Industry of Ghana and its problems.

The word “Industry” have many dimensions to define different aspects, sometime it is

concept but many time it is construct, because it have multi dimensions that made reader confused to get an exact idea about. In general industry is a specific field of profession, which performs accordingly. In economics industry specifically associates with any company that utilizes raw material and produces goods and services to sell in the market. When life start there was no such need of mass production there was horticulture and hunting culture in which people used to hunt and live upon on the fruits and animals. Population increase and developed with the passage of time, growth in population increase the demand of food and other necessities made people thought about new system that can facilitate by filling their needs. There are many types of industry, classified with the level of its functions are; primary industry, secondary industry, and tertiary industry. And other classification with their production fields, like textile industry, food industry, telecommunication industry.

Industrial revolution is the period which starts from 1760 to 1840 in which the production and consumption started and touch the height of its peak in the west especially in England. When mechanism and power invented, this paved the way for industry. Western people are the pioneers of the industrialism in the world. The concept of industry spread rapidly in the entire world. All the industry established in the west but they are highly dependent on the third word, which is fully fertile for raw material. That need of the west start thinking to occupy the third world and get ram material and brought it to their native lands for manufacturing, then this production to sell in the rest of world. The period of occupation called colonial period, and the pet term is “colonialization” to define the whole process. Countries that were under domination located most of them in the continents of Asia and Africa. Unwillingly and at the same time luckily, west established industries in their colonial countries. Ghana was famous because of its natural blessed mines of gold. This made British to dominate the Ghana and ruled there with use of their force, and established there many types of industry in the country. They mainly established industry mines gold industry, tobacco industry, and citrus juice industry that provide vitamin c.

Ghana is an agricultural country is an agricultural country; agriculture is the main source of GDP and per capita income. Agriculture has 56% of the workforce. Services also a big source of income of Ghana, which is the 29% of total work force. Industry unfortunately on the worst

scale in Ghana, sometimes it is high and mostly downward. And it has only 15% of the total work force, due to lack of education, skills, and expertise in the technology. The know how rate is too low to meet certain criteria. But luckily Ghana earns 28.7% of the total GDP, while the agriculture only 21.5% share in the GDP of Ghana. Initially Ghana emerged as domestic industrial country, afterward with the technological development in Africa, Ghana proved itself as big exporter in all Africa.

Objectives on industry

Production of goods to meet domestic needs. To export the goods and earn revenue for the nation. Create jobs opportunities and employment. Development in every sector. Socio- technological development. Economic development. Improving infrastructure. Develop and maintain relation with countries you need raw material, and your receiver of

export. Little land is enough for maximum producing.

Types of industry working in Ghana

All the types of industry working in Ghana, classified into three categories are;

Primary industry (natural resources)

This type of industry simply means growing of crops, or fishing and farming. In other words all the production, we produce from natural resource, like mines, agriculture. As the Ghana is weak in industrial technology, this situation promote the primary industry in which less infrastructure produce lot of output without the high expertise. It is the 60% of GDP of Ghana. Some major key players of primary industry in Ghana are;

1. Agriculture

Agriculture is one of the great source of income of Ghana, engaged 60% of population, coverings various fields. Ghana blessed with bundle of natural fertile resources, that earning is the major part of GDP. Now Ghana is able to export its products in the market of the world. Cash harvests of Ghana are, cocoa, rice, banana, cassava, shea nuts, peanut and corn. That industry earning shares 49.6% of the GDP.

2. Mining

Ghana one of those countries blessed with marvelous treasures, it surprising fact that Ghana is the second largest gold producer and exporter of the world, if we talk globally Ghana is the 9th major country who mining and exporting of gold. Gold mining is more than 90% of total mining, in other mining resources bauxite, manganese, and diamond. There are many mining companies in all over Ghana, but 300 registered companies working. Mining is earning 4.05% of total GDP of Ghana, and mining industry sharing 37% of total export.

3. Fishing\Aquaculture

Although fishing is not able to export in the world market, but it is fully meeting the domestic needs of the country. Aquaculture has much importance in the primary industry of Ghana, we can’t even minimize the importance that department. The history of aquaculture in Ghana is not too old; it is recently adopted by Ghanaian’s. During 2003 fishing was meeting 51.6% of domestic need, same field in 2004 producing 61.9%, that shocking figure is the open secrete of progress in fishing. Tilapia is the most produced fish in Ghana which is 80% of the total fishing, in other fish’s Heterotis niloticus, which is the 20% of total fishing. The total worth of fishing in Ghana around about is 1.5 million US dollar.

