continental single market expected to implemented next year could by-pass a number of Ghanaian indigenous businesses. However, there is still some time left for effective policies to be instituted in the process aimed at addressing these teasing challenges.
If the findings of the survey are anything to go by, it should give sense of concern and worry to the Ghanaian business community and various stakeholders involved in the AfCFTA implementation as most importantly, the African Trade Policy Centre (ATPC) – one of the key implementing institutions of the agreement – recently challenged Ghana to put aside its national interest where and when necessary in ensuring the wider success of the agreement, where there is a conflict of interest between both objectives.
Instructively, Government through the Ministry of Trade and Industry and other related parties is currently considering implementing a number of protocols – such as the competition protocol – not only to safeguard the agreement, but to enable Ghanaian businesses to be competitive with their multinational counterparts.
Importantly, as part of strategic interventions to stimulate and sustain domestic trade, the trade Ministry is considering a legislation that seeks to promote patronage of indigenous products and services. The legislation is expected to provide an enabling environment for goods produced locally to have some form of preference in the local markets space. This would ensure that the chains of stores, malls and super markets would have some sections of their shelves reserved solely for made in Ghana goods for people to patronize.
Statistics indicate that Ghanaian products are actually price competitive. This is corroborated by a recent local business intelligence survey jointly conducted by the International Trade Centre (ITC) in collaboration with Ghana Exports Promotion Authority (GEPA) and Association of Ghana Industries (AGI) – representing exporters and manufacturers respectively, which revealed that 84 percent of small and medium-sized firms in Ghana’s manufacturing sector are internationally competitive with regards to product quality and pricing.
In actual fact, the AfroChampions survey finds that 73 percent of Ghanaian products on sale in the largest retail outlets are actually cheaper than their foreign counterparts.
We are of the view that to enable Ghanaian products to have the needed prominence on the shelves of these multinational retailers, there must be deliberate legislation instituted to enable people purchase made in Ghana products as the AfCFTA agreement is just around the corner which will see influx of African goods into the Ghanaian markets.
Aside this, Goldstreet Business believes that to enable Ghanaian businesses, most especially the Small and Medium-sized Enterprises to become competitive, there is the urgent need to improve their capacity and level of production. We see this measure as very paramount.
Finally, there must be intense sensitization carried out to enable Ghanaian goods to be patronized, as the more locally made products purchased, the better the exchange rate and consequently the better the cost of living.