Recent statistics forcefully bring to the fore the need to revitalise manufacturing in Ghana. Ever-rising unemployment figures that we have lost count of, declining educational skills, a fast-depreciating cedi, and taxation troubles are all effluence of moribund manufacturing machinery. Our economy is characterised by all these challenges despite high economic growth rates exceeding six percent (minus a couple of downward quirks) over the past half-decade, which hit 13.6 percent in 2011 aided by a nascent oil economy. Considering that this unprecedented economic growth was led by the industry sector, which recorded a whopping 36.2 percent growth compared to the two other sectors of services (4.2 percent) and agriculture (2.8 percent), it is baffling that the manufacturing sub-sector of industry only managed a growth of 1.7 percent – way-off the targetted 7.0 percent. Tellingly, manufacturing has lagged behind all sectors and general GDP growth rates -- even registering a couple of negative growth rates over the five-year period. Economists will tell you it is a very complex problem, involving trade regulatory policy, credit availability and affordability, tax, markets and many more; but by simple logic it is fairly safe to conclude that there is a strong positive relationship between our alarmingly deteriorating manufacturing sub-sector and our worsening unemployment and human capital situation. After all, all the other sectors except manufacturing are doing well. What economists may not often talk about is that right from specific cases at factory level up to high-level policy, it is governments’ role in supporting domestic manufacturing with subsidies, targetted loans, tailored regulations and many other specific interventions which cause those countries riding on the back of a strong manufacturing sector to emerge as economic powerhouses. Many private sector lobbies have been highlighting challenges confronting industry in Ghana, especially the manufacturing sub-sector. Reading between the lines of the Association of Ghana Industries (AGI) Quarterly Business Barometer Surveys since its inception in 2009, it is obvious the private sector has been sending out strong signals to the effect that macroeconomic stability is critical to business planning --but does not, in itself or alone, guarantee the kind of growth that would turn Ghanaian enterprises into regional and global players in the foreseeable future. Recent reports attributed the rapid decline in value of the cedi to higher demands of the dollar for importation purposes. Most of the imports are manufactures, both finished and semi-finished products. Quite a number of those items were either manufactured here in the past or could easily be produced in Ghana -- given the country’s natural resource base -- but for the fact that the exporting countries’ producers do so at lower cost than Ghanaian producers. How can Ghana’s competitors be so efficient? Well, it turns out that most of them receive subsidies and other targetted support from their governments. Recent efforts by government in developing a National Industrial Policy – in conjunction with the AGI – is a positive development that could make a difference in the fortunes of local enterprise. The Industrial Competitiveness Bill being pushed by the Ministry of Trade and Industry, if passed into law, could also be a shot in the arm for the ailing manufacturing sector. But like AGI President Nana Owusu-Afari is given to saying lately, the turnaround for manufacturing particularly and industry as a whole can only be realised through the serious implementation of the National Industrial Policy. It will be interesting to hear what the Centre for Policy Analysis’s Dr. Joe Abbey says when he addresses the AGI Executive Council at their annual conference in Kumasi next week on the topic Achieving Industrial Growth: Challenges and Strategies. Equally noteworthy would be the expectations of each of the 35 members of the AGI Executive Council, who each represent a sub-sector of the manufacturing sector, concerning government’s role in revamping industry to ensure meaningful growth. Having emerged as the strongest lobby for local industry, the AGI obviously cannot be ignored by policy-makers and government; they must, however, also be able to convince politicians that their proposals do not only aim at improving their bottom-line. Importantly, it is now time for both government and captains of industry to appreciate the need to move manufacturing beyond the profit and tax paradigm. Emerging powerful economies of Asia and Latin America, notably Brazil, China and India, see manufacturing as a tool for the promotion of the national interest rather than just putting a meal on the tables of many; an above-average standard of living for the entrepreneur; and improved tax revenue for government. Those governments identified industries they considered as having strategic value -- those industries that would most likely enhance their economic and political fortunes over several decades -- and then deliberately crafted policies and regulations which ensured that state financial resources and other forms of support were channeled into specific businesses that were groomed to become strong global players. Could that be done here? Let’s consider one example. Following the severe electric energy supply crunch of 2007, the Energy Commission advised government to embark on strict energy-use, efficiency, and conservation. They followed it through with the provision of energy-efficient CFL bulbs while strictly implementing a law banning the importation and sale of incandescent lamps, which were highly inefficient. Though very significant, the savings of GH¢31million annually may not be its most important outcome. The production of CFLs by two companies in the country, barely some three years after, could be its most important outcome. The importance of this development can be viewed from a number of angles. Most West African countries, including Nigeria and the Gambia are, seeking to implement Ghana’s programme of energy-use efficiency and energy conservation. This immediately creates a potentially huge market for the Ghanaian CFL manufacturers that translates into more potential job-creation, higher future tax revenue for government, and higher future foreign exchange earnings with its implications for the stability of the cedi. But perhaps its most important significance is the opportunity and the platform it provides for skills development and innovation. As Ghanaians stay on the factory floor, they experiment with new ways of doing things; they develop new skills, they gain new knowledge and build up experience and confidence to innovate. By this little development, Ghanaians can be at the cutting-edge of technology and one can be sure that with any new innovation in the future as far as lighting is concerned, Ghanaians will feature brightly. If as a nation we see the huge potential this development offers us, it would only be prudent for state resources to be employed to hasten the growth of such an enterprise into a global player -- if only to beat the competition for our sub-regional market. The developments leading to the manufacture of CFLs in the country is one example, but it is a pattern that can and must be replicated in many other industries. We must seek to seed many companies, out of which will emerge a number of significant players. With all our challenges, Ghana is about the most efficient economy in our sub-region and that gives us an advantage: a head-start that we cannot afford to lose. It is all about the state getting involved with the private sector and working together to manufacture products that we as well as others need. And this is what industrial policy is all about in our time. If we don’t manufacture, we fade into oblivion!