|
Release
NPP, October
24, 2012
SPEECH ON INDUSTRIALIZATION
DELIVERED BY NANA ADDO DANKWA AKUFO-ADDO, NPP 2012
PRESIDENTIAL CANDIDATE, AT THE ST HILDA HOTEL, TARKWA, ON
OCTOBER 23, 2012
Good evening, Ladies and Gentlemen, I am very happy for this
opportunity to speak on INDUSTRIALIZATION, a subject that is
fundamental to the NPP plans to transform the economy of
Ghana, and to do so most appropriately in Tarkwa, one of the
first mining/ industrial towns of our country.
At this time of the election campaign, those of us seeking the
mandate of the people to manage the affairs of our nation have
a responsibility to spell out our plans to help the people
make informed decisions on December 7. The NPP has been
consistent in its message about the need to transform the
economy and to do so through industrialization.
Luckily for me, I feel this message, like the free SHS
message, has found resonance with the people and so there
would not be the need to explain why we need to industrialize.
This evening I intend to talk about how we aim to achieve the
goal of industrialization.
Yesterday, I went to the offices of the AGI in Accra to have a
conversation with members about what they want and expect of
government and the role they could play in helping Ghana
become a truly industrialized nation.
As we sat in their council room, I looked around at the list
of the former presidents of the AGI and my eyes rested on the
very first president of this august grouping, the late Mrs.
Esther Ocloo. Her story, which she herself used to tell with
such good humour is certainly worth recalling and I believe
that story still has lessons for us today.
It was back in 1942 that Dr Esther Ocloo, at the time Esther
Nkulenu, made her first few jars of marmalade. She had
completed Achimota College and had been unable to find a job.
Having picked up marmalade-making skills at Achimota, she used
her pocket money to buy oranges, sugar and firewood and
immediately made a 100% mark-up on her marmalade. The rest, as
the saying goes, is history and Esther Ocloo’s twelve jam jars
turned into the internationally acclaimed Nkulenu Industries,
constant companion of boarding school students as producer of
marmalade, orange squash, palm concentrate, aubergines and
even palm wine.
I like the Nkulenu story, because she exemplifies the
entrepreneurial spirit in the Ghanaian, and is a classic case
of how other nations started on the road to industrialization:
food processing and adding value to raw materials that are
easily found around them. It is probably worth pointing out
another poignant part of the story as well. She had left
Achimota College, at the time it was the highest level of
education you could get in Ghana, and she could not find a
job! A young girl finishes school and can’t find a job has a
familiar ring to it in our present day Ghana. Seventy years
after that leap of faith however, it is sad that there aren’t
many more Esther Ocloos and Nkulenu Industries.
Some would say her business should be a large scale enterprise
by now, but nothing can take her pioneering status from her
and I would like to say that even if Nkulenu Industries has
remained a cottage industry throughout the years, there is
still a lot to learn from that. The leather industry in Italy,
a multi-billion dollar industry that makes world famous shoes,
bags, belts and other leather products, is run very much along
the lines of a cottage industry by many families. There are
still vast opportunities for the emergence of many more
Nkulenus and the processing of our foods so that cooking does
not remain such a time-consuming drudgery in Ghana.
But whether it is on a small scale or a large scale,
industrialization can only be successful when the necessary
infrastructure is available to make our production processes
and the products competitive. Industrialization can only be
successful if we have a workforce that is educated and skilled
and can compete on the global market.
I look at your University here, the University of Mines and
Technology, Tarkwa, sited in the heart of the mining industry,
and it is just the type of institution we need to train the
manpower to transform our economy. This is an institution
established back in 1952 as the Tarkwa Technical Institute. In
1961, it became the Tarkwa School of Mines with the mandate to
train the required manpower for the mining and allied
industries in Ghana. Later, in 1976, the Tarkwa School of
Mines was affiliated to the Kwame Nkrumah University of
Science and Technology (KNUST) as a faculty of the university.
In 2001, it became the Western University College of KNUST
Finally, in November 2004 in the Kufuor/ NPP era, the
University of Mines and Technology (UMaT) was established to
provide higher education in mining, technology and related
sciences, and to act as a catalyst for the development of
mining and technology.
Despite the change in names and centres of authority over the
years, the core mandate has not changed. There are very few
countries in the world with universities dedicated to mining
and allied industries.
UMaT puts Ghana, a country rich in minerals, in a strategic
position to be a world leader in mining and its allied
industries.
