Introduction

Since gaining independence in 1957, Ghana has been a hub of international trade, largely exporting raw commodities like cocoa, gold, and timber while relying heavily on imports for consumer goods, industrial inputs, and essential commodities. Over the decades, various interventions—such as the Akosombo Dam project, state-led industrialisation in the Nkrumah era, and the Economic Recovery Program of the 1980s—have aimed to reduce this dependence, but progress has been slow. Today, Ghana spends billions annually on imports. According to the Ghana Statistical Service, in 2022 alone, Ghana imported goods worth $13 billion, with key items such as rice ($1 billion), sugar ($200 million), and tomatoes ($400 million) dominating the list.

The heavy reliance on imports has further compounded the depreciation of the Cedi, which fell by nearly 50% against the US dollar leading the cedi into an unprecedented ditch. As a result, the cedi became the world’s worst-performing currency in 2022 and Ghana got a junk economy rating by Fitch in 2022. This has heightened inflationary pressures, eroded purchasing power, and exacerbated Ghana's balance of payments crisis. In such a precarious situation, import substitution has become an essential policy linchpin to stabilise the economy. With an abundance of fertile land, a youthful workforce, and existing but underutilised infrastructure, Ghana has the potential to produce many of these imported commodities locally.

The Case for Local Sugar Production

Ghana imports over $200 million worth of sugar annually, despite possessing the resources to produce it domestically. The Komenda Sugar Factory, inaugurated in 2016 under the leadership of President John Dramani Mahama remains underutilised due to inadequate funding, supply chain inefficiencies and an eroded political support after a change of government in 2017. Reviving the Komenda facility could reduce sugar imports significantly and provide a sustainable sugar supply to critical programmes such as the Free Senior High School (Free SHS). With the capacity to produce 250,000 tonnes annually, Komenda can meet nearly 60% of Ghana’s sugar demand if supported by a competent management and a well-developed supply chain.

In line with President Mahama’s vision for self-reliance, his government must prioritise funding for sugarcane farmers to enhance production capacity and create a reliable supply chain for the factory. Furthermore, distributing Komenda sugar to all public secondary schools under the Free Senior High School (Free SHS) programme could create a sustainable market while significantly reducing imports. As President Mahama aptly puts it: “We must invest in industries that add value to our local raw materials. Ghana’s path to economic independence is through industrialisation.”

Tomatoes and Onions: The Agric Value Chain Opportunity

Vice President Prof. Naana Jane Opoku-Agyemang highlights the importance of agro-industrialisation: “We must move beyond subsistence farming to create value chains that provide sustainable livelihoods and reduce our dependence on imports.”

Ghana’s annual import bill for tomatoes and onions exceeds $400 million, most of which comes from Burkina Faso. However, the fertile lands in Ghana’s northern and middle belts provide the perfect environment to cultivate these crops locally.

The major barrier has been post-harvest losses, with nearly 30% of tomatoes going to waste due to inadequate storage facilities. To address this, the Mahama administration must partner private investors to construct modern cold storage facilities in major farming regions and expand agro-processing capacity at the Wenchi Tomato Factory. Additionally, government should encourage farmer cooperatives as part of its strategy to empower smallholder farmers to pool resources and scale production.

Rice: Reducing Ghana’s $1 Billion Import Bill

Rice, a staple food in Ghana, accounts for nearly $1 billion in annual imports. However, the northern regions and Volta Region are well-suited for large-scale rice production. Under President Mahama’s administration, irrigation projects like the Tamne Dam and others must be revived and expanded to provide the irrigation support for commercial rice farming. Also the Avnash and Nasia rice mills must receive tremendous innovative government support to ramp up local production.

Subsidising inputs such as fertilisers and seeds for rice farmers, coupled with targeted support for mechanisation, will increase yields and make locally grown rice more competitive. Campaigns like “Eat Ghana Rice” have also gained traction, helping to shift consumer preferences towards homegrown options. Then, processing, packaging and market access should also be guaranteed and actively supported by government initiatives to make the rice business worthy of farmers scarce resources. If these measures are implemented and sustained, Ghana has the potential to cut its rice imports by 50% within five years.

A New Strategy for the 24-Hour Economy

The 24-Hour Economy Policy, championed by the Mahama administration, envisions an economy that operates round the clock to maximise productivity, trade, and services. This strategy aligns with the Mahama administration’s broader vision for economic transformation. By combining robust policies, investment in infrastructure, and support for local entrepreneurs, the 24-Hour Economy Policy can position Ghana as a self-reliant and industrialised nation.

Integrating a robust import substitution strategy into this framework could yield far-reaching socio-economic benefits.

1. Job Creation: Scaling up local production of sugar, tomatoes, rice, and other staples could create over 500,000 jobs in agriculture, agro-processing, and distribution.
2. Currency Stabilisation: Reducing the $13 billion import bill by even 30% could significantly reduce demand for foreign exchange, stabilising the Cedi.
3. Income Growth: Empowering smallholder farmers and agro-processors with financing and technology could double household incomes, creating a ripple effect on poverty reduction.

Conclusion

Ghana’s path to economic stability will largely be determined by our ability to reduce our dependency on imports and fostering a self-reliant economy. By targeting key commodities like sugar, tomatoes, and rice, and integrating these efforts into the 24-Hour Economy Policy, Ghana has the potential to create jobs, stabilise the Cedi, and reduce its vulnerability to global supply chain disruptions.

As President Mahama recently remarked: “We must chart a new path for Ghana—one where we are not just consumers of imported goods but producers of our own wealth. Together, we can build a resilient economy for the future.” The socio-economic case for import substitution is clear. Ghana has the resources, workforce, and political will to implement this transformative strategy. Now is the time to act.