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Ghana
The gateway to west Africa. |
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Interview with
Mr. Tawai Akyea
Executive Secretary
August 20st 1999
Contact :
Republic House, Tudu
P.O. Box M.146
Tel: (233-21) 228813 228830 228623
Fax: (233-21) 668263 233725
E-mail: gepc@ighmail.com
Website : www.exportghana.org
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Q.1 The Ghana Export Promotion Council is an autonomous body that was established in 1969, can you give us a historical background to the G.E.P.C.?
A.1 As you stated it was started in 1969 so it has been around for 30 years and I would say that we have seen the GEPC’s most productive years from about 1985. In the early years it did not make much impact because of the macro-economic situation. At that time the State was the operator and the entrepreneur and every ministry was literally running a business. Since 1983, when we adopted the Economic Recovery Program, the entire focus of the economy has changed; it is now private sector led. The State is divesting itself of all business activities and the promotion of exports has become very relevant in terms of getting private enterprise operators to become the exporters. This is the historical context in which the GEPC finds itself. The other aspects are that this economy has always, from a strategic point of view, been export oriented or export dependent. The interesting thing is that for a long time the export portfolio of this country has been a very narrow band of products. Since 1985 we have tried to promote the idea of expanding this portfolio so that instead of a narrow band of products, that is cocoa, gold and timber, we could develop other products that would be exported. The obvious advantages are that the economy would then have a more stable outlook. Currently if you look at what is happening to gold and cocoa prices no one needs to tell you that it is devastating to the economy in the sense that just because the cocoa and gold prices collapsed the country is put in crisis. If we had many more products, 10 or even 20, and for some reason 2 products could not stand up, the others would bridge the gap. It is a very simple strategy; to promote and encourage the development and growth in terms of expansion not only vertically but also horizontally in terms of the products that you have.
Q.2 How successful would you say you have been in trying to promote other products apart from the 3 main ones?
A.2 The measure of success can be seen in the export figures, and what has happened to exports since 1983 and 1985. We categorized the export sector into the Non-traditional and the traditional sector. Now the traditional sector is your familiar, well-established export products; cocoa, timber, gold and the minerals. The challenge is with the non-traditional sector. The measure of our success would be to see how well the non-traditional sector has grown since then. If you go back to 1984 and you look at the statistics you will realize that the non-traditional fetched less than $2 million in 1984. When you take the statistics of 1998 you will see that non-traditional exports fetched over $400 million. There has been a tremendous growth but we are quick to say that this is no ground for complacency. As a matter of fact this is just the beginning, there is more work left to be done, much development in the export sector that we need to be working on.
Q.3 One of your goals is "The development of national export awareness", what exactly does that mean?
A.3 The other characteristic about this economy is that it is heavily dependent on imported products both for consumer and productive activities. In order for the economy to be healthy there needs to be a balance, imports must equal exports. If you look at the trade balance you will realize that the imports are way ahead of the exports. This is where the pressure in the economy really comes from; inflation, shortage of foreign currency, incapacity to grow all these come from this imbalance in our external trade. So in order to get your exports to grow you need to sensitize the business community to see export as a viable business alternative.
Q.4 How much of your work would you say is done by pure education, making people aware of the importance of exports?
A.4 About 40% of our time is spent on carrying out this kind of awareness creation activities all the way from organizing training functions to just getting involved in discussions and media events to keep the idea of exports in the public eye. A great deal of activities in this office is targeted at creating and maintain exporting awareness in the public eye so you keep reminding both policy makers and the business community that this thing needs to be worked at.
Q.5 In addition to teaching people about the importance of exports, what kind of incentives do you offer in order to encourage exports? And how much influence do you have with the government to set up advantageous policies for exporters?
A.5 From a governmental point of view our approach has been to organize the macro-economic situation and the policy environment in such a way as not to give specific incentives. The policy environment itself should be so supportive that the natural flow of business would be to do export. There are no real bonuses.
Q.6 Maybe not bonuses, but what about tax incentives?
A.6 We are very hesitant to do this kind of thing but notwithstanding all that, we say that if you have an export company for example and you need to import inputs in order to produce, then you will not have to pay duty on the imported items. We have extended this policy into a program, which is what the Free Zones program is. We have extended the policy and created a specific program so that business people can go into the free zone and get the package of an enhanced environment. This is not just a financial package but we create an enhanced environment physically so business people can come in and produce solely for export in a very efficient manner. We take ideas and try to transform these ideas into programs. For example from the Ministry of Trade we are running a Gateway program and the entire concept of this program is intended to make the business environment even friendlier for exporting.
Q.7 Do you not think that the Gateway project is very orientated towards imports as well and encouraging people to come to Ghana?
