Electricity Power Insecurity and SMEs Growth: A Case Study of the Cold Store Operators in the Asafo Market Area of the Kumasi Metro in Ghana

Solomon Kwarteng Forkuoh^*, Yao Li

School of Management & Economics, University of Electronic Science & Technology of China (UESTC), Chengdu, China.

DOI: 10.4236/ojbm.2015.33031                

Abstract

The poor quality electricity supply has been recorded as a major problem hampering the operations of SMEs in developing countries, and is more prevalence in Sub-Saharan African countries and some part of the Middle-East. In recent times, access to reliable electricity supply and associated high tariffs is creeping to the top spot of SMEs challenges in Ghana, with SMEs in the country losing over US $686.4 million sales annually since the beginning of 2009. Considering the significant contributions SMEs made towards the socio-economy of countries, if care is not taken to assess the effect of the intermittent power outages on the running of businesses so as to create the awareness to policy formulators in other to find a lasting solution to this canker, then, the demise rate of SMEs will be on the higher pedestal. Against this backdrop, the researchers assess the impact of the power insecurity on the growth of SMEs with a particular study on cold-store operators in Asafo Market of Kumasi in Ghana, since previous researchers have not zoom on small sectors and also did not used case study approach. The research findings indicated that, power outages had a negative effect on SMEs growth, while the cost of operating businesses saw a significant increase under the power outages. Cost of alternative sources of power also significantly pushes the operation cost of businesses high.

Keywords

Electricity Outages, SMEs Growth, Ghana, Challenges

Conflicts of Interest

The authors declare no conflicts of interest.

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