A study by the Ghana National Chamber of Commerce and Industry (GNCCI) has revealed that about 108 businesses have lost a minimum of GH¢39.8 million to the novel Coronavirus (COVID-19) which broke out in the country in March 12.
The study showed that since the virus was noticed in the country, businesses have been hard hit, with the estimated financial cost differing from one firm to another.
It indicated that the firms, consisting of micro and large enterprises lost between GH¢22,500 and GH¢600,000 within the last three months.
The President of the chamber, Nana Appiagyei Dankawoso I, shared the findings of the study at a seminar organised by the GNCCI online on May 13, from Accra.
The seminar was on the theme “COVID-19: Strategies for Business Survival and Growth”. It had speakers such as Prof. Peter Quartey, Director, ISSER – UG; Mr Kofi Frimpong Kore, Partner, KPMG; and Mr David Ofosu-Dorte, Senior Partner, AB & David Africa.
Communications on COVID-19
As the representative of the business community, he said the chamber undertook a business survey to elicit the concerns and expectations of the business community on the pandemic towards ensuring an effective engagement with the government and other stakeholders.
He said the results showed that business respondents were generally satisfied with the communication on COVID-19 and the government’s response.
He explained that businesses had been proactive in curbing the spread with the predominant responses being the increasing awareness and keeping of workplaces safe and hygienic.
He said other measures included investing in personal protective equipment, working from home or taking paid-leave.
Inadequate stimulus package
The findings, the President said suggested that the government’s stimulus package of GH¢600 million to be shared among about 200,000 small and medium enterprises (SMEs) was woefully inadequate.
“Also, the delay in the disbursement of the stimulus package is further worsening the plight of SMEs.
“The chamber urges the government in consultation with the financial industry players to urgently make known the modalities required to enable large enterprises to access the GH¢3 billion syndicated loans. Businesses need to be supported and this must be done quickly.
Across the business sectors, the results also show varying effects of the pandemic in terms of lay-offs, short-time working hours, workers on paid leave, and workers made redundant. Across firm sizes, small enterprises are faced with highest lay-offs and redundant workers.
“Medium enterprises also have highest expected lay-offs and workers on paid-leave while large enterprises have highest short-time working hours,” he added.
Although the interventions introduced by the government to help businesses cope with the financial challenges that the novel coronavirus had imposed on them was significant, the Director of the Institute of Statistical, Social and Economic Research (ISSER), Professor Peter Quartey, said it was inadequate to stimulate the economy.
He said the GH¢600 million stimulus package for instance did not support salaries of employees. He said in South Africa, $40 million out of its $500 million stimulus package was allocated for salaries of businesses that could not pay salaries of their employees.
“Loans cannot be used to pay salaries of workers, especially when the SMEs are not operating. You rather borrow to invest in production not to pay salaries,” he said.