Nearly 16,000 agribusinesses closed between May 2020 and January 2021
New data by the Ghana Statistical Service have shown that an estimated 16,000 agribusiness firms remain closed between May 2020 and January 2021.
The data said the firms’ closure came with over 78,000 estimated staff laid-off and more than 267,000 workers having their wages reduced between the same period.
It said COVID-19 has affected almost all sectors of the economy and agribusinesses, which form an important part of the economy, have not been left out.
New data on the impact of the pandemic on agribusinesses in Ghana suggested that it may take a little more time and support for businesses to recover from the impact of the pandemic.
The survey results released by the GSS, funded by the German Ministry for Economic Cooperation and Development (BMZ) and implemented by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, in partnership with the United Nations Development Programme (UNDP), collected data from about 8,000 agribusinesses across Ghana.
The findings revealed an increase in the estimated number of job losses for agribusiness workers, from 51,111 during the lockdown to 78,412 in the post-lockdown period.
In the same vein, workers with reduced wages increased from 175,255 during the lockdown period to 267,211 within May 2020 and January 2021.
“The Agribusiness Tracker builds on the COVID-19 Business Tracker and this is to enable us compare the data and create timelines,” Professor Samuel Kobina Annim, Government Statistician said.
He said this way, “we are better positioned to inform Government and key stakeholders on the changes over time. We believe this panel data will guide the implementation of the Government’s GHC100 billion COVID-19 Alleviation and Revitalization of Enterprise Support (Ghana CARES) Programme, seeking to enable the economy to recover.”
The data also show slow demand for goods and services for most agribusinesses, with over 77,000 firms (61.5 per cent) reporting a decline in sales within the post-lockdown period under review.
This implies that, though there was some improvement after the lock-down restriction (from 84,869 to 77,254 agribusiness firms reporting sales decline), agribusinesses were yet to recover to the level seen prior to the coronavirus pandemic.
For example, sales growth was 30.2 per prior to the pandemic, 10.7 per cent during the lockdown and 15.4 per after the lifting of the restriction.
Similarly, despite some improvement in inputs supply post-lockdown, about half of agribusiness firms (45.9 per cent) still have challenges in getting supply inputs.
The survey said the regional distribution showed that the Greater Accra region was the most impacted, with almost three out of ten firms (28 per cent reporting input supply challenges).
It said even though the drift in policy was relatively slow, as much as 8 per cent of firms have started sourcing from domestic sources.
However, there were some positive trends, as digital technology is beginning to play a significant role in the operations of firms, with almost 9 out of 10 firms leveraging digital platforms including social media to market their products.
Similarly, mobile money and door-to-door delivery via courier services, and internet usage for business operations also increased, with about 8 in 10 firms (77 per cent) increasing the use of the internet in marketing compared to 19 per cent percent during the lockdown period.
Dr. Angela Lusigi, Resident Representative of UNDP in Ghana, said it was heartwarming to know that digital technologies were at the heart of Ghana’s COVID-19 response and recovery.
She said it would be important to consolidate the gain through the effective implementation of the Digital Ghana Agenda to ensure equity and the protection of more businesses.
Also, though increase in access to finance is yet to get to pre-pandemic level (22.5 per cent), this has marginally increased from about 12 per cent during the lock-down to 14 per cent post-lockdown.
Despite the slight increase, three in ten agribusinesses reported decrease in accessing finances mainly due to high interest rate.
The COVID-19 Agribusiness Tracker survey also enquired about the level of awareness among the firms on the African Continental Free Trade Area (AfCFTA) agreement, which is expected to provide a single market for goods and services in Africa.
The findings suggested a low awareness level, with only one in four agribusiness firms knowing about the AfCFCTA.
The top three support the firms need to participate in AfCFTA include increased information on business opportunities, reduced cost of credit, and removal of policy or regulatory bottlenecks.
“Small and medium-sized businesses are the backbone of the economy. Agribusinesses, especially have great potential in Ghana with hard-working entrepreneurs needing support to un-lock their opportunities”, Madam Regina Bauerochse Barbosa, Country Director GIZ Ghana said.