Local Content Policy: The path to our Economic Emancipation

The Local Content Policy initiative being spearheaded by the government is a thoughtful one that ought to be commended. Admittedly, it is a proactive move that should be given all the required attention in terms of legislations and strategies.

Local Content is a documented policy indicating desire of a government to actively engage indigenous or local companies in economic activities hitherto reserved for foreign investors especially the oil and gas industry. Local content means the development of local skills, technology transfer, use of local manpower and local manufacturing.

In developing oil and gas nations, the Local Content Policy is a commitment on the part of the state to ensure that companies owned by its citizens actively participate in all aspects of the oil and gas trade and not just in the periphery. For example, Malaysia, Singapore, and Brazil have pursued aggressive local content policies to the benefits of their national economies. There are lessons also to be learnt from our neighbor, Nigeria.

The Local Content Policy provides a huge opportunity for job creation and builds the indigenous capacity or technical expertise of local companies and entrepreneurs. This indirectly becomes a stimulant for growth of other sectors of the economy which eventually contributes to the nation's Gross Domestic Product (GDP) or output. A local content policy in Ghana's sensitive industries would serve as a tool for the advancement of local development not only in the identified industries but in the economy as a whole. Such policies backed by the appropriate legislation and procedures would build human capacity as well as capabilities of local companies which certainly will have a multiplier effect on the rest of the economy.

In Ghana, we have a number of entrepreneurs who have proven their worth and demonstrated that given the opportunity, they can perform satisfactorily. All that they need is an action plan of the government to actively engage them.

Already we as a country have missed the opportunity of adopting a local content policy in the telecommunication and the mining sectors. The telecommunication sector is fully taken over by foreigners though we have equally capable Ghanaians who could have ventured into that field and raised capital from within to manage similar entities given the opportunity. Can you imagine the amount of money that is taken out of this country by the telecom operators? Unfortunately, we do not seem to trust ourselves as Ghanaians and we seem to always be suspicious of our own people.

For now, Local Content Policy initiative should be a major priority for the government looking at the overall economic implications. Thankfully, the policy initiative is not only being directed towards the Oil and Gas industry alone but to other areas of the economy such as the Power Sector. With respect to the Gas and Oil Sector, the final draft of the policy was issued in November last year and all interested parties are waiting for its completion and legal backings for its implementation schedules.

As an indication of governments' commitment to seeing to the realisation of the policy within the Power Sector, the Deputy Minister of Energy in Charge of Power, Dr. Kwabena Donkor paid an official visit to all Manufacturers of Electrical Cables and Accessories soliciting for information. He acknowledged that for the country to become a major exporter of power there is the need to build indigenous capacity to take advantage of opportunities within the Power Sector.

“It is in our interest as a nation to develop this Local Content Policy of Power to assist our indigenous companies in the Power sector like cable manufacturers since local firms are ultimately and probably the most important drivers of economic incomes and growth in developing countries'. If we want to develop we need to build up indigenous capacity. We can't expect foreign expertise and foreign capital to develop this country”, explained the Deputy Minister.

Indigenous companies and entrepreneurs hope to see this Local Content Policy materialise as soon as practicable since that will be a major booster for their growth. The fact is, this will be seen as an expression of governments' commitment to its intention of investing in Ghanaians and their businesses. When this finally becomes a reality, indigenous companies and entrepreneurs will surely celebrate and feel proud to belong to this country because the fact is, foreign expertise and foreign capital cannot lead us to our economic emancipation.

It is only Ghanaian businesses and entrepreneurs that can honestly move this country forward in the right direction we all crave for.

Frank Agyemang
Public Relations Officer
Reroy Cables Limited

Source: Frank Agyemang

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