The Ghana Union of Traders’ Association (GUTA) states that the dollar rate is not the only factor used in determining the prices of goods.
Speaking in an interview, GUTA President Mr. Joseph Obeng said many factors influence pricing, including duty, bank interest rates, VAT, and the exchange rate.
He explained that while the exchange rate is a major factor, it is not the overriding one. Therefore, traders cannot base a reduction in prices solely on the stability of the currency.
Mr. Obeng acknowledged a significant reduction in the forex rate, stating that it is now around Ghc12 to a dollar on the forex market.
He indicated that the prices of goods have also responded positively.
”We have seen a significant reduction in the forex, and due to that, we have also seen that prices of goods have responded positively,” he stated. “The price reduction we have seen is the best we can do, and so Ghanaians should appreciate it.”
Mr. Obeng noted that traders have considerably reduced the prices of electrical and food items, among other products. However, the extent of the reduction is what is in question, and Ghanaians believe the prices should have come down even more. He questioned the justification for such a demand.
He said traders struggle to get forex and must rely on “abokis,” or black market vendors, which comes at a cost.
He urged Ghanaians to consider whether interest rates, VAT rates, and other costs associated with trading have seen any reductions before demanding further price cuts.
”We buy over 70% of our forex from the ‘abokis’ because banks don’t have it readily available,” he explained. “The forex we buy from them is expensive, so what justification do Ghanaians have for demanding further reductions in the prices of goods? Have interest rates, VAT, and other costs of trading reduced? We can adjust prices further if all of these things reduce.”
He concluded that Ghanaians are still concerned because domestic products like gari and tomatoes have not seen significant price reductions, although the prices of other products have dropped considerably.
