Boahene Asamoah's Stories- Daily Graphic

British elections, losers and winners

2010-05-13T03:57:00.000-07:00

• Gordon Brown holds Kirkcaldy and Cowdenbeath with a majority of 23,000 - up almost 5,000 on 2005. Returning to Downing Street, he says he is willing to hold discussions on the future shape of government with any party leader, with economic stability the top priority.

• David Cameron comfortably holds Witney, winning 58.8% of the vote on a 6.3% swing from the Lib Dems. He says it is clear that Labour has lost its mandate to govern, and plans to make a "big, open offer" to the Lib Dems about forming a strong, and stable government, but does not rule out a minority Tory administration. Former premier Sir John Major says offering the Lib Dems seats in Cabinet was "price worth paying".

• Liberal Democrat leader Nick Clegg increases his majority in Sheffield Hallam, but admits it has been a "disappointing night" for his party. He said the Conservatives have earned the right to try to form a government.

PUBLIC ANGER OVER VOTING PROBLEMS

• The Electoral Commission announces a "thorough review" after hundreds of voters were turned away from polling stations and police called to deal with queues as the 2200 voting deadline passed. In Hackney, east London disgruntled voters stage a protest sit-in. Lib Dem leader Nick Clegg apologises to people at a polling station in his Sheffield Hallam constituency, who did not get a chance to vote.

• Overseas Britons also complain they have been denied the chance to vote.

review of the insurance sector

2008-12-01T04:45:00.000-08:00

The review of the insurance sector in 2006, has brought some interesrting development in the insurance sector, bringing new insurance companies to the economy, Boahene Asamoah explains how new players would impact on the insurance sector.

THE Ghanaian industry is expected to get more exciting as new players storm the market taken over existing companies as a result of the oil find.
Some industry experts are already discussing issues rated to the capitalisation of the industry, the prospects of oil find and reshaping the industry especially the life business to attract more policy holders.
These new entrants have huge capital and assets as compared to the local operators
New entrants from especially neighbouring Nigeria have made their entry into the Ghanaian market already taking the initiative from their counterparts in the banking sector.
So far six major insurance companies have regisrtered their presence in the country. They are Capital Express Assurance Ghana Limited, which has bought controlling interest in Benefits Life Assurance Sector, while Regency Alliance Insurance Limited, another Nigerian firm has also bought controlling interest in Benefits Non-Life business.
Industrail and General Insurance (IGI) Ghana Limited, which is a subsidiary of IGI plc of Nigeria has bought controlling interesting in Network Assurance in both the Life and Non-Life businesses.
However, two other firms have set up their own operations in the country. They are the International Energy Insurance Company (IEI) and Equity Assurance Limited.
Others such as Zenith Bank plc, which has an insurance subsidiary are expected to also make inroads into the Ghanaian market.
Following the Insurance Law of 2006, Act 724, the separates the Life and Non-Life business of insurance companies and the raising of the minimum capital to $1 million for each of the buisnesses, the number of players have increased from 24 to 37.
Interestingly, the oil find has brought about new businesses in the country with some experts in the oil insurance underwriting becoming a new hot bed for the indurance industry.
Again, the general business climate in the country which has led to a construction boom presents some tremendous opportunities for insurance companies.
Over the past five years there has been a general increase in premium income. From 2002 to 2007 gross premium income for all businesses increased from GH¢47.2 million in 2002 to GH¢1.64 billion in 2006.
This represents a yearly average growth rate of 36.7 per cent.
Total gross premium for non life business however, increased by 270 per cent from GH¢38. 2 million in 2002 to GH¢141.5 million at the end of 2007.
For the life business gross premium increased from GH¢8.9 million in 2002 to GH¢68.6 million at the end of last year.
Analysts say the continous increased in growth in this sector is an indication of the increase in public awareness and confidence.
Over the past few years, there has been an emergence of new products that are tied to investments such as the funeral insurance, which has received a lot patronage.
However, some industry players still believe that a lot more attention needs to be given to the life business because of its spiral effects.
According to reports the life business of the insurance has the pontential to generate wealth for the industry and encourage investments as a whole in the insurance industry.
Looking at the premium income by class of business for the period between 2002 to 2006,
The Nigerian authorities on the 5th of September, 2005, announced the recapitalisation of Insurance and Reinsurance companies. The new minimum paid-up share capital, as announced, is as follows:
Class of Business, New Capital Base Life Insurance business 2 billion Naira, General Insurance Business 3 billion Naira, Reinsurance companies to 10 billion Naira.( would do the conversion)
It was also identified that the total market capitalization for the insurance industry then which stood about N34 billion spread among 103 direct insurers and 4 reinsurers.
Indeed this is the present situation in Ghana, at least four international banks in the country, with the new capitalisation requirement could take more than half the number of insurance companies in the country.
However some industry experts said it would not be prudent for Ghanaian insurance firms to recapitalise only to take advantage of the oil business, although the experts believe that recapiatlisation was neccessary.
The argument is that the oild business is a one risk business and that should all the insurance underwrite such a business in the likely event of a disaster, claims from such a disaster could wipe off the whole industry.
Experts say Ghanaian insurance firms must be encouraged to take some of the insurance, while spreading the risk with some international firms to safeguard the local industry.
While the economy present some opportunities for the insurance industry, the challenge is how best to educate the Ghanaian public on the need to take insurance policies for future occurences.

Zain implementing millenium villages

2008-12-01T04:44:00.001-08:00

read by ssb
zain (fin)

Telecommunications giant Zain Ghana is implementing a mobile communications and internet connectivity to the Millennium Village of Bonsaaso in the Amansie West District in the Ashanti Region to help improve the living conditions of the inhabitants of this cluster of villages and lift them out of extreme poverty.
The project is being implemented through its partnership with Ericsson and the Earth Institute.
The project, after completion, would help the people to access health and education services through their mobile phones.
The initiative, which Zain, Ericsson and the Earth Institute first outlined in September 2007 at Columbia University in New York City, has already had a positive impact on health, education, social well-being and livelihoods in Dertu, Kenya
The villagers of Dertu, who are mainly pastorialists, can now access health and education services through their mobile phones.
Mobile communications have also helped them to identify safe sources of water, mobilise emergency transportation, find employment and get accurate information on the prices of goods and services before taking their livestock and other produce to the market.
For its customers, the benefits include improved access to health and education services, direct access to livestock and employment markets, and increased social contact with family, friends and the outside world.
The project has enabled villagers to be closer to their social network.
By putting the community in touch with and closer to their friends and family, it is integrating the village into the broader environment, which is all part of Zain's theme of creating a wonderful world.
The Dertu Millennium Village is located in north-eastern Kenya, a mainly rural and nomadic area approximately 140 km from the Kenya-Somali border.
Zain has a temporary network with a 20m, diesel-run tower that covers up to 20km and brings mobile communications, enabled by EDGE, to Dertu's estimated 5200 people.
Call volumes as of July 2008 increased by 30 per cent from June, with more than 1000 individual customers using the service so far. In June alone, 22,000 calls were placed.
By the end of 2008, a permanent “green” network will be up, with a 60m tower covering 50km. The permanent site will leverage renewable power sources and will reduce reliance on the diesel generator by up to 80 per cent.
For Zain, the benefits of supporting this cause include positive public relations, improved customer relations, closer community ties, positive stakeholder engagement, and additional marketing opportunities. In the long term, it's still a recipe for a profitable business.

Insurance Awards

2008-12-01T04:40:00.000-08:00

THE First ever insurance awards has been launched in Accra with a call on the insurance companies to brace themselves up for challenges that comes with new businesses especially the oil find.
Speaking at the launching ceremony, the Executive Director of the Centre for Policy Analysis (CEPA), Dr Joe Abbey, stated that the oil presents opportunity for the insurance sector, however, he stated “to seize these opportunities, insurers will need to move up the value chain by providing innovative products, value-added services and holistic risk management.”
He said the increase in wealth and life expectancy would lead individuals to demand a range of wealth protection and health insurance, as well as property casualty coverage.
He said the economic growth, coupled with the higher usage of automobile in the country would give rise to new risks requiring insurance coverage from factory owners to cover property and casualty and to car owners that needed automobile insurance.
According to Dr Abbey, Ghana’s growing wealth and increasing sophistication of economic activities would lead to a sharp growth in the volume and complexity of risks adding that investors and individuals would be more conscious of managing these risks.
He said even as more complex insurance products were being introduced in the market, insurance intermediaries had a duty to ensure that consumers were only offered products they could understand and find suitable.
“Any undesirable sales practice such as churning and inappropriate switching will undermine the reputation of the insurance industry, with adverse consequence for its ability to attract good quality talent,” he said.
Dr Abbey said the industry faced important challenges in the current environment, but said the growth prospect for the industry was promising.
Giving an overview of the awards, the Head of Planning of the Ghana Insurance Awards, Mr Boahene Asamoah stated that 15 awards would given out best performing insurance companies.
He said the awards would be based on 2007 performance and stated as part of effforts to ensure transparency in the awards a technical committee has been set made up of all representatives of the methodology and approach.
He mentioned that the Institute of Social, Statistical and Economic Research (ISSER) has been contracted to undertake the survey and stattiscal analysis.
Mr Asamoah commended the media partners, which are Daily Graphic, Metro Television and Joy FM for the continued support of the awards.
Corporate Initiative Ghana (CIG), is a non for profit organisation aimed at ensure a high financial service delivery in the country.
The organisation has been organising the prestigeous Ghana Banking Awards over the past seven years.

Security and Excahange Commission

2008-12-01T04:39:00.000-08:00

In spite of the bullish performance of the Ghana Stock Exchange, many analyst believe that the market capitalisation is too small to make any meaningful impact in attracting foreign capital. The way to go according to many analyst is to integrate with other regional markets, Boahene Asamoah explains.

THE Ghana Stock market has for the first half of this year adjudged as one the best performing stock markets in the world, with year-to-date yield far excess of 65 per cent as of last week.
But while such performance has widely been welcome as good news for investors on the Ghana bourse, many analyst believe that Ghana could not attract big time investors, because of the constraints of the small nature of the market.
According to Mr Nick Naezer, the First Counsellor and Acting Head of the Delegation, European Ghana, the Ghana bourse is shallow and illiquid and could on its own could not compete with other regional bourse in Europe for capital and investments.
“The solution is this situation is obviously regional integration”, according the Mr Naezer.
Analysts believe that there are greater benefits that comes with integration of the stock markets in Africa, the most prominent is to attract huge capital inflows especially from the major markets.
Integration of the capital markets could bring about economies of scale, increase liquidity and provide a larger pool of investment resources for national development.
African markets have shown to be more vibrant in terms of the yields over the past years, which has led to some foreign institutional investors looking at Africa with keen interest.
Over the past two years, some multi-national firms have made substantial investments in Africa, one of which is Renaissance Capital.
But the small capitalisation of the Ghana Stock market and many other African Stock markets, does not favour such big investments into Africa.
Although there are on-going talks to merge for instance the BRVM of Cote d’Iviore, the GSE and the Nigerian Stock market, the snail pace at which such talks were being done pre-supposes that the realisation of an integrated regional bourse would not be in sight sooner than expected.
However, analysts also believe that there are various dimensions of integration and it is difficult to isolate financial aspects from political, economic, commercial or monetary agendas.
“There is certainly a need to tailor the sequence of integration and the level of harmonisation, according to the progress evidenced in the other dimensions”, Mr Naezer explained.
There are currently about 20 stock markets in African and market watchers believe that the continent could learn lessons from regroups such as London, Paris, Brussels, Amsterdam and Lisbon stock markets.
Liquidity issues
The GSE, for instance has about 34 companies listed on the bourse with about 10 of these equities being actively traded in, leaving the rest with little or no movements in their share prices and or trades. The GSE has a market capitalisation of about GH¢18.004,79 million. (US$......)
The Nigeria stock market on the hand has a market cap of N Naira 9,957,879,491,625.42 (US$.............
The BRVM, which is a regional bourse for the Francophone countries in the sub-region has a market capitalisation 4,184,306,581,400 CFA (US$.......) and that the combined capitalisation of these markets has the potential to attract more foreign capital, improve liquidity and promote investments and development within the sub-region.
Some brokers have expressed their frustrations about the lack of liquidity on the Ghana market, which makes it virtually impossible to do transactions on the market.
Their frustrations step from that fact that many individual and some institutional investors were unwilling to trade their shares, hampering the smooth operations of the stock market.
Again, while the performances of many companies on the market could be described as fair, other equities performance however, could be described far from being fair.
Serious institutional investors view this lack of liquidity on the markets an unattractive for which, their investments could not be guaranteed.
However, a regional stock market could provide such liquidity for foreign investors to enter and exist the market at any time.

Constraints
The existence of various currencies with the inherent issues of convertibility is major constraints towards the realisation of a regional market.
Again, the legal regimes within the West African region and Africa as a whole have restrictive rules to foreign investments and currency exchange.
There are also difference in standards for accounting and audits within the African continent or for that matter even within the region of West Africa, the absence of a weak cross-border dispute resolution mechanisms and infrastructure and communication issues such payment systems are some of the major challenges.

Lessons from Europe
It is imperative to know that the treaty that established the European Communities did not include formal obligation to secure free movement of capital.
However, 29 years later the first document in this regard was signed when preparing the Single European Act, which constituted the first drive towards establishing an European financial area.
Under this agreement, operations concerned by the progressive liberalisation of capital movements were classified in three categories, namely, capital operations, operations in financial market securities, and operations involving financial credits.
Under the capital operations, commercial credits or direct investments were linked to the exercise of the other fundamental freedoms of the common market such as free movement of goods and services, persons and establishment.
Under the operations in financial market securities it encouraged liberalisation of financial securities such as bonds or shares requiring a single financial market at European level, while the third level operations involving financial credits, mandates a liberalisation of operations involving financial credits and operations relating to money market instruments and necessary for the establishment of a unified financial system.
The European Union proposed two main phases for achieving the liberalisation of capital movements.
These are liberalisation of capital operation, and total freedom of capital movements.
Realising the need that not all members would be able to move at the same pace the EU made provisions to support such countries to overcome such constraints.
“Moreover it was considered that it was crucial for liberalisation to be parallel by provisions designed to ensure the cohesion and identity of the financial convertibility of European currencies”, according to Mr Naezer.
It was in this light that the Single European Act signed by member countries in 1987 placed the free movement of capital on the same footing as that of goods and services and which led to the adoption in June 1988 of a directive aimed at giving the single market its financial dimension.
The EU went through some processes, which culminated in the completion of a single market by the end of 1992, seven years later in 1999 that led to the introduction of the Euro on the markets.
Market participants and experts believed that while the EU model may not replicated wholly, however, the sub-region could draw lessons from this experience.

