The Africa Center for Economic Transformation (ACET) has revealed that Ghana’s economic transformation since independence has fallen short of expectations, particularly in terms of industrial competitiveness and manufacturing growth. Despite considerable focus on these sectors, they remain hampered by an unfavorable business environment and weak connections to the extractive industry, according to ACET’s Ghana Country Economic Transformation Outlook 2024.

The report highlights that these shortcomings have negatively impacted economic diversification, export competitiveness, productivity, technological advancement, and overall human well-being. It criticizes successive governments for failing to consolidate industrialization efforts and create an enabling environment for a competitive private sector. Key challenges identified include persistent macroeconomic instability, inadequate support for private sector growth, and the inability to drive agro-based industrial development.

ACET pointed out that past industrial policies, such as import substitution industrialization, were implemented in a context where the private sector struggled with weak innovation capabilities, poor managerial capacity, and an under-skilled workforce. To address these issues, the report urges Ghana to prioritize and empower small and medium enterprises (SMEs) to boost productive employment and enhance technological capacity within the manufacturing sector.

Additionally, the report emphasizes the importance of promoting agro-based industrial development to add value to Ghana’s exports. However, it notes that poor policies, institutional barriers, and external factors have hindered progress in transforming the agricultural sector and strengthening its linkages with higher-productivity industries.

The manufacturing sector, in particular, faces significant supply-side challenges, including limited access to raw materials, inefficient supply chains, and inadequate infrastructure such as unreliable electricity and underdeveloped rail systems. These obstacles collectively impede the transformation of agricultural outputs into value-added products.

On environmental sustainability, the report highlights Ghana’s ongoing struggles with environmental and climate challenges, despite various policy initiatives. Key risks include air and water pollution caused by illegal mining (galamsey) and poor waste management practices. These issues threaten the sustainability of critical environmental resources, including water bodies, nature reserves, flood plains, and public parks.

The Ghana Country Economic Transformation Outlook 2024 aims to assess the country’s progress and identify barriers to economic transformation. Using ACET’s “Growth with DEPTH” framework, the report seeks to influence policy debates and shape Ghana’s development agenda by advocating for gender-responsive policymaking in both macroeconomic and microeconomic strategies.

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