The last NPP government started on a vigorous upgrading and
expansion of facilities in this University and I believe that,
if this is continued, equipment for all aspects of mining from
prospecting to refining of minerals can be designed and
prototypes produced here. Students, with the necessary
motivation and entrepreneurial skills, will also be assisted
to form incubator companies during their training so they can
be self-employed when they leave the walls of the University.
Mining has been an integral part of our economy for hundreds
of years, but Ghanaians have never really controlled the
business. When voted into power, I will see to it that the
University fulfills its mandate so that, as soon as possible,
Ghana will be self-sufficient as far as mining technology is
concerned, and that Ghana will get, at long last, full value
from its mineral wealth.
This, of course, will be of interest to the growing army of
young people that are involved in small scale mining around
the country. I cannot and should not avoid the subject of
Galamsey at this stage. My government will find a way to
regularize small scale mining, including Galamsey to make it
safer and better for the environment. But to do that this
university has to assist in designing the machinery that will
make this type of mining safe for both miners and the
environment.
I have spoken about the exploits of one woman in establishing
a food processing industry, and I have spoken about an
institution that can and is producing the workforce that can
transform one particularly important industry, mining.
And it leads me to the critical role of government in creating
the enabling atmosphere and providing the infrastructure to
make industrialization possible. The availability of
reasonably priced and reliable power ranks very high on the
MUST HAVE list. The energy deficit is a great drawback to our
development and it has to be resolved. The last NPP government
made great strides in increasing the energy capacity of the
nation. We added a total of 560 megawatts to the National
grid. These include:
i. VRA Plant, Tema, funded by government: 110 Megawatts
ii. Mines Reserve Plant, Tema, funded by mine companies with
government support: 80 Megawatts
iii. VRA Athol Plant, Tema, government support: 50 Megawatts
iv. Emergency Plant, Tema, funded by government: 120 Megawatts
v. Asogli Power Plant, Tema, funded by a private investor with
government support: 200 Megawatts, making a TOTAL of 560
Megawatts
It is probably worth mentioning here the energy projects
started by the NPP and not completed before we left office:
i. BUI Hydroelectric Dam, Bui: 400 Megawatts
ii. ABOADZE Thermal Plant (T3), Takoradi: 136 Megawatts
iii. OSORNOR Thermal Plant, Tema 120 Megawatts
iv. KPONG Thermal Plant: 220 Megawatts
TOTAL: 876 Megawatts
An Akufo-Addo government, God willing, will tackle the power
problem to save industry from the insecurity and extra costs
that come from frequent power outages. We are determined to
increase generation from the current 2,400MW to 5,000MW within
the four year term of office. We will ensure a strategic
generation reserve requirement of a minimum of 18% to ensure
stable power supply to our industries. We will review and
consolidate the governance and power regulatory regime to
ensure consistency and fairness in pricing.
We cannot hope to industrialize with the current state of
water supplies in the country. We will implement a
strengthened National Water Policy, which will greatly improve
supply, hygiene and sanitation. Our goal is to ensure that
every Ghanaian has access to potable water and industry get
the water needed to function. We will continue the programme
of the Kufuor government, which undertook major water systems
improvements nationwide, including Cape Coast, Mankessim,
Koforidua, Ku- masi, Kwanyarku, Ada, Sogakope, the Accra East
– West inter-connection and Tamale.
We will additionally construct more dams along our major
waterways and build a third water treatment plant in the lower
Basin.We will ensure the water sector gets the investment it
needs, by dramatically cutting down on non-revenue water
losses, and empowering the PURC and the CWSA to oversee
effectively the water delivery system in the country to ensure
Ghanaians get value for money.
We have made great strides in telecommunications in the past
decade and this has transformed communications in the country,
but we still have a long way to go with the state of our
roads, railways, ports, harbours and airports. We must open up
our country and make movement around the country less
stressful and cumbersome if our industries are to prosper.
Ever since Governor Guggisberg left our shores in 1928,
Ghana’s economy has remained structurally rigid, depending
largely on exports of primary commodities such as gold, cocoa,
bauxite and timber. In 1928, seventy percent (70%) of our
foreign exchange earnings were from gold, cocoa and timber.
In 2007, about 65% of our earnings were from these same three
products.
In 2009, cocoa and gold exports accounted for $4.5 billion or
78% of total exports.
Provisional data for the past year indicate that cocoa and
gold exports alone accounted for $6 billion or 76% of Ghana’s
total exports.
In 2011, we hit the magic number of 1 million metric tonnes of
cocoa production, which was the target set by the Kufuor
government. This was also the year that the target for having
50% of our cocoa processed locally was set. Sadly, my
information is that this target for added-value has been
missed.
