Investing in 1D1F: How B5 Plus is positioning Ghana as a net exporter of iron and steel products

Featuring prominently in governments priority developmental programs and now a household term is the one-district-one-factory (1D1F) initiative- touted as the nostrum for unraveling Ghana’s industrial revolution.

The reasoning behind the concept is simple-Government will support existing companies or private sector investors to set up factories in various districts across the country, to stimulate economic growth, better utilize resources and create jobs.

So far, the project appears to be on track with the one-district-one-factory secretariat reporting that about 170 factories were at various stages of completion.

Out of this number, a total of 28 Factories have been completed and operating fully as 1D1F projects while government has partnered the private sector to either expand or revive existing companies, bringing the total number of operating companies under the 1D1F and private partnerships to 76.

B5 Plus Company Limited, one of Ghana’s biggest steel and metal fabrication companies has been a beneficiary of the 1D1F initiative. Situated around the Kpone barrier, the company produces over 4,000 iron and steel products such as nails, wire mesh, iron rods, roofing sheets etc.

Two decades of existence has made B5 Plus a household brand an exporter of steel to countries within the West African sub-region. “we started nearly two decades ago importing and selling steel products. Today we are the biggest metal factory in Ghana and our products are not only sold here but supplied to 15 other countries within the sub-region” said Mukesh Thakwani the CEO and founder of B5 Plus Company limited when a team from the Ghana Investment Promotion Centre (GIPC) visited the factory.

With government support, under the 1D1F B5 Plus is now pursuing the construction of what will be the largest metal manufacturing factory in West Africa. The over 80 million-dollar project is located within the Ningo Prampram District of the Greater Accra region.

When fully completed, the new factory is expected to create some 5000 new jobs in addition to the existing 10,000 workers already employed by B5 Plus Company limited. Mukesh Takwani explains, “We just finished the first phase of the new construction and at present, we already have about 2300 workers on sight. But once we complete, we are projecting over 5,000 direct and indirect jobs to be created and up to 10,000 with the second and third phase”.

For workers, this is exciting news. Abdulai Alhassan for example is a mechanic at the B5 Plus factory. According to Abdulai, working at the factory has helped him conveniently cater for his family “I have a wife and two children that I take care of with my salary and I’m also putting up my house with a loan facility I secured from the company” said he.

“For me working at B5 Plus not only earns me income but has helped me upgrade my skills as a mechanic” added a colleague of Abdulai, known as Richard Kartey.

These sentiments are shared by many of the hands working on the factory floors of B5 Plus Company Limited. They believe the expansion will create avenues for many more unemployed persons to earn an income.

Besides the job opportunities, the expansion of the steel factory B5 Plus will most significantly boost Ghana’s iron and steel manufacturing capacity to meet both local and export demand.

It is estimated that the installed capacity of the local steel industry is about 1,000,000 Metric Tonnes (MT) whereas the country’s annual average demand for steel is about 350,000 MT, leaving an excess capacity of 650,000 Metric tonnes for export.

At present B5Plus also has a total installed capacity of 500,000 metric tons but operates at about 20 percent capacity. It is however expected to scale up to over a million tons with the completion of the new factory in Pramprarm. With B5 Plus projecting over a million tons of steels production together with the additional excess output from other players in the steel industry, Ghana is looking at well over a million tonnes of steel products not only for the country but export to the rest of the African Continent. “with the first phase of our project, we are saving more than a 100 million dollars in foreign exchange and we plan to export to the whole of the West African Market. With the second phase, we will export to other to the rest of the African countries” remarks Mukesh Thakwani.

Now staring at a nascent automobile Industry hub, the expansion of a steel manufacturing company like B5 Plus comes as timely development to meet the increasing demand for steel that will be required by the automobile manufacturers and other related industries.

Moreover, although data is not readily available on steel production in the continent, it is assumed that Sub-Saharan countries production of steel is much smaller than demand which is estimated to hit some 37.2 million MT between 2019 and 2020.

With the coming in force of the African Continental Free trade Area Agreement, it means Ghana has a good chance of tapping into this market and establishing itself as a net exporter of steel in Africa.

Reflecting this new chapter in the Iron and steel manufacturing industry in Ghana, owing to governments effort under the 1D1F initiative, the Ghana Investment Promotion Center in furtherance of the growth of the industry is impressing on investors to explore business in the steel industry.

“We believe that these opportunities offer ample and very attractive returns so we invite various investors to have a good look at the ID1F policy and partner with Ghanaians so together we can create a great economy,” said Yofi Grant the Chief Executive Officer of the Ghana Investment Promotion Center.