The Association of Ghanaian Industries (AGI) has vehemently criticised the Bank of Ghana’s Price Stabilisation policy modalities, citing the devastating impact of bi-weekly port charge increments on businesses.

The Association stressed that in an economy where the majority of raw materials are imported for productivity, the increase in tariffs at the ports every two weeks is disheartening and eroding any meaningful profit to ensure sustainability.

President of the Association, Dr. Humphrey Ayim-Darke, speaking at the sixth Ghana Industrial Summit and Exhibition (GISE) 2024 in Accra, argued that BoG’s inflation-targetting monetary policy needs reconsidering as it’s failing to address the price stabilisation issues it seeks to achieve, hence becoming a bane to businesses.

These frequent changes in port charges – driven by exchange rate fluctuations, he noted – are crippling industries that rely heavily on imported raw materials. The erratic policy is eroding profits, threatening sustainability and undermining Ghana’s industrialisation and export goals.

“We desire to see macroeconomic interventions that will be adaptive to change around the macro conditions. The biggest is the exchange rate factor. So, if we seek to drive industrialisation and promote export, then a fundamental issue like the exchange rate must be dealt with permanently.

“The port of entry – by the BoG’s price stability policy – sees an increase in charges every two weeks because of the exchange rate factor, and this has implications. Note that if it’s once every two weeks prices change, then the cost of doing business also changes every two weeks, leading to inflation which worsens the deficit of government and debt position of the country – leading to bigger problems for the state on international markets,” he said.

He added that the macroeconomic issues influencing exchange rates must be dealt with from the policy perspective when the BoG’s policy on price stability is reviewed.

Dr. Ayim-Darke emphasised a need for innovative macroeconomic interventions to address pressing issues, particularly the exchange rate. “We cannot drive industrialisation and promote exports without stabilising the exchange rate. The BoG’s inflation-targeting monetary policy must be reassessed, as it’s failing to achieve price stability and instead becoming a burden for businesses,” he added.

Dealing with short-term measures at the port which have a cascading effect on the economy, a healthy competitive platform is set to compete with others.

Chief Executive Officer-MTN Ghana, Stephen Blewett, on his part stated that Ghana’s industrial transformation initiative is a great idea – but challenges such as inadequate basic infrastructure, poor road networks, especially in rural Ghana, and SMEs’ access to finance as well as costs make it difficult to realise.

“It is important that we think global but act local. We need to create a support system for SMEs – who are in the majority of the country’s productive industry – and move beyond lip-service to action.

“Promoting strong value chains creates opportunities and supports businesses to thrive. It’s not just about lip-service to the public but real action, now,” he said.

AGI’s Call to Action

The AGI is calling on government to address macroeconomic issues that are creating imported inflation and find ways to drive remittances and inbound tourism to enable currency swaps.

Furthermore, the Association urges the Bank of Ghana to reconsider its price stabilisation policy modalities and engage with stakeholders to develop a more effective and business-friendly framework.