General News of Monday, 23 January 2017
Minister-designate for Trade and Industry, Mr Alan Kyeremanten has said the New Patriotic Party’s (NPP) manifesto promise to establish a factory in each of the 216 districts in the country would transform the country’s economic fortunes while creating employment for the youth.
According to him, the initiative was started under the former president John Kufuor’s administration and that feasibility studies had already been done in some 110 districts to ensure the success of the policy.
“This one district, one factory initiative is actually an initiative that we started during our previous time of office in government, and I superintended this initiative. By 2007, there were about 110 districts at the time, and we had done consultations with the District Assemblies, identified 3 projects in each district, done diagnostic studies, prepared full business plans, and had consultations with a number of business partners and literally we were on the verge of taking off,” Mr Kyeremanten told the Appointments Committee of Parliament on Monday.
What is the one district, one factory policy?
According to Mr Kyeremanten, the initiative, otherwise known as District Enterprises is a medium to large scale factory or industrial enterprise that has the potential to fundamentally affect the economy of the district.
Among other things the district enterprise is aimed at supporting existing companies while creating new ones to create employment as well as add value to the country’s natural resource base.
“Even if admittedly it is useful to support existing companies, we recognized that the concentration of the existing industries either by chance or by design, is in the major cities in Ghana. So the one district one factory is design to do a number of things; first to create massive employment all over the country and secondly to add value to our natural resource base,” he explained.
When will it start?
When asked by the Member of Parliament for Wa West, Mr Joseph Yieleh Chireh, when the initiative would hit the grounds, Mr Kyeremanten explained that although extensive consultations had been done with the district assemblies, he could not state categorically when the first factory will be started.
“The normal gestation period for a new factory will be may be one and half years, in some cases two years, in some cases it can be one year. But I want to clarify that our starting point is to look at existing companies that are viable, that potentially could qualify under the criteria of a district enterprise project and actually support them to become a district enterprise.
Depending on how things go and the appetite of Members of Parliament, district assemblies, private sector to work with this programme, potentially, you could have within a matter of six months a number of district enterprises already underway,” he explained.
Establishment of a secretariat
Mr Kyeremanten explained that a technical support group would be established at the Ministry of Trade and Industry to work with the district assemblies to help identify strategic economic projects which can be described as district enterprise projects.
Following that, the district assemblies, with the help of the technical support group would identify potential investors or entrepreneurs after which a business plan would be developed.
Member of Parliament for Tamale South and Minority Leader, Mr Haruna Iddrisu asked Mr Kyeremanten how much government was likely to spend in realising the establishment of the factories.
But the minister designate explained that it would be difficult to determine the exact cost of implementing a particular project since it is only when a business plan is completed that the cost of a particular district enterprise can be determined.
“Once we get interested potential partners, the technical support group will help these potential partners to develop a business plan and it is at that point that we can determine the exact cost of implementing that particular project,” he explained.
He stressed however that “whatever it takes for the government to make sure that this district enterprise is realised, government commits to do that; including infrastructure support.”
What will be the government’s role in the financing of those initiatives?
Mr Kyeremanten explained that there is an agreement in principle for government to allocate a certain percentage of the one million dollars that is intended to go to every constituency to support each district.
He further noted that government might turn to the capital market if need be to support the initiative.
“We are talking about viable commercial enterprises, and so if government has to borrow to be able to provide equity to support a private enterprise investor, why not?” he quipped.
Role of GIPC
The Member of Parliament for Dome-Kwabenya and Deputy Majority Leader, Madam Adwoa Safo sought to find out the role of the Ghana Investment Promotion Centre in realising the establishments of the district enterprises.
According to Mr Kyeremanten, the technical support group, which will be the first point of call for investors and entrepreneurs at the Ministry would complement the efforts of the GIPC to identify potential investors.
He said the GIPC would also spearhead the organisation of an investor forum to showcase the profiles of the potential enterprises to potential investors.