Redefine Ghana’s Economic Direction

The Chairman of UNILEVER Ghana Limited, Mr Ishmael Yamson, has called for the redefining of a new Ghanaian economy which will be resilient, robust, sustainable and prosperous.

“Ghana cannot sustain a rapidly growing balance of trade deficit due to the growing import bill and the general importation of goods into the country,” he said.

Speaking at the 40th annual general meeting (AGM) of the company, Mr Yamson stated that the current growth in export revenue was largely driven by high commodity prices and cautioned that “commodity prices have the awkward tendency of being extremely volatile”.

“Our response, therefore, must be to restructure the economy away from its continued overdepedence on commodity exports and donor grants and aid to build a sustainable growth economy and prosperity into the long term,” he said.

“We have the opportunity now”, Mr Yamson said, adding that “commodity prices are high, there is huge international support for the economy, we are deriving benefits from our HIPC status and, even more assuring, private inward remittances have been growing strongly in recent years, with the 2006 receipt reaching $5.7 billion”.

The chairman said figures from the last Monetary Policy Report on the economy indicated that the economy finished 2006 more robust, with an estimated Gross Domestic Product (GDP) growth of 6.2 per cent, a year-on-year inflation of 10.5 per cent, a declining interest rate regime, while the currency continued to be stable against the major international currencies, especially the dollar.

He said commodity exports remained firm and export revenue recorded a significant 33 per cent growth in 2006 over the 2005 figure.

However, the total import bill rose by 22 per cent, while the oil import bill rose even higher by 45.7 per cent at $1.6 billion, more than $500 million above the 2005 imports and almost 50 per cent of total export earnings.

Touching on the energy crisis, Mr Yamson said the issue required a more serious, strategic-focused response which would address the short, medium and long-term solutions.

Giving the performance of the company, Mr Yamson said it achieved sales turnover of ¢1.2 trillion, while turnover grew by 14.7 per cent, which reflected a real underlying volume growth of 10.7 per cent.

He said the company's export business continued to make a significant contribution to the total business and now represented 10.5 per cent of the company's total turnover.

Mr Yamson stated that the excellent growth in operating profits drove profit after tax of ¢99.4 billion, despite significant reduction in other income and a higher tax charge due to an adverse profit mix.

“We ended the year in strong cash flows,” he stated.

Story By Boahene Asamoah