The Ghana Union of Traders Association (GUTA) anticipates a difficult Christmas holiday season this year as businesses continue to be negatively impacted by the nation’s ongoing economic crisis.
President of the association, Dr. Joseph Obeng, told the media that businesses are currently producing in lower volumes because their capital has been depleted by the ongoing depreciation of the Ghana cedi.
“It [The situation] is affecting us badly. It’s so negative on our businesses to the extent that we cannot even do the volumes that we normally do for Christmas because our capital has already dwindled. It has been so depleted that we cannot do the same volumes,” he said.
Without mincing words, Dr. Obeng explained that “businesses are collapsing, so Christmas, as [we know it], will not be the same as the previous Christmas because the money is simply not there,” he predicted.
As a result of Dr. Obeng’s comment, it is anticipated that prices for goods and services will soar because demand will outstrip supply, in accordance with the laws of economics.
Reports from the Bank of Ghana reveal that the Ghana Cedi has depreciated by 37.5% against the United States dollar from January to September 2022.
Other major trading currencies, the pound and the euro, have depreciated by 24.1% and 27.5%, respectively.
Businesses in Ghana are heavily dependent on imported products, so any depreciation of the cedi results in an increase in the cost of production.
GUTA noted that the central bank’s weekly exchange rate quoted by the Customs Division of the Ghana Revenue Authority (GRA) has seen a sharp rise from ¢8.2 to ¢9.5, thereby shooting up duty charges at the ports by about 30%.
The Association has therefore called on the government to implement lasting solutions to arrest the dollar and appreciate the local currency.
According to experts in the financial market, a dollar is now selling at GH11.2.
Source: The Independent Ghana