The Association of Ghana Industries (AGI) has reiterated its call for the government to prioritize local raw material production as part of efforts to reduce the country’s dependence on imports.
The association believes that securing local alternatives will not only ease pressure on the cedi but also promote industrial growth and long-term economic stability.
Ghana’s economy has long been strained by high import bills, with raw materials accounting for a significant portion of foreign exchange expenditure. This persistent reliance on imports has contributed to the depreciation of the cedi, increased inflation, and widened trade deficits. The AGI argues that a strategic shift towards local sourcing of raw materials is necessary to mitigate these economic challenges.
The Greater Accra Regional Chairman of AGI, Tsonam Akpeloo, has called for urgent government intervention, particularly through the newly established Ministry of Trade, Agribusiness, and Industry. He emphasized that local industries cannot thrive if they continue to struggle with the high costs associated with imported inputs.
The Economic Impact of Import Dependency
Over the years, the AGI has repeatedly warned about the dangers of over-reliance on imported raw materials. Ghana’s trade deficit has been exacerbated by the increasing demand for foreign goods, leading to higher national debt levels and economic vulnerability. Furthermore, global disruptions such as the COVID-19 pandemic exposed the fragility of Ghana’s supply chain, as industries faced shortages of essential inputs due to import restrictions and delays.
By promoting local production of raw materials, Ghana could reduce its exposure to external shocks and create a more self-sufficient economy. This move would also help stabilize the cedi, as less foreign currency would be needed to purchase raw materials from international markets.
The current administration, under President John Dramani Mahama, has introduced a new ministerial structure aimed at driving economic transformation. The establishment of the Ministry of Trade, Agribusiness, and Industry is a significant step toward reducing Ghana’s dependency on imports while enhancing industrial productivity and improving the country’s trade balance.
The restructuring of ministries was formalized through the Civil Service (Ministries) Instrument (2025) (E.I. 1), signed on January 9, 2025. This replaces the previous framework from 2021 and reflects the government’s renewed focus on key economic sectors, including agribusiness, green energy, digital transformation, youth empowerment, and job creation.
The Role of Agribusiness in Reducing Import Costs
Agribusiness is expected to play a crucial role in Ghana’s push for self-sufficiency in raw material production. Many industries, particularly those in the food processing and manufacturing sectors, rely on imported agricultural products. With the right policies in place, Ghanaian farmers could be supported to produce key raw materials domestically, reducing the need for imports and strengthening local supply chains.
The government’s commitment to agribusiness development could also create new opportunities for farmers, processors, and other stakeholders in the agricultural value chain. Investments in modern farming techniques, infrastructure, and financial support will be essential in ensuring that locally sourced materials meet the quality and quantity demands of local industries.
Industry players are now looking to the new administration for concrete policies that will encourage local raw material production. The AGI has urged the government to implement targeted interventions, including tax incentives for businesses that use locally sourced inputs, subsidies for agricultural production, and investments in research and development.
Manufacturers are also calling for improved infrastructure, such as better road networks and storage facilities, to facilitate the efficient movement of raw materials from farms to factories. Additionally, regulatory frameworks need to be streamlined to make it easier for businesses to access locally produced inputs without bureaucratic delays.
READ ALSO: A Lonely Walk to Nowhere? Ofosu-Dorte on Ghana’s 24-Hour Economy Implementation