A.7 There is something called re-export so under the Gateway program one of the outcomes is to create a friendly business environment, encourage business people to come and locate here and to use this place as their base for doing business. For example the rice trader from Bangkok wants to sell rice to 200 million people in West Africa but he needs a base. Our objective is to create a set nation which will encourage him to chose to locate here, bring all his rice from Bangkok to Ghana and distribute from here so that any one could just come in here and get what he needs for his business in his country. Therefore looking at the statistics, we would be importing 2 million bags a year, consume 500 bags and the rest would be re-exported from here to markets in the sub-region. The regional market is a viable business proposition and international business people should look at this regional market and supply this market from here. In the first instance it will be an import for Ghana but then you turn around and export.
| Q.8 Is the GEPC actively encouraging people to go and make use of the export zones?
A.8 Yes, a free trade zone office has now been established so all free zone activities are handled by that office. It is a policy, which feeds into the entire national program. We promote it abroad, we promote it among the local business community and we are talking to our colleagues in this new office and sending proposals to them.
Q.9 What measures have you put in place to help find effective markets for Ghanaian products?
A..9 We undertake the normal market development and trade promotion programs. We identify product areas in which we think our exporters have the capacity, we identify buying companies and we try to match them to our local suppliers.
Q.10 In the non-traditional export areas, which markets are being targeted and what kind of products go there?
A.10 The regional market which I have already talked about is our first priority and this regional market responds to mostly manufactured products so whatever we can manufacture in this country can be exported to countries in the sub-region. The other important market that we work with is the European market and Europe has been a trade partner for a very long time. The EU countries take mostly agricultural produce either fresh or slightly processed.
Q.11 How are you funded as an organization?
A.11 This is a government agency so it is funded by the government.
Q.12 With regards to the Vision 2020, how active a role would you say this institution is playing in meeting the criteria of raising Ghana to the ranks of a middle income country?
A.12 We reckon that if you say this country’s economy is going to be like that of a middle income country, there are certain characteristics that it must have. If you did a study of middle income countries in the world today you would find certain characteristics like high per capita income; the configuration of their trade shows high export volumes. We already have models that we can use. We did a review of the situation and realized that for Ghana to become a middle income country by the year 2020 you are talking of raising per capita income from the current $400 a year to $1800 per annum. To achieve that you are talking about increasing your international trade up to a certain level. In our estimation we think that by the year 2020 Ghana’s exports should be about $16 billion and we reckon that about 12 billion of this 16 billion should be from the non-traditional export sector. That is an incredibly tall order. But this is our challenge and this is what we are working at.
Q.13 Would you say that to achieve these goals it is more a question of working on the dynamics of Ghana as a country itself or is it more a question of working on the export markets themselves?
A13 oth ways. The internal dynamics have to change dramatically in terms of levels of investment by finding ways to increase this level. This is one of the reasons why we are promoting the free zone because you get foreigners to also participate in the investment process by establishing production units here. There is a lot of public investment in just building up the infrastructure to sustain these higher levels that we are talking about. I foresee the need to double the size of the Tema Port because $16 billion worth of produce cannot go through the port we have there now. It is just physically impossible. Also for levels of production needed to achieve the vision objectives, example we need to build up our energy generation by 4 times or more in order to sustain the Vision. We are talking about a massive continuous sustained level of investment in the next 10 to 20 years. So we need to do a lot on the dynamics of Ghana as a country. These are some of the internal dynamics. But there are some external dynamics too. First thing about the external dynamics are that business people in this country had to change their orientation. Business people in this country should have the confidence to establish outside. Without this way of thinking you cannot be successful as an exporter in the long term. The other dynamic is that trading partners in other countries must be exposed to the idea of businessmen from Ghana going to set up shop in overseas countries and seeking a place for their products on the global markets as well. This is why for us international conventions like the one under the WTO or in a regional context, ECOWAS, is important because it gives a framework within which we can begin to operate in a reasonably sustained manner.
Q.14 Are you confident about the future?
A.14 Of course, otherwise I would not be here.
Q.15 On a more personal level can you tell us a little bit about yourself and about being the Executive Secretary?
A.15 I have worked in this office for 10 years and I have been the Executive Secretary since 1993. Before I came here I worked at the National Investment Bank also for 10 years. I am a lawyer by profession. Before then I worked as a State Attorney at the Attorney General’s office. I trained in the University of Ghana.
Q.16 As you know Forbes Global Magazine reaches more than 4 million readers, mainly businessmen. What is your final message to them?
A.16 Come and do business in Ghana.
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© World INvestment NEws, 1999.
This is the electronic edition of the special country report on Ghana published in Forbes Global Magazine.
March 20th 2000 Issue.
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GHANA
