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Business News of Monday, 15 July 2019

Source: primenewsghana.com

Fix energy sector issues to avoid dumsor under ACFTA - AGI to Gov't

The Association of Ghana Industries, AGI, has asked the government to find a lasting solution to issues in the energy sector to allow companies in the country to participate competitively under the African Continental Free Trade Area.

According to AGI, threats from the Chamber of Independent Power Producers, Distributors and Bulk Consumers (CIPDIB) to shut down their power plants if debts owe them are not paid will not be in the best interest of the country's production sector.

Even though PDS released some GHC 200 million last week, the CEO of the AGI, Mr. Seth Twum Akwaboah in an interview with Citi FM reminded government that, any challenges with the supply of power could have a negative impact on Ghana’s industrialization drive.

“I think that whatever it will take to resolve this kind of issues, we should resolve it and I don’t think this is beyond the capacity of government to resolve. If it’s a question of being paid for the service they’ve provided, which business can continue to provide service when it’s not being paid. So if indeed they are not being paid then it has to be looked at, with all challenges being resolved. The thought of shutting down should be completely out of the question.”

Mr. Akwaboah also highlighted the fact that if the issues of power get out of hand the country’s ability to be competitive in the era of the Africa Continental Free Trade Agreement will be affected.

“I mean we are talking industrialization and we are talking of business growth and now we even have a huge opportunity and a huge challenge at the same time under the Africa Continental Free Trade Agreement. It’s a huge opportunity because you have a big market out there that you can export to, and on the other hand it’s a huge challenge because huge products can get onto the market and compete with you. If you are not competitive on electricity tariffs and on reliability and consistency in the supply of electricity you are in trouble. You will be competed out, so in this time and age you just don’t talk of shutting down, whatever it will take to resolve them, let’s resolve it.”

Threat of shutdown

Last week, the Independent Power Producers IPPs, which currently supply about 1,500 megawatts of electricity threatened to shut down their plants if PDS fails to settle debts amounting to over $600 million within eight working days.

The IPPs in question were Sunon-Asogli Power (Ghana) Limited, BXC Solar Ghana, Cenit Energy Limited, Cenpower Generation Company Limited and Karpowership Ghana Company Limited.