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Ghanaians Owning the Economy; is it necessary?

The Ghanaian economy is bedeviled with perennial challenges: forex woes (cedi’s strength against some major trading currencies), budget deficits, fiscal and monetary challenges among others. These problems are faced by almost all governments both in the past, recent and if not addressed future governments may grapple with them too. In the midst of all these challenges, there is a school of thought who thinks the way to go around these challenges is for Ghanaians to own the Ghanaian economy from services, to manufacturing and agriculture et al. 

In the just ended Ghana Economic Forum 2016, Chief Executive Officer of finance house, Beige Capital, Mr. Mike Nyinaku was a lead campaigner for the clarion call; “Ghanaians must own the Ghanaian economy.” The tone for this grand agenda has been on the discussion table for years but seem to be given much voice in recent times because this new school of thought believes Ghana needs to better by allowing its people have a commanding stake in the local economy. 

But there is also another school of thought, not so opposing of the position taken by the former but critical of what needs to be done as a matter of urgency and importance to achieve this grand agenda of a Ghanaian owned local economy. Chief Executive Officer of Dalex Group, Kenneth Kwamina Thompson, poignantly asserts that much needs to be done on the part of policy makers to ensure that Ghanaians do not take just a controllable stake in the economy but Ghana becomes attractive to the outside investment community. Mr. Thompson and those who side with him believes for every advanced country in the world, it took ‘outsiders’ bringing in some expertise and investments to make those economies boom. America he asserts, rode on the back of foreigners to become the superpower it is today. Being open to investments and expertise from elsewhere has its attendant benefits to the local economy. 

Public Private Partnerships some believe is the way to go. This current administration seeing its importance has gone ahead to create a whole ministry to oversee partnership between the public and the private sector. Although Foreign Direct Investment into Ghana declined 31 percent between 2014 and 2015, much needs to be done on the fiscal space by the policy makers to attract the needed FDIs to spur growth which can be shared by both local and foreigners. Mr. Thompson believes we don’t have the capacity to undertake such big projects and as such must think of partnerships which have some incentives for the local partners to spur the growth and development we seek.   

Mr. Kwaku Dua Berchie, a Financial Consultant and Lecturer also asserts that as a country we have not deliberately made policies to ensure the locals get a controlling stake in some important sectors of the local economy. The top five banks aside Ghana Commercial Bank are all not locally owned. Same can be said of the telecoms and the oil and gas sectors. It’s high time we formulate policies which favor the locals to venture into these sectors which define any developed economy. The talk shops must give way to action-orientated moves to make the Ghanaian owned economy narrative a reality. 

Mr. Thompson again makes a strong case for Agriculture and Agribusiness to be taken more seriously for the expansion of the local economy.   Agriculture has been the main stay of the local economy for years and if the country seeks to wean itself from perennial macroeconomic challenges, Ghana needs to pay more attention to that relevant sector. A drastic move from the hoe-and-cutlass practice to a more mechanical means with investments in machinery and infrastructure in these farming areas should be put first in addressing this challenge. Financial and technical (extension services) services should be placed high on the agenda. Much of our forex woes are mainly due capital flights and we can arrest this trend by making a conscious effort to add value to these agric produce. In the recent times agriculture has seen some decline- its contribution to Gross Domestic Product has declined by 10 percent in five years. Fertilizer subsidies, lack of extension services, poor storage facilities and irrigation are the main causes for this decline and an appropriate agric intervention by policy makers can stem this trend. Mr. Thompson asserts that, Ghana will do best if the sector is given much priority. The private sector can be incentivized to venture into agric since the potential for growth is certain. The attendant job creation in this sector will contribute enormously to tackling the unemployment menace in Ghana. The World Bank currently puts the unemployment rate at 48 percent and deliberate agric policies to stem this trend are paramount. According to the former United Nations Secretary General, Kofi Annan, Africa imports $35 billion worth of food annually. Ghana can take a bold step towards modernizing agric to get some substantial foreign exchange from its neighbors in the sub-region. 

Get the right infrastructure in place, support the locals by enacting favorable policies and they will take advantage of this to contribute meaningfully to a competitive local economy. 

 

Author: Paa Swanzy-Essuman || p.swanzy@ghanatalksbusiness.com

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Henry Cobblah

Henry Cobblah is a Tech Developer, Entrepreneur, and a Journalist. With over 15 Years of experience in the digital media industry, he writes for over 7 media agencies and shows up for TV and Radio discussions on Technology, Sports and Startup Discussions.

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