Business News of 2014-02-04

Ghana risks losing export trade target

Ghana risks missing the US$5billion Non- Traditional Export (NTE) revenue target if exporters do not adhere to standards set by the European Union (EU).

The Ghana Export Promotion Authority (GEPA) has warned that adhering to the quality standards set by the EU may be the biggest drawback to the attainment of the US$5billion target by 2017.

Acting Chief Executive Officer of the Ghana Export Promotion Authority, Mr Gideon Kwame Boye Quarcoo, feared that the Economic Partnership Agreement with the EU, if not negotiated collectively as a bloc, would offset the gains made in promoting non-traditional exports.

“We need to strengthen trade and the collective partnership in the sub-region in our negotiations with the EU in order to overcome the difficulties set in the export trade debates”, he said in an interview.

The authority, which is the coordinating body of the National Export Strategy plans to roll out several programmes in the coming months to identify at least one exportable commodity within each district.

At the moment, the ECOWAS sub-region is Ghana’s second largest market for non-traditional exports after the EU.

Mr Quarcoo is hopeful that proximity and other factors could improve Ghana’s exports to the sub-region by using the ECOWAS protocols which seek to increase trade amongst member states.

Among the activities expected to be rolled out in the year by GEPA is awareness creation on the need to adhere to standards and quality assurance by Ghanaian exporters in order to access the European market.

But the GEPA, which recently won an award from the Nigerian government for being the best participating country in the Lagos Fair is currently struggling with other agencies and exporters for funding from the Export Development and Agricultural Investment Fund, thus stifling its activities.

So far, the authority has achieved US$2.4 billion export revenue in non-traditional exports and hopes to double that figure by 2017.

Nigeria, with a population of about 150 million and a relatively large middle income class is the biggest market within the ECOWAS sub-region and therefore presents opportunities for Ghana’s NTEs.

Out of the total national non-traditional exports of US$2.364 billion in 2012, exports to Nigeria constituted about US$144.84 million.

“All things being equal our exports to Nigeria should rise to US$306 million if GEPA is to achieve its objective of US$5 billion by the year 2017”, Mr Quarcoo said.

This according to him requires a lot of innovative programmes with the view of maximizing the growth potentials in existing markets as well as identifying and developing new ones.

The regional markets present opportunities to grow a country’s exports because barriers to accessing markets are lower than those for accessing global markets.

Neighbouring countries’ markets are often similar in taste, standards and culture. Developing regional markets will allow companies to expand operations and create economies of scale making them more competitive.

It is also expected to create incentives for more investment flows and allow suppliers to specialise and integrate into regional supply chains that ultimately cater for both domestic and international markets.

Source: graphic.com
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