The CEO Network of Ghana has followed with great concern developments within the Ghanaian economy and the negative effects these have been exerting on the business fortunes and prospects of Ghanaian businesses. We have been particularly disturbed by the seeming lack of a discernible intervention on the part of government, and this chilling effect this has on the overall dynamics of the economy.
The rapid depreciation of the cedi has meant that businesses dependent on forex for daily transactions are facing enormous and unsustainable liquidity challenges, with many threatened with the prospects of insolvency and closures. This development holds dire consequences for the survival of many businesses and the employment of many.
This situation is further compounded by the rather ruthless and punitive enforcement of the tax regime which continues to badly affect the ability of business to sustain their operations within the current climate, not to mention hiring of new labour to ease the unemployment difficulties confronting the economy.
The ongoing situation with the economy is exacerbated by the rampant hikes in fuel prices, coupled with uncertainty with the adequate supply of fuel within the economy. These price rises and uncertainties depress economic activity and the prospect of shortages may worsen the situation. The situation remains deeply troubling for the general performance of the economy, but even more problematic for businesses directly dependent on crude oil imports and distribution as well as consumption.
The ongoing IMF bailout talks provide a blueprint template for government intervention. But that in itself is both inadequate and – in the circumstances – delayed to respond to the fast paced occurrences in the economy and seeming collapse of the Ghanaian cedi. In the circumstances, there seem an urgent need for government intervention independent of the bailout prescriptions to be administered as and when agreed.
The situation of labour and industrial unrest occasioned by other economic variables, such as the steep depreciation of the cedi, calls for urgent action as well; and the current silence of government on these remain both inadequate and unsatisfactory.
We accordingly call on government to do as follows:
- a) Address the nation on the state of the economy before the presentation of the Budget
- b) The taking of bold and imaginative steps to halt the rapid depreciation of the cedi
- c) Make a clear statement on policy and steps to deal with the rising labour unrest and general cost of living situation
- d) Address the Ghanaian people on the debt situation and containment measures prior to and under a future IMF programme
- e) Open a national economic dialogue to build consensus on the state and future of the economy
The CEO Network of Ghana pledges its support and commitment to government to help overcome the raging economic difficulties, and look forward to cooperating when invited.
Sincerely,
Ernest DeGraft Egyir
