The Ghana Leather and Footwear Manufacturers Association (GLFMA) has formally petitioned Parliament for customs duty relief on raw materials. This urgent request aims to address significant cost disadvantages faced by local leather and footwear manufacturers.
Local manufacturers currently pay cumulative duties and levies of up to 36.1% on essential production inputs. These inputs include leather sheets, soles, rubber, and industrial adhesives. In stark contrast, imported finished footwear often enters the Ghanaian market at lower effective tariff rates. Some imported goods also benefit from misclassification, further widening the cost gap.
This tariff structure creates an uneven playing field, hindering the growth of Ghana's domestic leather industry. The situation forces local producers to compete with cheaper imported finished goods. This disparity impacts their profitability and ability to expand operations. The issue also affects Ghana's broader economic strategy of promoting local industrialisation and reducing import dependency. High import duties on raw materials contradict efforts to boost local manufacturing capacity.
Mr. Gilbert Akwasi Ntim, President of the GLFMA, highlighted the severe implications of this policy. He stated, "Our sector currently suffers under an inverted tariff structure where imported raw manufacturing materials attract cumulative port duties up to 36.1 per cent, while foreign finished footwear frequently enters under lower effective tariffs." This statement underscores the core challenge faced by the industry.
The GLFMA represents over 12,000 registered artisans and 3,300 manufacturing workshops across Ghana. Mr. Ntim warned that the existing tax structure threatens thousands of local jobs. It also places additional pressure on the country’s foreign exchange reserves. When local industries struggle, Ghana imports more finished goods, increasing demand for foreign currency. This demand can weaken the Ghana cedi and contribute to inflation.
The association submitted a memorandum titled 'Urgent Policy Intervention: Customs Duty Relief under Chapter 98 for Raw Material Inputs in the Local Leather and Footwear Manufacturing Sector.' This detailed document includes verifiable baseline data, economic impact projections, and actionable policy proposals. The GLFMA has requested that Parliament's Select Committee on Trade, Industry and Tourism consider their proposals during upcoming sittings. They have also offered to provide an oral briefing and technical justification to the committee.
Parliament's response to this petition will be crucial for the future of Ghana's leather and footwear sector. A favourable decision could significantly boost local production, create more jobs, and conserve foreign exchange. Conversely, inaction could see more local businesses struggle or close down. This would further increase reliance on imports. Policymakers must weigh the revenue implications of duty relief against the economic benefits of a thriving local industry. The outcome will signal Ghana's commitment to supporting its manufacturing base and achieving economic self-reliance.