Trade: Why are Ghana and Nigeria at each other’s throat?

West African neighbors Ghana and Nigeria are in a worsening diplomatic feud prompted by the treatment of Nigeria businesses in Ghana by the latter’s union of retail traders.

For over a year, the private and powerful Ghana Union of Traders Association (GUTA) has forcibly closed down Nigerian businesses suspected of engaging in the retail business. Under Ghanaian law, only nationals or foreigners under special dispensations can venture into retail trading.

This year, GUTA even ordered its members on a nationwide closure of Nigerian-owned retail businesses suspected of flouting the laws. Although this order was eventually flattened by action from Ghana’s Trade Ministry, GUTA members have taken it upon themselves to embark on isolated crusades against Nigerian businesses.

Nigerian-owned stores have been seized and demolished while wares have been looted or destroyed.

But all attempts by Ghanaian authorities to calm GUTA have fallen of deaf ears. There are some, however, who believe that the government of Nana Akufo-Addo and the New Patriotic Party (NPP) are not trying as hard as they could because they have their eye on general elections in December.

A few of Ghana’s labor unions, including unions of doctors, industrialists as well as traders, have proven to be kingmakers in presidential elections in the past. The 76-year-old Nana Akufo-Addo is seeking a second term.

On their part, Nigeria has warned of a similarly harsh response if Ghana’s authorities do not get their house in order. Nigeria believes GUTA is acting with an implicit greenlight.

A statement from Nigeria’s Information and Cultue Ministry last week said “The Nigerian Government is deeply concerned by the incessant harassment of its citizens in Ghana and the progressive acts of hostility towards the country by Ghanaian authorities, and will no longer tolerate such.”

But the Nigerian statement also reminisced on recent perceived transgressions by Ghana, including destruction of property belonging to Nigeria’s Mission in Ghana as well as deportation of Nigerians from Ghana.

“The Federal Government will like to put on record the fact that even though over 1 million Ghanaians are resident in Nigeria, they are not being subjected to the kind of hostility being meted out to Nigerians in Ghana,” the Ministry said.

Ghana has since set up a task-force whose job is to assess the situation in markets. Recommendations by the task-force will be revealed on September 3.

Ghana and Nigeria are West Africa’s biggest economies, two of Africa’s most influential countries and they are bound together by the histories of colonization and cultural similarities. In 2019, Ghana emerged as the biggest export destination for Nigerian products for the first time in the six decades of the bilateral relationship.