Home » Trade Ministry Faces Opposition Over Import Restrictions

Trade Ministry Faces Opposition Over Import Restrictions

The LI is meant to protect local industries and promote value addition, but critics say it will increase prices, disrupt trade, and harm businesses.

by Motoni Olodun

The Ministry of Trade and Industry in Ghana has proposed a Legislative Instrument (LI) that will limit the importation of 22 products, including rice, sugar, poultry, diapers, and animal intestines. The ministry says the LI is meant to protect local industries and promote value addition to Ghana’s natural resources. However, the LI has faced strong resistance from the minority in parliament and some trade associations, who argue that it will increase the prices of goods, disrupt the free flow of trade, and harm businesses.

The LI, which was first tabled in parliament in November 2023, requires importers of the restricted items to apply for a licence from a ministerial committee before they can bring in the products. The ministry claims that the LI is in line with Ghana’s industrial policy, which aims to increase the competitiveness and productivity of the manufacturing sector, create more jobs, and diversify the export base.

However, the minority in parliament has blocked the LI three times, citing the lack of quorum and consultation. The minority leader, Dr Ato Forson, said the LI violated the World Trade Organisation rules and could expose Ghana to trade sanctions. He also expressed concern that the LI could be used to favour the ruling party’s supporters and cronies.

The LI has also been opposed by the Joint Business Consultative Forum, a coalition of trade associations, such as the Ghana Union of Traders Associations (GUTA), the Food and Beverages Association of Ghana (FABAG), the Importers and Exporters Association of Ghana, the Ghana Institute of Freight Forwarders (GIFF), the Chamber of Automobile Dealership Ghana (CADEG), and the Ghana National Chamber of Commerce and Industry (GNCCI). The forum said the LI would have detrimental effects on their operations and the economy at large. They presented a petition to the Speaker of Parliament, urging him to reject the LI.

On the other hand, the LI has received support from the Association of Ghana Industries (AGI), the umbrella body of manufacturers in the country. The AGI said the LI would complement Ghana’s industrialization drive and ensure healthy competition between local and foreign products. The AGI president, Dr Humphrey Ayim-Darkey, said the association had pledged its support to the trade minister and the LI, as long as the principle was correct. He also called for wider stakeholder consultations on the implementation process of the LI, to address the concerns of the affected parties.

The LI is expected to be laid before parliament again on Monday, December 4, 2023, for a final decision. The outcome of the vote will have significant implications for Ghana’s trade and industrial development, as well as its relations with its trading partners. The LI is seen as a test of the government’s commitment to its vision of transforming Ghana into an industrial hub in West Africa.

Source: MyJoyOnline

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