The implication of the closure of markets and shops on Ghana’s economy

Data has shown that about 80 percent of Ghana’s population comprises of the informal sector which plays a key role in economic development. Out of this figure, a greater percentage can be found in the country’s major markets namely, Kejetia, Makola, and Kaneshie among others. However, markets and shops in Accra’s Central business district were locked up on Wednesday, October 19, 2022, over the current economic hardships in the country. According to them, the increasing rate of the cedi's depreciation against the dollar has resulted in high inflation rates which have increased the cost of living in Ghana. As a result of this, buyers have had to turn away as they could not get access to their respective items to purchase. The traders told in interaction with GhanaWeb Business said the closure will continue until Monday, October 24 to demonstrate to the government the extent to which the economic meltdown is affecting businesses and livelihoods. The closure will however mean that no sales will be made in the next three to four days, which is significant to the growth of the economy which is now seeking support from the International Monetary Fund. Makola market, for example, comprises of several merchandises including clothing and textiles, footwear, food, drugs, groceries, raw material, and kitchenware among others. Four to five days of little to no sales is estimated to cause huge revenue losses to the country as VAT payment and payment of other taxes will be impacted. At a time when the government is finding it difficult to generate revenue, it is a bad omen for economic activity to somewhat shut down. Some traders speaking with GhanaWeb's Stella Dziedzorm Sogli said the activities of the black market have been the main reason for the increase in the exchange rates. One of the traders, Abigail said: We are pleading with the government to arrest those in the black market. They are the main reason the dollar and CFA keep increasing. The dollar rates are changing too rapidly. In a day, the dollar can rise about three times within three hours." She continued, "It is unbearable," she added. Shaima, who retails socks and other clothing items recounted that "the black-market folks have hoarded the dollars. They are the reason the rates have gone up. What we know is that exchange is done in either bureaus or the bank, but now these black-market people have taken over." Calling on the government to intervene quickly, other traders said "We are pleading with the President to come to our aid. This is not the Ghana he promised us." Last week, traders in Adum embarked on a similar protest to drive home concerns about the high cost of living in Ghana. The persistent depreciation of the cedi has now reached alarming levels as the currency is now selling at GH¢13.65 at some forex bureaus in the country while the CFA is selling at GH¢17.50, as of October 20. Watch the latest episode of BizTech below: SSD/FNOQ