Trade and Industry Minister, Ms Hanna Tetteh, last week launched Ghana’s Industrial Policy with a call on stakeholders to partner government for its smooth implementation and enhance its success. She said the country’s long-term vision of high levels of development required on industry driven economy capable of delivering decent jobs and productivity to achieve equitable economic development. The policy is a set of specific policy instruments and measures to be applied to increase access of the country’s manufacturing sector to competitive factors of production to enhance productivity efficiency and competitiveness. Key development objectives of the policy include expansion of productive employment in the manufacturing sector, promotion of agro-based industrial development and ensuring spatial distribution of industries to achieve reduction in poverty and income inequalities. The implementation of the policy will be done through an Industrial Sector Support Programme, which is time-bound intervention to set up the rate of industrialization over the next five years. Ms Tetteh said the policy would provide clear and transparent guidelines for the implementation of the industrial agenda to ensure the competitiveness and growth of the manufacturing sector. This policy is set within the context of Ghana’s long-term strategic vision of achieving middle income status by the year 2020, through transformation into an industry driven economy capable of delivering decent jobs with widespread, equitable and sustainable growth and development. It has taken the government some time to produce this document despite the fact that similar documents have been produced before. However, one wonders if this kind of document can seriously catapult the industrial sector into one that will enable the country to meet its long-term strategic vision of achieving a middle income status by the year 2020. Going through the document one hardly comes across any line that gives time fines or milestones that have to be achieved at any point in time over the nine-year period of the document, despite the fact that the document provide clear and transparent guidelines for the implementation of the government’s industrial development agenda. Between 1960 and 1970, Ghana had a very vibrant industrial sector to the extent that Tema was named as the industrial city of the country. In 1957, after Ghana gained independence, the Nkrumah government launched an aggressive industrialization drive that Increased manufacturing’s share of Gross Domestic Product (GDP) from 10 per cent in 1960 to 14 per cent in 1970. This expansion resulted in the creation of a relatively wide range of industrial enterprises, the largest including the Volta Aluminum Company, (Valco) smelter, sawmills and timber processing plants, cocoa processing plants, breweries, cement manufacturing, oil refining, textile manufacturing operations, and vehicle assembly plants, as well as the GIHOC Group of Companies. The country had two industrial towns, Accra North Industrial Area and Accra South Industrial Area. Under utilisation of industrial capacity, which had been endemic since the 1960s, increased alarmingly in the 19705, with average capacity utilisation in large and medium-scale factories falling to 21 per cent in 1982. Many of these enterprises, however, survived through protection because Ghana at that time was a young, independent country and every effort was be made to protect these young enterprises. That was a deliberate policy to keep these industries afloat. Unfortunately, the overvalued cedi shortages of hard currency for raw materials and spare parts, and poor management in the state sector led to stagnation from 1970 to 1977 and then to decline from 1977 to 1982. What should have been done at that time was for the government to gradual weans itself through these enterprises through the creation of a stock exchange which had been accepted in principle as far back as 1958. Beginning from the 1980’s to date, the manufacturing sector has never fully recovered, and performance still remains weak. Instead of the government recapitalising some of these industries, it rather opened its doors to cheap imports from the far East and this rather aggravate the situation of the industry through its trade liberialisation policy. The garment, leather, electrical, electronics, textiles and pharmaceuticals sectors have been particularly hard hit. The GIHOC Group has now become pale shadow of Itself. The New Match Company, the only safety match company in the country, was closed down in 1990. If the country had pursued the level of aggressiveness it exhibited in the 1960’s, the country would have surpassed countries like Malaysia; South Korea, Singapore and other East Asian countries. If the new industrial policy can be a document worth its salt, then the government must really assist local enterprises, especially the small to medium scale enterprises to be able to compete with the cheap imports from the Far East. This must be a deliberate and conscious effort from the side of the government. The South Koreans did it and they were successful, why can’t we do just that? Source: Graphic Business