Ghana’s manufacturing and export sector continues to lag in high-intensity technology adoption, placing the country at a disadvantage compared to regional peers like Senegal and Tunisia.
A report by the Africa Center for Economic Transformation (ACET) highlights that the country’s industrial policy has not effectively promoted the use of advanced production technologies, limiting the competitiveness of its exports. Additionally, the small and declining manufacturing sector faces difficulties in attracting highly skilled and innovative workers, further hindering progress.
The report points to a significant gap in Ghana’s technology intensity score for manufactured exports, which, despite improving from a low of 4 in 2002 to 18.6 in 2020, remains below Africa’s top-performing economies. The sector had reached a peak score of 28.7 in 2014 but has since struggled to maintain momentum.
Progress in Human Well-being Amid Economic Challenges
While the industrial sector grapples with these challenges, Ghana has seen significant improvements in human well-being, driven by economic growth and improved market conditions.
Between 1990 and 2022, Ghana’s GDP per capita more than doubled from $852.4 to $2,040, contributing to a sharp decline in poverty from 64.2% in 1991 to 25.2% in 2016. However, income inequality remains a concern, rising from 38.4 to 43.5 during the same period.
Despite these disparities, the income share held by the top 10% of the population has seen a marginal decrease, dropping from 32.7% in 2005 to 32.2% in 2016.
The ACET report underscores the need for Ghana to enhance its industrial strategy by integrating more advanced technology into production processes. Doing so could improve the competitiveness of Ghana’s exports, drive economic transformation, and create higher-income opportunities for the population.
