Bottlenecks and high regulatory costs at the Food and Drugs Authority (FDA) is discouraging small- and medium-sized enterprises (SMEs) from obtaining the necessary sanitary permits and product approvals – raising concerns about public safety and the long-term survival of this critical sector.
Industry experts are worried that the current regulatory regime creates a significant barrier for smaller producers, particularly in the food and beverage industry where a large proportion of businesses operate from informal or home-based settings.
Failure to address these challenges increases the risk of unregulated and potentially contaminated products entering the market. The SME sector continues to face persistent challenges such as limited access to finance, poor infrastructure and high operational costs.
Regulatory hurdles are also now, more than ever, appearing to be another pressing concern. Research indicates that up to 75 percent of SMEs fail within their first three years of operation.
For instance, Kwaku Agyeman (not his real name) – a honey seller operating from his home for the past eight years – had his desire to formalise and scale up his business by obtaining FDA certification thwarted by what he describes as unrealistic production requirements and a lack of clear guidance.
Despite the lack of certification, he continues supplying his honey to consumers who trust the product blindly. Consequently, many SMEs, especially those operating in informal settings, do not possess sanitary permits – posing a potential risk to public health.
Larger companies, with reputations to protect, are more likely to comply with safety standards. But it is the informal producers – without certification, oversight or structured facilities – who pose the greater public health risk.
This calls for urgent attention if Ghanaian products are to cross international regulatory requirements which are increasingly becoming more and more complex because demand for high standards of consumer protection.
FDA must seek to simplify its processes – making them industry-friendly, particularly, for SMEs which constitute 92 percent of all registered businesses and contribute approximately 70 percent to national GDP – and are often lauded as the economy’s backbone.
