Ghanaian businesses are increasingly facing pressure from rising logistics costs, a challenge that industry experts say is undermining competitiveness, driving up consumer prices, and limiting the country’s ability to fully benefit from regional and global trade opportunities.
From transportation and warehousing to port charges and supply chain inefficiencies, logistics expenses have become a significant cost component for businesses operating across sectors, including manufacturing, agriculture, retail, and exports.
According to Dr. Hod Anyigba, PhD, Executive Director and Chief Economist of ITUC-Africa, logistics costs remain one of the least discussed but most critical factors affecting productivity and business competitiveness in Ghana.
“Every additional cost incurred in moving goods from the factory, farm, or port to the final consumer ultimately affects the competitiveness of businesses,” Dr. Anyigba said in an interview.
He explained that high logistics costs increase production expenses, reduce profit margins, and make locally produced goods less competitive compared to imported products and goods from countries with more efficient transport systems.
“For many businesses, logistics is no longer just a support function. It has become a major determinant of profitability and market competitiveness,” he noted.
Impact on Manufacturing and Trade
Dr. Anyigba observed that manufacturers are particularly vulnerable because logistics costs affect both the importation of raw materials and the distribution of finished products.
According to him, businesses often absorb part of these costs to remain competitive, but many eventually pass them on to consumers through higher prices.
“When transport costs rise, the cost of raw materials rises. When fuel prices increase, distribution becomes more expensive. The final effect is higher prices for consumers and reduced competitiveness for firms,” he said.
He added that exporters face similar challenges, especially when competing in international markets where buyers are highly sensitive to pricing.
Ghana’s participation in the African Continental Free Trade Area (AfCFTA), he noted, presents enormous opportunities for businesses, but high logistics costs could prevent local firms from fully exploiting the benefits of the continental market.
“The AfCFTA opens access to a market of more than 1.4 billion people, but if our goods are more expensive to move than those of our competitors, we risk losing market share despite having quality products,” he explained.
Infrastructure Deficits Increase Costs
One of the key drivers of logistics costs, according to Dr. Anyigba, is inadequate transport infrastructure.
Poor road conditions, traffic congestion, limited rail connectivity, and inefficiencies in cargo movement contribute to delays and higher operating costs.
He stressed that businesses often spend additional resources on vehicle maintenance, fuel, storage, and inventory management due to transportation bottlenecks.
“Time is money in business. Delays in moving goods affect production schedules, increase storage costs, and weaken supply chain efficiency,” he stated.
Dr. Anyigba argued that improving transport infrastructure should be viewed not only as a development priority but also as a strategic economic investment capable of boosting industrial growth and job creation.
SMEs Feel the Greatest Impact
Small and medium-sized enterprises (SMEs), which form the backbone of Ghana’s economy, are among the hardest hit by rising logistics expenses.
Unlike larger corporations, many SMEs lack the scale and financial capacity to negotiate favorable transport rates or invest in dedicated logistics systems.
As a result, higher logistics costs often reduce their competitiveness and limit expansion opportunities.
“SMEs are particularly vulnerable because logistics expenses account for a larger share of their operating costs. Many promising businesses struggle to grow because the cost of moving goods is simply too high,” Dr. Anyigba said.
Digital Solutions and Policy Reforms
To address the challenge, Dr. Anyigba called for greater investment in logistics infrastructure, digital trade facilitation systems, and policy reforms aimed at reducing supply chain bottlenecks.
He also advocated stronger public-private collaboration to improve transport efficiency and support the development of integrated logistics networks.
According to him, digital technologies such as cargo tracking systems, electronic documentation, and supply chain management platforms can help businesses reduce costs and improve operational efficiency.
“Ghana cannot become a competitive manufacturing and export hub if logistics costs remain persistently high. We need targeted investments and reforms that make it easier and cheaper to move goods across the country and beyond our borders,” he said.
Economic Growth Depends on Efficient Logistics
Dr. Anyigba emphasized that efficient logistics systems are essential for economic transformation, industrialization, and trade expansion.
He noted that reducing logistics costs would help businesses lower prices, increase productivity, improve export competitiveness, and create more employment opportunities.
“Countries that have successfully industrialized invested heavily in logistics infrastructure because they understood that competitiveness starts with the efficient movement of goods and services,” he said.
As Ghana pursues its industrialization agenda and seeks to maximize opportunities under the AfCFTA, experts believe that addressing logistics inefficiencies could become one of the most effective ways to enhance business competitiveness and accelerate economic growth.
