A senior lecturer at the University of Ghana Business School, Dr Mohammed Aminu Sanda, has identified the struggle for survival as the driving force behind the craze for imported products.
According to him, the unfavourable business environment in Ghana, characterised by high lending rates and high cost of production, was affecting the prices of locally produced goods which invariably are priced above imported products.
He said the drop in people’s purchasing power was pushing them to opt for cheap imported products to the detriment of local goods.
Speaking on Closing Bell on Class91.3FM on Monday August 15, Dr Sanda added that there was the need to fix the fundamentals of the economy to help engender interest in locally manufactured products.
“The issue of survival coming into the fold now generates this consumption behaviour. So, now, it is not an issue of what I want, but what I need. So, since it’s the issue of need, what can I get, at least, maybe to consume, which of course will be malleable to my lowering income? So, as a result of that, people now find it very easy to depend on most of these substitute products against what local guys (entrepreneurs in the system) are trying to promote as part of whatever business they are trying to do,” he stated, adding: “So, at the end of the day, you will realise they will be having very good products. For them, they should sell, but those who are supposed to contribute in terms of consumption are not interested to do that because if they make comparisons, what you are bringing there is a substitute: ‘I am not interested in quality, I just want something that I can use to meet my needs.’ So, we see that there is this kind of over-reliance on these substitute products, so at the end of the day these entrepreneurs, all the investments that they’ve made, they realise that they cannot let whatever that they have produced to go [waste].
“In the end, they have to stop because if you come out with something, those ones don’t go out, then they remain there and at the end of the day, it also becomes a burden on you. If it is a loan you’ve got from the bank, interest also keeps on rising so at the end of the day people fold [up] and in folding [up], the smart ones say: ‘Why don’t we enter into this kind of approach and go and bring substitute products?’”
Source: ClassFMonline
