More than 50,000 timber workers to lose jobs

Kumasi, July 18, GNA - More than 50,000 employees of the timber industry in Ghana would lose their jobs as a result of the recent upward adjustment of utility tariffs.

This is contained in a joint press statement signed by the Executive Secretary of the Ghana Timber Millers Organisation (GTMO), Mr E.E.K. Acquah Moses and the General Secretary of the Timber Workers Union (TWU), Mr Joshua Ansah, and issued in Kumasi.


It said it was not possible for the industry, Ghana's fourth foreign exchange earner with receipts averaging 180 million Euro annually, to survive the nearly 200 per cent electricity charges.


The statement said that energy charge for this category has shot up to GH¢27.00 from GH¢9.05, meaning that companies which hitherto paid GH¢100,000 would now pay nearly GH¢300,000.


It said this would have drastic impact on the companies since Ghana contributes only one per cent to the international market regarding tropical timber and there was no way they could pass on the increases in local cost to the market.


The statement said it was important to reckon that any further increase of sawmill lumber on the domestic market occasioned by increases in electricity traffic would worsen the already destructive activities of chainsaw operators.


It said complained of high and prohibitive bank lending rate, resulting in low investment, which was affecting value addition and diffusion of technology to enhance efficiency and productivity.

The statement said that the inability to access long-term capital at reasonable interest rate was a big challenge to expansion needed to generate benefits from economies of scale and create the critical mass required for competitiveness on the global market.


It said faced with these grim realities, the only option was for the timber organisations to shut down and throw workers on the streets.


The statement said that to prevent this from happening 93we call on government to reconsider the Public Utility Regulatory Commission (PURC) tariff increment which is unhelpful to industry growth.


"We believe that government energies should be directed at growing the private sector by the provision of policies and interventions that will support industrial expansion, re-investment of profits and payment of taxes to the State for the provision of public amenities".


The statement called on government to prevail on the financial institutions to reduce interest rates on loans to help entrepreneurs to borrow and invest in the manufacturing sector of the economy.