Ghana is rich in gold, cocoa and oil, and often posts export surpluses. But those headline surpluses can conceal deals and market rules that leave local producers worse off because access to foreign markets comes with terms that reduce domestic returns.
A vivid example is poultry. Roughly 80% of the chicken consumed in Ghana is imported frozen from Europe, the US or Brazil. Exporters in those countries frequently sell the prime breast cuts at home and ship the remainder abroad. Even with import duties of about 30%, frozen imports can be as much as 35% cheaper than locally produced chicken, according to a 2023 study. That price gap has hollowed out local meat production. ‘If you produce the chicken, they’re not buying it. So you can’t produce it,’ says Charles K. Donkor, chairman of the Poultry Farmers Association in Ashanti, who now focuses on eggs rather than meat. ‘We can’t create jobs for young people this way.’
The trade relationship between Europe and many African states is built on decades of treaties and partnership frameworks. Beginning with the Lome Convention in 1975 and followed by accords tied to summit locations (Cotonou in 2000 and Samoa in 2023), arrangements involving the Organization of African, Caribbean and Pacific States (OACPS/ACP) govern preferences and access. Today 44 of Africa’s 54 countries enjoy duty-free entry into the EU internal market under these schemes, and many benefit from ‘everything but arms’ provisions for developing countries. But tariff-free access does not by itself produce balanced development outcomes.
DW’s review of 25 years of trade data shows that trade volumes between Africa and Europe have grown since 2000, and a handful of African economies recently registered overall trade surpluses with Europe. Those surpluses are largely driven by fossil fuel exports from Libya, Algeria, Nigeria and Angola. Between 2020 and 2022 the value of those exports to the EU more than doubled amid pandemic-related price swings and supply disruptions after Russia’s invasion of Ukraine. Côte d’Ivoire is another outlier, running surpluses thanks to cocoa and rubber. Yet the majority of African countries still run trade deficits with Europe.
Raw commodity exports are more volatile and capture less value than processed goods. European shipments to Africa tend to be industrial or partially manufactured products with steadier demand, while African exports to Europe are disproportionately raw materials priced on global markets. ‘Africa exports many raw materials… Conversely, Africa imports industrial goods or products from Europe that already have a certain degree of manufacturing,’ says Anja Berretta, head of the Africa Regional Economic Program at the Konrad Adenauer Foundation. Exports to Europe represent roughly 25–30% of Africa’s external sales, while Africa is a relatively small market for Europe — creating an asymmetry that leaves African producers more dependent on European buyers than the other way around.
That asymmetry also reflects missed opportunities to add value locally. Many countries have not reinvested commodity windfalls into industrial diversification, leaving their economies vulnerable to price shocks. Berretta points to Ghana and Mauritius as examples where active industrial policy and reinvestment have supported diversification and helped cushion against volatility.
There are openings for change. Europe’s push to diversify suppliers and reduce strategic exposure has increased demand for African critical minerals and other inputs. Joseph Matola of the South African Institute of International Affairs argues Africa can capitalise on this interest if governments prioritise exporting processed goods rather than raw materials.
Two initiatives could alter the balance. The EU’s Global Gateway Initiative has pledged roughly €150 billion for infrastructure and energy projects in Africa to strengthen supply chains and investment links. And the African Continental Free Trade Area (AfCFTA), in force since 2021, aims to unify markets across 55 members and cut non-tariff barriers — long customs delays, inconsistent procedures and poor infrastructure — that now impede intra-African trade. Reducing those obstacles could boost investment, speed up movement of goods and make regional value chains more viable.
AfCFTA may also serve African states as a collective negotiating platform rather than forcing them to bargain one-by-one, increasing their leverage with external partners. Observers note the treaty could make African markets more predictable for European exporters too, changing incentives on both sides.
Challenges remain: divergent national policies, weak infrastructure, limited reinvestment of resource revenues and the inertia of existing global value chains. But coordinated industrial strategies, targeted investment in processing and better facilitation of trade within Africa could help shift the terms of exchange so more of the value from African resources is captured locally rather than exported as low-value raw commodities.
Data, code and methodological choices underpinning this reporting are available in a public GitHub repository. Isaac Kaledzi in Accra contributed reporting. Edited by Sertan Sanderson.