Last year’s depreciation of Ghana’s local currency dealt a heavy blow to businesses as it led to major losses in revenue.
Engen Ghana Limited, one of the prominent Oil Marketing Companies (OMCs) in the country with 25 service stations across the country says it lost over GH˘800,000in foreign exchange losses last year.
Managing Director (MD) of the company, Mr Henry Akwaboah in an interview with this paper remarked that 2014 was “a very difficult year.”
“We started the year with product supply challenges, it settled for a while and then just when we thought that things were going to be fine, we were hit with another supply crisis, “he recalled.
In spite of the challenges, the company was able to keep its head above water as it managed to minimize costs as much as possible.
“We survived because of the way we are structured and the discipline with which we approach our work,” he submitted.
Mr Akwaboah stated that the company had discipline itself financially to the extent that it did not rely on banks “to carry out our business.”
The company found ways of engaging its customers to appreciate the difficult times and “so they always went along with us whenever there was ample reason to for instance change the trade terms with our suppliers.”
He noted that Engen Ghana’s parent company, Petronas South Africa had been extremely supportive.
“When it got to the point where our suppliers were requiring that we make purchases upfront, we had to fall on external support and also manage our own internal mechanisms to ensure that stayed afloat,” the Engen boss said.
The cedi saw no stability for most part of 2014, depreciating in value by almost 40 per cent from January, with government itself admitting that the depreciating cedi had badly affected economic activities.
The Bank of Ghana (BoG) in a bid to arrest the steep fall of the cedi introduced measures which were heavily criticized as too restrictive and counter-productive.
The measures were however reversed after it became clear that more harm than good was being caused the cedi itself and the Ghanaian economy at large.
The measures, experts say dealt a heavy blow to businesses, especially banks and hotels in the country.
The Bulk Oil Distribution Companies (BDCs) last year made the case of GH˘1.8 billion in foreign exchange losses and appealed to government to settle the debt.
The figure was however disputed by government, culminating in the appointment of Auditing firm, Ernst and Young to audit the debt.
Source: The Finder
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