To ensure that the new National Export Development Strategy (NEDS) drafted by Ghana Export Promotion Authority (GEPA) and key stakeholders is implemented in a timely and effective manner, government has begun sourcing for funding to finance implementation of the strategy. Most of the financing for implementation of the strategy is expected to be raised from private sector investors in commercial projects
Information gathered by the Goldstreet Business indicates that financing to the tune of at least US$270 million is needed to execute the projects listed in the export strategy. As part of this GEPA itself needs to finance its own budget towards implementation of the strategy, of an envisaged average of US$10 million per annum for the ten year implementation period, amounting to US$100 million.
The projected budget is geared towards financing the establishment of factories; processing plants; commercial farms; acquisition of industrial boats and funding for revitalizing existing industries in distress; as well as funding for building transport and logistics infrastructure.
The remaining include funding for industrial raw materials as the strategy envisages massive investment in tree and non tree crop and funding for acquisition of technology, machinery and equipment for procuring specialized technical services.
Towards all this, the Ghana Investment Promotion Centre (GIPC) has been tasked to mobilize investors, both domestic and external into the export sector aimed at achieving the desired results and to achieve this the Centre is to get public funding to the tune of some US$30 million.
Most of the remaining US$140 million is to be provided as private sector investment into building production capacity for export. Investors can expect be enjoy specific government support such as fiscal incentives under the policy framework.
Speaking during the President’s National Awards for Export Achievement held in Accra last Wednesday, the Minister of Trade and Industry, Mr. Alan Kyerematen said since trade and export businesses require financing to achieve desired export volume, having a strategy is not enough as it is important to enhance the productive capacity base to ensure economies of scale in order to stay competitive.
“Once you talk about productive capacity, it ties in with having nationwide high quality infrastructure” he asserted. The quality of the resultant goods being produced is even more important. “It is not just about producing, you have to produce goods of the right quality to become competitive”, he reiterated.
Background
The key objective of the strategy is to achieve strong growth in Non-Traditional Export (NTE) revenue to at least US$10 billion per annum by 2028. Currently Ghana is generating a little below US$3 billion annually.
Over the next decade, the average annual NTE revenue growth rate being targeted is 16.8 percent. The immediate goal of the new strategy is to achieve not less than US$5 billion in NTE exports annually in each of the next three years and to realise this, stakeholders are targeting 20 percent year on year export growth during this period.