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Head of the European Union Mission in Ghana, Ambassador Diana Acconcia
The head of the European Union mission in Ghana, Ambassador Diana Acconcia, has denied claims that the entry into force of the interim Economic Partnership Agreement (EPA) with Ghana would undermine the objective of the African Continental Free Trade Area (AfCFTA), claiming that the country’s trade pact with Europe will instead increase the capacity of the manufacturing sector to produce for the continent.
His belief is that the EPA will see Ghana gradually reduce its tariffs to zero for 78% of its imports from the EU by 2029, which will significantly affect the removal of tariffs on intermediate goods and EU machinery, guaranteeing cheaper inputs for the manufacturing sector.
For her, this is a good opportunity for the country’s manufacturing sector to be competitive as companies seek to take advantage of the new market on the continent. Therefore, the two trade deals – EPA and AfCFTA – will put Ghana in pole position to benefit from both the continent and Europe.
“With AfCFTA, Ghana will be at the center of two free trade zones. It exports freely to the European Union and it has free trade with Africa, so this is a very good opportunity for Ghana’s manufacturing sector.
It is true that the trade volumes from Ghana to Europe are higher than the trade volumes to Africa. If you look at Ghana’s trade, the only country that trades significantly with Ghana is South Africa, and Ghana’s export to South Africa is mostly gold, so it’s not products that create manufacturing jobs. And you don’t see any African country among Ghana’s top 10 trading partners. But that can change.
For the moment, the political priority is to trade with Africa but it will take a little time to reach a higher level because we do not yet know which products to export to Africa. There must be a discussion to determine which products will be competitive for exports to the rest of Africa, ”she told B&FT in her latest interview, as her term as head of mission expires this month. .
The EPA comes at a time when the country has also signed the continental trade pact which is to connect 1.3 billion people in 55 countries with a combined GDP estimated at 3.4 trillion dollars. It is expected that the AfCFTA would significantly boost African trade, especially intraregional trade in the manufacturing sector.
The volume of total exports is expected to increase by almost 29% by 2035 compared to the baseline scenario. Intra-continental exports would also increase by more than 81 percent, while exports to non-African countries would increase by 19 percent.
However, with Ghana as host of the AfCFTA secretariat, it is not yet clear what other signatory countries will think of its commitment to the EPA trade deal, given that Europe has always been the biggest the country’s trading partner, even without the EPA.
But the government assured in a joint press release with the EU that it would not relegate the AfCFTA to the background, but that it would take advantage of the opportunities presented by the EPA to help the manufacturing sector take advantage of the new market created by the African Union.
“The government is fully aware that these benefits of the AfCFTA will not automatically benefit Ghanaian businesses. This will require a comprehensive program of support to Ghanaian businesses in areas such as access to finance, improvement of industrial production capacity, trade facilitation, trade related infrastructure and facilitation of access to information. on the market.
A number of program interventions have already been put in place to support businesses in the areas listed above. These include the financial recovery plan for local industries implemented with the support of participating financial institutions; banking sector reforms; the One District One Factory initiative (1D1F); the creation of industrial parks and special economic zones; development of SMEs; Extension project for the ports of Tema and Takoradi; construction and rehabilitation of road networks; railway development; and the introduction of the new trade facilitation and customs management system (ICUMS / UNIPASS).
The government will continue to prioritize supporting the private sector and entrepreneurship to create jobs and improve incomes by making Ghana a hub for trade, financial services and manufacturing to take full advantage of the AfCFTA. », Indicates the press release.
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