I speak for the thousands of Gen Z Ghanaians who are rooting for change come December 7 and admire Professor Peter Quartey as senior economist and remarkable in development economics. Contrary to the above, it is quite baffling to many of us, his lowbrow remarks of John Mahama’s 24-hour economy policy at the launch of the State of the Ghanaian Economy Report (SGER). “If all the factories were to produce 24-hours or increase their demand by 50% or 100% is their demand for the product?” quoting him.
Prof. to indulge you, yes there will demand for it and here is why. It will interest you to know that in 2018 alone Ghana’s import of consumer goods amount to $4.5 billion (WITS). Such is the market prospect.
Here is the release in response to Prof Quartey.
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Press release
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NDC Station response to Prof. Peter Quartey infernal remarks of the 24 hour economy
Manufacturing surplus in Ghana will be a Strategy to Address Trade Deficits and Job Creation by John Mahama’s government
I speak for the thousands of Gen Z Ghanaians who are rooting for change come December 7 and admire Professor Peter Quartey as senior economist and remarkable in development economics. Contrary to the above, it is quite baffling to many of us, his lowbrow remarks of John Mahama’s 24 hour economy policy at the launch of the State of the Ghanaian Economy Report (SGER). “If all the factories were to produce 24-hours or increase their demand by 50% or 100% is there demand for the product?” quoting him. Prof. to indulge you, Yes there will demand for it and here is why. It will interest you to know that in 2018 alone Ghana’s import of consumer goods amount to $4.5 billion (WITS). Such is the market prospect.
Ghana’s trade imbalance has presented decades of economic challenges, with imports outpacing exports. With consumer goods, the gap is more pronounced as Ghanaians relies heavily on imports of household products, foodstuffs, and machinery. According to data from the World Integrated Trade Solution (WITS), Ghana’s consumer goods imports alone accounted for roughly 50% of its import value in recent years. By increasing the surplus of domestically produced goods through local manufacturing accelerated by the 24 hour economy Ghana has a strategic opportunity to not only reduce its trade deficit but also strengthen its economy in multiple ways. Aided by NDC’S 24-hour economy, let us explore how our economy can benefit from creating and leveraging manufacturing surpluses as it makes mockery of Prof. Quartey’s remarks.
- Reducing Dependence on Imports
A surplus of locally manufactured consumer goods can directly reduce Ghana’s reliance on imported products. Currently, Ghana imports a significant volume of household goods, machinery, and processed food items, with the cost of these imports rising due to currency depreciation and global supply chain pressures. By boosting the domestic supply of similar goods,(import substitution )Ghana can reduce the volume of imports required to meet demand, which would help reduce the trade deficit and stabilize the currency.
The long-term benefits of this shift are substantial. Increased local production of consumer goods like packaged foods, textiles, and personal care items could lead to a gradual shift in consumer preferences toward domestically produced goods, thereby supporting local businesses and employment. Furthermore, substituting imports with local alternatives could create a self-sustaining production ecosystem where domestic industries collaborate, reducing costs and improving efficiency. - Enhancing Export Opportunities with Surplus Goods
With a manufacturing surplus, Ghana could expand its footprint in export markets, particularly in Africa, leveraging trade agreements like the African Continental Free Trade Area (AfCFTA). By targeting markets in neighboring countries and throughout West Africa, Ghanaian manufacturers could turn surplus goods into valuable exports, providing additional revenue streams. This would not only increase Ghana’s export revenues but also diversify its export base, moving beyond the traditional reliance on gold, cocoa, and crude oil.
The potential is particularly promising for finished consumer goods, where Ghana could gain a competitive advantage. Exporting surplus textiles, processed foods, and electronic goods would increase the country’s economic resilience, as it would no longer be as heavily affected by the fluctuations in raw commodity prices that affect gold and cocoa markets.
- Job Creation and Skill Development
A surplus in production naturally leads to expanded operations, which require a larger workforce and more specialized skills. By increasing manufacturing, Ghanaian companies can create more jobs, contributing to the reduction of unemployment, especially among youth. A robust manufacturing sector supports job creation in various roles, from production and packaging to logistics and sales.
This growth also fosters skill development, as companies invest in training workers and introducing advanced technologies. For example, with sustained manufacturing growth, Ghana’s workforce could develop skills in areas like quality control, production management, and equipment maintenance. Over time, these skills become assets that enhance the productivity and competitiveness of Ghanaian industries.
- Increasing Economic Stability and Currency Strength
A manufacturing surplus would increase the volume of Ghana’s exports and reduce the need for imports, both of which contribute to currency stability. By earning more foreign currency through exports and reducing the outflow required for imports, Ghana’s currency can be better protected against depreciation. This is critical in an economy where fluctuations in the value of the cedi have a direct impact on inflation and purchasing power.
A stable currency also has a positive feedback effect on the economy. With lower import costs and less inflationary pressure, businesses can plan with greater confidence, making investments in expansion and improvement more feasible. In this way, a surplus in production not only addresses the immediate trade imbalance but also supports longer-term economic stability and growth.
- Encouraging Foreign and Domestic Investment
An economy with a robust manufacturing sector and a strategy for managing surplus production is attractive to investors. Foreign investors are more likely to consider Ghana for projects if they see a strong market with export potential. Moreover, local companies are more likely to reinvest in their operations, expanding capacity and upgrading technology when they see opportunities for sustainable growth.
Surplus production fosters an economic environment where both foreign direct investment (FDI) and local investments can thrive. For instance, as Ghana’s companies build their capacity to produce goods at scale, foreign firms in sectors like technology, food processing, and apparel may choose to partner or invest locally, capitalizing on Ghana’s strategic geographic location and the opportunities presented by regional trade agreements.
- Environmental and Resource Benefits Through Efficient Production
Producing goods locally and managing surpluses sustainably can have environmental benefits by reducing the need for transportation over long distances, thereby cutting down on emissions associated with imports. Moreover, surplus manufacturing encourages companies to adopt more efficient production techniques to avoid overuse of resources, which can lead to waste. This aligns with Ghana’s goals of building a sustainable economy that respects environmental boundaries and conserves resources.
Conclusion
As it will be rightly convey by the 24 hour economy in 2025 by John Mahama, surplus of goods and products in Ghana’s manufacturing and production sectors has the potential to transform the economy, especially as it addresses the country’s trade deficit. By increasing the local production of consumer goods, Ghana can reduce its dependence on imports, create jobs, stabilize the currency, and enhance economic stability. Leveraging surplus goods for export not only diversifies Ghana’s economy but also opens up new revenue streams, especially in regional markets.
As the policy 1.3.3 focuses on fostering manufacturing, supporting local industries, and building export capabilities, Ghanaians stands to benefit significantly from a surplus-driven strategy. Encouraging local companies to scale up production and manage surplus effectively could be a key step toward reducing the trade deficit and achieving long-term economic sustainability by the next NDC government.
Signed
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NDC Station
Mr Smith P Boahene
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