‘Take advantage of tension in Europe to negotiate for better trade deals’
A senior research fellow at the Institute of Statistical Social and Economic Research (ISSER) of the University of Ghana (UG), Dr Charles Godfred Ackah, has called on African countries to take advantage of the trade tension within the European Union (EU) to negotiate for better trade agreements.
He said the ongoing trade policy uncertainty between the United Kingdom (UK) and the EU had since June 2016 generated some controversies, adding that the happenings could have major implications for African countries.
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“I believe that a Brexit fallout and the current European Union trade challenges are a God-given opportunity for Africa to come together as a strong continent to negotiate for better trade agreements. This is also the opportunity for the Free Continental African Trade Market Agreement to be utilised,” Dr Ackah said.
The Fellow made the call at the Ninth Lecture Series of the Centre for European Studies, UG, in Accra yesterday, on the theme:
“Trade and economic relations in Europe: Challenges and Opportunities for Ghana.”
Trade values
Dr Ackah also explained that the EU was the world’s largest free trade bloc, and Africa notably its biggest trading partner, with prevailing trade flows estimated at nearly €300 billion, compared to about €18 billion in 2014.
“The UK is the world’s fifth-largest economy generating trade flows of around $1.6 trillion (almost four per cent of total world trade in goods and services). African countries, particularly Ghana, must consider developing stronger trade policies to tap into the space,” he added.
The Fellow further stated that the tension on the international trade front also made businesses less willing to invest in new projects, leading to lower global growth. He added that the tension within Europe had affected business confidence and reduced investments which, he said, could affect developing countries such as Ghana.
Diversification
Dr Ackah, therefore, advised the government to consider diversifying its trade relations to avoid the effects of the trade tensions in Europe.
“We export three main commodities: petroleum, cocoa and gold, which constitute about 80 per cent of commodities exported mainly to Europe. We need to now diversify our trade because it is not good to put all our eggs in one basket,” he said.
Dr Ackah also urged the government to develop long-term trade policies to create industries that would be sustainable.
He further suggested that Ghana move beyond exporting raw materials and rather focus on industrialising the economy.
“We need to move beyond exporting primary commodities such as cocoa beans; this is the time to industrialise, add value to our raw material, set up businesses to process our raw material, create jobs and determine the prices of our finished goods,” the Fellow added.
Advice
The acting Director of the Centre, Dr Lloyd Amoah, advised the participants, mostly students, to learn from the issues raised by the resource persons to guide them in their chosen areas of specialisation to help in the accelerated development of the country.
He also entreated the government to develop long-term policies which could sustain the manufacturing sector in the country.