Mr. Seth Twum-Akwaboah says businesses have been under severe pressure from the power crisis, cedi depreciation and high cost of credit.
A recent survey conducted by the Association of Ghana Industries (AGI) has revealed that business confidence in the economy is worsening.
The study attributed the situation to the erratic power supply in the country, which has resulted in the collapse of many business and redundancy.
The AGI Business Barometer Report for the first quarter of 2015 revealed that confidence level of businesses dropped from 98 percent in the fourth quarter of 2014 to 85 percent presently.
Forty seven percent of captains of industry said business performance is getting worse, while 35 percent said the performance had not changed.
Only 18 percent said business performance has improved, it revealed.
On employment expectations, the report said 23 percent of captains of industry expected an increase while 50 percent were of the view that the situation would remain the same.
However, 27 percent predicted that there would be down-seizing of the workforce.
Captains of industry cited unavailability of power, cedi depreciation and exchange rate volatility, access to credit, delayed payment, unfair competition on the market as the major challenges facing them.
Seth Twum-Akwaboah, Chief Executive Officer (CEO) of AGI, who was speaking during the release of the report in Accra said, “AGI has noted with serious concern the worsening business climate in Ghana since the beginning of the year.
“Businesses have been under severe pressure from the power crisis, cedi depreciation, high cost of credit and difficulty in getting bank credit, among others.”
He said the dip in confidence reflects the worsening energy situation, stating that timelines for solving the current power crisis, especially for industry, have not materialized and the timelines continue to be extended.
Power supply outlook for the rest of the year looks bleak, with further drop in water level of the Akosombo Dam (240.42ft as of May 4, 2015) and difficulty in sustaining LCO stocks, Mr. Twum-Akwaboah indicated.
“On average, industries are paying six times the cost of grid electricity to run on generators and this not sustainable,” he said.
The CEO urged government to effectively address the power crisis to enable industries to plan properly.