Realities
The realities are that the total value of the Ghana Stock Exchange for instance remains small compared to the Gross Domestic Product (GDP), while access to the banking system are limited to a large number of people.
Therefore, according to analysts, capital market must play greater role in the intermediation between savings, investments and economic growth.
The robust capital market the size of a regional bourse can constitute the avenue for raising medium to long term capital especially for local entrepreneurs.
But in spite of the advantages that such a bourse presents, there are a number of constraints that face the integration of a regional bourse.
The first that comes to mind is the lack of an appropriate safeguard that minimise the risk and minimise the benefits of a stock market to investors.
“It is necessary to improve market infrastructure, mainly the clearance settlement and depository systems,” an analyst stated.
Again there is the need for clear regulatory and legal framework, using transparent codes and standards. Regulatory authorities are responsible for making markets fair, efficient and safe and investors must be protected from fraud, abuse and risk insolvency.
Market watchers believe that the underlying economic structure are not conducive enough and the vulnerability to macro-economic shocks remains high, representing a major risk to especially foreign investors.
However, many experts are also worried that deeper financial integration will increase volatility in capital markets, encourage speculation and make economies of more vulnerable to external shocks, due to the herd instincts of investors and their focus on short-term profits.
Analyst point to the financial crises in South East Asia and Latin America and the current global turmoil as clues to the potential volatility of capital markets and of the necessity to regulate their development.
“Indeed risk can be managed and therefore, risks must be compared with the potential benefits that capital markets can bring”, an analyst stated.
Market watchers point to the need to diversify financial systems with banks and non-banks so as to enhance risk sharing for investors and borrowers and to channel more domestic and international capital for investments in the national economy.
This however should be done with the appropriate safeguards investors rights.

A new dawn blows at GSE

2008-12-01T04:37:00.000-08:00

new dawn

A new dawn is blowing through the Ghana Stock Exchange as a result of the introduction of information technology to transform the operations of the GSE. Boahene Asamoah reviews how the IT platform would transform trading on the floor of the Ghana Stock Exchange.

“A New dawn” is how the General Manager of the Ghana Stock Exchange, Mr Ekwow Afedzi described the automation of the Ghana Stock Exchange which is scheduled to begin by the end of next month.
The $2.1 million automation of the Ghana Stock Exchange has long been anticipated and has for years been on the drawing board of the GSE.
However, since January this year, through the influence of the late Finance Minister, Mr Kwadwo Baah-Wiredu, funds was released by the government to facilitate the process of automation and to bring the GSE close to international practise.
The full implementation of the electronic platform is expected to start after approval has been granted by the Securities and Exchange Commission (SEC).
This involves web base trading and settlement as pertains elsewhere such the one would find in New York Stock Exchange or the London Stock Exchange.
Among some of the what is expected to happen is to link the automated platform to major Licences Dealing Members of the Ghana Stock Exchange and other major clients.
This is to ensure online transactions and cut down the present manual transactions on the market.
A visit to the stock exchange showed that all equipment’s and gadgets have been installed, whiles brokers and dealers are going through training.
Some of the features of the automation platform is the electronic trading and settlement that would do away with the physical transactions between brokers and their clients.
According to the GSE, a settlement guarantee fund would be established to facilitate trade and settlements between brokers and their clients.
Brokers are also expected to come out with credit lines to cover short falls during the course of trading.
Analyst believe that with the electronic platform trading and settlement was expected to improve from the current T+3 to T+1.
Again, a central depository has been established as part of the transformation being witnessed in the industry where share certificates would be
Many market watchers believe that the capitalisation of Licence Dealing Members (LDMs), which currently stands at GH¢100,000 was too low and does not make LDMs competitive in the sub-region.
According to the Managing Director of the Ghana Stock Exchange, Mr K.S. Yamoah, the automation is achieve to three main objectives, to move from the manual automation that would ensure efficiency, ensure online settlement and to establish an electronic depository.
Mr Amoah was of the view that automation of the Ghana bourse would place the market in pole position as talks of common trading platform within the sub-region was on-going.
The BRVM of Cote d’Ivoire and the Nigeria Stock markets have all been automated.
“Our manual trading was a disincentive to especially foreign investments firms who were looking towards West African and Ghana for that matter”, Mr Yamoah stated.
Analysts also point to the intention of other neighbouring countries such as Gambia and Sierra Leone who are planning to established their own bourses.
As part of efforts to get investors involved in the process, the GSE has embarked on sensitisation process to ensure that its partners buy into the online transactions and do away with the paper transactions.
A depository has been established and investors would encourage to migrate from the paper certificates of shares to an electronic depository.
The electronic platform therefore offers a seamless transaction from trading, settlement and depository shares.
The idea is to get every investor to get involved in the depository, which would ensure an efficient trade execution.
Among some of the innovations would be quarterly issued of statements from the depository to shareholders as well as SMS alerts to all shareholders.
Again the GSE is looking to companies coming to the market to make provisions in their prospectus to shareholders informing that shares would issued in electronic form.
Again shareholders would encourage to make voluntary share migration where their paper share certificates would be transferred to the depository.
The seamless transactions stem from the fact, shares can only be traded and settled once there are locked in at the depository.
Many investors believe the automated platform would even place the stock market in better light as the bourse is set to achieve another record feat this year.

Zain to compete on network quality

2008-12-01T04:30:00.000-08:00

New mobile telecommunications giant Zain, is preparing the grounds for what many industry watchers think would be grand launching of its operations in Ghana within this last quarter. Boahene Asamoah interviews the CEO for Africa, Chris Gabriel on the prospects of Zain brand in the highly competitive mobile phone market and general market conditions.

ZAIN telecommunications, a global mobile operator says it has invested over half a billion dollars in its Ghana operations as the company gears up to launch its brand and product on the Ghana market sometime next month.
The company plans to invest additional $100 million in the Ghana operations next year as part of its commitment to increase its market penetration strategies.
Management are tight lip on the exact day of the launching of the Zain brand.
Market watchers are upbeat that given the recent successful global brand of Celtel to Zain in 14 countries simultaneously, the Ghana launching is expected to take off in great style amidst huge media publicity.
“We are going to compete on superior quality and one network concept”, says Chris Gabriel, the Chief Executive Officer for Africa.
Chris explains that the company’s strategy of compete of network quality and the one network were expected to differentiate its brand from the competition.
The company says it intends to have 85 per cent coverage along the major roads through the Northern part of the
“We intend to make significant investments in Ghana and in African operations”, adding that it was to leverage.
Zain’s Ghana operations one-network operations when launched would enable customer access their mobile phones in Burkina Fasso, Nigeria and Sierra while paying for the same local charges and abolishing high roaming charges.
However over the next one year Zain customers in Ghana would be access to the groups network in 22 operations across Africa, Middle East and Europe.
So far, Zain Ghana has employed over 270 people already and there are indications that many more employment opportunities exist as the company expands operations.
The company said it has outlines a policy to ensure that 70 per cent of employees who excel at their jobs were promoted to management positions and that indeed the Ghana operations was determined to make Ghana a net exporter of human capital across the group’s 22 operations.
Price wars was a major concern for Chris, who thinks that that would ultimately lead to the collapse of the industry and undermine shareholders fund and thereby stifle investments in the sector.
As the company’s research, network quality remains a major source of concern for customers in Ghana, but Zain to ensure high level of network quality.
The network has over the past years invested over 12 million in its Africa operations and has operations in 14 African countries.
Zain would operating on the 3-G platform has added value services and the company hope to provide these services to the Ghanaian customers.
Touching on the mobile penetration rate which is currently at 35 per cent, Mr Gabriel said mobile penetration does not peak at 100 per cent and stated that in some countries mobile penetration is over 150 per cent and expressed optimism that the industry had potential to grow further.
“What Zain offers is value for money, customer service delivery affordable products and also expansion of our network to rural areas.”
Zain says they welcome competition provided that such a competition was rational.
Many experts say with five global brands in the country, consolidation was expected to happen among major players while there would be a sizeable proliferation of small operators across Africa.
Chris was of the view that industry players must however collaborate and encourage co-operation and discussions on market dynamics, especially in the area of taxation and infrastructure sharing.
The country has four operating brands, MTN a multinational mobile phone operator, TIGO, another international brand, Kasapa, which is an affiliate of Hutchison, another multinational and One-Touch, a local brand has just been bought by the world’s leading brand, Vodafone.
Zain and Globacom are the new operators soon to begin operations. Both are multinational brands.
Chris was appointed CEO of Zain Africa December 1, 2007 and plays a vital role, overseeing all Zain's 15 operations in Africa that currently serve over 33 million active customers representing two-thirds of Zain's total customer base.
Previous to this appointment, Chris was Chief Officer of ACE, from May 2007, where he was accountable for defining, executing and delivering Zain’s Global ACE Strategy (Accelerate, Consolidate and Expand); leading and managing the Group’s international and regional IPO’sBusiness Transformation and Performance Improvement.
Chris is an experienced international executive with a flair for operational excellence and over achievement in high growth start up, turn-around and challenging competitive environments. He is also a recognised leader in team building, mentoring, human capital development and public speaking.
Prior to joining Zain, Chris has played vital roles as Interim Chief Executive, Group Chief Financial Officer and Group Chief Information Officer in several regional telecom companies.
In addition, Chris was the Director, Finance for SingTel Optus Business in Australia. Major achievements during his time with
Chris has over 25 years experience in the Information Technology and Communications sectors, having developed his strategic, managerial and financial expertise through a wide variety of roles spanning Financial Management, Business Process Engineering, Customer Care and Billing, Product Development, Commercial Operations, Facilities, Strategic Programs, year 2000 Remediation, Information Technology and Corporate Acquisitions. He has previously held senior executive positions with Ericsson, Unisys and ComputerLand.
Chris holds a Bachelor of Business in Finance; CPA; an MBA in Marketing; a Bachelor of Law; a Diploma of Corporate Management and an Advanced Diploma Company Director.

Competition to drive telecoms centre as Zain enters the market.

2008-12-01T04:29:00.000-08:00

With the licence of two additional mobile phone operators, and the anticpated launching of Zain Ghana operations, some industry players have already psyche up their activities, Boahene Asamoah examines how the much anticipated competition is expected to impact on customers.

TELECOMS watchers are anticipating real competition as Zain rolls out its services and products in the country by the close of the year.
With a huge financial muscle, the competition from Zain could be felt from afar with huge bill boards and television commercials even before it begins operations, making some giant companies rethink their strategy.
Already, MTN, the leading mobile network has began to rethink its strategy and has announced that customers can now have their mobile numbers for free from February next year. Previously, subscribers to its pay and go service have a given date and time by which time such subscribers have to re-load their credit or would have their services suspended.
Again, MTN has now abolished the $40 dollar charge for roaming services it introduced sometime ago. Now there is a new commercial that requires a subscriber to only pay local charges when the person is outside the home country.
Ghana is now home to five global brands, Vodafone, MTN, Zain, Tigo, Kasapa and yet Glo, each with strong balance sheet and huge subscriber base across their global operations.
Anticipating the introduction of the one-network concept from Zain which enables a subsrciber to be able to use the same number and pay local charges wihtin countries of operations, vigorous marketing communications have already began, introducing no roaming charges for West Africa.
Zain had indicated that during its take-off operations in Ghana, subscribers should be to access it network within the sub-region through its seamless one-network concept.
Indeed the competition is not only limited to these two networks, Vodafone which has controlling insterest in state run Ghana Telecom and Tigo, have also through its market communications began the process of attracting back into its fold, their old customers, by enticing them with offers to re-active their telephone lines.
But analyst fear price wars would be a major feature of competition to win over customers.
But the CEO of ZainAfrica, Mr Chris Gabriel would rather prefer what he describes as “rational competition” as price wars would eventually lead to the collapse of the entire industry.
Although Zain has indicated that it would not compete on price, but on network quality, indications are that other operators were likely to go the price war way.
Examples abound in Nigeria, where Glo brought down prices of the industry down and introduced the per second billing instead of the bulk charges. Again, the monthly charges for internet service by some operators had to abolished and prices dropping by almost 50 per cent.
However, network quality seems to be what most consumers in Ghana of mobile telecomunications are yearning for.
With a poor network quality most consumers are looking for the kind of network that would perhaps for the first time offer real value for money.
Again, analysts beleive that with the current mobile penetration of 35 per cent in the country, there was indeed huge potential in the mobile telecommunications sector to grow.
This is because according to analysts mobile penetration does not peak at 100 per cent and instances abound in Kuwait and some other countries where mobile penetration was well above 120 per cent.
This coupled with the expansion of the economy and ofcourse the oil find presents tremendous opportunity.
But market watchers are of the view that any market penetration strategy for late market entrants would deepen largely on how the four p’s of price, promotion, place and the product are mixed to yeild ultimate benefit to the customer.
According to research, one of the top most priority of mobile subscribers is that of network quality.
Industry experts think standards in the industry have fallen in spite of heavy investments, alluding to rest drop calls being experienced lately and poor quality network and the seemingly inability of the National Communications Authority (NCA) to walk-the-talk.
With Zain being granted the 3-G technology platform superior services are expected at an afforable prices.
The competition is expected to go even beyond mere price wars and network afforability, marketing integrated communications is expected to soar, with each mobile phone company pitching camp with a particular niche in the market.
Already, things have already started, with MTN loosing the sponsorship deal of Kotoko, while Tigo has grabbed that deal.
MTN for instance have invested heavily in football as some major sponsorship, Zain has chosen music as its main sponsorhip programme.
Interestingly, the very large segment of almost all the networks are targeted at the young people.
Giving the financial muscle of all the international players in the country, the competition is expected to be much keener in the coming months.
Zain for instance recorded a seven per cent increase in turn over across its operations amounting to $327 million at the end of the third quarter.
The results showed significant growth in revenues with customer numbers reaching 56.3 million.
For the third quarter of 2008, Zain Group recorded consolidated revenues of US$1.887 billion, an increase of 25 per cent compared to Q3-2007. The company's consolidated EBITDA increased by 20 per cent for the same period to reach $ 763.6 million.
Year-on-year customer growth across the two continents where Zain operates was 54 per cent with the Zain Group serving 56.3 million managed active customers at 30 September, 2008.
MTNs financial report for 2007 also shown strong financial support with the group showing 42 per cent growth for the period, with contributions to total revenue split 43 per cent, 43 per cent and 14 per cent among the SEA, WECA and MENA regions respectively.
With such strong financial performance the race to capture the mind and pocket of subscribers have been set with anticipated fierce competition from all five mobile phone operators.

