Delegación de la Unión Europea en la República Dominicana

Ghana and the EU

11/05/2016 - 17:24
EU relations with Country

Cooperation between Ghana and the European Union came into existence after the first Lomé Convention in 1975. The two parties have since enjoyed fruitful economic cooperation since and this has been improved and strengthened over the years with successive partnership agreements.

Ghana gained its independence from the United Kingdom as the first sub-Saharan country on 6 March 1957. It has achieved remarkable progress in deepening its democracy since the return to democratic rule in 1992. It has experienced peaceful transitions of power between different parties following democratic elections four times, the most recently one being the 2016 elections.

Ghana and Europe are bound together by common history, interlocking cultures, and shared objectives. They have a long history of a prosperous partnership enhanced by an existing framework for political dialogue. This practice has been strengthened under the 2nd revision of the Cotonou Agreement.

Since the entry into force of the EU Lisbon Treaty in 2010 and the creation of the European External Action Service (EEAS), the political dialogue has been coordinated by the EU Delegation on behalf of the High representative of the EEAS and takes place on a regular basis between the EU ambassadors and the Government of Ghana.

In line with the Paris Declaration and the Accra Agenda for Development other platforms for dialogue and coordination among Development Partners (DPs) have been established in Ghana: the Heads of Mission (HoM) and the Heads of Cooperation (HoC) Groups. These groups allow Development Partners (DPs) to coordinate among themselves in order to jointly align their development programmes and activities to national priorities and strategies.

Ghana has witnessed impressive economic growth with annual growth averaging over 6.4% since 2000 and attained (lower) middle-income country status in late 2010 after a rebasing of its national accounts. Estimates from Ghana's Statistical Service from April 2013 show that in real terms, the Ghanaian economy expanded by 7.9% in 2012 which compares well with an average global growth of 3.2% and an average sub-Saharan African growth of 4.8% in 2012.

Ghana's growth has been largely driven by expanding service and industrial sectors, notably due to the start of oil production in 2010, a growing construction sector and continuously strong mining activities. Projections made by the International Monetary Fund (IMF) show a growth rate of 6.9% in 2013 and an expected average annual growth rate of 6.3% in the period from 2013 to 2018 .

Ghana is becoming increasingly engaged in international trade with Ghana's total external trade in US Dollar terms increasing by over 70% over the last five year. The EU continues to be the most important trade partner for Ghana, accounting for around 30% of Ghana's total external trade in 2012. Foreign Direct Investment (FDI) inflows to Ghana have also increased significantly in the past few years, with Ghana featuring among the top five recipients of FDI into Africa in 2012, according to the  World Investment Report 2013.

Ghana is part of the World Trade Organisation (WTO) as well as a member of Economic Community of West African States (ECOWAS) and other major international trade, investment and industrial bodies. In parallel, Ghana is one of the active proponents of the African Continental Free Trade Area (AfCFTA) process, signed in 2018. The Secretariat of the AfCFTA is based in Ghana's capital, Accra.   

Over the last 15 years, Ghana's international trade has significantly increased. Hence, while in 2004 the country's total value of exports and imports was USD5.74 bn. in 2018 the same value was USD30.8 bn. In parallel, while Ghana's balance of trade during the period 1990 – 2010 was dominated by imports, the last years (2016-2018) has shown a balance of trade surplus driven by a boost of the country's exports of crude oil, gold and cocoa beans. 

Since 2008, Ghana is engaged with the European Union through the Economic Partnership Agreement (EPA). The EU-Ghana EPA is a trade and development agreement under which Ghanaian exporters benefit from duty-free and quota-free access to the EU market. Equally, under the EPA, Ghana has agreed to gradually open its market to selected EU products which are not sensitive for Ghana's local producers. The agreement has also introduced EU funded tailored programmes that boost Ghanaian businesses and enhance capacities for trade and export promotion.

The EU remains the top trading partner of Ghana in goods. In 2018, Ghana’s total trade value with the EU worth more than EUR 5.9bn – an amount that represents 19% of the country’s total trade with the world. In 2018, Ghana recorded a trade surplus in goods with the EU of EUR 302m. Ghana’s exports to the EU represented 21% of its total exports to the world. Ghana’s main exports to the EU are concentrated in mineral oils, cocoa beans, cocoa butter and cocoa paste. EU exports to Ghana are dominated by machinery and transport equipment and mineral fuels.

Ghana remains a favourite destination for investment in West Africa.  European businesses are very interested in using Ghana as a gateway for the region. Ghana is valued as an investment destination for its political stability, relatively open democratic institutions, free media and a fairly vibrant civil society. The 2018 Mo Ibrahim Index on African Governance ranks Ghana 6 out of 54 African countries with increasing improvement in indicators like 'Sustainable Economic Opportunities' and 'Safety and Rule of Law'. Ghana remains an important Foreign Direct Investment (FDI) destination in the African continent as in 2017 ranked 7 out 54 countries.

