Focus on Manufacturing as Engine for Jobs, Growth- Economist Urges Policy Shift Amid 5.3 % Q1 GDP Growth

As Ghana records an overall GDP growth of 5.3%, economist Dr. Paul Appiah Konadu of Pentecost University is urging a strategic policy pivot toward manufacturing, which he describes as the most labour-intensive and inclusive growth engine.

In an exclusive interview with The High Street Journal, Dr. Appiah Konadu said the 6.6% growth in the manufacturing sector is a bright spot that deserves more policy support and targeted investment.

“If you have a manufacturing sector growing by 6.6%, that is impressive because that is the labour-intensive sector. Usually, it‘s the manufacturing sector that employs a significant number.” he noted.

He contrasted this with Ghana’s extractive sectors oil, gas, and mining where employment generation is low and benefits often accrue to foreign nationals in top positions.

“In oil and gas, most employment opportunities are limited and it’s the foreign nationals that take a chunk,” he added.

Channel Oil Windfalls into Manufacturing

Dr. Appiah Konadu emphasized that instead of over-relying on extractive industries, Ghana should invest oil and gas windfalls into productive sectors like manufacturing. He stressed the urgent need to invest in power infrastructure, reduce production costs, and revive critical industrial facilities.

“Accelerating investment in infrastructure like power is very key. We must ensure constant power supply to drive manufacturing output. Now that the cedi is stabilizing and imported inputs are cheaper, this is the time to support manufacturers and maximize the returns from the stability we are experiencing.” he said.

He also advocated for robust investment in road infrastructure to efficiently link production zones to consumption markets, cautioning that poor logistics undermine industrial gains.

Value Addition is Non-Negotiable

A recurring theme in Dr. Appiah Konadu’s analysis is the need to transition from exporting raw materials to value-added products.

“Gold, cocoa, and oil accounted for 84.1% of our foreign exchange earnings in 2024 and they were all shipped out raw. We need to establish gold refineries, cocoa processing factories, and revive our oil refinery to retain more value locally.” he stated.

He pointed out that Ghana spends about $450 million monthly on refined oil imports. “Reviving the oil refinery is non-negotiable. It will help retain foreign exchange, ease pressure on the cedi, and expand employment opportunities.”

Affordable Finance and Trade Integration

Another key recommendation was ensuring access to affordable credit for businesses. “Interest rates above 25% are simply too high. We need policies that reduce the cost of borrowing to enable private sector expansion and job creation,” Dr. Appiah Konadu stressed.

He further urged Ghana to leverage the African Continental Free Trade Area (AfCFTA) to overcome market size limitations.

“With Africa’s 1.4 billion population, AfCFTA offers a huge opportunity for Ghana’s value-added exports. That is a sector that can generate unlimited employment, especially for the youth graduating every year.” he noted.

Dr. Appiah Konadu concluded with a clear message, “Manufacturing must be the cornerstone of our growth strategy. It is time to diversify, industrialize, and empower the private sector for inclusive and sustainable development.”

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