1D1F Not feasible -EIU

 

The Economic Intelligence Unit (EIU) is doubtful about the implementation of 181 factories pledge by President Nana Addo Dankwa Akufo-Addo under the One District, One Factory (1D1F) initiative by the end of this year.

 

According to the EIU, Ghana’s regional imbalances- coupled with broader issues of a poorly trained workforce and weaknesses in the business environment- were among the reasons the 1D1F target would be impossible to achieve this year.

 

The EIU is a specialist publisher serving companies establishing and managing operations across national borders. For 60 years, it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide.

 

EIU delivers its information in four ways: through its digital portfolio, where the latest analysis is updated daily; through printed subscription products ranging from newsletters to annual reference works; through research reports; and by organising seminars and presentations.

 

It would be recalled that Ghana’s Minister of Trade and Industry, Alan Kyerematen, in May this year said that the 181 factories were at different stages of completion across the country.

 

He said that the factories under the 1D1F project would not be built by the government, explaining that the initiative would be private investor-led.

 

“This initiative is for business people who have their monies to establish factories in the various districts and then the government will only support them to create those factories in the districts,” he said during a meet-the-press encounter.

 

But in its latest report on the Akufo-Addo’ administration, sighted by Today, the EIU said, “the NPP administration will continue to prioritise industrialisation, in line with its election pledges. As part of this strategy, it aims to establish at least one factory in each of Ghana’s 260 districts by 2020 under the One District, One Factory (1D1F) initiative.

 

“The government aims to have 181 projects operational by end-2019, although we believe that this is unlikely, given limited progress over the year to date. There are stark regional imbalances—with development hampered by a lack of supporting infrastructure—combined with broader issues of a poorly trained workforce and weaknesses in the business environment.

 

“The authorities are also keen to develop domestic refinery capacity to allow the upstream oil industry to improve value-added and revenue generation. However, poor data quality reduced investor interest in the licensing round announced in July.

 

“On a positive note, the administration continues to focus on the need to improve the business environment in order to boost private ­sector investment—achieving some success, with investments across industries—although we believe that the government’s industrialisation strategy is too ambitious, given broader barriers to growth.”

 

 

The report also observed that Ghana’s gas boom had  become a fiscal burden and explained that: “Ghana started producing gas in associated form in 2011, when the Jubilee oilfield came on stream, with capacity for around 120m cu ft/d to be sent first to the Aboadze Power Enclave, near Takoradi.

 

“Production increased by some 50m cu ft/d when the TEN oilfields development was commissioned in 2016, in the same year in which WAGPCo cut supplies to the VRA over unpaid debt—both events strengthening the rationale for the TTIP, which had been launched by the government the previous year.

 

“However, long delays ensued, blame for which has been traded by the New Patriotic Party, which is currently in government, and its predecessor, the National Democratic Congress. Strained relations with WAGPCo over continued payment issues also hindered progress. These tensions have eased since late 2018, following the settlement of more than 50% of arrears and regularised reimbursement for ongoing consumption.”

 

 

Story: Franklin ASARE-DONKOH

Writer’s email: franklin.asare-donkor@todaygh.com

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