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Business news for Tuesday, March 9, 2021
Source: Goldstreet Business
2021-03-09
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Despite initial concerns about Ghana’s readiness to actively participate in Africa’s new single market, less than two months after the start of the African Continental Free Trade Agreement on January 1, corporate Ghana has begun to exploit the terms preferential commercial offers. With the deliberate documentary support of the government, two Ghanaian companies have already made their first duty-free exports to other African countries and Ghana has also received imports from Africa on duty-free terms.
The two exporting companies are Kasapreko Company Limited and Ghandour Cosmetics Limited. Kasapreko, already a highly successful exporter of its alcoholic beverages to other West African countries, made further sales under the auspices of AfCFTA last month, successfully exporting a 20-foot container of its products to South Africa, while Ghandour Cosmetics, which is looking to become an internationally revered personal care brand, also shipped a 20-foot container of cosmetic products to Guinea in February.
In the other direction, Ghana has so far received a shipment of unspecified goods from Egypt under AfCFTA-enabled duty-free terms of trade.
According to Ghana’s AfCFTA National Coordination Office, several other companies in the country are in the process of generating the necessary documentation to enable them to export their products to other African countries under the auspices of the continental single market. The closest to completing the process so far appears to be Ernest Chemists, an indication that the deliberate state policy of supporting Ghana’s pharmaceutical industry to be a hub for non-traditional export growth is a good one.
A Senior Technical Advisor to the Coordination Office, Dr. Fareed Arthur, has revealed that several other companies have called the office to ask how they could take advantage of the deal.
Ghana’s early start in the pancontinental competition for market share has resulted, in part, from the AfCFTA secretariat being located in Accra.
“The information we have indicates that most countries are not ready yet,” says Dr. Arthur. “Ghana was lucky to have started early because we have the secretariat in our country. Looking at the situation, we believe that most member states will be ready by March of this year. “
The other major reason why Ghana has been one of the first to come out of the starting line is the government’s astute facilitation framework. In fact, the first two export shipments received extraordinary documentary support from the government to serve as test cases. In fact, the shipments were accompanied by special letters from the Ministry of Commerce and Industry to their counterpart institutions in both partner countries.
They were used to test the Ghanaian preparation as part of the initiative, ”confirms Dr. Arthur. “They were also used to evaluate the forms and the format of the documentation accompanying the shipments.”
Since the final rules of origin have not been finalized, the current process requires documentation at both the bilateral and multilateral levels. Once a country has designed its tariff offer, it submits it to the AfCFTA Secretariat for approval. A member state must be able to clearly indicate the type of goods or tariffs that it intends to accept.
To trade under the initiative, a company needs a certificate of origin issued by a competent authority such as the Customs Division of the Ghana Tax Authority. This certificate helps the receiving country to determine if the goods actually originated in a member country and if they meet the necessary requirements according to the protocol.
Here, the Coordination Office provides key services, serving as a liaison between Ghana and the AfCFTA Secretariat. Interested indigenous companies that want to export to African countries duty-free can register through an online portal: external.unipassghana.com. “We’re trying to get everything online as much as possible to allow interested companies to register when it’s convenient for them,” says Dr. Arthur.
This is part of a broader and more comprehensive institutional framework that Ghana has established to maximize its profits from the AfCFTA.
It includes the establishment of the AfCFTA inter-ministerial committee, the national steering committee, and technical working groups in the seven groups to boost intra-African trade. These are in addition to the AfCFTA and the National Export Development Strategy already in force.
Ghana’s current exports to Africa amount to about US $ 1.4 billion annually and, although the country’s exports to the continent have increased at an annual rate of about 10.2 percent; on average, since 2015, its share of intra-African trade is only about four percent.
Technical working groups have been created covering areas such as trade policy, trade facilitation, productive capacity and industrialization, development finance, factor market integration, and trade-related infrastructure: transportation and communications, to make it easier for investors to settle in the country.
In addition, the country can boast of a good enabling infrastructure: energy, roads, seaports, airports, telecommunications, educated and qualified workforce and access to commercial justice, among others, which makes it a preferred destination for investment. within the AfCFTA market area.
