On Monday, President Nana Akufo-Addo unveiled the first locally-made Volkswagen (VW) vehicle – which marks the first phase the company’s operations in the country and will see the German carmaker produce three cars daily, with plans to increase production capacity in the second phase.

The president noted that the production presents a win-win opportunity for both foreign and local companies engaged in the industry’s value chain, and also puts the country on course to be an automobile hub in West Africa.

VW’s investment in Ghana was announced during German Chancellor Angela Merkel’s official visit to Accra in August 2018. During the announcement, the government of Ghana and Volkswagen signed a Memorandum of Understanding to establish a vehicle assembly plant in Ghana.

What makes the venture even more intriguing is that global players in the automobile industry are setting their eyes on Ghana as a preferred investment hub to establish assembly plants for assembling brands like VW, Nissan, Toyota and Sino trucks.

The car-making business is a high-tech industry that will bring with it skills and jobs to the country, and that should make the economy much more resilient. The firm’s Ghana Chief Executive Officer, Jeffrey Oppong Peprah, noted that cars assembled here come at a very low cost since they are over 10 percent lower in term of cost than imported ones.

This will afford the Ghanaian middle-class an opportunity to own brand-new vehicles at cost-effective prices, and the country can also serve as a hub to export such vehicles to ECOWAS member-countries with the hope of seizing on the opportunity that AfCFTA will present when it takes off in January 2021.

All in all, it represents the confidence the business community has in the Ghanaian economy which is a good sign since we have been labouring hard these past years to attract foreign direct investment in the economy.

This move will undoubtedly promote import substitution and enhance Ghanaian exports, particularly within the framework of the African Continental Free Trade Area. Toyota is scheduled to start the assembly of vehicles in Tema during the last quarter of this year.

These assembly plants are expected to create some thousands of jobs for Ghanaians, and this is very crucial considering the high youth unemployment rate.