Being touted as a leading producer of cocoa, raw gold, raw
manganese and timber has done nothing to address the concerns
of the hundreds of thousands of young men and women who do not
have jobs. Even though the significant expansion of the
economy over the last decade has brought about a higher
average per capita income, it is still limited in its capacity
to generate decent jobs with decent pay for our youth.
An expanded economy should not mean having a wider variety of
cheap imported goods to sell on our streets. An expanded
economy should mean an industrializing economy that is adding
value to its raw materials.
During the 8 years of the NPP being in government, thanks to
the focused leadership of J. A. Kufuor, Ghana eventually
discovered oil in commercial quantities in 2007. The discovery
is offshore here in the Western Region and your towns and
cities are beginning to feel the impact in terms of an influx
of people and higher rents. There is an Immigration Desk at
the small aerodrome in Takoradi and you only need to see the
numbers of foreign arrivals to accept that we have become an
oil economy.
We have two options about what to do with the oil: one, to
treat the oil like we have done to gold and allow it to be
exported in its raw material form as crude; or, two, use this
as a perfect opportunity to transform the structure of our
economy through industrialization and value-added commercial
activities. I believe we should use our oil revenues to create
assets, not waste it on consumption and accumulate debt simply
because people will lend us money now that we have oil.
Our oilfields provide us with the perfect opportunity to
create a petrochemical industry in Ghana. We will facilitate
the setting up of a multi-billion dollar gas feedstock
industrial estate in the Nzema area producing methanol,
ammonia, urea and natural gas liquids, which hopefully will
feed from the oil and gas industry in both Ghana and Cote
d’Ivoire.
We also intend to convert our petrochemicals into hundreds of
industrial and consumer products produced right here in Ghana,
including plastics, paints, rubber, fertilizers, detergents,
dyes, textiles, solvents and, hopefully, bitumen for road
construction. From the petroleum, we can get the preservatives
to can food produced in Ghana and we can get plastics in which
to preserve the processed food. The synthetic by-product from
petroleum can serve as raw material for the manufacturing of
different types of garments and footwear.
Ladies and Gentlemen, unless we add significant value to our
primary products, be they heavy or otherwise, we cannot create
the necessary numbers of high-paying jobs that will enhance
the living standards of the mass of our people. Raw-material
producing economies do not create prosperity for the masses.
The way to that goal, the goal of ensuring access to
prosperity, is value addition activities in a transformed and
a diversified modern economy, in other words, the industrial
development of our economy.
An Akufo-Addo Presidency will focus on leveraging our basic
sources of comparative advantage; namely, relatively
inexpensive labour and natural resources from agriculture and
mining, especially the emerging oil/gas sector, to develop a
value-added industrial sector that is globally competitive.
We also have the opportunity to make Ghana a regional centre
for light manufacturing industry for a market of some 350
million people, projected to reach 500 million by 2030, by
weaving together our numerous natural resources, like food
produce, bauxite, iron ore, oil and gas, with our talents and
energy to turn our nation into an economic powerhouse in
Africa, generating full employment for our teeming youth.
Mr. Chairman, I believe Ghana should be at the forefront of
the industrialization of West Africa. Ghana’s bauxite deposits
carry a potential value of $350 billion, far in excess of what
we expect to reap from crude oil. An Akufo-Addo government
will seek private investment to add value to our bauxite by
building an integrated aluminium industry and export
manufactured aluminum products, as was envisaged by the Kufuor
government.
We will add value to our iron ore and build a new Iron and
Steel Industry. Our salt will be part of this new vision. I
want to see a West Africa that is working together to create
jobs for its people; and providing decent lives for its
population and I want to see Ghana being in the driving seat
of that regional project.
Ladies and Gentlemen, unfortunately, the contribution of
Ghana’s manufacturing industry is small and getting even
smaller under this NDC government. In 2008 it was a meagre
7.9% and last year it had gone down to 6.7%. A bad situation
is being aggravated by bad policies.
Let us take the Pharmaceutical industry for example. Up until
recently we were doing quite well in the sector. Now our
pharmaceutical companies are struggling with the introduction
of measures that are counterproductive to the growth of the
local industry, with Facility Audit Fees, for example, going
up from $7,000 in 2008 to $15,000 today. At the same time, the
Food & Drugs Board, the regulatory body, has seen its share of
the national budget decreasing in real terms. Is it any
wonder, therefore, that our pharmaceutical companies are under
pressure from cheap foreign imports?
