Pharmaceutical industry lauds CET implementation

While some traders are lamenting over implementation of the ECOWAS Common External Tariff (CET), the pharmaceutical industry sees it as a move that will promote and increase affordable healthcare in the country.

The new tariff regime is composed of four tariff rates for Customs duty, namely: zero percent for essential social goods; 5 percent for goods of primary necessity, raw materials and specific inputs; 10 percent for intermediate goods; and 20 percent for final consumption goods.

Most of the pharmaceutical products fall under the category of essential social goods which attract zero percent duty. This, according to the Executive Secretary of the Pharmaceutical Manufacturers Association of Ghana (PMAG), Mr. Kwabena Danso, will translate into an era of affordable medicines in the country as the cost of importing them will reduce.

“In the past pharmaceutical finished products imported into the country attracted 10 percent duty. But under the new tariff regime, about 70 percent of imported finished pharmaceutical products are duty-free.

“The new tariff regime also allows for no duty to be charged on the importation of pharmaceutical packaging materials. So as far as pharmaceutical businesses are concerned, the CET does not present any adverse effect,” he said.

“So the biggest advantage the CET will bring is a reduction of cost in the country’s healthcare. Medicines that will be affected by the new tariff regime are going to be more affordable because, at least, it is not likely the prices of medicines will be increased. So even if the prices of medicines do not reduce, they are not likely to go up,” he said.

The CET is one of the instruments for harmonising ECOWAS member-states and strengthening its common market.

The CET establishes a system where goods coming into any of the ECOWAS countries pay duties in the country of first entry within the ECOWAS region, and the importer will no longer be required to pay in the country of final destination.

However, this regional integration initiative has been met with mixed reactions in the business community -- with some traders worried it will push them out of business while others are bemoaning the timing of its implementation.

President of the Ghana Institute of Freight Forwarders Kwabena Ofosu-Appiah, in an interview with the B&FT said: “We are aware that the CET is about positioning the region to take advantage of its potentials in certain items that the sub-region has capacity to produce; but the duration and time that the arrangement is being implemented smacks of a certain unfairness, as it is about managing the incidence of this intervention on the people.

“In this case the importer, and by extension the end-consumer, is the one going to suffer the effects from the abrupt manner in which the system is being implemented, no matter how well-intentioned it is; and that is the reality,” he said.