One Factory One District Is More Than Doable; The Facts And Importance
There have been lots of arguments in the past weeks on whether a factory per district is doable or not, after Nana Addo Danquah Akufo-Addo, the flagbearer of the New Patriotic Party (NPP) made a declaration of his intention to implement such a policy if he is voted into power by Ghanaians.
The pronouncement made Critical Thinkers International (CTI) do an in-depth research to find out if such a policy is possible or not, so as to help bring a stop to this argument and through that educate Ghanaians on it.
After our research, we have come to a conclusion that it is very possible if only a government is very willing and determined to do it.
Below is a summary of our reasons for our conclusion.
Since it is a factory per district just to help turn the raw material in abundance in a district into finished goods, the factory does not have to be a multi complex one but rather it just has to be a simple factory of a size, functions and capabilities just enough to handle the major raw material in the district.
Examples i. Cassava- Starch factory, Alcohol factory, Flour factory, Gari Factory ii. Tomatoes- Tin tomatoes factory iii. Coconut- Coconut oil factory iv. Fish- Tin fish factory v. Palm nut- Cooking oil factory vi. Maize- Flour factory vii. Shea nut- Shea butter factory viii. Trees (Special kind) - Toothpick factory ix. Mangoes and other fruits- Mango and other fruits juice factory x. Cow- Canned beef factory xi. Stones (Special kind) - Beads xii. Others
Our research from some Non Government Organisations (NGO) which are into rural enterprises has shown that it will cost around 1.5 million dollars to 2 million dollars to build a factory of such size, function and capability for each district in Ghana but CTI used a cost of 5 million dollar per district rather for our analysis.
There are a total of 216 districts in the country with the Municipals and the Metropolitans inclusive in the count.
There a total of 275 constituencies in Ghana. The number of constituencies exceeds the number of districts in the country because some districts contain more than one constituency.
Since there is a confusion surrounding the current total debt of the country in dollar term, but none surrounding the total debt in Ghana (Gh) Cedi term, and also for a better understanding and appreciation of our analysis by Ghanaians, we used the Gh cedis for our analysis.
Currently 1 dollar= 3.6 Gh Cedis Meaning a maximum cost of 5 million dollars for a factory for a district changed into Gh Cedis will be;
3.6 Gh Cedis x 5 million= 18 million Gh Cedis Since there are 216 districts, the total cost for all the factories in the districts will be; 216 x 18 million Gh Cedis= 3.9 billion Gh cedis (approximately 4 billion Gh Cedis)
Ways Of Financing The Factories Per District.
There are three ways of financing these factories even though each of them will depend on the actions, willingness, determination and policies of the government in power.
They are; i. Public/Government ii. Private sector iii. A collaboration of the Public/Government and the Private Sector[Public Private Partnership (PPP)] i. Public/Government Funding
We will use the funds accumulated by the present government under the leadership of President John Dramani Mahama as the source of our secondary data for our analysis.
Even though the current government has accumulated lots of funds from loans, cocoa, gold, introduction of new and increment in existing taxes, introduction of the deregulation policy in the petroleum sector, drilling of crude oil, removal of many subsidies, a stop of some social interventions like free maternal health care, a freeze of public employment, a sack of many government workers[National Youth Employment Programme (NYEP) workers such as nurses, police, teacher, Zoomlion sweepers and others], removal of training colleges allowances and others, we will only use the loans this government has accumulated for our analysis.
Total Debt Accumulated i. End of 2008- 9.5 billion cedis (NPP) ii. 2008 to March 2016- 99 billion cedis (NDC) iii. 2008 to June 2016- 117.6 billion cedis (NDC) We used the 2008 to March 2016 value because it will give the minimum debt accumulated under the NDC lead by President John Dramani Mahama.
Since the total debt that had been accumulated by the end of 2008 was 9.5 billion Gh cedis, to find the total debt that has been only accumulated by this government from 2008 to March 2016, it will be;
99 billion - 9.5 billion = 89.5 billion Gh Cedis Since the total cost of financing all the one factory per district is 4 billion Gh Cedis, it will still be left with a huge 85.5 billion Gh Cedis of the loan remaining after all the factories has been built with all the other source of funding for government mentioned above left untouched.
89.5 billion - 4 billion = 85.5 billion Gh Cedis (Loan accumulated by this NDC government remaining after all the factories has been built) ii. Private or Public Private Partnership (PPP)
With this form of financing, the government in power has to provide a very conducive business environment for investment which can increase both producer and consumer confidence, an environment that will encourage production and also buying.
Some of the factors that can bring about a good business environment for investment include; i. Low taxes ii. stable electricity supply iii. Low interest rate iv. Good security v. Good international trade agreements vi. Others
With these factors and others in place, it will drag more individuals, companies and organizations from both local and international either solely or in collaboration with government (PPP) to set up some of these factories in some of these districts.
Importance Of A One Factory Per District Policy i. It will help reduce waste of raw material when it’s in abundance in a district ii. It will help add value to our raw materials iii. It will help change our raw material export based economy to one of a finished goods iv. It will help give the country more money from both local and international v. It will help reduce the rural- urban migration vi. it will help decongest the big cities such as Accra, Kumasi and Takoradi vii. It will help in a quick development of each of the districts, in order words help with a decentralized form of development of Ghana viii. It will bring about lots of direct and indirect employment ix. It will help widen the tax net x. Others
To conclude, from the analysis above, it can easily be seen that the one factory one district policy proposed by Nana Addo Danquah Akuffo Addo is doable, and so any government who is willing, determined, and also has the welfare of Ghanaians at heart can easily do it.
Moreover, an implementation of such a policy will bring about lots of advantages to Ghanaians.
Thank you. Hhhmmm, may God be praised always
.............Signed............ Critical Thinkers International [Creative Minds; Changing The World] [email protected] www.criticalthinkersghanablogspot.com
<<Print>>