Businesses sentiment has worsened sharply, according to the latest Association of Ghana Industries (AGI) Business Barometer Survey for the second quarter of 2014. From an index of 90.13 in the first quarter, business confidence fell sharply to 22.42 in the second quarter, 2014.

Mr Seth Twum-Akwaboah, Executive Director AGI said the findings were consistent with current developments in the economy, including cedi depreciation, availability of power supply and the multiplicity of taxes emerged as the top three challenges businesses faced in the second quarter.

“These do not come as a surprise. Measures by the Bank of Ghana to control the cedi depreciation against major trading currencies seemed to have had little impact. Foreign earnings that would have been repatriated are likely still being kept in offshore accounts.”

“As uncertainly lingered over the entire business climate, planning into the future remained a major hurdle for many captains of industry,” he said. The Business Barometer Indicator is an AGI proprietary tool that measures the level of confidence in the business environment and predicts short-term business tend.

It simply expresses the state of the business climate numerically in one figure (index) with 100 as the base index. It is calculated out of “current” business mood and “expectation” for the future. The Chief Executive Officers (CEOs) interviewed said they had to contend with more of contingency measures to keep business running.

Out of the CEOs interviewed 38 per cent believe the business climate has not changed between Q1 and Q2, 2014 while a good majority 57 per cent reported. In contrast, seven per cent are optimistic the business climate will improve in the next six months.

“Overall, business outlook is not likely to improve in the next six months according to 93 per cent of the respondents,” Mr Twum-Akwaboah said. On challenges, the depreciation of the cedi, the availability of power supply, multiplicity of taxes and delayed payments ranked as topmost among the respondents.