ETI lays foundation stone for its headquarters

2008-12-01T04:26:00.000-08:00

Story: Boahene Asamoah

PRESIDENT Faure Essozimna Gnassingbe on Friday laid the foundation stone for the building of a $15 million head office complex of Ecobank Transnational Incorporated (ETI), the Pan-African bank in Lome, Togo.
The ceremony comes on the heels of a landmark public offer and rights issue in Africa by ETI to raise $2.5 billion across Africa.
The function also attracted the Prime Minister, Mr Gilbert Fossoum Houngo, and several ministers of state and the Speaker of the Togolese Parliament.
Delivering an address at the ceremony, the Board chairman of the pan African bank, Mr Mande Sidibe, said the decision to build a permanent office in Lome was a demonstration of the bank’s commitment to continue to do business across Africa.
He said “the group has grown so well that it has outgrown its current clothes. That is why it has decided to equip itself with a modern and functional building.”
Mr Sidibe stated that the bank had over the past 20 years overcome various difficulties to become the first pan African bank with 25 subsidiaries, 600 branches, more than 10,000 employees of 29 nationalities, and offering varied financial and banking products.
The board chairman said the bank had also established the Ecobank Development Corporation in charge of wholesale banking and stock market intermediation.
Mr Sidibe added that the bank had also established the e-Process which is in charge of technologies and integrated system and other specialised structures to assist trading operations across the world.
“Ecobank will continue with its appropriate policies in terms of risk management and resource mobilisation, adding that “we will continue with our banking activities and the development of financial services for the benefit of Africans”, he stated.
Mr Sidibe commended past executives and the founding fathers of the bank as well as the Togolese authorities for their immense support.
The Togolese Minister of Commerce and Private Sector Promotion, Mr Guy Madje, commended the management and board members of the bank for the initiative to build a permanent office in Lome, and assured them of the government’s support.
“Making these four hectares of land available to ETI for their new headquarters reflects the Togolese government’s wish that staff of the group conduct their work in the best possible working environment.’’
The Minister of Finance and Economy, Mr Adji Oteh Ayassor, in his statement also commended the board and management of the bank for their effort to expand their operations across Africa, and stated that the government would continue to offer them support that would ensure further growth of the bank.
The new head office, located along the coast of Lome, when completed would overlook the Atlantic Ocean.
It would be a seven storey building office complex and would house an Information Technology Centre, a conference room, catering spots and entertainment facilities.
Later in that evening a dinner was held to honour the founding members as well as employees who had spent 20 years or more with the bank.
Guests were treated to a sneak preview of the bank’s new logo due to be officially launched in January.

NTEs to hit $1.4 billion over five years

2008-12-01T04:25:00.000-08:00

Story: Boahene Asamoah

THE country’s Non-Tradtional Exports (NTEs) is projected to hit $1.4 billion in the next five years under a new National Exports Strategy programme to be rolled out next year.
The country recorded for the first time last year, an increase of NTEs well above $1 billion from the $400 million it recorded in 2000.
Speaking at the launch of the National Service Export Strategy and inauguration of an Implementation Committee in Accra , the Executive Secretary of the Ghana Export Promotion Council (GEPC), Mr Edward Collins Boateng, said the council was hopeful that over $30 million of the total projected exports would come from the service sector.
He said the service sector had not been formally captured under the country’s non-traditional exports over the past years.
Mr Boateng said “the idea of streamlining and strategically positioning services in the nation’s exports portfolio has generated a lot of interest across the academia, policy makers, stakeholders and other interested groups”.
He said the strategy covered three main areas, namely awareness creation, looking at the obstacles which hindered the service sectors ability to export and the need to carry out specific activities to promote the service sector.
Mr Boateng said it would take the commitment of all stakeholders to ensure the development of the service sector to contribute to the national goal.
The Minister of Trade, Industry, President’s Special Initiative (PSI) and the Private Sector Development (PSD), Paapa Owusu-Ankomah, said the country needed a more purposeful national approach if wanted to take full advantage of and participating in the opportunities that existed in the sub-region.
“That is why we embrace this renewed national efforts at providing a clearer strategic direction for the development of the services export sector of Ghana”, the minister stated.
Mr Owusu-Ankomah, said the prospects of the service sector for developing new knowledge based services and international competitiveness would depend largely on how the country continued to invest in its human resources.
“Greater attention must also be paid to quality management, setting of standards and accreditation by professional bodies if we are to ensure that Ghana appears on the radar screens of the major users and consumers of international services”, he stated.
The minister called on service providers who wanted to be part of the export market to take advantage of the 50 per cent matching scheme available through the Business Development Services at his ministry.
He also stated that the Export Development and Investment Fund, had factored in the services export sector in its new corporate strategic plan.
“We believe that the tremendous growth recorded in the services sector in general which contributes over 40 per cent of the Gross Domestic Product (GDP) can also be replicated in the export of services within and beyond the borders”, Mr Owusu-Ankomah stated.
The Director General of the Private Enterprise Foundation (PEF), Dr Osei-Boeh Ocansey commended the GEPC for the initiative to ensure the implementation went through successfully.
He called on members of the implementation committee to face the challenges that came with the export sector by addressing some of the constraints that hindered business in the sub-region.

service export strategy for non-traditional exports

2008-12-01T04:21:00.000-08:00

service export strategy (fin)

Exports of Non-traditional products have reached all-time high of over $1 billion over the past seven years. However one critical area that has not been looked at is the export of services sector especially within the sub -region.
Boahene Asamoah looks at the proposed National Strategy for the export of Non-Traditional Services.

THE country’s non-traditional exports (NTEs) for the first time cross the $1 billion mark as at the end of the 2007 export season.
Non-traditional exports are those products that does not fall within the three main traditional export of the country, namely Gold, Cocoa and Timber.
The significance of an appreciable increase in NTEs is important to the economy especially where there is a diversified foreign exchange earnings that serves as buffer for the cyclical external shocks that the economy experiences every now and then.
The service sector all over the world has been one that spearheads the economic growth of many industrialised countries.
This can be evidenced by such countries such as Taiwan, Malaysia, India and China where the boom in service sector has pushed up the economic growth in these countries.
Indeed, under a three year growth projection from 2005 to 2007, the Ghana Export Promotion Council (GEPC) stated that export strategy for NTEs envisaged the achievement of export earnings of US$ 1 billion by 2006 and US$1.2 billion by year 2007.
According to the Board chairman of GEPC, Mr Stephen Sekyere Abankwa, “strong export performance is crucial to Ghana's economic development and growth.”
Non-Traditional Exports increased from $460 million in 2001 to $1,164 million in at the end of last year depicting a growth rate of over 150 per cent.
On annual basis, this translates into a growth rate of 20.7 per cent
NTEs percentage contribution to total exports in 2004, 2005, 2006 and 2007 were about 25.74 per cent, 28.09 per cent, 26.14 per cent and 27.76 per cent respectively.
Three main sectors have contributed to the upward increase in NTEs, which are agriculture, semi-processed/processed or manufacturing and handicraft sectors have contributed.
Significantly, the service sector has not made any significant impact on the export under the non-traditional export sector.
Services in the country currently accounts for 30 per cent of the Gross Domestic Product (GDP) amount to about $3.87 billion and contributed about 31 per cent to economic growth.
Services exports account for only 8.3 per cent of GDP amounting to US$1.07 billion, however exports of goods represents over 30 per cent of GDP indicating that there is much more potential for the development of Ghana’s services exports.
According to the GEPC, the majority of revenue from services exports comes from the tourism sector, which account for US$836 million, however there seems to be lack of adequate information on the composition of the remaining $234 million services.
Research available indicate that the major component of these services were likely to be the more traditional services sectors such as transportation and financial services exports.
Estimates of selected non-million services exports based on a survey of films in selected sectors amount to US$34 million which comprise of: Business Processing Out-sourcing (BPO) exports US24 million, professional consultancy exports US$2 million; higher education exports US$8 million and medical tourism services, less than US$0.2 million.
As compared to with NTEs goods exports of about US$778 million, there is reason to believe that untapped potential for the development of the services sector strategy.
And to take advantage of these untapped opportunity a national strategy to develop and promote non-traditional services has been developed.
The thrust of the strategy is to increase exports of non-traditional exports of services to a level equivalent to 10 per cent of total non-traditional exports.
The strategy has been designed to be practical document to guide implementation of a comprehensive programme to promote, develop and support service sectors ports from the country.
The proposed strategy has three main components; awareness raising or creation, identification and removal of constraints and sector specific promotion.
According to the Executive Secretary of GEPC, Mr Edward Collins Boateng “the idea of streamlining and strategically positioning services in the nation’s exports portfolio has generated a lot of interest across the academia, policy makers, stakeholders and other interested groups”.
The Minister of Trade, Industry, President’s Special Initiative (PSI) and the Private Sector Development (PSD), Paapa Owusu-Ankomah, indicated that the country required a more purposeful national approach if it aimed at taking full advantage of and participate in the many opportunities that exists in the sub-region.
“That is why we embrace this renewed national efforts at providing a clearer strategic direction for the development of the services export sector of Ghana”, the minister stated.
“We believe that the tremendous growth recorded in the services sector in general which contributes over 40 per cent of the Gross Domestic Product (GDP) can also be replicated in the export of services within and beyond the borders”, Mr Owusu-Ankomah stated.
Many private sector operators believe that the strategy has the potential to open up the country to international best practises and building a solid human resource capital to serve the sub-region.
However, experts believe that the private sector must build capacity and also collaborate with other firms in the sector to take full advantage of strategy.

Chamber hold public lecture

2008-12-01T04:20:00.000-08:00

Story: Boahene Asamoah

THE Ghana Chamber of Mines, the umbrella organisation of mining firms in the country, would next Tuesday, November 18, 2008, organise a public lecture as part of activities marking the 80th anniversary of the organisation.
Prof Daniel Mireku-Gyimah, Chancellor of the University of Mines and Technology, Tarkwa, would deliver the lecture on the topic “Life without Mining is impossible”.
According to the Chief Executive Officer of the Ghana Chamber of Mines, Ms Joyce Aryee, the topic, though controversial, was a reflection of the reality in that every activity of human live deepened on mining activities.
She said from agriculture to the use of new technology such Internet and computers, all such activities depended on mine products that had been transformed to better the lives of people.
Ms Aryee stated that contrary to perceptions of environmental degradation as a result of mining activities, the chamber had adopted best practises to ensure that the environment was not degraded.
“All human activities have impact on the environment”, she stated, adding that “technology has however made it possible to manage the effects of human activity on the environment.
The CEO stated that mining had always been part of human activity, and “would continue to be part of our lives”, adding that there was the need to ensure best practices to ensure development.
She said the chamber, together with the mining firms, had always paid attention to Corporate Social Responsibility and supported communities to ensure their activities impacted such communities positively.
The CEO said the chamber introduced the “Environmental Management Programme”, that monitors year-on-year environmental issues to ensure best practices, and that a recent survey had indicated that the country must harness the minerals that would be mined for economic development.
She said recent survey had indicated that the country had more untapped resources such as kaolin, mica, lime and others that needed to be exploited for the country’s development.
Ms Aryee stated that the chamber would continue with its efforts to ensure that communities and the firms continued to pursue policies that would ensure a win-win situation for all.
“Building trust is a continuous process and we are committed to ensuring that we build the right policies to manage conflicts and resolve our differences”, the CEO stated.
Ms Aryee stated that the chamber looked forward to collaborating with all stakeholders in moving the mining sector forward for the benefit of all.

Investment: Sea-Change in Law

2008-12-01T04:19:00.000-08:00

\GIPC (FIN)

Ghana’s Investment Council Act of 1994, has not seen any changes 14 years after it was passed into law. To reflect global changes and local demands and requirements the GIPC has reviewed the Act and presented it to the Office of the President for consideration and passage into law. Boahene Asamoah talks to the CEO of GIPC on how the revised act could impact positively on the local entrepreneurs and also bring in the much needed FDI.

