Ghana’s economy stands to lose $15 billion over the next five years due to stringent export restrictions imposed by the Bank of Ghana (BoG). Concerned exporters have raised alarms over the Letters of Commitment (LoC) rule, which requires exporters to repatriate the full value of their exports back into the country. This policy, they argue, has become a significant disincentive, particularly because the BoG does not offer pre-financing for exports.
Francis Gbedemah, a Ghanaian exporter, emphasized the detrimental impact of this rule, noting that the country is already losing over $3 billion annually as a result. Despite the BoG’s intentions to streamline the export process through the LoC regime, many exporters feel that the rule is stifling their businesses and limiting Ghana’s export potential.
The LoC rule has also sparked concerns about trade tensions with international partners, as well as potential negative impacts on Ghana’s economy. The exporters have called on Vice President Dr. Mahamudu Bawumia and Finance Minister Dr. Mohammed Amin Adam to urgently review and reverse this policy to prevent further economic losses.
In 2023, Ghana’s Non-Traditional Exports earned $3.94 billion, marking an 11.4% increase from the previous year. However, exporters believe that this figure could have been significantly higher without the restrictive LoC rule, especially given the ongoing push for industrialization in the country.