Ghana’s industrial strategy has been a reference point in the acceleration of Africa’s industrialisation drive in recent years. Since 2015 industrial subsectors such as manufacturing, and oil and gas have consistently attracted some of Ghana’s largest inflows of foreign direct investment (FDI). Indeed, the country has remained in the top-three FDI destinations in West Africa since 2006. The relative success of Ghana’s industrial landscape has been built on a proactive government implementing an ambitious industrial policy, overcoming key obstacles such as trade barriers and industrial land availability, empowering strategic agencies to facilitate industrial growth, collaborating with the private sector, and exercising political will and bipartisanship. Nevertheless, amid domestic economic challenges and global headwinds, Ghana offers significant development potential to enhance and consolidate its position as a centre for industrialisation in West Africa.

Structure & Oversight

The Industrial Development Directorate of the Ministry of Trade and Industry (MoTI) is responsible for fostering the growth of a technology-focused and globally competitive industrial sector. Among its strategic functions are formulating and implementing industrial policies, plans and programmes, promoting the development of small and medium-sized enterprises (SMEs) through capacity building and funding initiatives, and developing standards and quality systems to enable access to local and international markets. Supporting MoTI’s remit are the Ghana Standards Authority, charged with promoting industrial welfare by ensuring that industrial processes, goods and services meet international best standards; the Ghana Free Zones Authority, tasked with supporting the development and regulation of free zones, many of which are focused on industry; the Ghana Export Promotion Authority, responsible for the facilitation, development and promotion of exports; and the Ghana Enterprises Agency (GEA), which administers and facilitates the development of micro-, small and medium-sized enterprises (MSMEs) in industrial segments, including agro-processing, food and beverages, and manufacturing. In January 2023 the GEA launched the $20m SME High Growth Programme to support capacity-building initiatives for 2000 SMEs, 40% of which are led by women.

Housed under the office of the president and empowered by the enactment of the Ghana Investment Promotion Centre (GIPC) Act 2013, the GIPC is a critical facilitator in the country’s industrial transformation. Its policy formulation, and suite of incentives and subsidies have enabled the duty-free import of technology and machinery for manufacturing, and expanded the number of companies seeking to manufacture for export.

Performance & Size

The industrial sector remains the second-largest contributor to Ghana’s GDP, accounting for 28.3% and 31.5% of GDP in 2021 and 2022, respectively. In 2023 industry’s share increased slightly to 32% in the first quarter, amounting to GHS60.8bn ($5.5bn). With industry value added to GDP consistently measuring around 30%, the government is intensifying support for important industrial segments through increased foreign investment and private-sector participation to accelerate industrial growth.

According to the most recent Annual Household Income and Expenditure survey published by the Ghana Statistical Service (GSS) in 2022, roughly 16.5% of the working population 15 years and older were employed in the sector in 2022, ranking third behind services and agriculture. Maximising the sector’s job creation capacity requires sustained FDI inflows, which stood at $2.6bn in 2021, up 39% from $1.9bn in 2020. Several projects in the extractive industries, such as the construction of an $850m gold mining facility by US-based Newmont Mining and the construction of a $436m cement factory by Morocco’s CIMAF underpinned this growth. Nevertheless, a combination of global and regional headwinds, including debt pressure and rising food and energy prices, slowed down FDI momentum in 2022.


While industry subsectors encompass water supply, waste management and remediation, construction, mining and quarrying, and energy, manufacturing is increasingly viewed as the key driver of industrial growth. Manufacturing value added to GDP totalled around GHS70.6bn ($6.4bn) in 2022. Furthermore, manufacturing accounted for $7.4bn in economic output in 2022, a 12.5% decline from 2021. While the first quarter of 2023 saw the subsector’s economic output improve slightly to negative 0.7% from negative 2.5% in the fourth quarter of 2022, negative growth rates in consecutive quarters underscore the adverse impact of the macroeconomic climate on the sector. Despite the downturn, the manufacturing sector recorded 32 projects out of the 72 projects registered with the GIPC in the first half of 2023, the highest of any sector, and the largest FDI value, at $156.3m. Accordingly, the sector was projected to supply 6749 and 3227 jobs for Ghanaians in 2022 and 2023, respectively.

The main activities within the manufacturing subsector are agricultural and timber processing, breweries, aluminium smelting, cement, oil refining, textiles, electronics and pharmaceuticals. With SMEs underpinning Ghana’s manufacturing base, the subsector remains the largest employer in the industrial sector and a powerful instrument to deepen the availability of formal labour. To that end, the MoTI, in collaboration with the UN Industrial Development Organisation (UNIDO) and the EU-funded West Africa Competitiveness Programme, is providing capacity-building and funding tools to support the growth of export-oriented business clusters across Ghana to engender inclusive and sustainable development. Under the programme, SMEs in industrial clusters in the cosmetics, fruits and cassava value chains are incubated to enhance their value addition, low-carbon sustainable production and processing capacities, increasing their competitive advantages, especially for the export market.

According to the International Labour Organisation, Ghana’s labour productivity per hour worked stood at $7.06 in 2021, the third-highest in West Africa behind Côte d’Ivoire and Nigeria. However, its output per hour of workforce dropped by 0.8% in 2022, compared to a growth of 2.5% in 2021. Labour productivity should see steady improvements in the coming years on the back of growing support for technical and vocational education, and training from domestic stakeholders, such as the Ministry of Education (MoE), the private sector and international development partners, such as the German Federal Ministry for Economic Cooperation and Development (see Education chapter). Moreover, the MoE’s emphasis on improving digital literacy and deepening the digitalisation of local business operations could foster a higher level of technical skills to attract foreign manufacturers into Ghana’s free trade zones.