Mindful of the increasing attraction of the country as an investment destination within the sub-region, a revised investment and promotion law by the Ghana Investment Promotion Council (GIPC) which takes into consideration the realities of the country’s development agenda has been proposed for consideration.
Under a “Ghana Investment Council Act 2008”, the proposed revision of the law also seeks to empower Ghanaian entrepreneurs to actively take advantage of the emerging economic opportunities in different sectors of the economy and also cover broad areas under the Growth and Poverty Reduction Strategy (GPRS 2).
The revision of the law comes at a time when many traders, especially members of the Ghana Union of Traders Association (GUTA) have complained of foreigners taking over their trade without due regard to country’s investments laws.
The oil find and the progressive reforms undertaken by policy makers over the past years, to position Ghana as an investor-friendly destination for businesses within the sub-region, has resulted in record investments into the economy.
However, investment analysts have pointed to weak monitoring and supervision of the investment laws as some of reasons for influx of foreigners into trading activities.
The revised act, hopefully if passed into law by the end of the year, would thus, bring a huge sigh of relief to many such traders.
“ The revised laws takes into consideration the development needs of the country”, Mr Robert Ahomka-Lindsay, the Chief Executive Officer (CEO), of the GIPC, told the Graphic Business in an interview.
Among some of the proposals in the revised law, was the need to upgrade the act and threshold of investment requirements from as low as the current US$10,000 to US$1 million for trading activities.
“We need to scale up the investment ladder to attract the right investments and investors”, the CEO stated.
Under the Ghana Investment Promotion Centre Act, 1994 (Act 478), a foreign investor may team up with a Ghanaian entrepreneur or company for a joint venture, usually in the form of a partnership or a limited company.
Under the same law, however, a minimum equity capital of US$10,000 is required from any foreign investor who intends to enter into a joint venture partnership with a Ghanaian in any area of economic activity, except trading. In trading, the minimum equity capital requirement is US$300,000 in either goods or cash.
“This threshold is rather too low”, says Mr Ahomka-Lindsay, adding that
“the GIPC has proposed for instance that foreign investments in trading activities be pushed to US$1 million cash.”
Again, GIPC under the proposal, which is model along the Korean and Malaysian models, has proposed that 25 per cent of all goods on the shelves of foreign traders should be goods produced in Ghana.
The new proposal have suggested the establishment of a Negative Lists, which is currently being developed, which would delineate activities reserved for Ghanaians and majority owned Ghanaian companies.
‘This is tailored to ensure that Ghanaians play an increasingly prominent role in our economy and stimulate the effective development of indigenous capabilities’, Mr Akomka-Lindsay stated.
Under the negative list, for instance, the GIPC has proposed that all services and supplies related to the mining and oil explorations must be sourced from local entrepreneurs.
Again, trading in second-hand spare parts and clothes would be restricted to Ghanaians or foreigners with local partners.
Importation and distribution of pharmaceutical products and textiles have also been limited to Ghanaians.
Many traders would see this as welcome news for Ghanaians and timely intervention especially coming at time where there is unbridle competition from India and China in respect to pharmaceutical and textile products on the local front, leading to the near collapse of the textile industry.
According to experts, there is a potential $5 billion annual revenue that the country could derive in terms of services to the mining and oil sectors alone and this cuts across, food, advertising, hospitality, apparel, transportation, stationery, banking, insurance and many other services that comes with the activities of these two sectors.
Another interesting aspect of the revised act, is the targeted foreign direct investments, which seeks to attract FDI in very core areas of the country’s developmental challenges and focus GIPC more on attracting investments into these areas, rather than the general FDI attraction.
To ensure that these targeted FDI are attracted to the country, specific incentives have been designed for these sectors.
This policy, according to the GIPC was started at the beginning of the year and has already started bearing fruits with year forecast of FDI exceeding its target as of the first half of the year.
The GIPC projected FDI inflows for this year at GH¢1.5 billion, however, as of the end of the third quarter, FDI inflows have hit record high of GH¢2.66 billion from 227 new projects with estimated value of GH¢4.61 billion.
Seven major areas have been identified by the GIPC as priority areas that needed special attention under the targeted FDI drive.
These are; agriculture and agricultural processing; infrastructure, including utilities, railways and power; tourism;, information, communication technology (ICT); financial services; industry; mining and petroleum.
“ We intend to align these areas alongside the national growth strategy and priority areas.”, Ahomka-Lindsay stated.
Many analysts in the oil industry, say Ghanaian entrepreneurs may lack capacity in certain service areas, but Mr Ahomka-Lindsay was upbeat saying, “we have to start from somewhere and gradually build up capacity.”
However, other industry experts believe that with respect to the mining industry, the country do have the requisite capacity since mining has been part of the economic activity for decades.
The GIPC, has also beefed up its human resources to reflect the challenges that would come with the revised law and stand ready to offer technical assistance and advice to investors.
Some investment lawyers are of the view that the revision of the law would be a feather in the cup of the country, having been adjudged two years ago as one of the leading reforming economies with good business climate.
However, others are worried that other neighbouring countries and trading partners of the country would also impose stiffer investments laws as recipocral gesture to the GIPC.
But Ahomka-Lindsay disagrees, saying most countries have a negative list and Ghana was not alone in this, adding that the centre studied about 80 countries investment laws to fashion out what was best for the country.
To ensure continuos monitoring of the investment climate, GIPC intends to review its policies every two years in order not to be overtaken by events in the global investment climate.

Accountants must ensure high sense of integrity

2008-12-01T04:17:00.000-08:00

ICAG (fin)
Story: Boahene Asamoah

THE Minister of State at the Ministry of Education, Science and Sports, in Charge of Tertiary Education, Ms Elizabeth Ohene, has called on professional accountants to ensure a high sense of integrity in the practice of their duties.
She said “if the country cannot count on the professional integrity of accountants in the country, then the country would be doomed”.
Speaking at the launching of five locally produced accounting manuals in Accra today, Ms Ohene said the country should be able to count on professionalism of accountants and should play an active part in national budget.
She added that the accounting profession also needed to be an integral part of the Ghanaian life and questioned why weighting of food items which were critical instrument of measurement was not part of the daily sales of goods in the country’s markets.
“You have a responsibility to become an integral part of our daily life and the economy as whole”, Ms Ohene stated.
She said the accounting profession comes with high responsibility to the society and urged accountants to partner her ministry in educating the youth on the need to take mathematics as a serious subject.
The Managing Director of HFC Bank, Mr Asare Akuffo, who chaired the function, said there was the need for the practice of the profession to reflect local demands.
He mentioned for instance the issue about audit, where in especially foreign countries the notion of auditing was not to discover fraud but rather to check whether proper procedures were followed.
Mr Akuffo said in such countries there were systems available to check fraud, however, he suggested that in countries such as Ghana, auditing must discover fraud as there were weak structures to deal with fraud in accounting practises.
“We must look at accounting systems that are relevant to the country’s own peculiar needs”, he stated.
He used the occasion to urge students to breast themselves with modern things and learn broad areas to be able to rise to the highest level in their careers.
The President of the Institute of Chartered Accountants, Ghana, (ICAG), Mrs Cecilia Nyan, said the launching of the manuals was an important step towards ensure that local students were adequately prepared for the examinations.
She said the books were not only relevant to local demands but also important for other countries as well.
She added that the manuals would help students to have access to books in order to study to pass their examinations as well as help increase the number of students who pass the chartered accountancy course from the current 100 annually to about 300 in a year.
Mrs Nyan also encouraged other professional institutions and companies to also make good use of the books as reference points and materials.
The first auctioned copy of the book was bought by Pricewaterhouse Coppers for GH¢7,500.

Merchant Bank opens more branches

2008-12-01T04:16:00.001-08:00

THE acting Managing Director of Merchant Bank, Ghana Limited, Dr Kwame Osei-Owusu, has said that the bank would pursue an aggressive branch roll-out nation-wide, as part of the bank’s strategy to play a key part in the retail end of the banking business.
Speaking at the opening of a new branch office at Achimota in Accra, Dr osei-Owusu said “In the coming weeks this branch will be one of a chain of branches that would proudly display the Merchant brand all over the country”.
Merchant Bank until 2006 was a corporate bank. The opening of the new branch therefore brings the branch network to 15.
Dr Osei-Owusu said seven more branches were expected to be rolled out in Osu, Tema, South Industrial Area, Abossey-Okai, Asafo Market, Adum and Korle-Bu.
“Our presence would be heavily felt in Kumasi as we roll out more customer friendly branches in Bantama, Roman Hills, Railways, Suame Magazine, Komfo Anokye, the Kwame Nkrumah University of Science and Technology (KNUST) and Subin Valley in 2009,” the Managing Director stated.
He said the bank would extend to its customers the bank’s values of customer relationship, empathy, ethics and sound business advice to all its branches.

Accountants hold career guidance counselling for students

2008-12-01T04:15:00.000-08:00

Members of the Accra West District Society of the Institute of Chartered Accountants (ICA) last Thursday carried out a career guidance seminar at Presby Osu Secondary School in Accra, where they also donated about 400 books and documentary literature to the school.
The programme was part of the ‘early awareness’ programme of the ideals required of the professional accountant.
Students in their final year were taken through the various modalities of becoming a chartered accountant and the subjects and grades required to be eligible to register with the institute.
Among the resource persons were the Accountant-General of Ghana, Mr Christian Sottie, an old boy of the school, and the Head of Education at the Institute of Chartered Accountants, Miss Helen Boafo.
The books were received on behalf of the school by the headmistress, Miss Dennis Welbeck,
Ms Welbeck expressed her appreciation to the members of the ICA society, who were led by their President, Mr Joe Hyde Jr and his vice, Mr Joe France.

Pix: Mr Joe Hyde Jnr, Chief Accountant of Mechanical Lloyd (third Left), presenting the books to Ms Welbeck at a short ceremony.

UN should play active role in solutions to financial turmoil

2008-12-01T04:14:00.000-08:00

INFORMATION NOTE

THE bail out of some of the world’s wealthiest companies have send strong signals about the likelihood of cut backs of financial support from the developed economies to the developing countries.
At a meeting of the Trade and Development Board (TDB), in Geneva on “Financing for Development” recently, concerns were raised on the need to continue economic support for the developing world despite the global crisis. Boahene Asamoah reports.

TRADE and development experts who spoke at the Geneva meeting were unequivocal on the need for a systemic remedy to the global financial crisis and also the need for the United Nations and its partners to play an active role in crafting solutions to the global financial turmoil.
These crises according speakers at the forum would impact financial support to especially developing countries, as rich countries have dolled out trillions of dollars to help bail out the affected financial institutions.
“The availability of phenomenal sums for bailouts and stimulus packages" in rich nations "makes it hard to understand why resources are suddenly so scarce when it comes to developmental assistance,” says Mr. Supachai Panitchpadki, the Secretary-General of the United Nations Conference on Trade and Development (UNCTAD) at the meeting.
His opinions were echoed by a various speakers a the just ended Trade and Development Board (TBD) meeting In Geneva.
Experts say the developing world is facing, with the expanding financial turmoil, difficulties over food costs, and wildly gyrating energy prices, a "triple crisis" that must be addressed.
Reports from some renowned economist, Jeffrey Sachs, indicate that Europe and the US have mobilised around US$3 trillion in the past month in guarantees and bailout funds for banks, but failed to mobilise even one ten-thousandth of that this year to help the world's poorest grow more food, and this is in the midst of a food and hunger crisis.
Senior officials from some developing countries were equally upset at the billions being dolled out to support such companies.
A deputy Minister of Trade, Industry, President’s Special Initiative and Private Sector Development, Mr Kwaku Agyeman-Manu, also expressed similar concerns.
“Even before the onset of the current turmoil, efforts to implement the “Monterrey Consensus "had been mediocre, because even though significant progress has been made in the area of debt relief, progress has been very limited in other areas of mobilisation of domestic and international resources for development, promoting international trade as an engine of development, and addressing systemic issues through expanded participation in global economic governance", Agyeman-Manu stated.
Preliminary research indicates that during past banking crises official development assistance (ODA) to poor nations has declined anywhere from 20 per cent to 40 per cent.
For the current crisis, according to estimates from the Organisation for Economic Co-operation and Development (OECD), foreign direct investment to developing countries would have declined by 40 per cent during 2008.
Remittances to developing countries from nationals working overseas who represents a huge source of income, according to reports, may fall by up to six per cent.
The International Labour Office has estimated that the financial crisis will cause global unemployment to increase by 20 million and extreme poverty to rise by 40 million.
“The current meltdown “must not be allowed to derail the very important efforts developing countries have made in recent years to sustain economic growth,” TDB President, Debapriya Bhattacharya of Bangladesh stated at the meeting.
Trade experts say the current global crisis should be an occasion for the United Nations to perform “an essential function in generating innovative ideas, fostering universal dialogue and building consensus,"
“It is the forum, par excellence, for universal participation in global decision making when needed,” Mr Supachai stated.
"People may discuss whether it is a recession or a depression,” Mr Bhattacharya said, adding that “we will soon find out."
Experts say it is necessary for the international community to move from "a fire-fighting approach" to a more concentrated and co-ordinated response to the financial crisis.
Again, they said “risky” financial instruments, “runaway speculation,” and insufficient supervision by regulatory agencies, particularly in developed countries, had led to the current crisis.
Impacts on developing countries could be expected to be significant, including declining exports, declining tax income, and expanded debt problems. These could make it difficult for governments “to meet basic human needs.”
Many analysts have called for a holistic approach to development which places equal emphasis on the health of the global economy as it does with individual national economies.
Civil society organisations were concern that financial markets would continue to deteriorate for some time, however they were optimistic that the failings of financial markets would not detract from the solid record of the market economy system and globalization in rescuing millions of people from poverty.
Others have said the crisis called for the widest possible dissemination of information on the turmoil and steps to improve and reform accounting and auditing and the overall financial system, so that confidence is restored.
There should be “democracy and stability” in the international financial architecture and the architecture itself "should be restructured," international trade experts stated.
UNCTAD said it has assembled a Task Force on Systemic Issues and Economic Co-operation to co-ordinate research on major weaknesses in the international financial system and related institutional architecture of concern to developing countries.
The task force, according to UNCTAD would focus, among other things, on currency speculation and global monetary co-operation; commodity futures speculation and price volatility; and financial sector regulation and surveillance.
Some senior European governmental officials have admitted that financial markets in the developed countries, the rules of the game have simply not kept up with the speed of globalization.
Analyst believe that financial stability was clearly "a global public good" that requires supervision and international co-operation.
While the EU said it was committed to financing for development and to achieving the Millennium Development Goals (MDGs), it called for steps to be taken, including through the essential role of the Bretton Woods institutions (the World Bank and the International Monetary Fund) to carry out an effective and complete reform of the international financial system based on the principles of transparency, banking stability, and the integrity of international economic and financial governance.
The African group at the meeting said a "concerted structural measures" can ease the effects on Africa of the financial crisis.
According to the African group, major steps must be taken to permit Africa to resist the external shocks caused by the current turmoil and enable it to protect and expand the economic progress it has made over the past five years and to sustain reductions in poverty.
According to experts the world economy had become much more integrated since 2002, and any talk of a supposed "de-coupling" of the South from the economies of industrialised countries was being exposed as untrue by the current crisis.
It also was a matter of concern that manufactured goods from developing countries had suffered, overall, a decline as compared to manufactured goods from developed countries.
“ Clearly there was a need for further aid and attention to expanding the productive capacities of developing-country economies, says the Assistant Secretary-General of the United Nations Department of Economic and Social Affairs (DESA)Mr. K.S Jomo .
Trade experts say three major issues should be addressed namely, greater international tax co-operation; the Financing for Development follow-up mechanism, which must be made more effective; and the matter of systemic financial reform which would ensure a widespread recognition of the need for new international financial architecture.
Many experts express concern that there was a widening global imbalances in current-account deficits and current-account surpluses among countries around the world, that indicates that the risks associated with the currency statuses of a number of countries have increased, which helps to explain why the financial crisis is having such a widespread fallout.
“This is a systemic question that can only be addressed at the global level,” senior economist at the UN stated.
According to senior analysts one long-standing UNCTAD proposal deserves further consideration were co-operative global financial and monetary system should be established that would assure, on a multilateral basis, the same rules of the game for all parties involved, more or less in the same way as multilateral trade rules apply to any trading partner.

