zion

Search

GEPA grows the Non-Traditional Export (NTE) sector

By G.D. Zaney

 

The Export and Import Act, 1995 (Act 503) of Ghana defines Non-Traditional Exports (NTEs) to include all export products with the exception of cocoa beans, lumber and logs, unprocessed gold and other minerals, and electricity.

 

The NTE sector, which plays a critical role in Ghana’s economy— being one of the principal sources of foreign exchange generation, has seen considerable growth in revenue over the last decade, with the expectation that the sector’s contribution to the overall export revenue basket of Ghana will increase from the present 19 per cent to, at least, 30 per cent in the next few years.

 

From 2005 to 2008, NTE earnings grew steadily at an annual average rate of about 20.1 per cent from US $777.59 million in 2005 to US$1,340.94 million in 2008.

 

In 2009, the NTE sector recorded a 9.38 per cent decline with earnings at US$1.215 million, due, primarily, to the global economic recession and in 2010, and 2011, earnings from the sector increased by 34.1 and 48.74 per cent, amounting to US $1.629 billion and US$2.423 billion, respectively.

 

In 2012, earnings from the sector again suffered decline by 2.24 per cent to US$2.364 billion and in 2013, earnings from the sector went up by 3.05 per cent to US$2.436 billion and, again, by 3.20 per cent to US$2.514 billion in 2014.

 

In 2015, Ghana’s total revenue from NTEs amounted to US$2.522 billion, representing a modest growth of 0.32 per cent over the previous year’s performance of US$ 2.514 billion.

 

Earnings from three sub-sectors—Agriculture, Processed and Semi-processed and Handicrafts— add up to arrive at the total earnings for the NTE sector.

 

Export earnings from the Processed and Semi-processed sub-sector, contributed 84.09 per cent of the total NTEs, amounting  to US$120.50 million,  compared to US$2,169.65 million earned in 2014, a decrease of 2.27per cent, due to a decline in the performance of some key products such as cocoa paste, natural rubber sheets and aluminum plates, sheets and coils.

 

For the agricultural sub-sector, earnings increased by 16.51 per cent from US$396.91 million in 2014 to US$ 340.68 million in 2015 and contributed 15.74 per cent to total NTE earnings, while the export earnings from the Handicraft sub-sector increased by 23.05 per cent in 2015 from US$3.47 million in 2014 to US$ 4.27 million, and its contribution to total NTEs increased from 0.14 per cent in 2014 to 0.17 per cent in 2015.

 

Ghana’s NTEs were exported to 137 countries, divided in to five groups—the European Union, Economic Community of West African States (ECOWAS), Other Developed Countries, Other African countries and Other Countries.

 

The performance of the NTE sector by markets  show that the European Union and the ECOWAS markets accounted for 35.84 per cent and 31.59 per cent, respectively, and continue to be the leading markets for Ghana’s NTEs with Other Developed Countries, Other African countries and Other Countries accounting for 3.2 per cent, 7.52 per cent and 21.43 per cent, respectively.

 

The growth of the NTE sector is attributable to the efforts of the Ghana Export Promotion Authority (GEPA) in designing programmes and activities aimed at facilitating, developing and promoting Ghana’s NTEs.

 

For the sector to realize its full potential, a number of programmes and activities have been designed and are being initiated by GEPA, notable among which are the provision of market information to the exporter community, delivery of market penetration assistance to exporters, initiation of product development programmes, capacity-building of exporters and the development of national export awareness.

 

The launch of the National Export Strategy(NES)in 2013 by government, therefore aimed to increase the level of export revenue from the NTE sector to US $ 5 billion in five years, with the overall objective of developing the potential of the sector for maximum contribution to Ghana’s Gross Domestic Product (GDP) growth and national development in order to consolidate and enhance Ghana’s middle-income status, create formal decent job opportunities and ensure high standards of living for the people.

 

To be able to generate the US$5 billion from NTEs within the 5-year strategy period, eleven priority product sectors have been identified and recommended for aggressive support for support.

 

These product sectors include cocoa products, cashew nuts, horticultural products (pineapples, mangoes and vegetables), fish, shea nuts, root crops (yam, cassava and sweet potato), oil palm and crafts.

 

Other products targeted for support are textiles and garments, gold jewelry and services (medical tourism, higher education and business process outsourcing).

 

To ensure effective implementation of NES, a new GEPA organizational structure has been drafted, a Project Co-ordination and Management Unit established at GEPA while a Memorandum of Understanding (MoU) has been signed with the Rural Enterprise Programme (REP) to set up District Level Export Committees to assist in selecting the District Level Products.

 

Again, to enhance Export Quality Certification processes, the United Nations International Development Organization (UNIDO) and the TRAQUE project have extended their support to three export certification institutions—Food and Drugs Authority (FDA), Plant Protection and Regulatory Services Division (PPRSD) and the Ghana Standards Authority(GSA).

 

To assure buyers of Ghanaian products of quality products on the international markets, the mapping of producers and exporters under the National Traceability System is being done while a market hub within GEPA is also being developed to provide up-to-date trade/market information to Ghanaian exporters and buyers of Ghanaian products.

 

On the part of government, one major intervention for the export sector is the establishment of the Export and Import (EXIM) Bank of Ghana which is envisaged to support the private sector to diversify and expand its supply base as well as its domestic and export markets and the entire production and export chain of high earning export products.

 

EXIM Bank is also expected to provide the much-needed funds to implement the National Export Development Programme (NEDP) 2016-2020 as it relates to the eleven priority export products including cashew, medicinal plants and processed cocoa, which had been earmarked to lead the growth and increase of the Export sector and the NTE sector, respectively.

 

The bank has provisions to allow cashew farmers to access it to expand their export and in order to maximize earnings from the cashew sector, government is expected to encourage the processing of at least 50 per cent of cashew nuts for export and operationalize the Cashew Development Strategy to increase production volumes and value-addition activities along the cashew nut value chain.

 

The institution of the President’s National Awards for Export Achievement is another intervention which seeks to encourage and celebrate the contributions of companies operating in of exporters in the NTE sector.

 

The Awards scheme also provides exporters with the opportunity to gain valuable exposure and recognition for their national and global market expansion endeavours.

 

The writer is an officer of the Information Services Department.

 

Hits: 7262