Local industry appeal for sustained government support to ease Covid-19 induced challenges
Ghanaian businesses bracing high-cost production in the wake of the coronavirus scourge have called on the government to focus on protecting them from irreversible losses.
Recounting their new reality on Joy News’ current affairs programme, PM Express, on Tuesday, four business executives said although the government has shown commendable support since the business disruptions caused by the pandemic set in, there is room for improvement.
CEO of Sleek Garment, Nora Bannerman-Abott, said her company’s commitment to adhering to the safety protocols against Covid-19 has come at a cost.
Her company has been producing nose masks and other protective equipment for the government following a shortage on the international market.
Sleek Garments, originally a fashion house that produces bespoke outfits, changed its production model to producing PPE and nose masks in March when the lockdown in Accra, Kumasi and other parts of the country was announced.
To mitigate the infection risk of its staff who use public transport, Nora Bannerman-Abott arranged with a transport company to shuttle staff to and from work at a cost to the company.
Also, food was made available to staff to prevent them from going out to get food, the CEO explained.
Because these costs were not budgeted for, they cut deep into Sleek Garments’ capital, she explained.
Also, due to her firm’s adherence to social distancing, the factory has not been deploying the full complement of the machinery that it would typically deploy for production.
“So the cost of production is definitely high now,” she told host of the programme, Evans Mensah.
“At the same time, due to the volume [of the PPE] that government needed, we have been working with a few other companies so we have been subcontracting. Through this pandemic and everything else that we are doing, we are actually helping to revamp the Ghana industry,” she said.
While commending the Ministry of Trade and Industry and allied agencies for supporting their operations, Nora Bannerman-Abott said this support must be sustained post-Covid-19 for local businesses to hold on to their gains.
Deputy Managing Director of Kasapreko Company Ltd, Michael Effah, said his firm faces a similar cost of production challenge.
Kasapreko quickly shifted its main production of alcoholic beverages to the production of alcohol-based hand sanitizers and rubbing alcohol to meet heightened demand in the wake of the pandemic,
“Alcohol is very expensive,” he said, “and as we speak now, on the local market, the cost has increased by about 100% and on the international market it’s increased about 60%.”
Despite the surge in the price of its raw material, the company has kept the price of a 200ml bottle of a hand sanitizer stable at 6 cedis.
However, maintaining the price of its hand sanitizers to enable the product reach many Ghanaians, when the price of the major raw material, alcohol, has gone up many times has been a major challenge, Mr Effah said.
The pharmaceutical industry has not been spared the disruption caused by the virus.
Executive Secretary of the Pharmaceutical Association of Ghana (PMAG), Lucia Addae, said before Covid-19 hit, the industry had been receiving support from government, but more support will be welcomed.
She commended government for a relief package specifically for the pharmaceutical industry in Ghana and urged government to do well in settling its debts when it makes purchases.
“We have people that buy from us, especially the government. The government is a big buyer. So we are engaging our stakeholders that ‘continue to buy from us and continue to pay on time – not after a year or two because we are not in normal times’,” she said.
The Private Enterprise Federation (PEF), a federation of private business in Ghana, urged the government to be proactive in drawing up policies that emphasises support for local businesses.
According to its CEO, Nana Osei Bonsu, the coronavirus has confirmed its long held position that government needs a robust policy framework that will promote the growth of local businesses.