TRADE POLICY REVIEW OF GHANA

Statement by Ambassador Peter F. Allgeier
U.S. Permanent Representative to the WTO

Geneva
January 28, 2008

Thank you, Chair. 

The United States is pleased to welcome the Ghanaian delegation here today.  The presence of such a distinguished delegation underlines Ghana’s commitment to the WTO and to the Trade Policy Review process.  We would also like to thank the government and the Secretariat for their comprehensive and thought-provoking reports circulated before this meeting.  These reports helped us to understand recent developments in Ghana including reforms now under way. They also helped us understand some of the challenges that the country faces as it seeks to participate more effectively in the global trading system, and to use trade as a means to spur greater economic growth and development.  With this in mind, I would like to take this opportunity to recognize Ghana for being UNCTAD’s choice to host UNCTAD XII this April in Accra.  Finally, we would like to thank Ambassador Arsene M. Balihuta for his contribution to this process and his insights into Ghana’s trade policy in the context of its economic development.

Since Ghana’s last Review in 2001, Ghana's macroeconomic fundamentals have improved considerably and its merchandise exports and imports have increased strongly.  Ghana's trade reforms, including lower tariffs and the number of tariff bands, as well as more streamlined customs procedures are, in part, responsible for these gains.  We also note that agriculture remains Ghana’s economic backbone, yet it is the most tariff-protected sector, followed by manufacturing.  Hopefully, Ghana will continue to pursue trade liberalization so that it can achieve its trade policy goals, such as to increase its regional and global integration, diversify and strengthen its export base, and promote agricultural processing.  

The World Bank’s 2008 “Doing Business Report” recognizes Ghana for having implemented significant economic reforms during the past two years, and as a result moved Ghana's ranking up from 109 to 87.  Ghana’s authorities reduced regulatory and administrative barriers on a number of business operating processes, including customs clearance, company registration, and property registration.  We applaud Ghana’s efforts and look forward to discussing the pace of these reforms as well as the timing of the next phase of Ghana's reform program. 

Turning for a moment to regional integration, we would like to draw particular attention to the Secretariat’s recommendation that Ghana consider pursuing liberalization of the ECOWAS Common External Tariff rates.  The current tariff structure may inhibit the competitiveness of certain industries and may discourage investment in others.  In addition, in spite of measures taken to integrate regional economies, the level of intra-ECOWAS trade has remained low.

In its Report, the Secretariat describes Ghana's investment regime as liberal, with some sectoral exceptions, including small-scale mining, fishing, and retail trade.  We recognize that Ghana faces important challenges to its investment environment for reasons relating to infrastructure, productivity, financing and the nature of the work force.  Inasmuch as state-owned enterprises continue to play a significant role in Ghana’s economy, we urge Ghana – as we urged in the 2001 TPR - to privatize basic infrastructure services, such as electricity, which can improve the competitiveness of downstream industries and attract investment.  Additional investment in infrastructure and human capital should improve Ghana’s business environment.

Adequate and effective protection of intellectual property rights continues to be a major U.S. concern. We are therefore pleased that, Ghana has passed legislation designed to implement its TRIPS commitments.  We would urge the Ghanaian government to continue its efforts to strengthen its protection and enforcement of intellectual property rights, including through better coordination of its enforcement agencies, development of a national strategy on IPR protection, public outreach and education on the importance of IPR and the dangers of counterfeiting and piracy, and by taking greater action at the regional level to promote IPR protection.  Continuing these efforts would also improve Ghana’s chances of attracting increased investment in key sectors.

Two-way trade between the United States and Ghana was $572 million in the first eleven months of 2007, a 31 percent increase over the same period in 2006. We note that Ghana is among the leading beneficiaries of the African Growth and Opportunity Act (AGOA).  During January-November 2007, U.S. imports from Ghana under AGOA and our Generalized System of Preferences totaled $66.5 million, an increase of 53 percent over the same 2006 time period. Such imports included petroleum, apparel, yams, cassava, cocoa paste, and wood ornaments.  In the first eleven months of 2007, over 99 percent of imports from Ghana entered the United States duty-free.  In July 2007, Ghana hosted the Sixth U.S.-Sub-Saharan Africa Trade and Economic Cooperation Forum, also known as “The AGOA Forum.”
 
We recognize that outside assistance can be important to participate in and to more fully benefit from WTO activities.  U.S. assistance to Ghana for implementation of WTO Agreements, trade facilitation, and customs operation and administration totaled over $37 million in the last five years.  For 2008, we have dedicated more than $1 million to a program to increase the competitiveness of Ghana’s private sector in world markets. The major objective of this bilateral program is increased exports by enterprises and smallholders, involving working with the government and other key stakeholders to improve key policies in financial markets, trade, and agriculture.

A complementary regional U.S. program focuses on improved management and governance of West Africa trade corridors, including those emanating from Ghana’s port in Tema, to link trade and customs information, stimulate export development, and address critical energy and sanitary and phytosanitary (SPS) issues.  The United States supports two “Competitiveness Hubs” in West Africa, one in Accra and one in Dakar, Senegal.  These hubs facilitated more than $7.5 million in exports from Ghana to the United States over the last two years.

Finally, Ghana is in the first year of implementation of a five-year, approximately $547 million compact with the Millennium Challenge Corporation to improve agricultural production, transportation and rural development.  This assistance responds to goals identified by Ghana in its Trade Sector Support Program.

The United States appreciates Ghana’s continued support and commitment to trade liberalization through the rules-based multilateral trading system.  We encourage Ghana, as a founding member of the WTO, to continue its active participation in the WTO’s work.  We urge the government to adopt voluntary standards in keeping with the WTO TBT Agreement as, all Ghanaian standards now are mandatory (technical regulations)  and to submit its SPS notifications to the WTO in accordance with the WTO SPS Agreement.

We appreciate Ghana’s active participation in the Doha Round.  In 2007, Ghana’s average applied MFN tariff was 12.7%, down from 14.7% in 2000. We therefore encourage Ghana to increase its tariff bindings beyond the 15 percent of tariff lines that it agreed to bind in the Uruguay Round.  Increased tariff bindings in line with Ghana’s applied rates would increase predictability and encourage more trade and investment in Ghana.

Ghana and, indeed, sub-Saharan Africa has a major stake in achieving an ambitious result in the Doha Round.  A result that includes new, meaningful market access in services, industrial goods and agriculture could further enhance opportunities for Ghana and the rest of sub-Saharan Africa to broaden and diversify their export markets,particularly with respect to new emerging markets.  My government looks forward to working with the government of Ghana toward bringing the Round to a successful conclusion.

Ghana’s economy is already benefiting from the steps it has taken to liberalize its trade regime.  Together with its macroeconomic and structural reforms, Ghana has been able to achieve higher growth rates since its last TPR.  The United States applauds these steps and urges Ghana to continue on this path. 

In closing, I would like to emphasize that Ghana is one of our most important trading partners in Africa and is also among the leading economic reformers in the region. The United States greatly appreciates the opportunity to participate in this review of Ghana’s trade policy regime and looks forward to continuing our dialogue with your government.

Thank you.