Rising prices of goods and services: Council of State engages industry players
The Council of State yesterday expressed concern over the steady rise in the prices of goods and services in the country.
Consequently, members of the council held a meeting with stakeholders, with the view to helping find a solution to the issue.
The meeting, held at the Accra International Conference Centre, had representatives of all business and traders groups in the country in attendance to share with the council members issues relating to high prices.
The groups included the Ghana Union Traders Association (GUTA), the Association of Ghana Industries (AGI), the Trades Union Congress (TUC), the Ghana Shippers Authority (GSA), the National Petroleum Authority (NPA), the Ghana Institute of Freight Forwarders, the Ghana National Chamber of Commerce and the Market Women Association.
Speaking at the meeting, the Chairman of the Council of State, Nana Otuo Siriboe II, said one of the main policies of the council was to gather as much information as possible on matters on which it wished to advise the President, to enable it to proffer the requisite counsel.
That policy, he indicated, stood well with the council in 2019 when, after wide consultations with relevant bodies and institutions on the high cost of tariffs and charges at the country’s ports, it made recommendations to the government.
“The government accepted the council’s recommendations and reduced the tariffs and charges accordingly. This year, the issue on everybody’s lips is the rising cost of goods and some services. Much as we are aware that the government has taken some steps to address it, we consider this as our bounden duty to create a forum to discuss this, particularly the underlying factors contributing to the rising cost,” he said.
Setting the tone for the discussions, the President of GUTA, Mr Joseph Obeng, said the main cause of the rise in prices was the increase in charges by shipping lines, although the coronavirus disease (COVID-19) pandemic had resulted in a rise in cost, in view of its effect on the global economy.
He said, for instance, that the cost of shipping a 40-footer container, which used to be around $3,000, had risen to $13,000 currently, and that the actions of those shipping lines were not in line with the law.
Also, the shipping lines used their own dollar exchange rates, instead of that of the Bank of Ghana, a situation that had made business more costly, he said, adding that businesses had no option but to pass on the cost to consumers.
The President of GIFF, Mr Edward Akrong, corroborated Mr Obeng’s assertion, and listed, among others, the permit charges by regulatory agencies, including the Food and Drugs Authority and the Ghana Standards Authority, as well as the duties paid on goods, which invariably affected prices on the market.
“Now you have interest charges, rent by the port authorities, state warehouse rent by Customs and the shipping lines waiting for their demurrage. All of these are time-bound — seven days. You are talking about shipping lines which don’t care whether it is a weekend; although they don’t
work on weekends, they charge you this demurrage.
“Also, we have mentioned the shipping lines charges. These are the same shipping lines which take the freight charges outside … and then a plethora of charges on their invoices. It is unimaginable,” he said, adding that once the shipping lines were able to bring in the goods to the ports, businessmen did not have any option but to pay all the charges thrown at them before the goods were released to them.
Cost of inputs
The Coordinating Secretary of the National Fisheries Association of Ghana, Mr Daniel Yaw Owusu, said the industry was affected by high charges on inputs and petroleum products.
He said apart from the increase in the already high cost of inputs, such as nets, which was indexed on the dollar, cost in the fishing industry had also gone up, as the direct fuel used constituted about 70 per cent of its operational cost.
“All these have contributed to the increase in the prices of fish on the market,” he said, and called for a second look to be taken at the price of marine gas oil, with a view to reducing it.
Impact on industries
The Chief Executive Officer of the AGI, Mr Seth Akwaboah, said the body was also concerned about the current cost of goods and services in the country, attributing it to both internal and external factors.
Internally, he cited the cost of energy used by industries as one of the factors responsible and said in Ethiopia, for example, power was being sold to industry at less than five cents per kilowatt hour, while in Ghana it was about 15 cents.
In addition to that, he expressed concern about the taxes that were supposed to be paid by industry members.
Passing on cost
The President of the Market Women Association, Madam Mercy Naa Afrowa Needjan, noted that market women could not be blamed for the rising cost of goods and services.
She said, for instance, that prices of goods quoted by manufacturers and the cost of transportation due to increased petroleum prices compelled traders to also pass on those costs to consumers.
The CEO of the Association of Oil Marketing Companies, Mr Kwaku Agyeman Duah, mentioned, among other things, operating fees charged by metropolitan, municipal and district assemblies, billboard fees and those charged by the Ghana Music Rights Organisation (GHAMRO), saying that all those ended up being passed onto the consumer.
In 2019, members of the council, also chaired by Nana Otuo Siriboe, held a closed-door meeting with President Nana Addo Dankwa Akufo-Addo on the high rate of duties, levies and taxes on imported goods at Ghana’s ports of entry and the large volumes of tax exemptions.
Some traders unions, including GUTA, had petitioned the state to intervene to review taxes and duties on imported items because they were too high.
Following the petition, the Council of State moved into action to hold consultations with various stakeholders to enable it to provide informed advice on the issue.