Dr Kofi Konadu Apraku, Minister of Trade and Industry on Wednesday said Ghana's participation in trade negotiations with the European Union (EU) for a free trade area presents an opportunity as well as serious problems for the country's economy.

There is a choice to be made between having cheaper imports for consumers and producers as well as improved market access for processed Ghanaian exports and an annual loss of $72m when tariffs are removed on imports.

An expected surge in EU imports into Ghana may lead to increased pressure on the national currency, increased competition for local industries and possible loss of jobs and income. The dilemma deepens when trade records traced from 2000 show that Ghana suffers consistently trade deficits in all its dealings with EU trading partners.

Dr Apraku, who was making a statement in Parliament said the 5-year negotiation involving the African and Caribbean and Pacific (ACP) countries of which Ghana is a member, and the EU was launched in Brussels, Belgium, on 27 September 2002.

"These negotiations are in accordance with the provisions of the Cotonou Agreement signed in June 2000, which called for new reciprocal trade arrangements, which are World Trade Organisation (WTO) compatible."

He said the agreements known as Economic Partnership Agreements (EPAs) are to replace the unilateral and non-reciprocal trading and market access preferences extended to ACP states under the Lome Convention. "The objective...is to foster the smooth and gradual integration of ACP states into the world economy..."

He said another concern for Ghana is the need to push the ECOWAS regional integration process forward so as to establish a functioning arrangement capable of dealing with the EU with one voice.

Dr Apraku said the Ministry of Trade and Industry has instituted an inter-institutional Committee to devise strategies for negotiations. The committee is made up of representatives from the public and private sector institutions with critical roles to play in trade. He said the Ministry has established links with academic and research institutions for appropriate positions and interests regarding trade issues.

Dan Abodakpi, Ranking member, called for a joint committee comprising the Finance, Food and Agriculture, Trade and Industry and Science and Technology Committee to consider the issue.

Ghana is engaged in three international trade negotiations, which are the WTO development round of negotiations, the trade portion of ACP and EU Cotonou Agreement and the ECOWAS process.