COVID-19 Outbreak: GEA makes Policy Recommendations to Government

The outbreak of COVID-19 has negatively affected businesses, employers and enterprises worldwide, including Ghana. The pandemic will have major economic and employment impact on, especially, the aviation, manufacturing, hospitality, tourism, sports and the entertainment industries, to mention a few. These organizations are in danger of being forced out of business.

It is against this backdrop that GEA calls for urgent action in the following key areas:

• Containment of the Pandemic
  Businesses and employers expect government to do everything possible to completely contain the spread of the virus and allay all fears in the populace. Fears of escalation of the pandemic could lead to panic buying and withdrawals, a situation that will create shortages, supply chain disruptions, rapid rise in the inflation rate and reduced real income levels as well as heightened suffering of the people.Containment of the situation is also paramount in helping to prevent high post COVID-19 losses in key sectors of the economy such as the tourism, manufacturing, pharmaceutical and banking and finance subsectors. It will further protect the health sector from being overwhelmed with cases, and medical staff being over stretched.
  
• Emergency Economic Response Strategy
  GEA would like Government to lead in the development and implementation of a comprehensive Economic Response Strategy (ERS) to the COVID-19 pandemic. This will require the development of stabilization and stimulus packages for businesses and households to reduce the impact of the pandemic both in the crisis period and after the threat of the virus has been eliminated. The ERS, which should comprise of fiscal and monetary plans will subsume the monetary policy measures prescribed by the Central Bank. Knowledge of government’s plan for the private sector in this critical period will play a significant role in guiding employers to allocate resources efficiently and safeguard investment to sustain businesses. It will further reduce uncertainties and risk in the economy.
• Support local production of raw materials
  Ghana depends largely on imports, which include inputs for the production of most of our goods and services. The spread of the virus has dampened global demand, which will in the coming months create supply chain shortages for businesses and employers in Ghana. To help address this situation, the GEA recommends that Government works with GEA and other Business Associations to identify and support local firms that produce substitutes of the imported products to ensure continuity of production and consumption in the Ghanaian economy.For those inputs that will still have to be imported, the GEA recommends that the exemption made for cargo to arrive by sea, air and land (following the Presidential announcement of March 21, 2020 shutting all our borders – land, sea and air) is maintained under all lock down scenarios.
  
  
• Continued Operations of Existing Commercial Bank Facilities
  A good number of businesses (if not all) operate on the strength of Commercial Bank Facilities. The drastic dislocation in the finances of these businesses – small, medium and large – occasioned by the negative impact of COVID- 19 cannot be over-emphasized. The GEA strongly recommends that Government works with the Commercial Banks to assure that these businesses are allowed by the Banks to continue to access the facilities under more flexible conditions so the Businesses do not collapse for want of working capital, among others.
  
  
• Stimulus Package
  Some suggestions for consideration are:

  o Deferring VAT and Income Tax Payments
  The GEA urges Government to defer payment of Value Added Tax (VAT) for a three-month period (or during the pendency of the COVID-19 threat) to cushion businesses hard-hit by the outbreak of the pandemic. Also, income tax payments for up to the mid-year (or beyond as appropriate) be deferred or be allowed to be paid in instalments by businesses after prior agreement with the revenue authorities. All registered businesses in Ghana must be eligible for this relief.

  o COVID-19 Interruption Loan Scheme
  This is a temporary loan scheme intended for SME’s and distressed but potentially viable big businesses, to cushion them against the impact of the pandemic. These loans must have government guarantees in order to give the lenders the needed comfort and assurance in financing the scheme.

  o Emergency Fund
  We urge Government to create an Emergency Fund to help address the financial challenges or fallout from the outbreak of the pandemic. Businesses could access the fund for the payment of workers salaries, procurement of raw materials, working capital, among others during these critical times of COVID- 19 if they are to retain employees on their respective payrolls.

• Potential Impact on Employment
  A good number of businesses, especially those sectors who are hardest hit by the pandemic are likely to review the employment relationships with their workers including some potential lay-offs. In such a situation there would be the need to engage the Trade Unions concerned or the Workers’ Groups through negotiations and dialogue on the financial implications of the lay-offs since the disruption of the employment contracts may not have been contemplated by the parties.
• Any Lock Down?
  We acknowledge the fact that a carefully considered selective lock down of one form or the other can immediately make a positive impact on the containment of the pandemic. A blanket lock down may however, bring in its wake, a massive systemic shock to Ghana’s economy, recovery from which may take a long time to come. This is not desirable, especially after all the efforts Government has put in to stabilise the economy, pre-COVID- 19. The GEA is of the firm view that any decision to consider a lock down must be preceded by a thorough dialogue between Government, Employers, together with other Business Associations and Organized Labour on the effects, ramifications and consequences on businesses, employers, workers and the citizenry.

  Given the enormity of the challenges facing the country, GEA urges constructive dialogue among the keys actors – businesses, Organized Labour and other bodies – to design and implement measures that balance the sustainability of enterprises, sustained employment, a safe and healthy citizenry and a resilient national economy. Time is of the essence in this regard, the GEA recognises

  In conclusion, the GEA wishes to commend Government for the measures and actions taken thus far to prevent the spread of the disease and to assure all of the full support and cooperation of the Association in our collective obligation to rid our country of this pandemic.

D. Employers urged to pursue WHO directive on COVID-19

The GEA has been keenly following developments regarding the spread of the corona virus pandemic across the globe. On March 15, 2020, His Excellency the President of the Republic of Ghana reported confirmed cases in Ghana and the steps the Government was taking to stop the spread of the pandemic in the country. In order to ensure that the COVID-19 outbreak is effectively contained, it will require the concerted efforts of all sections of society including employers and businesses.

As part of business and employers’ contribution towards the prevention of the spread of infections in the workplace, and among families of workers and their respective communities, GEA urges employers to vigorously pursue the following initiatives per the World Health Organization (WHO) guidelines:

1. Make sure your workplaces are clean and hygienic
2. Surfaces (e.g. desks tops, door handles, balustrades and tables) and objects (e.g. telephone, keyboards,) need to be wiped with disinfectants at regular intervals each day because contamination of surfaces touched by employees and customers is one of the main ways that COVID-19 spreads
3. Promote regular and thorough hand-washing by employees, contractors and customers
4. Promote good respiratory hygiene in the workplace
5. Advise employees and contractors to consult national travel advice before going on business trips.
6. Reduce physical meetings and events because there is a risk that people attending the meeting might expose others to the COVID-19
7. Regular education, sensitization and awareness on causes of the COVID-19, how it spreads and the impact on the workplace, family, and the nation

Businesses and employers are being requested to carry out actions and measures that protect the health and security of employees and their families in this critical period. Employers must also pay particular attention to directives from the Government as well as the Ministry of Health from time to time regarding the COVID-19.

Employers with online and digital facilities must encourage their workers, where possible, to operate from home to reduce the physical convergence of workers at the workplace in conformity with the social distancing strategy of controlling the spread of COVID-19.

GEA commends the Government for the measures and actions taken thus far to prevent the spread of the disease and to assure the full support and cooperation of the Association in our collective obligation to rid the country of this pandemic.