Business News of Thursday, 10 December 2015
Christmas has always been a season of hope for mankind, but that hope, this year, has been preceded with so much uncertainty and anxiety. Many still keep asking if this year’s Christmas is going to be what they anticipate.
As Ghanaians ponder over the kind of Christmas they are going to mark, prevailing conditions make all optimism summersault.
Perhaps, the way this year’s harmattan announced itself after last Thursday’s surprise rain in the morning is a foreboding of what to expect.
Also unexpected are the prices of food items and clothes which have virtually remained stable after very negligible increases in the countdown to the Christmas festivities.
However, this has not occurred because traders and sellers have decided to keep the prices low and affordable. In fact, before the middle of the year, various goods experienced price hikes on the markets.
Prices of some food items
A visit to the Mallam, Kaneshie, CMB and Agbogbloshie markets in Accra last Tuesday showed that traders and market women were dissatisfied with the patronage and the fall in the prices of their wares in the run up to the Christmas festivities, report Timothy Ngnenbe and Yakubu Abdul-Jalil.
Some of the traders complained that the erratic power supply in the country had greatly affected the patronage of their chicken. A 38-year-old trader at the CMB market, Esi Quarshie, told the Daily Graphic that her business had taken a nose dive because of the unreliable power supply.
“You see, because of the widespread reports about bird flu in the media, many people fear for their lives. No matter how you try to convince them, they still refuse to buy. They prefer fish to chicken now. A carton of chicken was GH¢100 but it has been reduced to GH¢80, yet people do not buy”, she lamented.
A cold store operator at the Kaneshie Market, who gave her name as Auntie Abigail, said, “last year around this time the pressure here was overwhelming due to the inflow of customers. I had to extend the time of my workers because of the pressure from serving our clients.”
Traders in palm oil are, perhaps, the most affected. They complained that the combined effect of the reports of adulteration of palm oil by some bad elements and the hard economic situation in the country had negatively affected the price and daily sales.
Eunice Mensah sold two barrels a day prior to the unfortunate development, but she does not even know when a customer would pass by to buy a litre.
Other food prices
While at the Mallam Market an “olonka” of gari is selling at GH¢5, and a bag of perfumed rice at GH¢150, at the CMB market, an olonka of tomatoes, which sold for GH¢20, has drastically reduced to GH¢10 and that of maize remained stable, even though the traders complained of low patronage, a situation they attributed to the Christmas season.
The prices of the varieties of rice have also reduced marginally. Fatima Aziz, a trader at the Agbogbloshie Market, said a 25 kilogramme of Cindy rice, which sold at GH¢120, had reduced to GH¢105, while the same kilogrammes of Royal rice had also reduced from GH¢115 to GH¢95.
That, she said, was in sharp contrast to the situation this time last year. “The thing is that there is no money in the system. Electricity and water tariffs are also up; so people cannot even pay, let alone buy rice to celebrate Christmas”, she said.
Low patronage of goods
According to the President of the Ghana Union of Traders Association (GUTA), Mr George Kweku Ofori, “Prices have not come down due to some imbalances in the system created by the exchange rate.”
He told the Daily Graphic last Monday that patronage was generally low at the various business districts of the country because of the low purchasing power of many people.
He explained that many parents had to pay the fees of their children in school not too long ago, and the price hike that had been experienced earlier, without a concomitant increase in salaries, was responsible for the inability of people to patronise goods at this time.
“If it was six items that one could buy, it is now five, four, three or two depending on the items of the market. Priorities now have to be developed to select the most immediate ones because of the low purchasing power,” he said.
Mr Ofori also stated, “If you take the number of people who flock the various business districts, it might disappoint you – most of the people go on window shopping.”
Effect of exchange regime
According to Mr Ofori, imports have also slowed down because of the current exchange regime. He said traders were now investing more in other ventures, as they were not able to cope with the interest on loans from the banks.
“Now, it looks as if we are holding stocks. They are artificial stocks because patrons don’t have money to buy the goods. If you are not able to sell or deplete the stocks, it will go against you in terms of turnover. If you cannot make sales to pay off a facility, an issue of defaulting sets in,” he said.
Mr Ofori said traders indirectly had to pay duties in foreign currencies to clear their goods from the ports because the calculation of the duties was done using prevailing foreign exchange rates.