ElvisAnokyenews Latest News Portal
The Chief Executive Officer of the Ghana National Chamber of Commerce and Industry (GNCCI), Mark Badu-Aboagye, has disclosed that the implementation of a 24-hour economy alone will not resolve the deep-rooted challenges confronting businesses in Ghana.
In an interview on JoyNews’ PM Express on Monday, July 7, following the official launch of the National Democratic Congress’ flagship policy by President John Mahama, which was monitored by Elvisanokyenews.net, Mr. Badu-Aboagye explained that while recent macroeconomic indicators such as inflation dropping to 13.7% are positive signs, they are not enough to change the structure of the economy or ease the current harsh business climate.
“Launching a 24-hour economy will not change the harsh business environment that we are facing now, the first point for me is to look at how we can improve the business. Having inflation down to 13.7 is a necessary condition but not sufficient to change the structure of the economy.”
He disclosed that key cost drivers for businesses, particularly in the manufacturing sector, remain high.According to him, if the government truly wants to boost manufacturing and increase exports, it must focus on significantly reducing utility tariffs and the high cost of borrowing.
The Chief Executive Officer of the Ghana National Chamber of Commerce and Industry (GNCCI), further questioned the effectiveness of the 24-hour economy if underlying economic pressures are not addressed.
He urged the government to ensure that current gains such as lower inflation and cedi appreciation translate into lower policy rates and tangible relief for businesses.
“We want to see how inflation, the lower inflation, will reduce the cost of credit. We want to see how lower inflation reduces the cost of utility, electricity and water. These are key components when it comes to manufacturing. In Ghana, the cost per kilowatt hour for a manufacturing company ranging from 12 to 50 is among the highest, so if you really want to manufacture more, we need to bring down the cost of utility and then that of cost of credit. If you have a policy rate of 28%, of course, your interest rate will be around 30 and over.
“No company would want to manufacture and export will be competitive under this condition. You are borrowing at 35, you are paying high utility tariffs and then you think that your product when it gets to the market outside, people will buy. The 24-hour economy is not only for local consumption. If it’s for local consumption, then we don’t need a 24 hour economy because we can produce more to feed ourselves.
“We want to export. That is why the accelerated export is a component of the 24 hour economy, but when you send your product outside, people will not buy it because it’s coming from Ghana, because you have launched a 24 hour economy. They will buy your product because one, it’s competitive, two, it’s of high quality. Let’s look at how the improvements we are seeing now, the lower inflation, the cedi appreciation will now impact on the policy rate.” He said.
Source: Elvisanokyenews.net
