Ghana SMEs suffer competition from foreigners

Small medium enterprises appeal for government protection against foreign traders .

Small medium enterprises appeal for government protection against foreign traders .

From RUSSELL ADADEVOH in Accra, Ghana
ACCRA, (CAJ News) – A GHANAIAN economic think-tank has appealed to the government to safeguard the local industry struggling under competition from cheaper imported goods.

The Institute of Fiscal Studies (IFS) proposed a “special levy” on several items imported into the country, insisting the move would protect the local manufacturers.

IFS insist that imposing the levy on several imported goods would help reduce the numerous challenges facing local manufacturers.

It argues that the government should review its tax policy and policy reforms in order to protect the local Ghanaian manufacturers from ‘unscrupulous’ foreign businesses allegedly invading the local markets.

“In 2010, when the duty on rice importation was reinstated, the importation of rice was drastically reduced which led the production of local rice to shoot up significantly,” IFS stated.

“To support the revival of the manufacturing industry, the country needs policies and programmes that reward domestic production and penalize imports that can easily and efficiently be produced locally,” IFS argues in its report to the Ghanaian government.

The IFS insists support should be given to industries with a huge export potential such comprising agro-processing, clothing and pharmaceuticals arguing that they would strengthen economic performance of the external sector over the medium to long-term.

It argued that Ghana’s economic incentives always favoured importation as compared to domestic production of goods, a move they argued would hamper competition for locally manufactured goods at both local and international level.

IFS also argue that imported goods were not helping creating jobs, but were promoting foreign business maintain their jobs at the expense of locals.

The move comes at a time Ghanaians have also been pushing for the government to ban foreigners venturing into the country’s Small-to-Medium Enterprise (SME) in order to shield them from fierce business competition posed by fellow Africans and Chinese.

Ghana’s SMEs business is seen as under threat from Nigerians, Chinese, Indians, Somalis and Ethiopians.

Locals have previously protested the dominance by foreigners.

Ghana Union of Traders Association (GUTA) has also called on government to reserve the SME for locals.

– CAJ News

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Posted by on Jul 21 2015. Filed under Africa & World, Featured, Finance, Finance & Banking, News, Regional. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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