The purchasing power of government, the purchasing power of
the National Health Insurance Authority must be used to
support our pharmaceutical companies, and an Akufo-Addo
government will certainly make this happen. We can position
our pharmaceutical industry to be a major player in the sector
not only in West Africa, but also on the entire African
continent. It could be a very lucrative industry generating
lots of revenues and jobs for our people.
After 20 years of a stable and free, democratic society, with
a market economy, resources-rich Ghana, today, has the best
opportunity since Independence, to undertake a deliberate and
meaningful transformation of the economic structure.
As the experiences of the successful countries in Asia and
elsewhere have shown, Government has a very important and
positive role to play in spurring industrialization and
economic transformation.
An NPP government will establish industrial parks in every
Region and we shall focus on building an integrated
industrialization programme, with a clear bias towards
supporting small and medium scale enterprises with access to
science and technology, incentives and markets to make them
more productive and competitive. We will introduce programmes
that will boost the agricultural sector and introduce
incentives that will encourage our banks to provide affordable
credit and other financial services to SMEs and launch a new
wave of small and viable industries across the length and
breadth of Ghana.
Government’s business is to ensure that businesses are up and
running and have access to the capital that will keep the
wheels of industry moving. These are simple beliefs with
profound implications.
A first class public sector will provide the backbone for
Ghana’s economic transformation. Mr. Chairman, the NPP will
focus on pursuing a public sector model that responds to the
needs of its citizens. We need a public service that frowns
upon the culture of corruption and provides the people with a
quality environment of law and order, physical infrastructure,
social services, sensitivity and quick responsiveness to
needs, and a regulatory environment that allows free and fair
competition.
We have the human capital right here to make it happen. Those
young people I met today here in Tarkwa, their colleagues at
Suame in Kumasi and similar sites around the country
demonstrate the vast intellectual property that is at our
disposal.
We will invest heavily in building up the most important
ingredient for development: the intellectual property of the
people – the mind – education, and skills training are the key
to success.
The challenge for Ghana is that we have not attracted as much
foreign investment as we could have. Our dealings with foreign
investors have not been as sure-footed as it could have been
and this has led to the many foreign-led highly publicised
projects that have not seen the light of day. There is a large
proliferation of agencies and departments that local
industries and would-be foreign investors have to deal with;
maybe it is time we consolidated some of them.
When Japan needed to, back in 1949, when it was reeling from
the effects of the war, it created MITI, (Ministry of
International Trade and Industry) which became one of the most
powerful agencies in their country. At the height of its
influence, it effectively ran much of Japanese industrial
policy, funding research and directing investment. MITI was
responsible not only in the areas of exports and imports, but
also for all domestic industries and businesses not
specifically covered by other ministries in the areas of
investment in plant and equipment, pollution control, energy,
and power, some aspects of foreign economic assistance, and
consumer complaints. This span allowed MITI to integrate
conflicting policies, such as those on pollution control and
export competitiveness, to minimize damage to export
industries.
MITI served as an architect of industrial policy, an arbiter
on industrial problems and disputes, and a regulator. A major
objective of MITI was to strengthen the country's industrial
base. It did not manage Japanese trade and industry along the
lines of a centrally planned economy, but it provided
industries with administrative guidance and other direction,
both formal and informal, on modernization, technology,
investments in new plants and equipment, and domestic and
foreign competition.
There was very close relationship between MITI and Japanese
industry and MITI facilitated the early development of nearly
all major industries by providing protection from import
competition, technological intelligence, help in licensing
foreign technology, access to foreign exchange, and assistance
in mergers. In its early years it was very much a protective
agent against foreign competition until Japanese goods were
strong enough to compete on the world markets.
Admittedly times have changed and such pure protectionism
would not be feasible today, but MITI still exists in various
forms in other emerging markets like Turkey, Brazil, South
Africa and Malaysia and even neighbouring Nigeria and we can
certainly learn a few lessons from them. Even if our own
government were to stick to the provisions of the Procurement
law, our local companies would get some protection, instead of
which we get the current situation of sole-sourcing in favour
of foreign companies. An Akufo-Addo government will not shy
from favouring local businesses. Our local companies need
assured markets at home and it is from such a base that they
will develop and grow into regional and international giants.
I, Nana Addo Dankwa Akufo-Addo, believe that the surest way to
build a strong industrial base is to develop our own
indigeneous businesses; and with your votes and God’s help I
shall do just that.
Thank you, God bless you, God bless Ghana.
|