Gradual improvements in the production and trade structure indicate that the education and training drive may be bearing fruit. The share of mediumand high-tech manufacturing value added to GDP, for example, has been on an upward trajectory since 2005, rising steadily from 10.8% in 2018 to 11% in 2020. Furthermore, earnings from the export of goods and services increased to $23.9bn in 2021, representing 29.9% of GDP, up from $22.7bn in 2020. The postCovid-19 pandemic recovery also manifested in a record merchandise trade surplus of over $676m, according to the Bank of Ghana, and an IMF forecast of a 4.4% average annual change in the volume of goods and services exported between 2023 and 2026. In 2021 manufactured goods accounted for 11.6% of total exports, while the share of medium- and high-tech activities in total manufacturing exports stood at 12%, according to figures from UNIDO. Manufacturing exports generated $1.9bn in 2021, with low-tech, medium-tech and high-tech exports constituting 21.1%, 9.4% and 1.2%, respectively. With only a 1.5% adoption rate of advanced digital production technologies, boosting investment in the medium- and high-tech manufacturing segments will be critical to accelerating the industrialisation drive.


In June 2023 the overall producer price index (PPI) inflation rate in the country stood at 29.2%, though this represented a 1.1-percentage-point reduction in year-on-year inflation from the May 2023 PPI. The industrial sector, for its part, recorded a 31.3% inflation rate, with the critical subsectors of manufacturing, mining and quarrying, and construction measuring in at 27.2%, 31% and 19.3%, respectively. Among the challenges underpinning Ghana’s elevated PPI are the high cost of capital, limited access to mediumand long-term financing, the high cost of electricity, fluctuations in the power supply, and limited logistics and infrastructure support. The fiscal landscape presents challenges given the taxes levied on the import of materials, chief among them being import duties and import value-added tax (VAT).

However, policymakers are working to alleviate these challenges. VAT-registered manufacturers, for example, can obtain fiscal relief, such as an exemption from upfront payment for import VAT and levies, resulting in improved cash flow and reduced cost of production. Furthermore, manufacturing firms can capitalise on location-specific tax rebates, such as 25% for Accra and Tema, 18.75% for all other provincial capitals and 12.5% for industries situated outside regional capitals. Additional reforms helping stimulate FDI inflows and address structural limitations on manufacturing growth are the digitalisation and automation of business administration processes. These include the issuance of construction and operating permits and identification numbers, as well as the ongoing digitalisation of tax, legal and business processes.

Intervention Programmes

The MoTI’s 10-point Industrial Transformation Agenda, outlined in 2017, remains the framework for stimulating industrial competitiveness. The agenda includes the One District, One Factory (1D1F) scheme, Ghana National Export Development Strategy, the Strategic Anchor Industries (SAI) and the Industrial Revitalisation Programme. The 1D1F scheme is a public-private sector initiative to accelerate Ghana’s economic transition from primarily exporting raw materials and importing finished goods, to manufacturing, value addition and the export of processed goods. The scheme entails the launch of one new factory in each of Ghana’s 216 districts and the establishment of an industrial zone in each of the nation’s 10 provinces. Pharmaceuticals, clothing and textiles, agro-processing, packaging materials and paper products are among the scheme’s focal sectors, given the potential for export-related manufacturing and FDI generation. According to an MoTI spokesperson, as of September 2022, 52% of Ghana’s 261 districts hosted 1D1F projects, directly benefitting 296 companies.

The SAI scheme is a further example of translating industrial policy to measurable results. Driving Ghana’s aim to position itself as an automobile manufacturing centre in West Africa, the Ghana Automotive Development Policy (ADP) was established in 2019 under the SAI, spawning the rollout of assembly plants of global manufacturing companies and enhancing the integration of local firms in the automotive value chain.

In August 2020 the Volkswagen Group completed its first locally assembled vehicle, the Tiguan, in line with an agreement executed between the Ghanaian and German governments. Additionally, Toyota’s vehicle assembly company in Ghana, the Toyota Tsusho Manufacturing Ghana Company, began assembly of its two flagship vehicles, the Toyota Hilux and Suzuki Swift, in June 2021 and September 2022, respectively, following the signing of a memorandum of understanding between the Ghanaian government and Toyota Tsusho Group signed in August 2019.

Valued at $4.6bn in 2021, Ghana’s automobile segment is projected to reach $10.6bn and capture 60% of the country’s new car market by supplying 12,000 assembled vehicles by 2027. With the number of assembled vehicles reaching 4700 units between 2020 and 2022, local stakeholders are advocating for the full implementation of the ADP to accelerate the country’s maturation from a vehicle assembly centre to a component manufacturing centre, supplying regional markets amid the emerging African Continental Free Trade Area. Policymakers have responded by advancing a raft of enabling measures, including vehicle financing support for local stakeholders, an automotive manufacturing support centre to enhance human capacity development and the establishment of the Ghana Automotive Industry Development Council.


Like most sectors in Ghana, industry has been affected by domestic and global macroeconomic headwinds . Accelerating Ghana’s industrialisation is key to efforts to diversify the economy, deepen the revenue base and foster long-term resilience. Furthermore, a robust industrial policy aims to transition the country into a centre for manufacturing, value addition and the export of finished products. Overcoming the challenges related to power, human resources, funding and import tariffs will be pivotal to this transition. Positive developments in the automotive manufacturing segment, however, offer evidence of industrial growth potential and underscore the need for continued investment.