Chief Executive Officer of the Association of Ghana Industries (AGI), Seth Akwaboah, has disclosed that businesses and industries are recovering from the impact of the pandemic.
According to him, the recovery of the global economies has trickled down to the country’s economy. By implication, it is initiating a recovery journey for most businesses in the country.
“I think it is true, things are picking up. If you compare to the latter part of the previous year… you could see signs of recovery. Indeed, the AGI business barometer report in the third quarter, last year, we did predict that by the middle of this year, recovery should happen. So, we are seeing the recovery happen”.
Mr Akwaboah, however, noted that some sectors are still struggling to survive and their recovery is slow.
“From all indications, industries are gradually picking up and the reason is that the economy is opening up. But in some areas, recovery has been quite slow; if you look at the beverage industry for example, the food industry in general, the pickup has been quite slow because the demand side hasn’t picked up that much. Don’t forget that because of the COVID situation, the big gatherings are not taking place. Even though they are gradually coming up, we are not having it in those big numbers.
“They all have impact on the economy because they are suppliers of all these products and if they don’t have the opportunity and avenue to supply, then for them, it means that demand is low. If you look at the hospitality industry in general, it is still a big challenge for them. The hotels are recovering but just gradually”.
Growth in construction sector
Commenting on the specific sectors and sub-sectors doing well, Mr Akwaboah noted that the construction industry is among the sectors picking up.
“I think that sectors that are not directly affected by such gatherings are gradually picking up. During the COVID period, the construction really went down. But I think part of the reason the data is also showing so is because the prices of cement has gone up. So, when you see the volumes and you’re looking at it in terms of the turnover, naturally it will go up.
“In fact, cement prices during COVID period was about GHC35, today it’s almost GHC50, so, it’s a significant increase. Therefore, if you look at just the turnover in the face value, you’ll think that construction has gone up so much. I think that one major challenge that most of the construction companies have is when they do government projects and they don’t get paid”.
The AGI boss however cautioned that, in the third quarter, we shouldn’t expect “significant increase in construction again”. He explained that, the quarter represents the lean season for the construction industry due to the rains.
Demands wane in the pandemic
Nevertheless, Mr Akwaboah expressed optimism over the turnovers of the construction industry bouncing back in the fourth quarter.
“At the private sector level, I think that because of the economy opening up, construction is gradually picking as well. It is sort of fluid. But generally speaking, I think recovery is gradually coming up and we are seeing it in several sectors”.
In spite of the seeming growth of the sectors, Mr Akwaboah explained that demand is straggling behind in the recovery.
Justifiably, he noted that people are “concentrating on essential products”, due to the pandemic factor.
“The demand side of the equation is where the problem is coming from. The demand is not growing. Expenditure hasn’t been that high even though it has improved over period”.
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