 

Ghana's objectives are to build a middle income economy and to go beyond the middle income status by achieving the Millennium Development Goal (MDG) targets, offering better jobs, diversifying the economy and reducing disparities between the regions.

Ghana has already made significant strides in that direction: the poverty level has been considerably decreased and Ghana is likely to be the 1st Sub Sahara African country to achieve the 1st MDG, halving extreme poverty, well before 2015. However, further efforts are needed to address the MDGs related to child and maternal mortality, and access to sanitation. In October 2012, the European Commission signed a health sector budget support of  EUR 52 million to assist Ghana in its effort to achieve MDG5. This support comes as additional resources to Ghana and became available under a special European Commission MDG-initiative to aid countries lagging behind in the attainment of some of the MDGs.

Since 1975 the European Commission has provided an estimated amount of EUR 1,200 million in terms of development aid to Ghana. At present around half of all Official Development Assistance (ODA) received by Ghana is financed by the EU (both European Commission and EU Member States). Contrary to World Bank, African Development Bank and some other major donors, the overwhelming majority of the ODA that stems from the EU is provided in the form of grants, meaning that the Ghanaian Government does not have to repay any of the allocated funding. 

European Development Fund (EDF)

As far as the Africa, Caribbean and Pacific (ACP) countries are concerned, the main source of EU funding is the five year European Development Fund (EDF), which at present is in its 10th edition (2008-2013). For all ACP countries together a total amount of EUR 21.966 billion is available in the 10th EDF, which is completely and directly sourced by the EU member states.

The EU is committed to the principle of ‘ownership’, i.e. that partner countries are fully involved in the process of developing the strategies and programmes which affect them. 

This allows the EU’s development assistance to be flexible and adaptive, responding to the specific needs of the beneficiary countries. This results in an agreed Country Strategy Paper (CSP), which includes a multi-annual National Indicative Programme (NIP)

 

1. EU JOINT PROGRAMMING

Joint Programming is the joint planning of development cooperation by EU development partners working in a partner country. It is a policy tool contributing to a stronger Europe, by bringing together resources and capacities. Now, more than ever, the European Union, the Member States and other like-minded governments need to join forces, programme their development cooperation together and, eventually, develop a strategic and coordinated response to key challenges such as migration and climate change. Working closely together will enhance the EU's ability to decisively contribute to the partner country's national development plan and to support our partners in the implementation of the 2030 Agenda for Sustainable Development and the Addis Ababa Action Agenda.

For more information on how Joint Programming progresses in each partner country, please visit our website: http://capacity4dev.ec.europa.eu/joint-programming and https://jptracker.capacity4dev.eu/ or contact us here: DEVCO-Joint-Programming-Support@ec.europa.eu ; JOINT-PROGRAMMING-SUPPORT@eeas.europa.eu ; NEAR-JOINT-PROGRAMMING@ec.europa.eu

2. EU JOINT PROGRAMMING IN GHANA

The Joint Programming process in Ghana was initiated in 2012 resulting in the "Transition towards EU Joint Programming 2013-2016" (2014), subsequently laying the ground for a full Joint Strategy for 2017-2020 titled "European Partners Working Together in Ghana" (2017). This is an outcome of strengthened coordination by the European Union with Denmark, France, Germany, the Netherlands, the United Kingdom as well as Switzerland and the Government of Ghana.

These European development partners have come together and jointly committed to supporting the priorities and objectives identified by the Government of Ghana in the Long-Term National Development Plan (LTNDP), focusing on the LTNDP's goal 1 and 4 out of the five.

Goal 1. Build an industrialised, inclusive and resilient economy:

  • Enhancing competitiveness and support to private sector, employment policy, social welfare services and social protection;
  • Energy generation and supply including renewable energy;
  • Agriculture, agribusiness, rural development.

 

Goal 4. Build effective, efficient and dynamic institutions:

  • Decentralisation;
  • Public Finance Management, Tax policy and tax administration support;
  • Accountability, anti-corruption and rule of law.

There are also five cross-cutting priorities: climate change, migration and mobility, gender, youth and the implementation of a human rights based approach to development cooperation.

The Joint Strategy covers the first Medium-Term period 2018–2021 of the LTNDP with a total financial envelope of €1.25 billion, which includes indicative funding from the European Investment Bank. The Czech Republic, Hungary, Italy and Spain are also present in Ghana and committed to the principles of Joint Programming. Civil society, think tanks and private sector representative organizations participated in the process as well.

The purpose of the European Partners' Joint Strategy is to improve donor coordination, reinforce policy dialogue with government structures, reduce transaction costs for the Government, and deepen synergies leading to enhanced development effectiveness. It aims to accompany Ghana’s transformation process and consolidation of its middle-income status, economic growth and democratic governance. It reinforces a "European Partners - Ghana partnership" based on shared values, increased commercial cooperation and strengthened political dialogue on our common future – a path that leads "Ghana Beyond Aid", as referred by the Government. European partners' cooperation will therefore evolve from traditional aid to a more comprehensive approach including trade, competitiveness, migration and climate change.

 

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