Captains of Trade and Industry say strategic investment and sustained local production is the solution to Ghana’s inflationary pressures and economic challenges.
They noted that the continued importation of goods, including about 70 percent raw materials for local production was the main contributing factor to the rising exchange rate challenge and high inflation rate, and its attendant economic hardships.
Accordingly, they have asked the Government to create an enabling environment for local industries to have access to capital and be in the position to increase production without pushing the high cost of production to consumers.
Dr Joseph Obeng, President, Ghana Union of Traders Association (GUTA), Mr Tsornam Akpeloo, Greater Accra Chairman, Association of Ghana Industries (AGI), and Dr Adu Owusu Sarkodie, an Economist, said this during a media engagement.
Mr Akpeloo noted that about 70 percent of raw materials for production were imported, which made local manufacturers incur high freight charges due to exchange rate and inflationary pressures.
He said as a country, there was the need to prioritise the domestic production of goods to halt the rising rate of inflation and spur local production.
“There is no way we can come out of this problem by not having clearly defined locally produced items to consume. The call to localise is what we are asking for to stabilise our system,” Mr Akpeloo said.
He emphasised that: “The solution now is producing locally. Everything happening on the international front is affecting us. Ghanaians should also take some of the blame, government is not the problem every day. We should also develop the love to encourage and appreciate local production.”
Dr Sarkodie observed that Ghana was not the only country suffering from the Russia and Ukraine war, but the extent to which it depended on them had an impact on the local economy.
He said that: “Local production is the best way to keep our exchange rate intact. We should encourage local production because we cannot predict when this Russia-Ukraine war will stop.”
He said there was the need to deal with the issue of food by ensuring that: “We have a policy as a country to say no Ghanaian will go hungry.”
Dr Obeng, GUTA President, stated that capital acquisition was very high in Ghana, with inflation also impeding industry’s growth and making the purchasing power of consumers limited.
He said: “We need to look within, and identify the areas that we have comparative advantage then we produce and become a hub of manufacturers. This will make us super-rich.”
He added that: “Those who are manufacturers of floor tiles are making it big. We need to encourage a lot more people to go into this sector so that we become a hub.”
The Ghana Statistical Service (GSS) announced on Wednesday, May 11 that, the national year-on-year inflation rate was 23.6 percent in April 2022, which is 4.2 percentage points higher than the 19.4 percent recorded in March 2022.
The month-on-month inflation between March 2022 and April 2022 was 5.1 percent, the GSS said.
Four Divisions; Transport, Household equipment and Routine Maintenance, Food and Non-Alcoholic Beverages, and Housing, Water, Electricity, Gas and Other Fuels, are the highest contributors.
The April food inflation of 26.6 percent was higher than both last month food inflation of 22.4 percent and the average of the previous 12 months, which was 13.5 percent.