36 companies receive awards

2008-12-01T04:12:00.000-08:00

December 1, 2008 Page 71
Story: Boahene Asamoah

Thirty-six companies and organisations have been awarded at the first Ghana Business and Financial Excellence Award for their contribution to the economy at a ceremony in Accra last Friday.
Ghana Cocoa Board won the ultimate award; a Platinum Award for its contribution to the lives of people and the company’s impact on the economy as a result of its activities.
Other companies which won awards were Agricare Ghana Limited, Alhaji I.D. Construction, Aluworks Limited, Amin Sankari Industries, Atwima-Kwanoma Rural Bank, Cadbury Ghana Limited, Cocoa Research Institute, Dizengoff Ghana Limited, De Paul Wood Treatment Limited, Enterprise Insurance Company, First Allied Savings Limited, Ghana Commercial Bank, GIHOC Distilleries, Global Haulage Ghana Limited, Guinness Ghana Breweries Limited and the Ghana Stock Exchange.
Others were, Holy Trinity Medical Centre, Inter City STC Company Limited, Interplast Limited, Irani Brothers, K.I. Ghana Limited, Latex Foam, Mechanical Lloyd, Melcom Ghana Limited, National Lottery Authority (NLA), New Plan Ghana, P & W Ghana Ltd, Produce Buying Company, State Housing Company Limited, Toyota Ghana Limited, Unilever Ghana Limited, Villa Cincinario, Voltic Ghana Limited, West African Mills and Western Union Money Transfer.
Delivering the keynote address at the function on behalf of the Vice President, Alhaji Aliu Mahama, a Deputy Minister of Trade, Industry, Private Sector Development, and the President’s Special Initiative, Mrs Gifty Ohene-Konadu, said the private sector must work closely with the government to ensure rapid development of the economy.
The Vice President said six key priorities needed to be focused on during the next phase of the country’s economic development.
These, he said, were enforcing adherence to rules and regulations regarding business operations; aggressively promoting the spirit of entrepreneurship at all levels of the society and attracting and mobilising foreign investment to priority sectors.
The rest were, building synergies between local entrepreneurs and foreign investors; improving efficiency, productivity and competitiveness of local industries through skills development, access to credit and technology improvement and promoting exports and facilitating access to foreign markets.
Alhaji Aliu Mahama said the focus of the government’s policy “is on the integration, promotion, development and growth of the private sector.
The Vice President acknowledged that “there have been remarkable reforms in the financial sector which has significantly transformed our economy”, adding that “these reforms have indeed opened up investments in the banking sector”.
The Vice-President called on businesses in the country to take advantage of the tremendous opportunities that abound in the economy to turn around the economy.
He commended the business community and the financial institutions for their immense contribution to the economy.
A Minister of State at the Ministry of Finance and Economic Planning, Dr Anthony Akoto-Osei, in a speech read on his behalf by Mr Dominic Donkoh, a Director at the Ministry, said there was the need for the financial service sector to support the Small and Medium Scale Enterprises (SMEs) to ensure their growth and development.
“Banks and other financial institutions remain the most significant source of credit for funding business and meeting the needs of individual borrowers”, he said.
“This demonstrates the critical role the banks and financial institutions are playing in financing the private sector, which has been identified as the engine of growth of our economy”, the Minister added.
Dr Akoto Osei said the government will continue to give banks and other financial institutions the necessary support to enable them realise a good return on their investments.

UT Lists on GSE

2008-12-01T04:08:00.000-08:00

UT lists (fin)
Story: Boahene Asamoah

UT Financial Services, an indigenous non-banking institution was today listed on the trading floor of the Ghana Stock Exchange at GH¢0.30 and immediately gained a 10 per cent price appreciation.
The listing of the shares comes after a successful initial public offer which saw the floatation of 90 million shares of the company to the investing public to raise GH¢27 million.
It’s shares were oversubscribed by 1.7 per cent, mainly individual investors.
UT Financial Services now has over 10,843 shareholders.
UT thus becomes the 35th company to be listed on the market and third company to be listed this year.
Speaking at the ceremony, the Chief Executive Officer of the company Mr Prince Kofi Amoabeng, assured shareholders that the company would continue on the path of growth to ensure higher share holder value.
“I can assure shareholders that we would live up to expectations”, Mr Amoabeng stated.
He said the primary interest of the company now was to fulfil the interest of shareholders and added that systems were in place to ensure the continuos viability of the company way into the future.
Mr Amoabeng paid glowing tribute to the staff of the company for their dedication to work and for playing a major part in what has become a world-class financial institution.
Mr Ken Ofori-Atta, the Executive Chairman of Databank, lead brokers of the offer, reiterated that the successful over-subscription of the offer was remarkable considering the difficult period under which the offer was done.
He mentioned the credit crunch, the global financial turmoil and the refusal of the Social Security and National Insurance Trust (SSNIT) to take a major stake in the UT share offer as some of the challenges that offer faced.
Mr Ofori-Atta said the business of UT Financial Services was viable in that the normal banking institutions have not be able to cover the niche market where UT operates, whiles there was a huge difference between UT Financial Services and the competition.
The Chairman of the GSE Council, Mr Frank Adu Jnr, said Ghanaians must celebrate Ghanaian companies that have been able to become very successful.
“It is not easy to grow business in our environment”, he acknowledged.
The Managing Director of the Ghana Stock Exchange, Mr K.S. Yamoah, called on shareholders of UT Financial Services to contact their brokers to convert their paper certificates into the electronic trading system to help ensure liquidity and improve efficiency.

Insurance industry set for boom

2008-09-16T09:52:00.002-07:00

Boahene Asamoah reviews the insurance industry since 2006, highlighting the significance of new entrants to the industry

There is a new buzz about the insurance industry today. As an important industry to everyone, businesses and individuals, one would have expected more serious activity until now. The industry seems to have been late responding to change, but it seems that it was worth the wait.

The Ghanaian insurance industry is expected to get more exciting as new players storm the market, and in most cases, as part of their market penetration strategy, taking over existing companies. It all seems to be working together for Ghana at the moment, with some industry watchers attributing the current foray into the insurance industry by bargain-hunting investors to the oil find.

The rush has got some industry experts talking, with some worried that if firms are not properly capitalised, they could collapse the industry in the future. Capitalisation is important for many reasons. As the Ghanaian economy develops with more people taking up insurance policies, some for the very first time, it is important that insurance companies are well endowed to meet the growing demand. What is important about capitalization also is that if the firm is well capitalised, it will be able to have more funds set aside for capacity development for example, all helping the industry to mature and grow fast.

But the worrying part if the new entrants, mostly foreign, do have the financial muscle to meet the growing challenges. In fact, they seem to have more capital than the local ones, which is causing anxiety among local industry players.

New entrants from especially Nigeria have made their presence felt in a big way, with more serious-minded approach to the business. It seems that they have taken a cue from their counterparts in the banking industry who have changed the face of banking in Ghana.

So far six major insurance companies have pitched tents in the country, and all of them in a big way. They are Capital Express Assurance Ghana Limited, who has bought controlling interest in Benefits Life Assurance Sector, while Regency Alliance Insurance Limited, another Nigerian firm has also bought controlling interest in Benefits Non-Life Business.
Industrial and General Insurance (IGI) Ghana Limited, which is a subsidiary of IGI Plc of Nigeria has bought controlling interesting in Network Assurance in both the Life and Non-Life businesses.
However, two other firms have set up their own operations in the country entirely from scratch, without taking over an existing trade. They are International Energy Insurance Company (IEI) and Equity Assurance Limited.
Other banking entities like Zenith Bank Plc, that already has a banking business in Ghana is expected to follow that by setting up an insurance company in the country. Zenith Bank has a subsidiary that deals in insurance.
Following the Insurance Law of 2006, Act 724, the separation of the Life and Non-Life business of insurance companies and the raising of the minimum capital to US$1 million for each of the businesses, the number of companies in the industry has increased from 24 to 37.
Interestingly, the oil find has brought about new businesses in the country with some experts in the oil insurance underwriting becoming a new hot bed for the insurance industry.
Again, the general good business climate in the country over the past five years that has led to a construction industry boom also presents some tremendous opportunities for insurance companies.
And performance has been good also. Over the past five years there has been a general increase in premium income. From 2002 to 2007 gross premium income for all businesses increased from GH¢47.2 million in 2002 to GH¢1.64 billion in 2006.
This represents a yearly average growth rate of 36.7 per cent; total gross premium for non life business however, increased by 270 per cent from GH¢38. 2 million in 2002 to GH¢141.5 million at the end of 2007.
For the life business gross premium increased from GH¢8.9 million in 2002 to GH¢68.6 million at the end of last year.
Analysts say the continuous increase in growth in the sector is an indication of the increase in public awareness and confidence in insurance products.
Over the past few years, there has been an emergence of new products that are tied to other investments such as the funeral insurance, which has received a lot patronage.
However, some industry players still believe that a lot more attention needs to be given to the life business because of its spiral effects.
According to market reports on the industry, the life business has the potential to generate wealth for the industry and encourage investments as a whole in the insurance industry because of its potential appeal to people looking at the premium income by class of business for the period 2002 to 2006.

Market watchers also believe that the companies from Nigeria could have a lot of impact on the Ghanaian market because of the excess funds they have for the industry. The Nigerian authorities on September 5, 2005, announced the recapitalisation of Insurance and Reinsurance companies. The new minimum paid-up share capital is as follows:
Class of Business, New Capital Base Life Insurance business 2 billion Naira, General Insurance Business 3 billion Naira, Reinsurance companies to 10 billion Naira.

It was also identified that the total market capitalization for the insurance industry then which stood at about N34 billion spread among 103 direct insurers and 4 reinsurers.
Indeed this is the present situation in Ghana; at least four international banks in the country, with the new capitalisation requirement could take more than half the number of insurance companies in the country.
However some industry experts believe that it would not be prudent for Ghanaian insurance firms to recapitalise only to take advantage of the oil business, although the experts believe that recapiatlisation was necessary.
The argument is that the oil business is a risky business and that should all the insurance companies underwrite such a business in the likely event of a disaster, claims from such disaster could wipe off the whole industry.
Experts say Ghanaian insurance firms must be encouraged to spread their risk, so that the industry is protected. Re-insurance provides that safety net for insurance companies, but there are always other pitfalls that should be checked.
While the economy presents some opportunities for the insurance industry, the challenge is how best to educate the Ghanaian public on the need to take insurance policies to protect themselves and their families.

Value added products to transform economy

2008-09-16T09:52:00.001-07:00

The government of Ghana is committed to adding value to cocoa produced in the country, so it introduced a policy to ensure that 40 per cent of production is processed locally, Boahene Asamoah explains.

Adding value to raw cocoa beans has always been the plan of successive governments but it has not always been successful.
So the announcement by the government some few years back to introduce policy initiatives that would ensure that over 40 per cent of cocoa produced locally would be processed into semi-finished goods so as to increase its price value was received with mixed reaction. But generally, the initiative holds a lot of promise for the country. Ghana's cocoa is of premium quality on the international market and as a result, many analysts and commentators believe that its semi-processed form could add as much as 40 per cent more to the price currently offered on the international market.
The current cocoa processing activity in the country is not encouraging. In 2007, Ghana exported about 730,000 tonnes of cocoa beans out of which about 13 per cent was processed into semi-finished products like cocoa liquor, butter and cake.
Again, only one per cent of total annual cocoa production is processed into finished products like chocolate, and other confectionery products.
Until recently, the West African Mills (WAMCO), Cocoa Processing Company (CPC) and Barry Callebaut were the only major companies producing semi-finished cocoa products on a large scale for exports. However, over the past three years as a result of the government's policy initiative, new companies have taken advantage of the government's policy and entered the industry to process cocoa beans into finished and semi-finished products, while the major companies already in the industry have made significant investments into their operations to increase their capacity.
CPC for instance has embarked on an expansion programme that would see its production capacity increased to 64,500 metric tonnes of cocoa powder, liquor and cake.
Barry Callebaut has also undertaken an expansion programme that would double its capacity to 60,000 metric tonnes per annum all in anticipation that the government policy would spike up the industry further.
Furthermore, WAMPCO 's capacity has increased tremendously, since it was divested and currently has a capacity of 80,000 metric tonnes.
New companies such as Gergens Cargilm, ADM, Afrotropic and Commodity processing are currently putting up capacities of 60,000; 60,000; 15,000 and 15,000 metric tonnes respectively to process raw cocoa into semi-finished products.
So far Afrotropic and Commodity Processing Industries, which is a joint venture between some Ghanaians and their foreign partners, has started operations, to take advantage of the government's policy and by the end of next year, Cargil and ADM should be in full operations. The combined production of these companies is expected to reach 354,500 tonnes by the end of next year, nearly 50 per cent of total production.
According to some industry experts, this new policy initiative will not only benefit the country, but also the companies themselves. Some of the locally registered cocoa processing companies are already processing beans for their parent companies abroad, which analysts see as a cost-saving measure. Due to the high labour cost in most advanced countries, processing the beans locally saves cost on transportation and labour.
Cocoa importing firms, it seems, are looking up to Ghana to process cocoa for the European and the US market, so as to improve their own bottom-line profit.
Strong demand from China and India has stimulated interest in cocoa products especially from Ghana and West Africa.
Ghana's cocoa enjoys high patronage especially from Japan and other Asian countries.
The only glitch, industry experts have warned, is the rising cost of the price of cocoa beans on the international market. It is believed that if prices keep rising, like they are today, financially it could become more beneficial to sell the raw beans than the processed product.
On the international market, cocoa price currently stands at US$2,862 per metric tonne, the same price local processing firms have to pay for cocoa beans.
Cocoa sales in Ghana are effected through forward sales, which involve contractual arrangements for future delivery of the beans. Cocoa has a long history in Ghana and from 1911 to 1976 Ghana was the world's leading producer, contributing between 30 and 40 per cent of the world's total output.
It is a major export earner for the economy. Since the mid 19th century, cocoa has contributed significantly to the socio-economic development of the country and there are currently around 1.6 million people involved in growing cocoa and many more in associated industries.
Processing of cocoa in the country, however, started in 1947 and in the late 1970s the world market price for cocoa plummeted by two thirds. Ghanaian cocoa farmers were getting less than 40 per cent of the world market price from the state agency responsible for the industry — Cocobod — and so many stopped producing cocoa altogether.
The situation worsened after the droughts and accompanying bush fires of the early 1980s and production in Ghana fell from a third of the world's total in 1972 to just 12 per cent of total world production.
At this stage the World Bank and International Monetary Fund intervened with a Structural Adjustment Programme to "rescue" the economy, and the industry, as it was a major sector for any structural reforms.
Today the government offers over 70 per cent of the producer price to cocoa farmers.
Cocoa production has soared since the government introduced mass spraying of cocoa farms throughout the country, a policy that started in 2002; culminating in record production in 2005.
Due to smuggling, the volume of export from Ghana has reduced in this light crop season.
Cocobod purchased about three per cent less beans from farmers during this year's light-crop season. Cocobod bought 13,613 metric tons of beans from growers by the eighth week of the season, compared with about 14,000 tons in the same period a year earlier, according to sources at Cocobod.
In July, the board said it expected to receive as much as 40,000 tons of the beans, compared with 50,000 tons last season. Fewer controls and poor quality beans in neighbouring Ivory Coast, the world's biggest cocoa grower, enable Ghanaian farmers to fetch higher prices for their crop in that country. Cocobod is working with security agencies in Ghana to reduce smuggling.

