Overview of the Manufacturing Sector in Ghana

The Ghanaian economy is made up of three main sectors; they are agriculture, industry and services sectors. The unimpressive performance of the industrial sector (comprising manufacturing, mining and quarrying, utility services and construction) was reversed in 2017 with a growth rate of 19.3%. This surge is largely attributable to the deferral of the FPSO Turret Remediation Project to 2018 as well as the increase in revenue from new production from the Sankofa-Gye Nyame and the Tweneboa Enyenra Ntomme (“TEN”) oil fields.

Ghana’s stable political environment, favourable legal framework, constantly improving infrastructure, improving macroeconomic fundamentals and abundant natural resources, amongst others, are bracing to the country’s investor attractiveness. With a robust economy and stable investment flows, the future outlook for Ghana is encouraging.

The country’s capacity to fully absorb and benefit from increased investments and new technologies depends a great deal on the availability, quality and efficiency of more basic forms of infrastructure. The Infrastructure Sector comprises the ports, roads, rail, aviation, electricity, water supply, transportation, telecommunications sub-sectors.

Ghana’s Tourism Sector is one of the fastest growing sectors in the country. In 2016, it was the fourth highest forex earner for Ghana. The sector employed about 125,000 people directly and a further 313,000 indirectly in 2016.

Tourist arrivals continue to increase in Ghana, hitting 1.2 million in 2016. Per purposes of visits, visits of friends and relatives (VFR) tops at 24.7% whilst business visits stand at 23%.

With a proven reputation for economic and political stability in recent years, Ghana is progressively developing into the go-to investment destination for property development in Africa and a springboard for investors seeking a fast- growing developing economy to put their investment dollars into.

According to UN Population’s data, 300 million new homes will be needed by 2030, or roughly 21 million new homes per year, which will bring global demand to nearly 100,000 new housing units each day.  By 2030, almost 60 percent of 8.3 billion people will live in cities, according to UN estimates. This means almost 1400 of the world’s cities will have half a million or more inhabitants.

Ghana’s healthcare sector is one of the most advanced in West Africa. With large-scale investments in infrastructure, expanding insurance coverage and an increasing role for private investors, Ghana’s health sector is evolving rapidly. Though the country has done well in addressing pressing health care issues, there is still work to be done on areas including communicable diseases, infant care and maternal health. However, the growing incidence of non-communicable diseases presents a new range of challenges. With government resources limited, there is growing scope for the private sector to participate in the construction, management, consultancy and financing aspects of health care.

Ghana, has a total land mass of 239,460 km2 lying between latitude 11.50N and 4.50 S and longitude 3.50W and 1.30 E. Ecologically, the country is made of three broad zones namely, the high-forest in the south (rain and deciduous forest), accounting for about one-third of the land area (8.2 million hectares), a savanna (15.7 million hectares – Coastal, Guinea and Sudan savannah), and a transition zone (1.1 million hectares1 mostly semi-deciduous forest in the middle belt)

Ghana’s quest to build a strong economy and vibrant business market requires the exploitation of all potential business avenues to create employment and prosperity. One such area which has lots of business potential is the forestry industry which the government, private sector and all stakeholders have not been able to maximize its value and potential.

In Ghana, the financial services industry is dominated by the banking sector, though insurance, pension and capital market have emerged in recent times as a result of past financial sector reforms. The implementation of the Financial Sector Strategic Plan (FINSSP) in 2003 promoted the evolution of various financial sector institutions which emerged to meet the varied financial needs  of  the  population.  Consistent  with  the  Government’s  vision,  the  project  has  an underlying theme of establishing an enabling environment supported by effective regulations, with an objective that all savers and investors will have the benefit of regulatory oversight. The operating financial intermediaries include both foreign and local major banks, Rural and Community Banks (RCBs), Savings and Loans Companies (SLCs) and other finance and leasing companies.

The energy sector is the lifeline in the development of any nation. This belief informed the decision to undertake the construction of the first hydroelectric (Akosombo) dam in 1965, which continues to be an important investment in Ghana’s economic history. Over the years with the increased demand by power users for greater security and reliability other sources of power – thermal, solar and lately windmills, as well as imports – have been added to the generation mix. The thrust of Government policy in the energy sector and Ghana’s oil find in commercial quantities is to push for a significant increase in its energy resources to become a net exporter of both power and fuel. The production of Ghana’s oil started in the year 2010.

Ghana’s Communication Technology Sector is viewed as a critical agent in the development agenda  in  the  country.  Telecommunication  services  are  now  relied  upon  for  information delivery to the hinterlands, where access to roads and power is non-existent. Truly, the information age is gaining popularity in Ghana and leading the much-touted infrastructural transformation within its economy.

Ghana’s urban population is moving away from consuming meals requiring long preparation and cooking times and rather towards already-processed foods.

Recent surveys show significant presence of processed foods in retail shops, including milled rice, processed fruits and vegetables as well as frozen meats. However, only about a fifth of these products are locally processed.

Animal production in Ghana plays a major economic, social and cultural role in the lives and livelihoods of small holder farmers, processors and traders. It is a source of protein, hence contributes to balanced human nutrition.

It acts as a bank and insurance in times of urgent financial needs, since it generates cash income. It also helps to maintain soil fertility and structure through manure.

The education sector has evolved and grown steadily over the past decades. However, it has not always kept pace with the economy’s acceleration and diversification in recent years, while in some areas particularly with inclusive education (IE) – long term goals have still not been met. With this in mind, reform and development of the sector has become a priority, an undertaking in which both foreign and private partners are playing key roles.

Agriculture has a greater impact on poverty reduction than other sectors in Ghana’s economy and is critical for rural development and associated cultural values, social stabilization, environmental sustainability and buffer during economic  shocks.  The  sector  currently  employs  about  48%  of  the  total workforce. Although its share of GDP has decreased in recent years, it continues to be vital to growth.