The President of the Ghana Union of Traders Association (GUTA) has bemoaned that traders in Ghana are in a dilemma whether they should increase the prices of goods or not.
He explained that the fear of traders is that if they increase the prices of goods in accordance with their cost, it will be expensive for consumers to purchase them; however, if they don’t increase the prices too, it will be inevitable for their businesses to die out.
“We can’t however increase prices as we should due to the stiffer competition in the market with the growing rate of foreign competitors establishing in the country. Also, purchasing power consumers have diminished thereby making it difficult for traders to increase prices since it will be expensive for consumers to buy.”
“Inflation indeed has a negative effect on our businesses because everyone who is selling wants people to buy but people cannot afford the goods due to high prices. The devastating effect is obvious, we are in a dilemma”
Dr. Obeng stated that foreigners such as; Indians, Chinese and other rich foreign nationals are competing with them in the same space at the disadvantage of the Ghanaian business owners whose capitals have been significantly reduced by exchange rate and high interest rate.
The GUTA president indicated that; freight prices have gone up further due to the effect of the Ukraine war, the Cedi has depreciated in value and interest rate have gone up too thereby making the cost of doing business escalate. Inflation rate influences the reference rate and the reference rate also escalates the interest rate which eventually leads to price hike.
“Any cost added to our product, will definitely be added to the prices to help strike a balance for the business to continue. We urge government to maintain the flat VAT rate as one of the measures to help remedy the situation” he appealed
The national year-on-year inflation rate was 23.6% in April 2022, which is 4.2 percentage points higher than the 19.4% recorded in March 2022, the Ghana Statistical Service (GSS) announced on Wednesday May 11.
The month-on-month inflation between March 2022 and April 2022 was 5.1% .
Four Divisions (Transport, Household equipment and Routine Maintenance, Food and Non-Alcoholic Beverages, and Housing, Water, Electricity, Gas and Other Fuels) recorded inflation rates above the national average of 23.6% with Transport (33.5%) recording the highest inflation.