Assessing Ghana's bilateral exports potential and gap

Abstract

Abstract To generate sufficient foreign exchange earnings for economic transformation, Ghana needs to expand its export base. This study analysed Ghana's bilateral export potential and gap using the stochastic frontier gravity model for a panel of 61 key trading countries over the period 2000–2018. The results show a mean untapped export potential of US$1.1 billion and a mean gap of US$1 billion for Ghana. The tax burden of trading partners, poor infrastructure and low credit to the private sector limit the exploitation of Ghana's bilateral export potential. On the basis of these findings, it is recommended that the government and policy‐makers of Ghana should increase investment in trade‐related infrastructure, provide reliable and affordable electricity supply, deal decisively with corruption and negotiate for the elimination of all forms of barriers to increase export flows.