Ghanaian Companies Feeling Brunt Of Japan Tsunami

Some local companies affiliated with Japanese multinationals have confirmed to Citi Business they have not been spared the ripple effect of the recent mega-earthquake, catastrophic tsunami and the unfolding nuclear crisis in Japan.

Apart from their supply-chain worries, the disasters, according to them have already taken a negative toll on their operations with an increase in their cost of importation.

The disasters have reportedly affected electricity supply in the country with especially the automobile and general electrical industries amongst the most affected. Here in Ghana, Japan Motors Trading Co Ltd, marketers of Japanese Nissan vehicles and all Yamaha equipment has confirmed the effect of this on their operations.

The Assistant Managing Director, Abdul Salat Alhasaan Musa told Citi Business the company’s immediate concern is the effect of the disaster on the exchange rate of the Japanese currency, the yen which is invariably increasing their cost of importation. The value of the currency has been rising as global investors hold up the yen, due mainly to supply-chain worries linked to the disaster.

Meanwhile, even though the phenomenon is yet to have any significant impact on the prices of imported Japanese cars on the local market, prices of imported used cars are set to rise in other local markets.

This is due to a limited number of used vehicles available in Japan following the disasters. Importers in Bangladesh said auctions for used cars, from where agents purchase for Bangladeshi buyers, are not being held regularly due to the ongoing crisis in Japan.

According to them, even if auctions are held in Japan, the Japanese people are also bidding, as many of their cars were washed away by the tsunami and production of new cars in Japan is also being hampered by the disasters. Prices of used cars have therefore shot up in Bangladesh, where used cars account for 90 percent of imported cars with Japan controlling 95 percent of the market.