Ghana’s auto dreams stall as policy delay threatens investment
By: Rebecca Okine
Ghana’s ambition to become a regional automotive manufacturing hub is under threat due to delays in passing the country’s automotive component policy, according to Mr. Jeffrey Oppong Peprah, CEO of Volkswagen Ghana and President of the Automobile Assemblers Association of Ghana (AAAG).
Speaking at the recent Intra-African Trade Fair (IATE), Mr. Peprah emphasized that while vehicle assembly is important, it is the production of automotive components such as engines, batteries, lighting systems, and electronics that truly drives industrial transformation. “Component manufacturing is the game-changer. It is where real industrialization happens,” he noted.
The President of the AAAG explained that component manufacturing has the potential to create up to seven times more jobs than assembly plants, making it a crucial focus for Ghana’s industrial strategy. Without a clear policy framework, however, the country risks losing out on investment and falling behind regional competitors.
Mr. Peprah revealed that the Ministry of Trade and Industry, together with the AAAG and other stakeholders, has developed a draft automotive component policy. Unfortunately, this policy is still under Cabinet review and has not yet been enacted into law. He warned that the delay could discourage investors and give countries like Côte d’Ivoire an advantage in attracting automotive manufacturing projects.
“Original Equipment Manufacturers are showing strong interest in Ghana’s component sector, but they are waiting for clear policy direction. If we don’t move fast, countries like Côte d’Ivoire could overtake us,” Mr. Peprah said.
The automotive component policy is a key part of Ghana’s broader industrial development plans. It aims to attract both local and foreign investment by offering tax incentives, improving infrastructure, and providing regulatory clarity to boost component production. This would help integrate Ghanaian companies into regional and global automotive supply chains.
Additionally, Mr. Peprah highlighted ongoing discussions with the African Export-Import Bank (Afreximbank) to secure financing solutions designed to lower vehicle prices and make cars more affordable for Ghanaians. He noted that introducing mortgage-style payment schemes could significantly expand demand for locally assembled vehicles.
He stressed that once the policy is passed, Volkswagen’s global partners could establish component manufacturing facilities in Ghana, not only to serve the local market but also to export to the wider ECOWAS region. This would align with Ghana’s goals under the African Continental Free Trade Area (AfCFTA) to boost trade and industrial growth.
“With the level of investment ready and the capacity of our global partners, Ghana has a genuine opportunity to become a leading component manufacturing base for the sub-region and beyond,” Mr. Peprah stated.
