Article | Ghana Domestic Trade | Inspexion

Ghana, known for its vibrant markets and entrepreneurial spirit, boasts a robust informal market sector that plays a crucial role in driving domestic trade and contributing to the country's economic resilience. The informal market sector encompasses a wide range of activities, from street vending and small-scale agriculture to artisanal production and service provision. This article explores the significance of the informal market sector in Ghana and its impact on the country's domestic trade landscape.

While it is challenging to provide an exact figure, estimates suggest that the informal trade sector in Ghana contributes a significant percentage to the country's Gross Domestic Product (GDP). Different sources and studies have estimated the contribution of the informal sector to Ghana's GDP to be around 30% to 60%. However, it's important to note that these figures can vary depending on the methodology used for estimation and the specific time period considered.

The informal market sector in Ghana serves as a vital source of employment and income generation, particularly for the marginalized and low-income population. With 80% of the workforce of the country involved in the informal sector. It offers opportunities for self-employment and entrepreneurship, allowing individuals to earn a living and support their families. By engaging in various informal activities, such as selling goods and services, individuals contribute to the overall economic growth and poverty reduction in the country.

The informal market sector plays a crucial role in providing accessible and affordable goods and services to the wider population. Markets, street vendors, and small-scale enterprises are dispersed throughout both urban and rural areas, ensuring that essential commodities and services are within reach of communities. The competitive nature of the sector often leads to lower prices, making basic necessities more affordable for many Ghanaians, especially those with limited financial resources.

The informal market sector is a breeding ground for local entrepreneurship and innovation. It empowers individuals to start businesses with minimal capital and limited formal education, as it requires fewer bureaucratic procedures compared to formal sectors. This flexibility allows aspiring entrepreneurs to tap into their creative skills and ideas, contributing to the diversification of the economy and fostering a culture of self-reliance and innovation.

Ghana's informal market sector is deeply rooted in its rich cultural heritage. Artisans and craftsmen produce traditional handicrafts, such as Kente cloth, Adinkra symbols, and wooden carvings, which are not only sought after by locals but also attract tourists from around the world. By preserving and promoting indigenous skills and crafts, the sector helps sustain cultural traditions while providing income opportunities for artisans and preserving Ghana's cultural heritage.

During times of economic uncertainty or shocks, the informal market sector serves as a safety net for individuals who may have lost their jobs in the formal sector. It provides a buffer against unemployment, ensuring that people can still engage in economic activities and earn income to meet their basic needs. The resilience of the informal sector contributes to the overall stability of Ghana's economy and reduces the vulnerability of households during challenging times.

Recognizing the importance of this sector, policymakers should implement measures to support and integrate the informal market sector into the formal economy, providing necessary infrastructure, financial services, and regulatory frameworks that foster its growth while ensuring the well-being of participants.

On this note regulatory frameworks can improve quality and guarantee safety of consumers in three of Ghana's important imports.

Pharmaceuticals and Medical Supplies: Ghana imports a significant amount of pharmaceutical products and medical supplies to support its healthcare sector. This includes essential drugs, medical equipment, and supplies necessary for hospitals, clinics, and pharmacies.

Textiles and Apparel: Ghana imports textiles and apparel to satisfy consumer demand for clothing and other textile products. This includes both raw materials for the textile industry and finished garments for the retail market.

By implementing these frameworks at the point of manufacture before importing, the informal segment will be assured of quality and by extension the vulnerable consumers will be protected from sub par products.

Import regulations can ensure the survival, and preserve cultural heritage, by protecting Artisans that produce traditional handicrafts from lesser quality imports.