The President of the Ghana Union of Traders Association (GUTA), Dr Joseph Obeng, made a startling revelation on Ghana Television breakfast show yesterday. According to him, Ghanaian traders control only 20% of all imports and that the rest are done by foreigners.
He went further to state that the cost of doing business at the Ghanaian sea ports is very high when compared with competitors along the West Africa coastline. He revealed that whilst the cost of doing business at the Tema Port is as high as 6%, that of its competitors is between one and two percent.
Dr. Obeng, who was commenting on how to stabilise the local currency, the Cedi, against the US dollar, and make the business environment friendly, argued that our investment laws should be reviewed and that its current state does not inure to the benefit of Ghanaians.
The GUTA president also told his host that 80% of the retail trade are being controlled by foreigners and that the manufacturers overseas just ship their manufactured goods to their representatives here in Ghana.
After they have sold these goods at cheaper retail prices, they will repatriate the profits, plus the principal, through the purchase of the dollar at the Bank of Ghana. This, he added, adds to the woes of the cedi.
To him, foreigners who have entered the Ghanaian retail trade space should be compelled to bring in their dollar investment money and deposit them at the Bank of Ghana. The deposited dollar, he advised, is what these foreigners should use to import their goods, instead of relying on the Bank of Ghana to supply them with the dollars.
He contended that because our investment laws are not rigid, these foreigners are exploiting the situation and putting severe pressure on the few dollars in the system that should have been given to Ghanaians. It must be put on record that one of the major causes of the high cost of living in Ghana today is the cedi-dollar volatility. Since almost every consumable in Ghana is imported, the local currency is always depreciating against the dollar.
The development is affecting the cost of doing business in all sectors of the economy. In the face of these difficulties, one would have expected that the so called foreign investors will direct their investments into the manufacturing sector. Regrettably, this is not happening and per the revelation of the GUTA president, the investors are rather going to the retail sector, which should, ideally, be the preserve of Ghanaians.
What has even exacerbated the situation is the failure of these investors to bring in the dollar. They are rather relying on our dollars here to import their goods and then repatriate their profits. If this is so, then what is the Ghana Investment Promotion Council (GIPC)doing about the situation?
It appears to The Chronicle that we, as a country, are not doing much to protect the free fall of the cedi against the dollar. If we do, there is no way we would have allowed foreign manufacturing companies to ship goods directly to their representatives here in Ghana who also retail them and then change the profits plus the principal into dollars and repatriate them.
According to the GUTA president, some of the foreign owned malls we have in the country are the worst culprits of this trade practice. But of cause we cannot blame them hundred percent because our own people have colluded with them to indulge in this bad trading practice.
Clearly, these so called foreign investors, we repeat, have seen our weak points and are seriously exploiting them. They are using our markets to create jobs in the countries they have originated from, whilst suppressing employment in Ghana.
Looking at the serious nature of the issue at hand, The Chronicle is appealing to President John Mahama to personally intervene and ensure that the practice, which is not in the interest of Ghana, has been stopped. In our view, all the foreign owned malls operating in Ghana should be forced to deposit their own dollars, which they have brought into the country with the Bank of Ghana (BoG).
Under no circumstances should the BoG be giving the few dollars in the system to them to import and destroy our cedi. After obtaining our independence over sixty years ago, we have come of age and should not allow foreign entities to cheat us in the name of investment. It is, therefore, our fervent hope that President Mahama will intervene to protect the interest of the country.
