Public Agenda (Accra) | 8 October 2007
Ghana: Industries Against Signing
The Association of Ghana Industry (AGI) has added its voice to the clarion cry on African governments not to sign the Economic Partnership Agreement (EPA) or risk killing local industries.
Under current EPA proposals, due to be signed by the end of the year, ACP countries will free up 80-90 percent of their trade with the EU in return for reciprocal duty-free access to European markets.
With this deadline fast approaching, civil society groups are becoming increasingly critical of the deals, accusing the EU of potentially ruining small scale farmers and producers by exposure to unjust competition from Europe. For these groups, signing the EPAs would slash the incomes of over half the people employed in these sectors, decimating efforts to reduce poverty in the region.
The President of AGI, Mr. Tony Oteng-Gyasi said the association is of the view that it will not be prudent for the government to sign the partnership with the EU in its current form since many of the industries in the country do not have the requisite capacity to export to European markets.
According to Mr. Oteng-Gyasi further trade liberalization which the EU is demanding will lead to the total collapse of the nation’s manufacturing, leather and textile industry, judging from the fact that even without even without the EPAs, the country’s local industries are already suffocating under trade liberalization.
The AGI President made this known at the 5th AGI Business Executive Luncheon on the theme "CEPS Operations and their impact on industrial activities." in Accra.
He said any effort by government to enter into such an agreement with the EU will lead to loss of huge revenues to the state because about 40 percent revenues collected for national development are taxes from imports from European Countries.
He cautioned government not to rush into signing the EPA in its current form fearing it will have negative implications on the economy if all imports from the EU countries are to have free access to the local market.
In his view, EUs argument that a fund has been set up to as aid to reduce the shocks that will result from the agreement is untenable, since currently the formulae for the disbursement of the so-called fund is still not clear.
"The principle of replacing trade with aid is a misplaced one that will affect every economy, we prefer more trade to aid," he added.
The Executive Director of AGI, Mr. Cletus Kosiba urged government to put in measures propel local industries, instead of signing the agreement.
He said currently many industries in the country are facing huge problems such as supply constraints, meeting international standards and this has led to unfair competition within the country, adding that government should draws lessons from the fact that even the Cotonou agreement which expires at the end of this year has not been beneficial to the country as was expected.
Mr. Kosiba said the idea of a fund being set-up as an aid that will help minimize the shocks of countries that will sign the agreement as a result of the loss of revenue was irrelevant since even within the ECOWAS sub region many countries are yet to realize the full benefit of the ECOWAS fund.
He called on the government not to bow to pressure from the EU through the misinformation and "empty threats" since there are other trade rules the country can benefit from without signing the agreement.
"The attitude of the EU in threatening the ACP countries is enough to let them know that the interest of the EU is not to see the economies of the ACP countries grow but rather just to consolidate their trade powers in the world".
Various civil society and advocacy organizations, striving for agriculture and trade justice, have asked government not to sign the EPA deal because it would destroy livelihoods.
At the event, the Commissioner of the Customs, Excise and Preventive Service (CEPS), Mr. Emmanuel N. Doku assured industrialist in the country that his outfit would continue to provide more customer friendly services to them.
He said his outfit has embarked on various activities to ease the time many industrialist waste in clearing their goods at the various ports.
Mr. Doku admitted that the current expansion projects at many of the ports including data processing machines have however affected the pace of work in many of these places and was hopeful it will soon be a thing of the past.
He disclosed that CEPS in collaboration with GTC has created an electronic platform that enables stakeholders to share and exchange date without having to spend days to get the required information.
The Commissioner indicated that his outfit is determined to ensure that within the next five years all CEPS revenue collecting points will be computerized to help in the monitoring of their activities.