Middle-income status by 2015 an illusion?

2008-09-16T09:49:00.002-07:00

If Ghana is to achieve a per capita income of US$815 and US$1020 by 2010 and 2012 respectively, its growth rate must increase three-fold from the current level, writes Boahene Asamoah.

Analysts and market watchers agree that Ghana has enjoyed impressive growth rates over the years, significantly improving on an annual growth of 3.7 per cent in 2000 to 6.4 per cent by the end of 2007.

The government has projected a per capita income of US$1,000 by 2015, a tall order that many analysts see as unrealistic, looking at the current economic development. Analysts at Renaissance Capital, for example, are of the view that Gross Domestic Product (GDP) growth has to triple to attain this feat.
This means that economic expansion, which will have to involve all sectors, must be firm.
It is true that the economy has held its own quite well, and that despite all the problems or credit crunch and its attendant problems in some economies, it has managed to steer clear of trouble — at least for now.

“We think that the US$1,000 threshold in income per capita [by 2015] will represent an important psychological boost at a time when oil production starts accelerating structural change,” the analysts said.
In fact, what are needed mostly in the Ghanaian economy are structural changes, since the economy has not changed structurally for more than 50 years.

Analysts are also not sure how even a GDP per capita growth could affect the lives of ordinary Ghanaians, many of whom live below the UN-backed poverty line of less?????????????? than US$1 dollar a day.
GDP per capita growth may not be fully indicative of actual income dynamics as a result of endowment differentials. Even with cross-border comparisons this distortion exists, notably in countries with small populations or oil exporters, leading, in some cases, to inflated GPD per capita levels.

According to Renaissance Capital, in terms of inequality, Ghana's Gini-Co-efficient stands at 40.8 on a scale of 100, thus Ghana is ranked 135th among 177 countries.

This is far below that of most sub-Saharan African countries having a relative level of development.
Research has revealed that recent economic reforms have sustained the consolidation of a domestic middle class, which would become more evident when the results of new surveys are released in the future.
The other worry with the structure of the Ghanaian economy is that there are a large number of people in the informal sector who constitute the bulk of the population whose lives may not be necessarily improved by a GDP growth. Therefore, the anticipation is that any increase in per capita income could be skewed and may only affect the small middle class and so may not be indicative of a real growth in GDP.

???According to the United Nations Development Programme (UNDP) Human Development Report for 2007-2008, Ghana has one of the lowest shares of income held by the 10 and 20 per cents richest segments of the population in the group of the sub-Sahara Africa frontier markets.

It was expected that Ghana would achieve a growth rate of seven per cent at the beginning of the year, but this has been revised downwards to 6.8 per cent as a result of the effects of the volatile oil market and rising food prices.
????The rising food and oil prices have taken a serious hit on the economy, threatening the macro-economic stability at has achieved so far.

This, however, does not derail the focus of the economic managers as government officials are adamant that the economy is strong enough to withstand such external shocks.

Inflation soared in the past months, but has recently shown signs of marginal decline.

Agriculture

Procredit to support sector

Procredit Savings and Loans Company Limited, Ghana, a member of the Procredit Group and a leading savings and loans company in Ghana, has earmarked 50 per cent of its total loan portfolio to support the agricultural sector in the next five years.

According to Ms Edwige Takassi, Managing Director of Procredit Ghana, currently Procredit Agro Loan (which is loans specifically earmarked for the agriculture sector) stands at GH¢1.5 million, representing just eight per cent of its total loan portfolio.

Procredit has made commitment to the agricultural sector, and according to Takassi, even though the current Procredit agro loan was its single largest loan portfolio, it was still not enough to meet the growing need for credit in agriculture.

"Procredit projects that within the next five years, agro loans would account for at least 50 per cent of the institution's loan portfolio," she said.

It estimates that if it is able to raise its funds available for disbursement to a portfolio of GH¢500 million, about GH¢250-million increase within the next five years, GH¢250 million would go to farmers, food processors and other stakeholders in agriculture.
Agriculture continues to be the mainstay of the Ghanaian economy, but it is also the sector that is so much dominated by peasant farmers who are unable to secure the needed credit to expand their farms. However, Procredit hopes to change all this, by providing them with the much needed credit facilities.

"Procredit is determined to become the leading provider of financial services to the agricultural sector," she said. According to Takassi, even though the agricultural sector is the backbone of the Ghanaian economy and employs over 60 per cent of the country's workforce, the sector is hugely underserved by traditional banks and financial services institutions, probably due to the inherent risk in the sector.
"Our agro loans would target farmers and people in agriculture-related businesses who constitute a very significant part of the sector, providing jobs and food for our people and yet do not have access to credit because banks usually require expensive business plans and huge collaterals from them," she said.
"The minimum loan amount is 50 Ghana cedis - loan amount will vary from one farmer to another, depending on the size and value of what the farmer already has," she said.

Meanwhile, Mr Ernest Debrah, the Minister of Food and Agriculture, on Thursday said in order for Ghana to achieve a middle income status by 2015, the country should not only increase its traditional agricultural export, but also diversify and modernise the agricultural sector.

"The horticultural sector, especially the fruits, vegetables and ornamentals, therefore presents an opportunity for the needed diversification, modernisation and accelerating economic growth due to its high potential economic returns," he said.

Mr Debrah said this at the Ninth Annual General Meeting and Scientific Workshop of the Ghana Institute of Horticulturists organised on the theme: "Achieving Middle Income Status in Ghana; The Role of the Horticultural Industry in the Millennium Challenge Account." The workshop, which was organised on September 11, brought together about 200 professionals and students in the industry to deliberate on issues affecting it and find common grounds for advancement.

He said the horticulture industry could play an important role in supporting the government's efforts at wealth creation and poverty reduction.

"The Ghanaian horticultural industry has grown rapidly within the last decade and has enabled Ghana to establish herself among the top six exporters of horticultural produce to Europe."

Databank left off the hook

The Securities and Exchange Commission (SEC) on September 10 announced that it had resolved the impasse between the Ghana Stock Exchange (GSE) and Databank Brokerage Limited (DBL) over the sale and purchase of Cal Bank shares.

A statement issued by Mr K. Okwabi, Deputy Director General, SEC, said subsequently the penalty levied on Databank by the GSE had been waived.

DBL was suspended from trading on the exchange by the GSE in what many analysts see as “improper” their conduct with regard to the Cal Bank shares.

The statement assured the public that the parties in the dispute, as industry participants in the capital market, were committed to the growth of the stock market.

SEC, the statement said, would continue to ensure that conflicts between market participants would be resolved in good time to foster the development of the market.

Zain implementing millenium villages

2008-09-16T09:49:00.001-07:00

Telecommunications giant Zain Ghana is implementing a mobile communications and internet connectivity to the Millennium Village of Bonsaaso in the Amansie West District in the Ashanti Region to help improve the living conditions of the inhabitants of this cluster of villages and lift them out of extreme poverty.
The project is being implemented through its partnership with Ericsson and the Earth Institute.
The project, after completion, would help the people to access health and education services through their mobile phones.
The initiative, which Zain, Ericsson and the Earth Institute first outlined in September 2007 at Columbia University in New York City, has already had a positive impact on health, education, social well-being and livelihoods in Dertu, Kenya
The villagers of Dertu, who are mainly pastorialists, can now access health and education services through their mobile phones.
Mobile communications have also helped them to identify safe sources of water, mobilise emergency transportation, find employment and get accurate information on the prices of goods and services before taking their livestock and other produce to the market.
For its customers, the benefits include improved access to health and education services, direct access to livestock and employment markets, and increased social contact with family, friends and the outside world.
The project has enabled villagers to be closer to their social network.
By putting the community in touch with and closer to their friends and family, it is integrating the village into the broader environment, which is all part of Zain's theme of creating a wonderful world.
The Dertu Millennium Village is located in north-eastern Kenya, a mainly rural and nomadic area approximately 140 km from the Kenya-Somali border.
Zain has a temporary network with a 20m, diesel-run tower that covers up to 20km and brings mobile communications, enabled by EDGE, to Dertu's estimated 5200 people.
Call volumes as of July 2008 increased by 30 per cent from June, with more than 1000 individual customers using the service so far. In June alone, 22,000 calls were placed.
By the end of 2008, a permanent “green” network will be up, with a 60m tower covering 50km. The permanent site will leverage renewable power sources and will reduce reliance on the diesel generator by up to 80 per cent.
For Zain, the benefits of supporting this cause include positive public relations, improved customer relations, closer community ties, positive stakeholder engagement, and additional marketing opportunities. In the long term, it's still a recipe for a profitable business.

insurance industry to reward excellence

2008-09-16T09:47:00.000-07:00

Zain to double investments in Africa

2008-09-09T09:18:00.001-07:00

Story: Boahene Asamoah, back from Nairobi, Kenya

DR Saad Al Barrak, the Group Chief Executive Officer of Zain, the new owners of Westel and international mobile telecommunications company operating in the Middle East and Africa, has said the company plans to double its investments in Africa and double its customer base throughout its operations.
He said the company had, over the past few years, invested over $10 million in its operations in Africa, adding that “we will continue to invest more in our operations across Africa”.
Speaking at a news conference which brought together some international media across Europe, Africa and the Middle East, Dr Barrak said as part of its vision, the company hoped to attract 110 million customers by 2011.
Zain, which operates in 14 other African countries, was previously known as Celtel.
He said the company had undertaken a strategy to re-brand its global business, adding that “by re-branding to Zain, we are bringing together our African and Middle East operations under a single, strong and unique identity”.
He said the re-branding was consistent with the strategic vision of the company to become a leading global brand in the next few years.
The Zain Group, which has operations in 22 countries in the world, including 14 operations in Africa, with Ghana as its new destination, has over 50 million customers throughout its operations.
Dr Barrak described the branding as a significant milestone in the history of the company from the company’s humble beginnings.
He said the company had, over the past few years, evolved from a regional company to become an international brand.
The group CEO said it had expanded its operations and now had operations in Africa and the Middle East, with Ghana and Saudi Arabia being the new subsidiaries of the group, adding that “we will long for opportunities to extend our brand and services”.
Dr Barrak stated that the company presently had a consolidated revenue of about $3.488 billion, with net income of $551 million.
“For us to become a global company, we need to have one identity that reflects our unique direction and reflects our values,” he said.
He explained that the Zain concept of one network was to create a seamless network across its operations with the offering of one local tariff, thereby abolishing the high cost of roaming charges.
Dr Barrak stated that its brand would bring about performance and place the company as the number one mobile company in Africa and among the top 10 global brands in the world.
Zain presently is the number one player in 14 out of 20 of its active operations in Africa and the Middle East.
He stated that it was part of the strategy of the company to list part of its operations on the local stock markets and mentioned, for instance, that the Ghana operations planned to list part of its shares on the Ghana Stock Market within two years.
He added that the group hoped to list shares on some international stock markets, adding that its initial public offer in Zambia achieved greater success.
Dr Barrak stated THAT the company had embarked on a number of sustainable projects under its corporate social responsibility to reach out to help deprived communities across Africa.
He mentioned its projects in Dertu in the northern part of Kenya where it had provided affordable handsets and installed a network service to help the farmers to do business.
Again, he mentioned the low-cost, affordable handset projects in Uganda to help the fishing communities along Lake Victoria to carry out their activities with low cost phones.

One Africa to award organisations

2008-09-09T09:17:00.000-07:00

From the Business desk

THE One Campaign, a global advocacy organisation, has announced an award to recognise best practice by African organisations or individuals promoting the effective use of development resources to help the continent to achieve the Millennium Development Goals (MDGs).
A statement issued by the organisation said winners of the awards would receive a one-time grant of $100,000.
It said individuals, organisations or other groups based in Africa that had demonstrated commitment and success in assisting Africans to meet one or more of the MDGs would be assessed and rewarded.
It recalled that all of the world’s countries and all leading development institutions agreed to work to achieve the MDGs which ranged from halving extreme poverty to halting the spread of HIV/AIDS and providing universal primary education, by the target year 2015.
The statement said qualified recipients may either be engaged in implementing programmes to address health, clean water/sanitation, agriculture, education, economic growth or employment generation for poorer communities.
“Throughout Africa, there is amazing progress to end extreme poverty and preventable disease”, the Africa Outreach Manager of the One Campaign, Edith Jibunoh, said in the statement.
It added that the One African Award would celebrate progress toward achieving MDGs.
The President and Chief Executive Officer of the One Campaign, David Lane, said: “We applaud the progress made in Africa and look forward to solutions for the challenges still ahead.
“By honouring the commitment and progress on the ground we hope that new efforts can be inspired and more lives can be saved,” he said.
The statement said the first recipient of the award would be announced at the Accra conference on aid effectiveness in September, this year, adding that the conference would be an ideal opportunity to announce the award as both conference and the award focus on ensuring assistance to Africa.
The application process is open until August 15, 2008 and interested persons can obtain more information on one.org/africaaward/.

GT bank introduces instant money transfer

2008-09-09T09:16:00.001-07:00

GT Bank (fin)
Story: Boahene Asamoah

GUARANTY Trust Bank, Ghana Limited, has introduced a new instant money transfer for its customers within the sub-region.
The new money transfer known as Guaranty Trust Monetary Transfer (GTMT) would offer common platform for all of the bank’s subsidiaries.
Speaking at the launch of the programme in Accra on Tuesday, the Managing Director of the bank, Mr Dolapo Ogundimu, stated that the new product was expected to add value its money transfer by offering lowest fee, ensure safety and was available at all its branches in the country.
“GTMT is a service for both customers and non-customers in Ghana, Nigeria, Gabon, Sierra Leone and Nigeria,”, she stated.
He said the bank has a network of 143 branches across its subsidiaries and stated that its services would be extended to its operations in Liberia as well as the London offices.
The Managing Director said one unique feature of the product was that the transaction was instant as compared to other money transfers available.
“A customer will receive instant cash from a sender sending money from any of our subsidiary anywhere”, he stated.
He said the product was intended to facilitate trade and economic growth in the sub-region and assured customers of the high quality service to support their businesses.
Research has revealed that about $300,000 of remittances are received from Nigeria to Ghana especially for Nigerian students in Ghana.
The Board Chairman of the bank, Alhaji Yusif Ibrahim, who launched the product said the product would lead to what he described as the “emancipation of African trade”.
He said “this promote would promote trade, harmony and deepen south-south co-operation.”
The Gambia Ambassador to Ghana, Alhaji Mohammed Jafah, stated that the product was a good business idea that needed the support of all stakeholders.
He reiterated earlier submissions that the product would further deepen economic relations between the countries within the sub-region of West Africa.

