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UNCTAD in collaboration with African Union and German corporations has organized a two-day workshop on the contribution of Special Economic Zones (SEZs) to economic diversification in Africa in the context of AfCFTA at Labadi Beach Hotel on the 2nd and 3rd day of June 2022.

The workshop dubbed “Special Economic Zones In Ghana As A Tool For Industrialization And Diversification” aimed to share best practices on special economic zones development and to contribute to the process of the implementation of the AfCFATA. 

The workshop also provided a platform for the diverse stakeholder community to discuss the role special economic zones can play in the economic diversification of the continent and supporting regional integration.  

Participants included government representatives from several African countries, experts and practitioners as well as private sector executives and pan-African organizations.

The workshop presented the main lessons learned from the development of SEZs in Africa and the implementation of SEZs targeted policies. 

It addressed the key factors that contribute to the success of zones through the evaluation of key success stories in the continent. 

The workshop also covered mainstreaming of Sustainable Development Goals (SDGs) into the development of SEZs policy with a focus on labour and environmental practices. 

The event also served as a platform for discussion on regional integration and the implementation of the AfCFTA.

The two-day workshop covered a high-level panel discussion, presentations of the findings of the handbook to a diverse audience of policymakers and practitioners as well as academic training sessions and SEZs visits.

Remarks by Hon. Alan Kyerematen, Minister of Trade and Industry at the workshop, stated; “SEZs are increasingly playing a key role in Africa’s industrial transformation and economic growth while many challenges lay ahead, these zones can play a tremendous role in the development of the African continent under the Africa Continental Free Trade Area Agreement.”

He further said; “Technology and innovation play a critical role in transforming an economy. Africa is lagging in terms of innovation and technology. SEZs through FDI act as a mode through which improvement and implementation of innovative technology. There is also the transfer of knowledge between local and foreign counterparts in execution of duties. Therefore, the dynamic benefits that come with spatial development can help in achieving the objective of AfCFTA and in ensuring structural transformation in the continent.”

“Similarly, although the implementation of the African Continental Free Trade Area (AfCFTA) agreement is set to impact SEZs on the continent significantly, there is a lack of research and policy guidance on how zones can adjust to the new regulatory environment.

If Africa is seriously considering adopting the SEZ model for development, policy adjustments are urgently needed. The current state of affairs will not spur industrialization and promote Africa’s active participation in global trade.

To achieve this, there is the need for a strong long-term vision and institutional support for the success of SEZs and development in Africa coupled with effective cooperation between different levels of government agencies and the private sector. 

Furthermore, SEZs are known to increase domestic and foreign direct investment (FDI) in economies due to their distinct regulatory regime and incentives. It is estimated that FDI inflows increased in Africa by 11% in 2018 and 80% and 60% of FDI inflows in 2018 to Egypt and Nigeria respectively are directed to the SEZs.”

He urged all participants to assist in maintaining a disciplined focus on the agenda to ensure that, at the end of the workshop, they will have a practical appreciation of the importance of SEZs to the economic diversification in Africa in the context of AfCFTA.

Delivering a keynote speech, H.E. Amb. Michael Oquaye, CEO Of Ghana Free Zones Authority, also said; “Africa is endowed with many natural resources and every country can boast of some dominant resource. There is therefore a great opportunity to leverage the resources we have to benefit from economies of scale and become competitive as a continent.”

“AfCFTA is a major initiative to enhance structural transformation and improve the competitiveness of African industrial products. 

It is generally agreed that the opportunities generated by deeper regional integration will not fully materialize unless African countries develop productive capabilities, enabling them to take advantage of economic complementarities between their economies and this is the reason the SEZs are crucial to the industrialization drive of Africa. 

For the SEZs to succeed however there is the need to develop productive capacity by attracting firms in strategic sectors and industries. This will be the strategic focus of the Ghana SEZ as well as developing regional and continental value chains.

In this regard, the initiatives our parent Ministry is undertaking includes the site assessment of government land banks including the Greater Kumasi Industrial Park Project, the Sekondi EPZ, the Yabiw ( Shama) EPZ, the Busila Land Bank and the Salvelugu Land Bank. Plans are also far advanced to create SEZs for the Automobile, Pharmaceutical, Agro processing and ICT sectors as well as building Business Incubation centers.

Another bold step of the government is the establishment of the Petroleum Hub Development Corporation with the mandate to create a petroleum hub SEZ on a 20,000 acre land at Jomoro in the Western Region of Ghana.The GFZA has also signed a PPP Agreement with a private developer to develop the Sekondi SEZ.  

For Africa, the future of SEZs after COVID probably lies in the success of AfCFTA. There is therefore the need for Africa to look within and be self-reliant using the competitive advantages of countries to produce goods that can be traded within Africa. There is also the need to focus more on developing local businesses and increasing the local raw material production base in the development of SEZs. Development of the local raw material production base is crucial in meeting the requirements of the rules of origin to be able to trade under AfCFTA.

I can confidently say that Ghana as a whole, the Ministry of Trade and Industry and the GFZA specifically, is on the path to putting in place the necessary policies to take advantage of the AfCFTA Agreement. This workshop will provide further clarity on the steps to take to make us more effective in implementing the strategies at the Secretariat levels. 

Looking at the concept note for the workshop, it aims to present the main lessons learned from the development of SEZs in Africa, the implementation of SEZs targeted policies, the key factors that contribute to the success of zones through the evaluation of key success stories in the continent, and the mainstreaming of Sustainable Development Goals (SDGs) into the development of SEZs policies with a focus on labor and environmental practices. The workshop is also expected to serve as a platform for discussions on regional integration and the implementation of the AfCFTA”, he added.