The arduous task of raising US$60.9 million annually for interventions under the National Export Development Strategy (NEDS) is raising uncertainty over the country’s ability to increase Non-Traditional Export revenue from US$2.8 billion in 2020 to US$25.3 billion in 2029.
The strategy, which was launched in 2020 has a 10-year funding component of US$30 million annually from the Ghana Exim Bank (GXIM) and a US$20.9 million from the Petroleum Heritage Fund.
A financing gap of US$10 million is to be filled annually from multiple sources such as soft loans and grants from development partners, budget allocations to Metropolitan, Municipal and District Assemblies (MMDA), leveraging venture capital funding to support startup companies as well as stimulus fund provided by GEXIM bank and government.
In an Interview with the Ghana News Agency, Mr. Alexander Dadzawa, Director of Projects at the Ghana Export Promotion Authority (GEPA) indicated that funding for interventions under the NEDS had so far been mostly from the allocations of the Authority.
“There is a financial crunch we are all going through, and government resources are thin. Government does not have the money to execute its agenda and it may also affect export trade,” he stated.
He said though GEXIM bank could not fully meet its obligations under the NEDS having been overstretched, there had been talks with management for collaboration towards supporting horticultural sector with grant and credit facilities.
Alternatively, he said, GEPA, as the lead implementer of the strategy had been in talk with development partners and agencies to support projects under the strategy.
Stakeholders in designing the NEDS among other things recommended the transfer of oversight responsibility of the EXIM bank from the Ministry of Finance to the Ministry of Trade and Industry, and the amendment of the Export-Import Bank Act, 2016 (Act 911) to allow the bank to support export business operation of private sector companies.
In effect, Mr Dadzawa said, work was ongoing to revise and amend the GEPA Act of 1969, which would inform an amendment to the Export-Import Bank Act, 2016 (Act 911) to mandate the bank, currently under the Ministry of Finance to be able to support export ventures in the country.
Processes, he said, were ongoing for the establishment of a governance structure for NEDS where a secretariat had been set up with a steering committee and inter-ministerial oversight committee due to be inaugurated by the end of the first quarter.
Meanwhile, needs assessment for 18 out of top 20 nontraditional exporting companies, he said, had been conducted while a strategy to improve access to cocoa beans for local industries was being considered.
GEPA, he said, within the year would focus on sensitisation at the district level on the NEDS and the AfCFTA while conducting market research in 15 other countries.
He said engagements were also ongoing with the National AfCFTA coordination office to streamline activities such as the needs assessment of exporting companies in the country.
“The next thing on our radar is the One District one exportable product within the NEDS. This means that we are going to work closely with district assemblies for each district to identify a core product that it can develop at the base to feed 1D1F,” he said.