Local Industries Struggle as Parallel Imports Surge – AGI Warns of Economic Crisis

The Threat of Parallel Imports and the Need for Industrial Resilience in Ghana

At the 2025 Ghana Industrial Summit and Exhibition (GISE) in Accra, the Association of Ghana Industries (AGI) president, Humphrey Ayim-Dake, highlighted a growing concern that is threatening the country’s manufacturing sector. He warned that parallel imports are undermining domestic production, leading to job losses and potentially weakening the cedi.

According to Ayim-Dake, the influx of cheap foreign goods—often smuggled through unapproved routes and without paying required duties—is putting local industries at a severe disadvantage. Products such as Malta Guinness and Coca-Cola are entering the market from neighboring states without proper regulatory checks or tariffs. This creates an artificial cost advantage for foreign products, while local producers who pay taxes and adhere to quality standards struggle to compete.

The president emphasized that if this trend continues unchecked, it could cripple job creation as local firms are forced to cut back on production or shut down entirely. This would not only increase unemployment but also reduce tax revenues and foreign exchange earnings, further weakening the economy and placing pressure on the local currency.

Ayim-Dake called on the Ghana Revenue Authority (GRA), Customs, and other regulators to take decisive action against parallel imports and protect local producers. He stressed that without strong regulatory enforcement, Ghana risks losing its industrial backbone. A weakened manufacturing base would lead to greater reliance on imports, worsening the trade deficit and straining the cedi further.

Building a Strong Industrial Base for Economic Growth

Under the theme “Unlocking Industrial Potential: Strategic Approaches for Ghana’s Economic Transformation,” Ayim-Dake reiterated the importance of a robust industrial base for national prosperity. He argued that no nation has achieved sustained economic success without a strong manufacturing sector. For Ghana, he said, the key lies in leveraging its natural resources, human capital, and strategic location to become a regional manufacturing hub.

While welcoming the government’s 24-hour economy initiative, Ayim-Dake cautioned that it must be supported by reliable power supply, efficient transport systems, and tax incentives. He pointed out that without fair energy tariffs and adequate infrastructure investment, local industries cannot produce at competitive costs.

Another issue raised was the uncontrolled export of raw rubber, which has left processors struggling to secure necessary materials. Some factories in the Western Region have even reduced their shifts due to shortages. Ayim-Dake urged the Tree Crop Development Authority to intervene and ensure that local processors have access to raw materials.

Fiscal Reforms and Investment Incentives

On fiscal matters, Ayim-Dake called for reforms to the Value Added Tax (VAT) regime, describing it as overly complex and burdensome for businesses. He also expressed concerns about new proposals on minimum capital requirements for foreign investors. While welcoming foreign investment, he emphasized that the rules must not discourage genuine investors.

He reminded the government of its promise to procure sanitary pads and school uniforms from local producers, stressing that AGI will monitor to ensure these contracts go to domestic firms. This commitment, he said, is crucial for supporting local industries and promoting self-reliance.

Finally, Ayim-Dake urged the government to fulfill its pledge to convene a Public-Private Dialogue (PPD), with the president engaging directly with industry leaders to chart reforms and the way forward. He concluded that the future of Ghana’s economy depends on building and protecting its industrial capacity. Without this, job creation, currency stability, and long-term growth will remain elusive.

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