Secondary industry (manufacturing unit)

Secondary industry is directly link with primary industry, it involve manufacturing of goods and sell to consumer. Secondary industry encircled a large segment of industrial sector. It utilized raw material and produced goods for the market. Manufacturing industry of Ghana rooted back to British occupation on gold coast (Ghana), when they established mechanism for gold. After the independence of Ghana the Nkrumah, first president of Ghana, focused on the demolishing of tribal system and adoption capitalism as well as industrialism. Secondary

industry plays always a key role in the development of any country. One of the most important advantage of the manufacturing industry is that minimum land and maximum production.

Industry secured 25% of total GDP of Ghana, which is unfortunately is not a big amount but not a refutable deal for the developing country. Development ratio of industry in the country is 7.1 which made Ghana 38th fastest increasing industry of the world. Leading manufacturing industry of Ghana are; electronic manufacturing, automotive manufacturing, car manufacturing, light, cement and other manufacturing units.

Electronic industry

The history of electronic industry in Ghana starts from 1974, when government introduced heavy industry in the country. Electronic equipment is most import parts of appliances today life. Unfortunately this sector too weak to meet the need of domestic, this situation allow to import the western appliances in the country

Textile industry

Textile is very important sector in the industry of world. But unfortunately entire Africa generally and Ghana especially fertile less in the textile industry there are many factor which are the hurdles in the development of textile industry. Textile industry is mainly in northern part of the country. There are many types of textile industry working in the country. Types are; hand woven textile industry (also known as kente cloths), hand printed traditional textile industry in other words known as andinkra, fanti cloth, machine printed fabrics and wax resist local fabrics.

Automotive industry of Ghana

It is one of the most heavy industry of the world, when a country moves this ward we say it is on the peak of technology. Recently Ghana moved on with the help of China and India. Car manufacturing is developing day by day in Ghana. First company of automobile in Ghana is Suame Industrial Development Organization.

Wood sector of Ghana

Ghana is now the 38th fastest growing economy in business and export. As well as many other sectors wood industry also developing in Ghana, earning a big deal of revenue. Wood sector of Ghana is the 8th big earner of the foreign, which earning around about 11% of total economy of the country. Ghana is the big exporter of the wood in all Africa, and from rest of the world. An estimation of 2006 shows that earn e €125.82 million in value and 328,620 m3 in volume.

The ownership of industry

Ownership is divided into 3 categories are, first and major one is private sector second one is government sector and mix ownership on third ranked which the combination of private and government both.

Private ownership government owned sector governement and private mix1%

10%

100%

1000%

80%

12% 8%

2.4

4.4

1.8

22

3

Manufactur ing of ownership ghanalive.tv by samuel toure

PVT sector GOVT sector MIX of both

Industry in Ghana is too weak to meet domestic needs of the nation. Most of goods imported by the western and Asian countries. But Ghana is sustained economy in the Africa. Ghana in the top 5 developed country in technology. There are many problems which are obstacles in the development of the country. Essentials element for establishing industry are land, capital, expertise, and technology.

Obstacles facing industry in Ghana.

There are many hurdles and obstacles in which industry of Ghana is suffering. Every manufacturing unit need some basic and essential key facilities to sustain and maintain its business. Major ones are;

Technical education\Expertise

In contrast with agriculture, the industrial sector must needed expert to run and operate the business in a fine way. Ghana is a under developed country in the continent Africa is not still

able to produce its educated working power. How can be possible to have high figure of expert employees in firm where the total ratio of education is not sustained and well established. Ghana now launch a plan to engage its youth in the technical vocational education.

No great investors\ no one ready for experiment

Investor is the first key player of any firm sector, which play a major role to establish the industry. As Ghana is developing economy of Africa, so there is very little class of elite people who can invest in this sector, but foreign is not willing to invest. Foreign investors are the asserts of industry especially when we talk about 3rd world countries like Ghana.

Less attraction for the foreign investors

Your environment is the most influential part to attract the foreign investors. Ghana is blessed natural resources but not still able to utilized as well as it can. Government policies, taxation, and the working condition must be supporting for the investors.

Government policy and taxation

In the past few decades there was no friendly environment in Ghana. Business friendly conditions also vary country to country, but the basic demands and necessities are the same everywhere. There is role of government is visible, even a bind man can perceive the role of government. Government must be serious to establish the industry and attract to investors. Recently government made a plan to facilitate the investor top come and enjoy working environment. Now very investor from china like telecommunication, from India car manufacturing unit like Mahindra established new industries in the different part of the Ghana.

