The Ghana Employers’ Association, GEA, has said it is vigorously engaging the Ministry of Business Development to come to the aid of existing businesses that are experiencing some operational challenges, largely due to poor finances.
But while no conclusion has been reached yet, the Chief Executive Officer of GEA Mr. Alex Frimpon, said: “Primarily, we want a situation wherein existing entrepreneurs with difficulty accessing finance get the requisite support to manage their businesses”.
This, he said, is expected to be done in addition to ensuring that a congenial business atmosphere is created for businesses in order for local businesses be enabled to sustain their growth.
To this end, Mr. Frimpong noted that when this support is realised beneficiary businesses are expected to apply the funding to the critical areas of need. He therefore urged them to begin identifying these critical areas of need where the support could be channeled.
Speaking in an interview with the B&FT at the backdrop of a breakfast meeting of members of GEA in Kumasi, as part of a nationwide consultation exercise of the Association, he noted that the cost of forex is affecting the production cost of many businesses.
Despite recording a 9.6 inflation rate, he maintained that the impact is not being adequately felt by employers – adding that interest rates are still high and thereby affecting cost of capital, which hinders businesses from borrowing at reasonable rates to expand and by extension create employment.
“Even though stability of the economy is important, employers’ are not getting the full dividends from it – and this demands that much has to be done regarding the rising forex and interest rates.”
To reduce the pressure on forex and ultimately the unfavourable trade issues, he suggested that government work toward limiting imports to only critical products while encouraging the purchase of local products and services.
Some employers at the meeting asked the government to compel banks and other financial institutions to adhere to the base rate by bringing their interest on loans down. But, Mr. Frimpong, observed that local businesses are being crowded out by the government leading to the high cost of borrowing.
Others also expressed frustrations at the infrastructure gaps that affects businesses from expanding their operations to other parts of the country.
The Employers’ Association said the views expressed by members at the meeting will be collated and used to develop a business agenda that will inform the advocacy actions of the Association, between now and 2022.