Traders on strike

Accra (Greater Accra) 29 May 2000- Commercial activities in the Ghanaian capital Accra have come to a halt as members of the Ghana Traders Union Association (GUTA) embarked on a week-long strike action to protest against the continues sliding of the cedi against other major currencies.

The action is also against the imposition of a 20.5 per cent special tax on certain categories of imports and a proposed increase in the rate of Value Added Tax from 10 per cent to 12 .5 percent, which starts on Thursday. Shops and malls in and around Makola and Okianshie in Accra central have been shut. So are vehicle spare parts shops in Obossey Okian.

A drive through the usually busy commercial areas this morning shows that traffic have eased considerably with traders hanging around their closed shops charting. The police have promised protection for traders who want to open their shops but it doesn't seems this will be necessary as most traders have complied with the directives reached last Thursday at an emergency meeting held in Accra by members of GUTA.

Callers to a local radio-phone in programme on Joy FM this morning declared their support for the trader's action, with some calling on other organised bodies like the Trade Union Congress and political parties to join the protest. The traders decided to embark on the strike action following what they described as the government's insensitivity to problems confronting them, which they say have resulted in high prices in the market.

According to the traders the Ministry of Trade had failed to act on proposals submitted to it by the association after series of meetings with its executives.

The traders, are seeking among other things, a reduction in the exchange rate of the cedi against the major trading currencies and the removal of the 20.5 per cent special tax. The cedi started the year with a value of 3,600 cedis to the dollar now the banks are quoting 4,576.64 cedis, for the currency, which is never available. The forex bureaux have been quoting between 4,800 and 4,850 on their board but in reality the currency is selling for 5,400 cedis and in some cases speculators say up to 6,000 cedis. Whereas the central bank makes it an offence to sell goods in dollar, the Ghanaian Customs authorities peg duty charges against the dollar.

"We are mourning because our working capital is gradually being eroded," the traders told journalists. Paa Kofi Ansong, the Public Relations Officer, said the special tax meant to encourage the consumption of made-in-Ghana goods to protect Ghanaian industries was misplaced and should be removed because prices of goods produced in the country tend to be higher than those imported.

Mr. Ansong said it was not the intention of the members to create chaos but to press home their demands for recognition. "The business community has been taken for granted for far too long. It is time for the government to recognise traders as partners."

He said the closure of the shops was a signal to government to consider the issues at stake and address them accordingly. The more than one million member traders' association say they intend to use their power as collector of government revenue to push their demands forward by freezing importation of goods and refusing to collect Value Added Tax on behalf of the VAT Secretariat if the government still maintains its negative stand. According to the traders, attempts by the government to blame the current economic hardships on external factors was not plausible since Ghana was not the only country reeling under external pressures.

"What is happening now is the result of unhealthy government policies that have strangled the growth of the private sector", Mr Ansong said.

The Ministry of Trade has described the trader's action as "unfortunate" and in "bad taste", since it was still engaged in talks with the traders to address their concerns. Prices have more than tripled since the beginning of this election year with fuel prices going up about five times within the last six months. However, there hasn't been a correspondent increase in wages and salaries.

Analysts say the strike action if allowed to continue, will further compound the crises of the import driven economy of a country which has been described by economists as "a nation of shop keepers".