Business confidence for the first quarter of this year has declined marginally as compared with that of the last quarter of 2017. That’s according to the Association of Ghana Industries (AGI) Business Barometer.
According to the report, the business confidence index declined from 107.9 as at fourth quarter of last year to 100.5 by quarter one this year.
President of the Association, Dr Yaw Adu Gyamfi says even though the first quarter of this year saw some positive signs including a good mix of the macroeconomic indicators, the confidence seems to be declining.
Dr Adu Gyamfi, attributed the drop to some major challenges like high cost of electricity tariffs, cost of credit, among others.
“Businesses have been under pressure from the high cost of credit, access to credit, delayed payments, particularly our contractors, the high cost of electricity prior to the announcement of the reduction of tariffs by the PURC.” Dr Adu Gyamfi said.
As a result, the Association has called for some policy measures to be put in place to forestall any recurrent mishaps to businesses in the coming future. Institutional collaboration
According to a release from AGI, there is the need for a private sector-led industrial development with mutual support from public institutions to enforce import regulations will help check huge revenue loses, create sustainable employment and growth of the Ghanaian economy.
AGI further notes that manufacturing which represents a critical mass of the real sector of the economy is becoming less competitive. Hence the collaboration between the AGI and the Customs Division of the GRA must be further strengthened to help check malpractices such as under-invoicing, under-declaration and erroneous description of imports in order to save manufacturing from the threat of collapse.
According to the Association, delays and charging of unofficial fees still persist, undermining trade facilitation programmes and reforms introduced last year.
“The paperless system is a welcome initiative, though it has not fully addressed all the challenges. To this end, AGI appreciates the discussions and institutional collaboration with the GRA and relevant institutions to help check malpractices at the ports.” Dr Adu Gyamfi said. GITC Inauguration
The AGI commended the passage of the Ghana International Trade Commission (GITC). The President of the Association says he looks forward to seeing the impact of the work of the Commission on cases of consumer protection and unfair trade practices against the local economy.
“The Association pledges its support for the Commission and as a result set up a private sector committee to closely monitor the work of the GITC, the AGI President said.
One-District-One-Factory
The AGI is urging Government to expedite action on the 1D1F initiative, considering the slow pace or its implementation. According to the Association, businesses are anxious to see a clear support from Government.
Electricity tariff reduction
The industry has lauded government for the recent reduction in electricity tariffs from 25% to 30% reduction. According to the Association, it has brought some relief to industry and non-residential customers, especially where consumers had not experienced such significant reduction in a long while.
According to the AGI business barometer, since the last tariff review in December 2015, the high cost of electricity has often emerged as the number one difficulty facing businesses.
The Association says it is optimistic the reductions will open up new prospects for businesses and inure to competitiveness as a country.
Key Policy Issues
The Association is calling for the passage of the local content law for the construction sector.
“AGI recommends a form of credit certificate to offset outstanding statutory payments to local contractors. There is also the need for a legislation to cushion contractors who suffer delayed payments in view of the huge pre-financing costs.” AGI President said.
The AGI also says duplication of mandates and services by some regulatory bodies at the ports is very worrying. It says the industry cannot bear the cost of such services already being delivered hence recommends the augmentation of existing structures to avoid excessive bureaucracy and undue costs to the businesses.
The Association is also calling for government’s close attention to the development of tourism in Ghana, considering the fact that it is the 4th highest foreign exchange earner in the country.
It is calling on the government to strictly implement the 15-year tourism development program and also ensure that tourist destinations are well-developed.
The AGI has also challenged the government to establish a state-of-the-art hospitality training institute.
Source: Myjoyonline.com