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January 16, 2019
IFS National Pension Dialogue
July 2, 2019

Ghana’s Attempts at Industrialization: How Can the Country Achieve the Success It Yearns For? [Occasional Paper No. 19]

[Occasional Paper No. 19] Ghana’s Attempts at Industrialization: How Can the Country Achieve the Success It Yearns For?

Since independence, Ghana has sought to extensively develop the manufacturing sector of the economy with the goal of becoming an industrialized nation, enjoying rapid and sustained economic growth and development. Yet, data reveal that the manufacturing sector has performed very poorly, leading to the failure of the country’s industrialization attempts despite strong policy attention paid to the sector.

Economic fundamentals such as high fiscal deficits, macroeconomic instability, shortage of foreign currency, inadequate raw materials to feed the manufacturing industries, etc. have commonly been cited by researchers as being responsible for this failure. We show that although economic fundamentals (and other factors) are the immediate causal factors affecting the performance of Ghana’s manufacturing sector, they are themselves affected by certain intermediate as well as more primitive or root causes, which have not been significantly addressed over the years and which are not only daunting to address but are also very delicate to deal with.

To ensure the success of the present and future industrialization efforts and achieve rapid and sustained growth and development of the broader economy, the country needs to adopt bold steps to address these root causes. We have provided a number of recommendations by which the country can address the root causes in order to permit long-term improvements in the economic fundamentals to stimulate manufacturing development and industrialization.

Read the full paper here.