Workforce

• Distribution of Labor Force by Type of Employment (%)

• Type of work 1988/89 1991/92 1998/99% Change1988 - 99

• Paid Work: Public 14.0 13.5 9.8 - 30.0

• Paid Work: private formal 6.3 3.9 4.4 -30.1

• Paid Work: informal 2.7 3.1 2.6 - 4.0

• Export farmer 7.0 6.3 7.8 11.4

• Food Crop farmer 38.8 43.6 41.6 7.2

• Non-farm self-employ. 30.5 27.6 31.6 3.6

• Others & non-working 0.8 2.0 2.1 ----

• Est. Labor force (ml) 5.4 6.0 7.5 38.9

Energy crisis

Energy crisis not only problem of Ghana, entire 3rd world is badly facing the shortage of energy to run business sector. Ghana is badly suffering in energy crisis. Load shading is menace problem of Ghana which wrapped all sector under its crises. Ghana has ability to produce 29000 MW, but only 12 MW currently producing. Many firms switch to other countries for their survival. Present government making a long term plan for fully salvation from this evil, an estimation showing that Ghana may overcome that crises till 2016. Not only energy problem but also much expensive energy available to the industrialists.

Poor road network

Most of road laid in the rural areas, where not concrete and reliable roads. Industry have to suffer when distributing goods in the market.

Technology

Weak and poor infrastructure is also big factor which help to stop the any kind of industry. Technology variations from one part of the world to other is also a big problem in the failure of industry. Technology invented in the north and move very slowly toward the south or 3rd world, so technology very important factor in this regard.

Globalization

No doubt globalization is blessings but at the same time it is evil for domestic industry. Globalization mostly suitable advanced country like America and UK. Our local industry total collapsed with the entrance of external products. Many scholars present their views in the favor of globalization, infect they are strongly inspire by west. All the scholars no doubt have a good approach on the behalf of western progress. They ignore the reality of that if the adoption of western product, which are manufactured by high technology, can sealed your own industry. It is true that competition with international make domestic industry to upgrade the standard, on the other hand industry of 3rd world countries they flopped instead of flourish. According to my point of view globally leaned follow but improved your own industry.

“It is possible that local firms will be deprived of the opportunity to grow” (Hillebrandt, 1999)

Word-system theory and dependency theory

These are the concept or theories prevailed in the worlds which simply means the division of labor between inter-regional and transnational countries. These concepts divided word into three categories are;

Core states located in the north equator of the world, much socially, economically, and technologically advanced.

Sami-peripheral countries these countries have both characteristics core and peripheral states located in the almost dominated by core and dominate the peripheral states.

Peripheral countries mostly in the Asia, Africa and the rest of the world, also known as 3rd world. Much backward by culturally, technologically, socio-economically as well as politically

All African nations especially Ghana have to leave the world system and adopt new one relevant to their conditions. On the other hand the concept of neo-imperialism and neo-colonialism also prevailed in the 3rd world, in which the trade flow between the west and east, west on the top of the world dominate the east with its multi-dimension of power. Neo-colonialism is the concept in which the link between the old lords and the countries got liberty from the lords.

Major efforts to develop industry.

Although Ghana is very poor conditions of industry, but at the same time some efforts made to improve the industry in Ghana, are;

Conference of African industry ministry 1971 (CAMI)

It was very important and most effective initiative, in the history of Africa, with the help of united nation industrial development organization. In which Ghana fully participated, and present its ideas with vision of improved itself.

Lagos Plan of Action

It was one of the most important step taken by the Africa in which the proposal of industrialization presented for the economic development of Africa. That plan was a milestone for the development of Africa. Ghana also follow the key points of that plan.

Ghana Industrial Policy document

It is the complete plan made the government for the industrial sector to develop. It provide new direction and aim to development of the industry sector, it not only provide the direction but also made regulations for the industry sector. It is implemented officially in 2006.

Industrial Sector Support Programme (ISSP)

ISSP is not a new plan it is directly link with its initiative plan Ghana industrial policy document. It is implementation of the Ghana industrial policy document. This plan took from the China.

Conclusion Industry in Ghana is too poor to meet the demands but it doesn’t mean it can’t be

improved. Government and other authorities must need to pay attention in this regards. There is no single factor responsible for the failure of industry in Ghana, bulk of factors that involve to degrade the industry in Ghana like socio-technological weakness, lack of investors, low rate of expertise and no technical education, energy shortage, harsh and fast rules and no friendly environment for the entrepreneurs. The question raised that, how can be improved the industrial flaw? There is need of multi-dimension plan to enhance the productivity of industry. First of all we have to develop 5 year plan to develop infrastructure, and make really effort to implement the strategy in a real way. Secondly need create industry friendly climate to attract the investors to establish their firm. We need to subsidies the entrepreneurs to launch their businesses. Taxation and permission must be easy to access. Thirdly energy crises to overcome through a proper plan to enhance the productivity. Fourthly we have to upgrade the system of education by adding technical education. Fifthly the roads network must be standardized and must have accordance with the heavy traffic. Sixthly need to attract foreign investors through ambassadors. Seventhly must needed to leave the currently world system which makes us slaves instead of lords. Industry is very important so we can make progress through advancement in the industry.

“It was Nkrumah’s belief that every imported item which could have been manufactured locally, provided that conditions allowed it, added to Ghana’s continuing economic dependence on the colonial system and delayed industrial growth”