Wrong timing - AGI questions electricity tariff hike despite falling inflation and stable cedi
The Association of Ghana Industries (AGI) questioned the timing of the latest electricity tariff adjustment on Tuesday on Joy News' PM Express. Eric Defoe, Chairman of AGI's Economic Affairs Committee, stated that the increase comes when key economic indicators are improving and global fuel prices are easing. He warned that manufacturers could experience much bigger cost increases than the headline increase of just over 3%, once the effects spread through the production chain. Defoe said, "It would appear so nominally, but the effect may not be 3.5% on pricing; it may go higher."
Defoe explained that electricity is only one component of production costs and that increases in utility tariffs often trigger additional cost pressures across other parts of the manufacturing process. He stated that cumulatively, the impact could go to 5% to 10% or anywhere in that band. He argued that regulators should have delayed the tariff review because fuel costs, a key factor influencing electricity pricing, are already beginning to reverse. Defoe noted that petroleum prices went up, leading to market adjustments, but are now falling because the US-Iran war has ended.
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The Association of Ghana Industries (AGI) has questioned the timing of the latest electricity tariff adjustment, despite improving economic
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