The newly inaugurated Ghanaian government is taking a bold step towards ECOWAS integration following its recent reaffirmation that it would do more business with the regional market than any other trade bloc.
This stance comes as a surprise to some economic analysts who see the current government to be pro-west.
But the Minister of Finance, Ken Ofori-Atta is emphatic: “The ECOWAS sub-region remains the key potential market for Ghana’s manufactured products, consisting mainly of light manufacturing and nontraditional export sectors. The regional market, thus, remains critical for the transformation of the Ghanaian economy”,
The ECOWAS Trade Liberalisation Scheme (ETLS) which was adopted by the Community to promote market integration, improve intra-regional trade, and reduce dependence on primary commodities, with the ultimate aim of accelerating socio-economic development of the sub-region is one of the vehicles the government is going to use to penetrate the sub-regional market.
More companies stand to benefit from the scheme in 2017 and in the years ahead. 46 Ghanaian companies were granted approval to export 112 products under the ETLS in 2016, according to the 2017 budget.
“The success of the ECOWAS Trade Liberalisation scheme will depend on the concerted efforts of member states and the adherence to the protocols.
Many pragmatic actions will be taken to remove some of the bottlenecks against the scheme. Needs assessment of the ETLS and the industrial entities under the scheme will be undertaken to resolve any implementation issues as they come up”.
Customs officials, as the key agents in Trade Facilitation, play a crucial role in the implementation of this protocol. Training of custom officers is critical to the success and smooth implementation of the scheme. A comprehensive training programme will be put in place, starting from this year, Mr Ofori-Atta revealed.
“Furthermore, seminars and workshops to sensitise private sector and industry stakeholders about this protocol will be organised to bring a clearer understanding of the scheme”.
Economic Partnership Agreement (EPA)
Additionally, the Ghanaian government is going to benefit from the disbursement of €6.5 billion from the European Union (EU) for the EPA Development Programme (PAPED) in West Africa.
The PAPED will play a crucial role in ensuring the EPA promotes trade and attracts investment to West African countries as well as provide funding for projects linked to trade, industry, energy and transport infrastructure in the region. Ghana will continue to access some of the funding for sustainable development and poverty reduction.
The EPA is a preferential trade agreement between the EU and the African, Caribbean and Pacific (ACP) Group of states that seeks to replace the trade chapters of the Cotonou Agreement.
The West Africa-European Union Economic Partnership Agreement (WA-EU EPA) was adopted by ECOWAS Heads of States in July 2014 to advance the process of regional integration. All 28 member states of the EU and 13 countries in West Africa excluding Nigeria, The Gambia and Mauritania, have so far signed the Agreement.
The Agreement covers goods and development cooperation with a rendezvous clause that provides for further negotiations on services and rules chapters.
Although Ghana ratified the Interim Economic Partnership Agreement (iEPA) in August 2016, there is a clause in the iEPA, which explicitly states that the WA-EU EPA will supersede Ghana’s iEPA should the regional EPA be signed and ratified anytime.
ECOWAS Common External Tariff
Ghana continues to play an important role in the adoption and implementation of the ECOWAS Common External Tariff (CET), which is considered a major platform for the establishment of a customs union that will facilitate free trade and advance greater economic integration within the subregion, the Minister of Finance noted.
“The implementation of the CET is expected to address the problem of cross-border smuggling, combat dumping, and also bring economic benefits to the people of the sub-region.
Ghana implemented the new tariff regime effective 1st February, 2016, and is among the 10 countries who are implementing the CET. The Ministry of Finance is currently monitoring and evaluating the impact of the new regime on various sectors of the economy”.
Community Development Programme
After a prioritization process based on criteria established by ECOWAS, seven projects were selected from the 230 Community Development Programme (CDP) projects for financing during the donors’ roundtable.
The selected regional priority projects in the areas of transport, energy, agriculture and health are: Construction of a (2×3) Dual Carriage Lagos-Dakar Highway Project (in two phases: Phase 1: Abidjan-Lagos Corridor highway of 1028 km; and Phase 2: Abidjan-Dakar Corridor highway of 3000 km);
Cotonou-Niamey-Ouaga-Dori-Abidjan Ring Railway Project and Ouagadougou-Bamako railway project; Regional shipping company “SEALINK” project; Development of Air Transport Project in West Africa; 225kV and 330kV Interconnection Project in West Africa (Nigeria-Niger-Benin-Burkina Faso, Ghana-Burkina Faso-Mali-Guinea) and construction of solar and wind farm Projects in ECOWAS member states; Regional Programme for the Production of Rice in West Africa and construction of Rural Water Supply for Food and Agriculture Use; and Development of Six Specialized Referral Hospitals Project and a Regional Centre for Disease Surveillance and Control (RCDC/ ECOWAS) Project.
The total cost of the seven projects is estimated at US$16.46 billion and the mode of financing adopted is Public-Private Partnership (PPP), according to the new government’s maiden budget.
Currently, the intra-regional trade among ECOWAS countries which is currently below 12 per cent has not been encouraging enough. For instance 46 per cent and eight per cent of Ghana’s exports find their way to the European Union (EU), a politico-economic union of Europe countries and Chinese markets respectively.
The bulk of the region’s trade is with Europe and America; only about 12% is with other African countries. By comparison 70% of Europe’s trade is with its own continent.
African Eye Report
