“As indicated in the Business barometer, we came out with the top ten challenges that businesses faced here as far as the last quarter is concerned. The first as far as the last quarter was concerned was access to credit,” Seth Twum-Akwaboah, Executive Director, Association of Ghana Industries told CNBC Africa.
The Association of Ghana Industries Business Barometer Survey revealed that access to credit and cost of credit remained major constraining factors businesses in the fourth quarter of 2013 with small and medium scale industries bearing the brunt.
“Another challenge is the cost of capital. Apart from the access being a challenge, the cost is also a big challenge because companies are borrowing at a very high rate of 25 per cent last and for companies that are borrowing medium to long term, if you are borrowing at those rates, it’s very difficult to survive,” he explained.
“Businesses are having challenges accessing credit especially in the case of the manufacturing sector. Medium to long term capital is a big challenge in Ghana.”
High utility prices, taxes and high cost of raw materials were also listed in the topmost challenges to business growth in the last quarter of 2013.
“The second is the utility tariffs, and the tariffs have gone up for some time now and that is contributing to the cost of production. This is not to say that we are against the tariffs being reviewed but the reality is that as its being reviewed, we have to see the implication on the manufacturing sector.”
However, Twum-Akwaboah believes that the way forward is to improve the country’s environment and make Ghanaian products more competitive policy and price wise.
“Once we are competitive, then they can compete with products from all over the world so this is the challenge we have, I think that government is putting in a lot of measures and we need all the industries support so that its feasible,” he added.