A new study by the International Growth Centre (IGC) and the Institute of Statistical Social and Economic Research (ISSER) has revealed Small and Medium Enterprises (SMEs) lost at least GH¢200 million cedis in revenue due to dumsor between 2012 and 2015.
“We also see that the crisis led to 10 percent loss in output or sales of the manufacturing firms and because of that the businesses were forced to use a lot of raw materials,” a co-author of the research, Dr. Patrick Opoku Asuming disclosed at the launch of the report on Wednesday.
Severe power crisis between 2012 and 2015 has been described as the longest in Ghana’s history.
Constraints in hydro power generation due to poor rainfall as well as low thermal power generation due to the disruption of gas supply meant that only 12 hours of power supply was provided.
Though the study argues that job layoffs were not necessarily associated with the power challenges, Dr. Asuming argues that at least 55 companies were compelled to fold up over their unprofitability.
“The results do not tell us that the crisis led to job layoffs among the firms that we surveyed…we only focused on firms that had existed as at 2010 or earlier and had stayed through the crisis so it is possible that some firms never survived through the crisis. There are about 55 of such firms,” he said.
In all, 885 firms were surveyed across four towns; Accra, Kumasi, Sekondi- Takoradi as well as Tema.
Majority of the businesses were engaged in Textile and garment (58.3%).
This is followed by Wood processing (20.3%) as well as Food and Beverage and others with 13.3% and 8.1% respectively.
Even though the affected firms undertook many coping strategies to stay in business, it turns out that majority operated fewer hours; 60.2% followed by change in production time; 51.1%.
Firms that engaged in less electricity –intensive products accounted for the least of 26.9%.