The Rise and Fall of Ghana’s Textile and Garment Industry

Abstract

Ghana’s textile and garment industry started in the 1960s with the establishment of several factories. Ghana’s national development model was built on state ownership and an infant industrial development model that sought to follow a path towards self-sufficiency and economic independence. This model reinforced the development of the textile and garment industry in addition to other industries shortly after Ghana gained independence in 1957 from the British. Following adoption of the national development model and government localisation policy immediately after independence, the textile and garment industry experienced significant growth with investment (state ownership) and support from the state, and a major shift from the initial foreign ownership dominance. The textile and garment industry contributed considerably to employment, state revenue, foreign exchange, and economic growth and development. However, for the past three decades, the textile and garment industry in Ghana has endured a decline with plant closures, job losses, and declining production. In view of the numerous challenges confronting the textile and garment industry, its future remains bleak and requires the Ministry of Trade and Industry to re-evaluate the model and policies that support the industry. The purpose of this case study is to evaluate and discuss the model behind the development of the textile and garment industry in Ghana, and the industry trajectory from success to long-term decline. What went wrong? Was it the development model or other factors and conditions that contributed to the decline of the textile industry? And what are the lessons for developing countries with suitable and abundant raw materials and surplus labour who wish to expand their manufacturing capability?

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