Govt to create manufacturers out of importers
Government has shifted its attention towards creating a new crop of indigenous manufacturers out of importers and traders in a bold attempt to further help accelerate the growth of the economy.
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The plan is to provide adequate impetus such as financial and technical support to importers that would take the bold step to transition into manufacturing to compete at the same level as the already established firms such as: Ernest Chemists, Reroy Cable, Ghandour Cosmetics, Tobinco Pharmaceuticals, among others, which successfully migrated or progressed from importation to local production.
Consequently, the Ministry of Finance is engaging with stakeholders in the importing business to help encourage them to diversify their operations.
It will help the country to manufacture enough for the local market, increase exports to neighbouring countries under the African Continental Free Trade Area (AfCFTA), generate more foreign exchange and reduce excessive imports to only essential goods that cannot be produced locally.
The ministry is subsequently urging the traders to take advantage of the new SME Growth and Opportunity (GO) programme that seeks to mobilise a total of GH¢8.2 billion to provide financial and technical support for small and medium enterprises (SMEs).
Information gathered by the Graphic Business showed that some traders have already started applying for the SME Go programme to leverage the opportunity to move into local production.
Govt’s position
The Minister of Finance, Dr Mohammed Amin Adam, who announced this at an economic forum organised by the Ministry of Finance at the Institute of Statistical, Social and Economic Research (ISSER) in Accra, stated that the government was in active discussion with traders to transition into manufacturing.
“We have found some funds to assist them to be able to transition from trading into production for both local consumption and for exports markets.
And so, very soon, through this initiative, the Ghana Union of Traders Association (GUTA) will cease to exist and their members will join the manufacturing sector actively,” he said
The minister added that the government’s plan was for Association of Ghana Industries (AGI) to provide the needed mentorship and assistance to traders in order to make the transition smooth.
Positive news
In an interview with the Graphic Business, the President of GUTA, Joseph Obeng, said it was a positive news for traders to be supported to transition into manufacturing and become captains of industries.
“We are happy that the minister and the government are trying to encourage traders to migrate into local production and exports.
The best people to venture into manufacturing are traders and importers because they know the products, its quality and quantity as well as flow in the market,” he said.
The GUTA president explained that the call does not mean that importers would transition immediately and produce all that was needed in the country.
Rather, he said the country would still continue to import essential items or goods without the capacity to manufacture locally.
“We will also patronise what we have produced locally. And so, importation is relevant just as local manufacturing and this will be done until we attain self-sufficiency,” he said.
As the government is promoting local manufacturing, the GUTA president added that there was the need to review the investment laws to ban foreigners from retail trade,
establish special fund to support Made-in-Ghana products, and build more industrial parks to serve as a hub for production
Provide soft interest
The Executive Secretary of the Importers and Exporters Association (IEA), Samson Awingobit Asaaki, also told the paper in an interview that the fund should only be given to traders with the capacity to produce goods the country imported in excess.
This, he said, would help reduce the pressure on the local currency and create adequate jobs to support the economy in general.
“I think the government should provide funds with soft interest rate, reduce utility tariffs and other interventions that would support the initiative to succeed.
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I also think that every importer is a potential manufacturer and so this initiative is a good call and must be backed with the needed impetus to make it possible,” he said.