Business News of Friday, 17 June 2016
The Ghana Statistical Service at a briefing meeting
The Ghana Statistical Service (GSS), has rejected assertions that Ghana’s consumer purchasing power is one of the lowest in Sub Saharan Africa.
The Managing Director of Nielsen West Africa, Lampe Omoyele at an evening encounter with the Chartered Institute of Marketing Ghana, asserted that Ghana was one of four African countries with low consumer purchasing power.
The figures released by Nielsen indicated that Uganda has the most affordable basket at 10.99 dollars while South Sudan had the highest at 38.60 dollars.
The report however pegged a basket of goods in Ghana at 27.50 dollars.
According to Mr. Omoyele, the development could also be blamed on the increasing inflation, cedi depreciation, high taxes among others.
“When there is inflation and wages do not increase to correspond, then consumers’ disposable income will decline. Ghana’s inflation has increased significantly in the last 24 months from 14% to over 18% in 2016,” he said.
He further pointed out that the country has also faced some challenges such as commodity price increase, supply issues, and infrastructure issues while wages have not improved, resulting in weakened consumer purchasing power.
“When that happens then consumers begin to rationalize. This means they don’t have enough money to spend and they rationalize by doing away with some of the things they feel are not important,” Lampe Omoyele added.
But reacting to the assertions on the Citi Breakfast Show on Friday, the Director of Economics at the Ghana Statistical Service Asuo Afram intimated that the report was not reflective of all areas in the country.
Asuo Afram explained that the category of items used in the study was skewed towards the high income urban dwellers.
“Most of the items used in the study are patronized by the urban dwellers and that is how come we intend to include in our next rebase we would like to include income level inflation so that those who live in the high income earning ranges.”
Mr Afram was however optimistic that Ghana could have performed relatively better if figures were extended to cover a much more wider group of individuals.
“This is what happens especially when you take only a few items like that and also what we have the weighting the weight will be skewed towards the urban areas…once you compare using the whole country’s average, then you will be able to get a figure reflective of all citizens in the country,” he noted.
Nielsen Africa report breakdown
Uganda has the most affordable basket at 10.99 dollars, Lesotho follows with 14.70 dollars, Swaziland is next at 14.99 dollars and Kenya and South Africa are at 15.06 and 15.33 dollars respectively.
For the list of countries with the least affordable basket where Ghana falls in, South Sudan is the highest at 38.60 dollars, Angola is at number two with 33.57 dollars, DRC comes in at number three with 28.80 dollars, Ghana is at number four at 27.50 dollars followed by Cote D’Ivore with 24.55 dollars.