Cedi fall: Sachet water producers threaten to increase prices, halt production

The National Association of Sachet and Packaged Water Producers (NASPAWAP) has threatened to shut down production, over the rising price of fuel and the falling cedi. According to the Association, the cost of fuel and the continuous fall of the Ghana cedi against the dollar is taking a toll on the packaged water industry. A statement issued by the Association and signed by its President Magnus Nunoo said: “The packaged water industry relies heavily on imported plastic pallets/granules used in the manufacture of the Polythene films and pet bottle preforms, that are used to package the treated water for consumers. “It is important to note that Packaging alone forms about 60 percent of the production cost for sachet and bottled water. Diesel fuel used for distributing the packaged water to market centres for consumers was around 15 percent of the product cost as at the third quarter of last year.” It indicated that: “Due to high increase of diesel and other petroleum products, diesel fuel for distributing packaged water to consumer centres now exceeds 25 percent of the product price,” while, “electricity cost which used to be around 15 percent of the product price has increased to 20 percent of the product price as a result of the recent increase in utility tariffs.” The Association, therefore, called on government to take urgent steps to remedy the situation. It wants the government to: “reduce taxes on the packaging materials for the industry, review the import and customs duty formula for the raw materials imported for the packaged water industry,” and “freeze payment of VAT, excise tax and other taxes on the packaged water industry. “Freeze government charges and fees for the packaged water industry and if possible, subsidise electricity and water bills of the industry, remove completely all taxes on reusable jar bottles used for the dispensing machines,” and “call on the bank of Ghana to be circumspect in the adjustment of the policy rate which is increasing the cost of borrowing from the banks to the businesses,” the Association has demanded. It further indicated that: “Calling on the packaged water producers across the country to shut down production and distribution for a couple of days to press home our demands may have been the obvious thing to do but as an essential product provider, we are mindful of the repercussion of such action and the health hazards it can pose to the citizens, more especially as most of the river bodies are highly polluted and most households depend on packaged water as the main drinking source, reported by the Ghana Statistical Service.” It continued: “It is important that the public, CSOs, the heads of faith-based organisations, NGOs, Parliament of Ghana, Diplomatic missions, and Others, support the packaged water industry by calling on the government to heed to the plight of the industry.” The Association also gave the government a week to address its concerns else it “will have no option than to pass on the cost to the public and possible shutdown of production and distribution for a week across the country.”