Employers rue economic environment

The President of the Council of the Ghana employers’ Association (GEA), Terence Darko, says the unpredictable and unstable nature of the macroeconomic environment remains a daunting challenge to employers.

He observed that a conducive environment for doing business is critical to the success or otherwise of any business entity, especially more so for the private sector. Thus, the current rate of inflation at about 19 percent has significantly affected the cost of borrowing as interest rates hover around 30 percent and beyond, Darko decried.

He made these observation when the GEA hosted a cocktail last week for members and stakeholders in Accra, to outline its outlook on national, social and economic expectations for the year.

He said access to credit is on the decline as businesses are competing with government for credit from banks, and the cedi’s depreciation to other currencies was another problem cited

“This makes business budgeting, planning and forecasting very difficult, and by extension unpredictable. The combined effect of these developments conspires to make the cost of doing business higher in Ghana, and therefore renders business entities uncompetitive.”

Mr. Darko however reiterated GEA’s support for the IMF bailout, to the extent that it brings ample credibility to the implementation of home-grown policies initiatives. He therefore urged the Finance Ministry and the central bank to deepen and strengthen dialogue with business and industry to find pragmatic strategies and options to improve the situation.

The second issue he focused on was counterfeiting and illicit trade, which he noted had heightened competition as legitimate businesses find it difficult to compete with pirates and “free-riders” who do not contribute to research, development or the social cost of their workers.

“The theft of intellectual property and piracy is stifling the innovation and creativity at the heart of today’s knowledge-based economy,” he noted.

Counterfeit products, he said, affect the economy in several ways: among which are loss of jobs due to the folding-up of companies/industries; ruining Ghana’s image in international circles; and the negative impact of counterfeit drugs on the health of citizens. The GEA urged the state to equip regulatory bodies with the requisite tools to strengthen their efforts in combatting counterfeit and illicit trade in the country.