ETI partners ACCION international

2008-09-09T09:14:00.000-07:00

Story: Boahene Asamoah
ECOBANK Transnational Incorporated (ETI), the pan-African bank, has partnered ACCION International, an international micro-financing institution to assist in providing services to micro-lending institutions in the country.
The $1.5 billion investment is known as EB-ACCION Savings and Loans Company limited, with equity participation from the two companies.
The company, which is started in Ghana, will be replicated using ETI’s Africa operations which currently has 25 operations in Africa to support micro-, small-and medium-scale enterprises.
At the launch of the new company in Accra over the weekend, the Minister of Finance and Economic Planning, Kwadwo Baah-Wiredu, stated that the partnership was in line with the government’s vision of supporting the micro sector of businesses in the country.
“We need partnership to move forward this nation,” he said, while making references to the GT and Vodafone deal.
He said the economy had been growing at a steady pace and stated that there had been improvements in the financial services delivery.
Mr Baah-Wiredu called on beneficiaries of the loan facilities from the loan company to ensure early repayment of loans to enable the fund support other people.
The minister called on management of the company to ensure good corporate practices that would make the business more viable.
A Deputy Minister of Trade, Industry, Private Sector Development (PSD) and the President’s Special Initiative (PSI), Mrs Gifty Ohene-Konadu, stated that the partnership between the two companies would complement government’s initiative to support the micro and small industries in the country.
She said the government had signed a €20 million loan agreement with the Italian government to support the development of the private sector.
The Group Chief Executive Officer (CEO) of ETI, Mr Arnold Ekpe, said the mission of the group was to offer world-class banking service that would make a difference as well as contribute to the economic development of the region.
The President and Chief Executive Officer of ACCION International, Ms Maria Otero, said the event carried several messages to support micro and small businesses in the country.
She said ACCION operated in over 24 countries with 35 partners and had 3.3 million customers.
Ms Otero added that the company had so far granted $3 billion in loans to customers and had repayment rate of 96 per cent of all loans granted.
The CEO stated that partnership with ETI was to reach the low-income earners in the Ghanaian society, and stated that the company was honoured to partner ETI to provide financial services to the people.
The Managing Director of EB-ACCION, Mrs Frances Adu-Mante, stated that within the short period of existence, the company had 4,000 savings deposits and had granted about 1,000 applicants credit to turn around their businesses.
She said the partnership, primarily, was to identify an opportunity to support individuals and micro and small businesses in the country.
ACCION is an innovator in financial access, pioneering many of the best practices and emerging standards in the industry.
The company provides a full range of technical assistance and management services, as well as investment and governance support to help financial institutions build institutional capacity and financial strength in order to serve low-income households on a broad scale.
Over the past 35 years, ACCION has helped to build and strengthen some of the most successful micro-finance institutions (MFIs) in the world.

GDP to slow down

2008-09-09T09:13:00.000-07:00

growth forecast (fin)
Story: Boahene Asamoah

ECONOMIC analysts expect the government growth projections of 7 per cent Gross Domestic Product (GDP) for the 2008 year to miss its target narrowly on account of slow growth during the last quarter.
According to Databank research though economic expansion during the first quarter of 2008, as measured by the Composite Index of Economic Activity [CIEA], improved by 3.0%; business and consumers expectations went
down on accounts of higher inflationary expectations.
‘We expect the higher outturn of inflation in the first half of the year to slow growth. Consequently, we project real GDP growth at 6.8% this
year; which is marginally below the budgetary target of 7%’.

Inflation deteriorated during the first half of the year, as the global
food and energy price hikes intensified. The pass through effects of
crude oil price increases on the international market was severe for
Ghana. Inflation for May was 16.9%, compared to 12.7% in
December 2007; and we project inflation for June at 18.4%.
A relatively loose fiscal policy, lower gross international reserves,
and a sharp depreciation of the local currency made the economy
less resilient to external shocks. Given that external volatility still
persists in the global economy, we do not expect the goal of single
digit inflation to be achieved by the end of the year. Our end year
forecast for inflation is within the band of 17.5% and 18.49%.

Inflation could rise above 21% by September if the current fiscal
mitigating package is not sustained and transport fares remained
stable. The domestic harvest season is likely to ease food inflation
in the last quarter, and we expect this to soften overall inflation
during the period. This could facilitate a disinflation process in the
last quarter, though the extent is expected to be marginal.
We, however, expect the fiscal mitigation package to strain
government budget. Essentially, in the absence of expenditure
shifts in favour of the package, additional spending in support of the
package could worsen underlying inflation.
National elections are due in December this year, and we expect
a keen contest between the ruling New Patriotic Party and the
main opposition party, the National Democratic Congress.
Events leading to the election date indicate that the democratic
structure of the country is deepening. The Institute of Economic
Affairs, an economic and governance think tank in the country
has conducted its first round of fora for the main candidates to
interact with the public on policy issues.
While it may be difficult to predict the outcome of the elections,
we are confident that there will be a peaceful transfer of power
after the elections irrespective of the political party that wins.
POLITICAL RISK OUTLOOK
Leadership
INFLATION RATE OUTLOOK
GROWTH OUTLOOK
We expect real GDP growth to accelerate to 6.8% in 2008, from
the 6.3% registered in 2007; mainly on account of favorable
export prices and strong domestic demand.

conti
The first half of the year witnessed more fiscal expansion compared to
the same period in 2007. Government’s fiscal deficit as a percentage of
gross domestic output (GDP) stood at 2.94% by March compared to
0.91% for the same period in 2007.
The fiscal slippage occurred as a result of interest payments on the
US$750 million euro bond issued in September 2007, expenditure on the
CAN 2008 tournament, higher than expected expenditure on crude oil
imports, increased expenditure on wages and salaries, and increased
capital expenditure, among others.
Government borrowing increased during the first half of the year, which
combined with the inflation rate hikes during the period led to higher
treasury market yields during the period. The higher fiscal deficit was
mainly financed through increased borrowing on the domestic treasury
auction market.
The 91-day Treasury bill reached 16.84% in July from a low of 10.6% at
the end of December, 2007. The 182-day and the 1-year note increased
from 10.8% and 12.3% at the beginning of the year to 17.76% and
17.00% respectively by July 2008; while the 2-year note increased from
12.8% to 16.5% during the same period.
The introduction of the communications service tax in June, the
government of Germany’s £39 million concessional loan and grant, as
well as, the renewed inflow of financial assistance from the World Bank
may improve government tax revenue in the second half of the year. The
inflow of divestiture receipts, especially from the sale of Ghana Telecom
will also enhance fiscal stability.
Government expenditure cut during the second half of the year is,
however, not likely due to the impending presidential and parliamentary
elections. Growth in fiscal expenditure is likely to further outpace
domestic revenue mobilization in the second half of the year; and we
expect government fiscal balance to close the year at a deficit of 14.5%
of gross domestic product.
FISCAL POLICY OUTLOOK
Databank
Leadership
EXCHANGE RATE OUTLOOK
The local currency depreciated sharply this year compared to
2007. By the end of the first half of the year, the cedi posted a
year-to-date depreciation of 6.01%, which is significantly
higher, compared to 0.59% for the same period in 2007.
The sharp depreciation of the local currency was induced by a
significant reduction in the gross international reserves position
of the economy by December, 2007. The reserve position of
the country was weak due to the energy crisis even before the
global food and energy price hikes intensified. Crude oil price
has increased from US$85 per barrel in the last quarter of
2007 to above US$140 by the end of June, 2008.

MONTHS
DEPRECIATION RATE (%)
Depreciation $ Depreciation £ Depreciation €
The local currency also depreciated against the pound and the
euro by 5.9% and 11.63% respectively by June 2008; and we
expect it to depreciate further during the year. Increased
domestic demand induced by fiscal and banking sector credit
expansion led to increased demand for imports, which has
furthered worsened the outturn of the cedi.
We expect further increases in the price of crude oil and an
easing in foreign private portfolio funds into the country during
the second half of the year to worsen the downward pressure
on the cedi. Overall, we expect the cedi to depreciate against
the dollar by 11.5% in December this year.

The Bank of Ghana’s decision to increase the prime rate to 16% in
May in response to the deterioration in inflation during the period
indicates that further upward adjustment in the prime rate should be
expected if inflation further increases in June and July.
The central bank has consistently increased its key policy rate since
November 2007, when upside risks to inflation started to emerge.
From 12.5% in August 2007, the prime rate was increased to 13.5% in
November 2007; but maintained at the same rate in January 2007. As
inflation picked up to 13.8% in March, the central bank responded by
increasing the prime rate to 14.25%. In May 2008, the prime rate was
further adjusted upwards to 16%, after inflation worsened to 15.2% in
the month of April.

We expect the prime rate to further increase in the second half of the
year amidst our inflation expectations and the fact that the central
bank is committed to an inflation targeting regime. Increasing the
prime rate further up will hurt industry, but we think that increasing the
prime rate is necessary since the current level does not reflect
economy wide risk and inflationary expectations.
We expect domestic liquidity to further increase in the second half of
the year, despite the recent increases in the prime rate. This is mainly
because of the huge spread between deposit and lending rates, which
currently averages 21% for commercial banks.
MONETARY POLICY OUTLOOK
Pressure from the global food and energy price hikes has
strained the external position of the country. The economy’s
reserve position slipped to 2.7 months of import by April this
year, which is lower than the year open level of 3.42 months of
import cover.
Despite the favourable commodity prices, windfall gains from
cocoa and gold exports still lag behind the growth in crude oil
import bills for the country. This higher import bill is likely to
worsen the terms of trade position of the economy. Remittance
inflows continue to remain strong, increasing by 35% over the
first quarter of 2007 outturn to US$2,008.
The inflow of private international portfolio funds into the
country is likely to moderate in the second half of the year due
to the impending presidential elections. Investors usually hold
back their portfolio funds from (developing) countries during
the period of elections, and we expect the country to be
exposed to this risk in the second half of the year.
Total merchandise imports for the first quarter of 2008 was
US$2,273.9 million, which indicates an increase of 33% over
the outturn for the same period in 2007. Oil imports accounted
for 23% of the total import bill for the first quarter of the year,
which is higher than the 21% outturn for the same period in
2007. Non-oil import’s share of total merchandise import was
77% in the first quarter of 2008.
We expect the current account deficit to further deteriorate in
the second half of 2008. This is likely to be induced mainly by
the continuing global price hikes and expected increases in
domestic liquidity. Inflation concerns have led both the
European Central Bank and the Federal Reserve Bank of the
United States to increase interest rates.
Databank
Leadership
EXTERNAL SECTOR OUTLOOK

Savings in cheque now acceptable

2008-09-09T09:12:00.000-07:00

By Boahene Asamoah
Previously it was not possible for savings account holders to pay in cheques into their bank accounts at any of the commercial banks operating in the country., and this had posed great problems for businessmen who have transacted business and receive cheques for payments.
Now, most savings account holders who had encountered the difficulty of lodging cheques into their accounts will be smiling following a directive by the Bank of Ghana (BoG) that all banks in the country should accept cheques as deposits into savings accounts in order to stimulate and encourage sound financial services in the country.
A Deputy Governor of the bank, Dr Mahamudu Bawumia, who announced the directive in Accra at the inauguration of the EB-ACCION, a savings and loan company, stated that “from now on, if someone issues you a cheque, you will be able to deposit it into a savings account”.
Dr Bawumia described the practice where banks refused to accept cheques as deposits into savings as inimical to the opening of and operations of savings accounts.
“This practice is anachronistic and discourages the opening of and operation of savings accounts,” the deputy governor stated.
He said to encourage the unbanked and the underbanked public in the country, there was the need to review the Know Your Customer (KYC) policy of banks to take into consideration of the socio-economic environment.
Dr Bawumia stated that under the current situation, “many of the unbanked are turned away, because they are unable to produce evidence, such as proof of address or utility bill.”
The new KYC would encourage the least-income earners such as market porters or ‘kayayoo’ to get hooked into the banking system, saying the account opening procedures for people engaged in low-value transactions should be simplified.
“For these accounts, proof of residence such as utility bill, while desirable is not obligatory unless where the bank considers otherwise,” Dr Bawumia stated.
Turning his attention on the global oil and food prices, Dr Bawumia stated that the economy had been able to withstand oil prices of up to $147 per barrel.
Again, Dr Bawumia stated that Ghana was not the only country going through inflationary pressures and mentioned Chile, Turkey, South Africa and the US, Sweden, India and the Eurozone, which had all exceeded their inflationary targets by 216, 175, 171, 150, 115, 110 and 100 per cent respectively.
Ghana’s inflation target has been exceeded by 104 per cent.
“The major difference, however, is that while economic growth is slowing down in most of these countries, growth in Ghana is on the increase,” Dr Bawumia stated, adding that “it is important to recognise the role of fiscal and monetary policy framework supported by the structural reforms that have underpinned this performance”

GT bonds trade higher •Than the eurobond

2008-09-09T09:11:00.002-07:00

Read by bs
Gt Bond (fin)

Story: Boahene Asamoah

THE announcement of the take-over negotiations between Vodafone and Ghana Telecom (GT) has triggered a sudden interest in its bonds on the international financial market.
Information gathered from the international media show that since June this year, the price of the sovereign bond has declined, while the price of the GT bond has increased during the same period.
A sovereign bond is a debt security issued by a national government within a given country, while a corporate bond such as the GT bond is issued by corporate organisations to raise long-term debt financing.
According to analysts, the price increase was due to the perception that the current ongoing negotiation with vodafone would eventually lead to a deal favourable to GT.
Analysts also believe that the reason for the sudden interest in GT bonds by investors was due to the creditability and the financial muscle of Vodafone as well as in its image on the international market.
Graphs from Bloomberg indicate that the GT bond was trading on the international market much higher than the Ghana sovereign bond
The last recorded yields of the GT bond was 8.021 per cent, while that on the sovereign bond was slightly higher at 8.32 per cent.
In effect, GT was trading at a better yield than that of the Government of Ghana (GoG).
According to market watchers, there was, however, a caveat.
That the GT yield reflects a five-year instrument with an even much shorter average life of between two-and-a-half to three years.
According to the analyst, the maturity of the GoG bond is 10 years. For the same maturity or average life as the GT bond, the GoG bond would probably trade much lower than GT.
Reports from JP Morgan show they were arranging for the refinancing of the GT bond.
GT floated bonds worth $200 million from the international market last year to finance its projects in the country.
The GoG last year also sourced a sovereign bond worth ¢1.2 billion, which was oversubscribed.

