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Opinions of Monday, 27 March 2017

Columnist: Kwesi Biney

An open letter to the Trade and Industry Minister

Alan Kyerematen, Trade and Industry Minister Alan Kyerematen, Trade and Industry Minister

By: Kwesi Biney

Good day Honourable Minister, May I humbly take this opportunity to formally congratulate you on your appointment to the Ministry of Trade and Industry, a position you once held under President Kufuor. Throughout the 2016 general elections campaign, the NPP through its then flagbearer, now the President of the Republic, Nana Addo Dankwah Akufo-Addo, promised the creation of jobs for the teeming youth of this country to reduce the epidemic unemployment situation confronting this nation, particularly among the youth.

So important is this policy to the party that it found precious space in the party’s manifesto for the 2016 general elections, and even before the Ghanaian electorates could even give the party the mandate, the then flagbearer had appointed you as the man to run the Ministry to create jobs for the teeming youth. Among the numerous strategies to deal with the unemployment scourge, the ‘ONE DISTRICT ONE FACTORY’ strategy was bought by the electorate, particularly, the youth who helped in no small measure to get the NPP back into office.

According to our Manifesto, ‘In collaboration with the private sector, the NPP will implement the ‘One District, One Factory’ Initiative. This District Industrialization Programme will ensure an even, spatial spread of industries.’

The recent Budget and Fiscal Policy of the government put before the nation by your counterpart, the Honourable Finance Minister, indeed outlined some strategies to create the enabling environment for business people and the private sector in particular to have confidence in the economy and invest in it. ‘Pursuing aggressive industrialization and value-addition to agricultural produce, providing tax and related incentives for manufacturing businesses in sectors such as agro-processing, light industries, pharmaceuticals, petrochemicals, garments and textiles, among others, providing a reliable and cost effective mix of energy supply for businesses etc. etc. seem to have been captured in the Budget and Fiscal policy for the year 2017.

These, Honourable Minister, are the legal framework and policy directions around which your Ministry is going to achieve its goals of ensuring job creation and employment opportunities to deal with the state of joblessness in the country. Mr. Minister, you will agree with me that aside the very good policies of legal and fiscal nature aimed at attracting investments into this country, one of the most challenging issues confronting investors in this country is the issue of land acquisition. The land tenure system in Ghana is not investment friendly. The last two decades particularly, have seen needless litigations over landownership which have frustrated potential investors into this country.

It is simply not the case that there is a dearth of land for both commercial and industrial purposes in our country, but it is the difficulties and the frustrations associated with land acquisition. The issue of double or multiple sales of land emanating from double or multiple ownership has been a threat to many an investor, some of whom have had to abandon their plans out of frustrations with the acquisition of land.

Mr. Minister, since your Ministry does not oversee land issues neither does it have huge tracts of reserved lands for commercial and industrial use, one of the first hurdles that your Ministry will have to cross to be able to accelerate the establishment of new industries or revive dead industries in the country is to address the land issue as early as possible.

You will also agree with me that apart from some state owned enterprises that have been allowed to be in ruins, and the premises occupied by weeds across the country, we also made the mistake of divesting state commercial and industrial entities to individuals and groups for purposes other than commercial and industrial. There are also hundreds of private businesses which have completely closed down over decades and still many of them in serious distress. At least, each district in this country can boast of one abandoned factory of some sort which used to be a source of employment for the people in that district.

The good news is that because the owners of these collapsed or distressed factories properly acquired the lands on which they operated, many of them are still in their ownership except that the infrastructure on them are totally gone or they are in terrible state.

My humble suggestion to you Honourable Minister is for your office to get a team to identify any such facility existing anywhere in this country. The District Assemblies may be tasked to identify such facilities in the various MMDAs, look out for the owners of such facilities and deliver such information to your office.

Then a team can be put in place to engage the owners of the abandoned or collapsed factories or facilities not for the purpose of government acquisition, but to look for investors to partner or acquire them to get the facilities running again where possible. In fact, the facilities need not go back to what it was doing previously before it shut down, but at least any new investor who can have access to a litigation free land for its activities will help in the speedy establishment of any business in mind.

In this case, if the owners of the land have no immediate intentions of investing on the land for medium and long term purposes, they can use their lands as equity in the new company. Mr. Minister, my district, the Ahanta West District for example, used to be the hub of timber activities in the 1970s until the timber industry collapsed. The companies acquired huge tracts of land which have become idle. Any serious engagement with owners of these idle lands can elicit their plans, going forward, so the relevant bodies can help them re-align their business thinking with local or foreign investors in a speedy manner.

In fact, there are about six such facilities in the District, and should they agree to convert those facilities into large scale poultry production for example, I can be sure that they can produce a million eggs each day, properly package dressed chicken to meet the consumption needs of about three regions of this country. Just think about the employment opportunities that will offer the people and the foreign exchange savings the nation will benefit from.

Mr. Minister, I am no expert, but I can state without any contradiction that the Bonsa Tyre Factory also in the Tarkwa Nsueam area cannot produce competitive tyres in spite of the availability of latex in the Western Region. But the facility can be converted into the production of something else. Piggery for domestic consumption and export? The Aboso Glass Factory cannot produce bottles anymore, but the facility can be used for something else of economic value and benefit to the people there and the nation at large.

The ‘One District One factory’ programme can have a space in each of the Districts with ease if we identify lands the investors would not have to litigate so much over to acquire through partnership with the owners or outright acquisition.

There are other cases where the very poor management of the economy over the last eight years has strangulated some businesses which have been compelled to shut down or shed off labour to cut down costs. These existing businesses require immediate support to get them working at maximum capacity as we look out there for new ones. Identifying them and linking them to potential investors will help them rise again.

It is also my humble suggestion Mr. Minister, that some of the causes of the collapse of local businesses is the Sole Proprietorship mentality of our entrepreneurs, many of such businesses die with their owners. To ensure the sustainability and continued operations of local businesses, your Ministry should encourage local business people to pull resources and run their businesses rather than going solo and dying with them in many instances.

An educational drive as well as tangible and intangible incentives should be given to investors and potential investors to encourage partnerships in the establishment of small and medium scale businesses. This will not only increase their capital base, but also ensure the growth and expansion of businesses and also the perpetuity of those businesses.

Thanks Mr. Minister and welcome back.

Kwesi Biney, c/o Daavi’s Kiosk everywhere.