PPI measures the average change over time in the prices received by domestic producers for the production of their goods and services.
For March 2022, the Ghana Statistical Service pegged the year-on-year producer price inflation at 29.3 percent.
Reacting to the development with an interview on Citi Business News, Greater Accra Regional Chairman of the AGI, Tsonam Akpeloo cautioned that the rise in inputs is likely to result in higher commodity prices if not checked.
“The rate of the producer price inflation is significant because what it means is that, by the time the cost of inputs goes up by the levels we’ve seen, it ends up affecting the entire production cycle, the cost of production and the final price that goes to the final consumer,” he is quoted to have by Citi Business News.
He continued that, “The reality is that the exchange rate instability we’ve witnessed in the past couple of weeks, has been part of the reason for the hike in the price of inputs producers’ use, as most of our inputs are imported. In as much as there are external factors affecting prices in Ghana, government needs to do its part to check the high price increases.”
The AGI Regional Chairman said the continuous surge in the PPI this year will also significantly impact on the goods and services of domestic manufacturers who could be forced to become importers.
“Now, the fact that importers of finished products are having to incur a lower cost of doing business, than those that have to import and manufacture, makes it unfriendly to produce locally. Very soon you may witness an increase in the importation of finished goods, and a decrease in the production of products locally, and that is certainly not good for Ghana,” he cautioned.
But to mitigate this, Tsonam Akpeloo called on government to implement a review on certain taxes which affect manufacturers as well as review the revised benchmark discount values policy at the ports.
Manufacturing sub-sector recorded the highest year-on year PPI for March 2022
