Economists are urging Ghana to strengthen its industrial and manufacturing base to reduce vulnerability to recurring global crises, including pandemics, conflicts, and geopolitical tensions.
Speaking on Metro TV, Dr. George Domfe, policy analyst at the Africa Policy Lens (APL), argued that Ghana’s open economy leaves it highly exposed to external shocks such as the COVID-19 pandemic, the Russia-Ukraine war, and ongoing tensions in West Asia involving Israel, Iran, and the United States.
“These international disruptions have repeatedly exposed structural weaknesses in Ghana’s economy, contributing to inflation, exchange rate instability, and rising living costs,” Dr. Domfe said. He traced Ghana’s vulnerability to decades of dependence on raw material exports, from the oil shocks of the 1970s to more recent global crises.
Dr. Domfe emphasized the importance of value addition and domestic production. Using cocoa as an example, he explained that exporting raw beans rather than processed cocoa products limits revenue potential and hampers long-term growth. “Countries like Singapore and South Korea show that industrialization and a strong manufacturing sector are essential for economic transformation,” he added.
He further noted that Ghana’s underdeveloped manufacturing sector restricts job creation and economic resilience. Economies typically move from agriculture to manufacturing before transitioning to services, a path Ghana has yet to fully achieve.
Economists broadly agree that investing in domestic industrial capacity, processing raw materials locally, and developing competitive manufacturing sectors are crucial steps to safeguard Ghana against future global shocks. Without such measures, the country risks continued economic instability in the face of international crises.
