The fourth quarter Business Barometer report released by the Association of Ghana Industries (AGI) has shown that business confidence dropped for the 4th quarter of 2015.
According to the report, business confidence among corporate leaders for the fourth quarter of 2015 reduced by 4.17 basis points.
It dropped from 97.29 points in the third quarter to 93.12 points in the 4th quarter.
The Business Barometer calculates the current business mood and expectations for the future.
Employment Confidence level in employment saw a sharp decline as nearly half of industry captains interviewed said the employment situation will stay same, and were not optimistic of expanding their workforce. 49% indicated they will not employ, while 34% said they will increase their labour force, while about 17% also indicated they will cut down on labour considering the challenges they face.
Expectations on business performance The 4th quarter Business barometer meter revealed 35% of Captains of industry interviewed believed the business environment will remain the same while 24% said it has improved.
But about 58% expect business performance to improve in the first quarter of 2016 while 7% believed business performance will worsen.
President of AGI, James Asare Agyei speaking to Citi Business News said increases in tariffs with hikes in taxes are responsible for the low confidence in the economy.
“We realized that increases in tariffs; electricity, water and other forms of taxes have further worsened business confidence that industrialists have in the economy and this is quite worrying and that is why we have called on the government to look at some key areas of the economy which requires boost. Cost of capital has become worrying situation”.
“Apart from access, the cost of it if you are paying over 35 % is very worrying,” he stated. Multiplicity of taxes ranked the 4th biggest challenge to businesses in Ghana while delayed payment was rated the 5th biggest challenge facing industry”
In the third quarter exchange rate volatility ranked first followed by inadequate power supply and multiplicity of taxes. But in the fourth quarter, high cost of electricity ranked first followed by inadequate power supply and unstable currency.
AGI is however optimistic business confidence in the first quarter of 2016 can be high. It cited the re-strategizing of companies to meet challenges within the economy.
By: Norvan Acquah-Hayford/citibusinessnews.com/Ghana