The Ghana Exports Promotions Authority (GEPA) is facing a significant funding gap as it strives to meet the ambitious $25 billion export target set under the National Export Development Strategy (NEDS).
A senior official from GEPA revealed that the authority requires $600 million over the next year to achieve this target, a stark contrast to its current annual budget of only $5 million, instead of the needed $60 million.
GEPA’s Director of Projects, Alexander Dadzawa, emphasized the insufficiency of the current budget, noting that it takes $200,000 to organize just one trade show. This funding challenge he said is hindering the authority’s efforts to execute its initiatives effectively.
This revelation comes amid concerns raised by the 2022 Ghana’s Trade Vulnerabilities Report, which exposed the country’s trade imbalances.
In 2022, Ghana imported GH¢148.6 billion worth of goods while exporting GH¢144.1 billion, resulting in a negative trade balance of about GH¢4 billion.
Non-traditional exports (NTEs) were highlighted as a key area with the potential to reduce import dependency and improve the country’s trade balance. However, experts argue that the resources allocated to this sector have been inadequate to achieve this goal.
The report identified that four commodities—gold bullion, crude petroleum, cocoa beans, and cocoa paste—constituted about 75 percent of all of Ghana’s exports, amounting to approximately US$9 billion annually. In contrast, 219 different commodities made up about 75 percent of all imports, totaling around US$4 billion.
The report further revealed that half of Ghana’s exports were directed toward four countries: Switzerland, China, Canada, and South Africa. On the import side, China, the UK, the Netherlands, the USA, India, and Switzerland accounted for about half of the country’s imports.
Additionally, the report indicated that only in Africa and North America did the value of exports surpass imports.
In 2022, Ghana imported from 209 countries while exporting to only 161 countries. Two commodities, gold and petroleum oils, made up a substantial 67 percent of export revenue. These figures raised questions about the country’s commitment to diversifying its export base.
Revenue from the top export commodities included GH¢53.6 billion from gold bullion, GH¢43.3 billion from petroleum oils, GH¢10.4 billion from cocoa beans, GH¢3.4 billion from cocoa paste, and GH¢2.0 billion from cashew nuts in shell.
The top import commodities comprised GH¢20.2 billion of diesel-automotive gas oil, GH¢14.7 billion worth of light oils, GH¢3.1 billion worth of cement clinkers, GH¢2.7 billion worth of used vehicles, and GH¢2.1 billion of cereal grains.
Mr. Dadzawa advocated for an increase in the import levy from 0.75 percent to 25 percent to enable GEPA to reach its annual budget target of $60 million. He expressed confidence in achieving the $4.8 billion export revenue target for the year.