Every day at the Aflao border crossing between Ghana and Togo, women carry metal pans of smoked fish on their heads through an unmarked dirt path in the bushes. They bypass the official customs station, which operates nearly 24 hours a day, by walking about 200 meters away through narrow spaces locals know well. No forms are filled. No lines are waited in.
They simply walk.
Ama Serwaa has crossed this frontier for 20 years, trading smoked sardinella. “The official gate is broken down,” she said, balancing her bowl while walking. “I’ve been on this road so long that I know it. I know the people. I can negotiate with my sister in Lomé. This is how trade is supposed to work.”
Why merchants avoid official checkpoints
Official border crossings come with long lines and harassment. Officials demand bribes.
When the frontier closed, unofficial networks expanded
Experts believed the March 2020 frontier closure between Ghana and Togo would stop nearly all trade. Researchers from the University of Bergen and Ghana’s CSIR-Food Research Institute studied what actually happened.
The female traders who could not cross asked trusted family members to move goods back and forth. They lent money to partners on the other side. They shared information about which unofficial crossings still operated.
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The two-year closure did nothing to stop the fish trade. When the frontier reopened in March 2022, these networks were not just intact — they had grown larger. Researchers found that the social relationships of the merchants were the determining factor in keeping the system resilient.
The local government gap
These unofficial systems exist because local authorities have broken down. District assemblies have the authority to provide markets, roads, and basic services — but most lack the capacity.
The District Assemblies Common Fund (DACF) was supposed to give assemblies fiscal autonomy. But funds have historically arrived late, and assemblies have received no more than 40-50% of what was budgeted.
“Delayed funding stalls project execution,” said Alhaji Osman Abdel-Rahman, Executive Director of the Ghana Developing Communities Association. It undermines planning and diminishes public trust.
When the local administration fails to fix a road or maintain a market, merchants find their own solutions. They create their own routes. They create their own marketplaces.
The Ghanaian government is trying to address this. In September 2025, President John Dramani Mahama announced that assemblies will now receive 80% of allocated funds directly, up from the previous 40-50%. But years of inaction have already pushed the parallel sector to build its own systems.
Currency and the parallel market
Across the Ghana-Togo frontier, cross-border trade has also created an unintended currency exchange system. The Ghanaian cedi cannot be converted into the West African CFA franc through official channels, so dealers use unofficial currency dealers instead.
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Economist Bright Simons said this explains the gap between official and actual exchange values. The Bank of Ghana’s official rate is around C10.10 to the dollar. The black market rate runs from C11.5 to C12.5.
Merchants have learned to profit from this spread. They use Ghanaian debit cards at ATMs in Togo to withdraw CFA francs, then convert those into dollars back in Ghana and sell the dollars on the black market.
“This is not illegal,” Simons said. “It’s standard economic behaviour.”
Formalization efforts have failed
For years, national authorities and international donors have pushed to formalize the parallel economy. Most efforts have not worked. The parallel economy is not an illegal underground system — it is a separate system that developed because the formal one does not fully function.
ECOWAS recognizes that unofficial commerce matters. Intra-African trade depends on these networks for 30-40% of its total volume. Simplified trade regimes exist in theory, but implementation is poor. At the Aflao joint border post, designed to ease crossings, sellers report harassment and bribe demands.
The recent changes to Ghana’s decentralization system are a step forward.
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When the Korle-Klottey Municipal Assembly was allowed to collect its own taxes, revenue jumped from C2 million to C12 million. If local governments control their finances, they can fund the marketplaces and roads merchants need.
Back at the Aflao crossing, the woman with the smoked fish has already crossed into Ghana. She will sell her goods in Lomé, negotiate prices in two currencies, and return home before nightfall. She moved food, generated income, and fed family on both sides of the frontier.
The woman is not waiting for decentralization to be implemented.
She has her own method. Until local government can build something as efficient as hers, she will keep using it.
The African parallel economy’s strength comes from an ironic source: weak governance. That weakness has forced innovation. For policymakers, the choice is clear. They can keep pursuing regulations that will be ignored, or they can fix the governance gaps that make the parallel economy more profitable.
Female merchants in Ghana at Aflao have already made their decision. They built something that works. Now it is time for governments to do the same.
