Ghana’s transition into its 64th year as a Republic coincides with significant price hikes across various essential commodities, setting a tone for the remainder of the year.
Key items such as cement, fuel, water, and electricity are all seeing price increases starting today, July 1.
Throughout the first half of the year, inflation rates remained above 20%, with transportation, vegetables, tubers, and plantains bearing the brunt of these increases.
Starting today, consumers will face higher fuel costs, with petrol prices expected to rise by 2.17% from GH¢14.17 to GH¢15.20 per litre.
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Diesel prices are also set to increase to GH¢15.21 per litre, while liquefied petroleum gas (LPG) prices will range between GH¢13.24 and GH¢14.64 per kilogram.
Electricity tariffs are also on the rise, with lifeline consumers seeing a 3.45% increase, residential consumers facing a 5.58% hike, and industrial consumers experiencing a 4.92% uptick. Additionally, water tariffs will climb by 5.16% across all categories.
In tandem with these increases, cement prices are set to rise further following an earlier increase of GH¢10.00 in May. Dr. Stephen Debrah-Ablormeti, former Vice Chair of the Ghana Real Estate Developers Association, confirmed that cement prices will escalate by an additional GH¢12.00 effective July 1, as communicated by manufacturers.
This comes amidst a move by Trade and Industry Minister K.T. Hammond to introduce a Legislative Instrument in Parliament to regulate pricing of cement, a move opposed by the manufacturers and being restricted by the Minority in Parliament.
The depreciation of the cedi, which has fallen by over 21% this year, is cited as a central reason for these price hikes, impacting the cost of goods and services across the board.
These increases in essential items directly affect a significant portion of the population, exacerbating the affordability challenges already faced, particularly in housing and food.
The implications are profound, particularly for government initiatives such as affordable housing, where prices are increasingly beyond the reach of average earners.
Rising cement costs will likely drive-up housing prices further, potentially leading to more incomplete projects and locked-up funds.
Moreover, the hikes in fuel, water, and electricity tariffs are expected to ripple through the economy, impacting both businesses and individuals.
Companies may pass on these increased costs to consumers, compounding the financial strain amidst an already challenging economic landscape.
These developments underscore the difficulties ahead for consumers and businesses alike, compounded by the constraints imposed by the International Monetary Fund’s programme with Ghana.
The IMF’s directives to tighten expenditure and increase domestic revenue further limit the government’s ability to provide relief, signaling tougher times ahead.
As Ghana navigates an election year, the upcoming mid-year budget will likely clarify the economic outlook for the remainder of 2024.
Despite July 1st marking the anniversary of Ghana’s Republic status, the day’s price hikes reflect a sobering reality, overshadowing the celebratory sentiments associated with the occasion, perhaps the reason why is it only commemorative and not a holiday.