Caption: a graph depicting the appreciation of GT bond on the international market.

Passion for Excellence

2008-09-09T09:11:00.001-07:00

abena amoah(fin)
Story: Boahene Asamoah

She is the embodiment of passion for excellence, hard work, dedication and commitment. She is also one of the youngest female CEOs in corporate Ghana to have emerged recently.
At 36, Ms Abena Amoah, the Chief Executive officer of Newworld Renaissance, a financial and investment banking firm, an affiliate of one of the world’s leading financial and investment banking firms has chalked a lot of first positions, through her academic and professional life in such a rather ‘ young life’.
Even after barely three months at her new post, she has led the team to transact the single largest transaction in a day in the history of the Ghana stock exchange, involving the transaction of $300 million in ETI shares on the July 25th 2008 trading on the floor of the Ghana Stock exchange.This transaction even surpasses the whole of the 2007 transaction on the Ghana Stock Exchange both in value and volume.
At a tender age of 27, whiles a national service person at Strategic African Securities (SAS), she ‘ cut her teeth ’ in what was then a new term to her, that is, ‘rights issue’ by leading a team that successfully raised $30 million for a rights issue and listing of additional shares of Accra Brewery Limited on the Ghana Stock Exchange. Ever since then, Abena has never looked back.
Abena swept all the awards at the School of Administration, now Ghana Business School, University of Ghana, Legon at the 1999 graduation which coincidentally also marked the 50th anniversary of the school.
She won the ‘Anim Addo Prize for the Best Graduating Student in Business School, the KPMG Prize for the Best Graduating Student in Business School, the Unilever Ghana Limited Award for the Best Graduating Student in Business School and the Volta Hall Alumnae Prize for the Best Graduating Student in Volta.
During her first year at the University, she had already showed great signs of brilliance, winning the Shell Ghana Limited award for the Best First year Student in Business School in 1994.
She was then given a scholarship to study at the University of Denver, Denver Colorado, for two years after which she came back to complete her first degree in Accounting and Finance at the School of Administration.
Before then, Abena emerged as the best Advance level student obtaining three A’s and a B in the Advance Level School examinations at the St Rose’s Secondary School. That also earned her a scholarship for a one-year AFS exchange programme to Iceland in 1992 to study for one year before coming back home to begin her tertiary education.
Indeed not until the ABL transaction was over, seasoned investment bankers she worked with on the deal did not know that Abena was a national service person.
As of today, Abena, has been involved in most of the landmark transactions on the Ghana Stock Exchange.
‘My drive is the satisfaction I derive from seeing a client happy. Being part of raising capital to help businesses grow’, she stated.
That was not all, ever since her 10 years stint with SAS, there is no major financial or major transaction on the stock market that Abena has not participated in.
‘It feels good to do successful transactions’, she stated, recounting with happiness the joy in seeing companies raise capital for their expansion programmes.
Talk about the $65 million rights issue and Listing of Ghana Commercial Bank last year. Abena stated that the GCB case was even peculiar.
‘It performance on the market has slumped’, she stated but due to the hard work Abena and her team did, the shares were oversubscribed by....
SAS were appointed lead managers and Co-sponsoring broker for the Initial Public Offer and listing of Ecobank Ghana Limited worth $10 million. That was also oversubscribed.
She was again involved in the issue and listing of $54 million shares of Total Petroleum Ghana Limited on the GSE as a result of merger of Total and Mobil.
One of her fondest memory was that Guinness Ghana Limited and the Ghana Breweries Limited, saying that that transaction generated a lot of issues and was a complex one. That was also one of the challenging moments in Abenaäs life.
Abena had to deal as she stated with a lot of stakeholders, but admitted that she learnt a lot on regulation on investments in the country, from both parties, shareholders and issues that had to deal with the structuring of the offer.
‘That deal was a landmark transaction’, she stated.
Other deals included the $10 million Ghana IPO and $700 million listing on TSX and AMEX, where SAS were the financial advisor and sponsoring broker, with Abena leading the deal. That was another success story.
Abena love for her passion was not coincidental. After graduating, she was a ‘hot cake’ for most of the multinational companies because of her academic brilliance. She turned job offers from Unilever and KMPG among many other offers.
Although, she knew little about stock market and investments analysis and rights issues, she turned down many offers to join SAS, then a growing company.
She recounted that a friend introduced Mr James Akpo now Togbe Afedi to her in 1999 and after a two-hour meeting, she was offered a job the next day.
‘I was inspired about the vision and direction of Mr Akpo’, she stated.
Much to the displeasure of her parents, who had hoped Abena would join one the multinational companies, Abena rather choose to start ‘small’ and after ten years, she has achieved a lifetime dream.
‘Everyone thought I was crazy choosing SAS, a relatively young and private company’, she stated.
She remember when she had to work late and the parents had to complain why she was working so late.
For the ten years that she stayed at SAS, she rose quickly from Investments Analyst and broker to become the Executive Director of SAS. She was promoted every eight months due to her hard work and professionalism.
It is no wonder that Renaissance Group, head-hunted Abena to head its operations in Ghana.
Today, she supervises over a group of talented professionals taking major corporate decisions and transactions in the country.
Among her many other accomplishements, she serves as a director of the Venture Capital Trust Fund, Director, the Ghana Stock Exchange, Assessor (capital Market experts), Commission Division of the High Cour of Ghana, Accra, Executive member of the Ghana Securities Industry Association.
Abena was also a Governor of the Millennium Excellence Awards in 2005.
In 2006, Abena was awarded the Newmont Gold Ghana Highest Award for Excellence (National Youth Excellence Awards).
She said it is good news for Renaissance to turn its investments to Ghana especially now that the GSE is presently the best performing market.
Indeed, Abena’s profile is very impressive for such a young lady.
She has served as capital market advisor to the SEC, GSE and even the Ministry of Finance and Economic Planning,
Abena has offered business development projects advise especially to the Golden Jubilee Bonds and the Ghana Educational Loans.
Her passion for the growth of the capital markets in the country had led her to host the television programme ‘Investments Digest’ which is being aired on GTV.
But Abena’s life is not all work, she has a soft side. Her first national service in 1994 after Advance level school certificate was at the Princes Maria Louis Hospital, in the heart of Accra has led her to have a kind heart for needy children.
She still find time in spite of her busy schedule to do some charity work for the hospital and describes herself as Ghanaian, refusing to be associated with any tribe in the country.
She has been involved in touring some senior secondary schools in the country to educate them on investments.
Abena is the first born of five children born to Mr and Mrs David Amoah, which is made up of four female and one male.
Having gone through such an elaborate professional training and carrier challenging jobs, is it any wonder that Abena is a success in today’s corporate Ghana. She is certainly a role model worthy of emulating.

Inflation closes at 18.31%

2008-09-09T09:09:00.000-07:00

Story: Boahene Asamoah & Sahadatu Atintande

THE Consumer Price Index which measures the rate of price increases over time has for the first time this year shown a marginal sign of decline.
The rate fell by 0.1 percentage points from 18.41 in June to 18.31 per cent for the July figure.
Announcing the figures for this month, the Deputy Government Statistician, Prof Nicholas N.N. Nsowah-Nuamah, attributed the marginal decline in the inflation rate to the low prices of food.
The rate of inflation which had been rising since January this year had seen the figures increased from 12.8 per cent in January to 13.2 per cent in February and 13.8 per cent in March. In the month of April the rate went up to 15 .3 per cent while in May the rate stood at 16.88 per cent.The figures for June closed at 18.41 per cent.
Prof Nsowah-Nuamah said the rate continued to be higher for the non-food group than for the food group.
He said the non-food group which was 14.40 per cent in January this year increased to 18.97 per cent in July and contributed 2.59 percentage points higher than that of the food group.
The Deputy Government Statistician did not rule out the government’s policy intervention announced in May as a result of soaring food prices as a factor in the lower prices of the food component of the index.
He said the monthly changes in the CPI from the previous month to the present recorded a rate of 1.08 per cent in July this year, which is the lowest monthly rate since January.
Prof Nsowah-Nuamah added that the change in the monthly inflation rate increased from 1.17 per cent to 3.20 per cent between January and May, and declined in June at a rate of 2.06 per cent.
On the regional inflation figures he said Ashanti Region recorded the lowest inflation rate of 12.96 per cent, while the Central Region recorded the highest rate of 27.95 per cent with six regions recording inflation rates above the 18.31 per cent national rate.
“ The inflation rate in the rural areas is significantly higher at 23.77 per cent than the urban areas which records an inflation rate of 13.68 per cent. This however, does not mean that prices of goods in rural areas are higher than in urban areas” he said.??????????

Citi Bank, GIB, ADB sign $60m pact

2008-09-09T09:08:00.000-07:00

From the Business Desk

Citi Bank and the Ghana International Bank (GIB) have signed a two-and-a-half year $60 million structured remittance-backed term loan facility with the Agricultural Development Bank (ADB) of Ghana.
A statement issued by Citi said the purpose of the facility was to fund certain aspects of the ADB’s requirements to promote agricultural and other exports from Ghana within the overall implementation of the country’s National Agriculture and Export programmes.
It said ‘this landmark transaction is the third structured term facility that Citi has arranged for the ADB, following successful transactions in 1998, 2003 and 2005.
The 2005 facility was a US$40 million remittance backed transaction that was credit enhanced through Western Union workers remittances. The proceeds of the 2005 facility were also used towards financing the Agricultural Development Bank’s end-user foreign exchange requirements for agricultural usage in Ghana.
Ghana International Bank plc has had a long and close working relationship with ADB spanning several areas of international banking, including trade finance, cash management, treasury services and transaction services.
Commenting after the signing of the facility, Joe Mensah, Ghana International Bank plc’s Managing Director, said: “We are pleased to have been mandated jointly with Citi to arrange this landmark deal which acts as a catalyst to the growth of the Ghanaian economy, and we see it as a logical step in the development of our relationship and commitment to ADB.”
Citi’s representative office in Accra was opened in October 2002. Supported by Citi’s global footprint, it offers advisory and execution services for the full range of structured finance and debt products, and its Global Transaction Services unit offers trade services and finance, cash management and treasury services, including derivatives and foreign exchange.
Citi has received numerous awards, including Best Debt House, Best Investment Bank and Best Cash Management in Africa from Euromoney magazine.
“Citi is proud to be associated with this successful transaction which promotes the continued development of Ghana’s vital agricultural sector. Citi's commitment to Ghana also includes charitable and voluntary work funded by the Citi Foundation. This $60 million term facility to Agricultural Development Bank (ADB) adds to this positive history of collaboration, and allows ADB to further intensify its support to the agricultural sector in Ghana" said Joseph Carasso, Citi Country Officer for Ghana.

ETI launches public offer

2008-09-09T09:07:00.000-07:00

Story: Boahene Asamoah

ECOBANK Transnational Incorporated (ETI), a pan-African Bank, will next Monday launch Africa’s biggest and first regional public offer and rights issue to raise $2.5 billion for its African expansion programme.
This follows the completion of board meeting of the directors of ETI in Accra on Monday and approval received from the three stock exchanges on which the bank is listed and securities regulatory bodies in those countries.
These are the Ghana Stock Exchange, the Nigeria Stock Exchange and BRVM of Cote d’Ivoire.
The offer includes a rights issue of 3,763,759,981 shares at $0.27 per share, which constitute 40 per cent or $1 billion, while the remaining $1.5 billion would be raised through an offer for subscription at $0.029 per share.
Shareholders at the annual general meeting held in Accra early this year approved the board decision to raise $3 billion to finance its expansion programme, as well as capitalise some of its operations in Accra.
The bank currently operates in 25 countries and has targeted 22 more countries in central and southern Africa.
At a press conference to announce the completion of the board meeting, which attracted both local and international media, the Board Chairman of the bank, Mr Mande Sidibe, stated that “the offer will be used to further strengthen Ecobank’s accelerated growth plan to expand its network of branches in countries where it currently operates”.
He said the exercise would offer Africans the opportunity to own part of the African bank and ensure that the bank remained an African company.
He said over the past years, the company had seen outstanding performance of the bank and urged the investing public to buy shares in the bank.
The group Chief Executive Officer of the bank, Mr Arnold Ekpe, stated that the company aimed at attracting both Africans and Africans in the Diaspora and other investors in the world.
He said the amount raised would not only go into expansion of its network in Africa but also to capitalise some of its operations on the continent.
The rights issue and the public offer are at discounts of 20 per cent and 12.5 per cent respectively over a period of six weeks.
Ecobank Nigeria Plc, Stanbic IBTC Bank Plc and CIMG Securities Limited are joint issuing houses to the offer in Nigeria, while Ecobank Development Corporation (EDC) and First Africa SA (Pty) Limited are the financial advisers to the offer in all the three markets.

ETI launches Africa's biggest public offer

2008-09-09T09:06:00.000-07:00

Story: Boahene Asamoah & Gifty Appiah

ECOBANK Transnational Incorporated (ETI), yesterday launched Africa’s biggest rights issue and public offer to raise $2.5 billion for its expansion programme.
The landmark transaction in the history of Africa share offer and rights issue was simultaneously launched in 25 African countries and is also the first-ever cross-boarder transactions on three stock exchanges in Africa.
These are the Ghana Stock Exchange, the Nigeria Stock Exchange and BRVM of Cote d’Ivoire.
The transaction consists of $1 billion rights issue and $1.5 billion offer for subscription.
This constitutes a rights issue of 3,763,759,981 shares at $0.27 per share, which constitute 40 per cent or $1 billion, while the remaining $1.5 billion would be raised through an offer for subscription at $0.29 per share.
Launching the prospectus of the offers in Accra, President John Agyekum Kufuor in a speech read on his behalf by the Minister of Finance and Economic Planning, Mr Kwadwo Baah-Wiredu, acknowledged the immense contribution of the banking sector to the development of the economy.
“Government is proud to be associated with Ecobank as it continually seeks to contribute to employment in the country by positioning strategic affiliates in Ghana notably the EB-Accion, which is dedicated to micro finance, Ecobank Development Corporation which is the regional investment wing of the whole group and Ecobank Ghana which is a universal bank with a special focus on retail banking,” President Kufuor stated.
President Kufuor also acknowledged the establishment of the bank’s shared services centre in Ghana to process all the back office activities of the 25 countries in which the bank operates.
He assured the banking industry that the government was committed to the development of the capital market in the country, alluding to the listing of SIC and GOIL to underscore the government’s commitment.
“Government intends to continually improve the economic environment to enable the banking sector to thrive and thereby improve funding to the private the sector substantially,” President Kufuor stated.
The Managing Director of Ecobank Development Corporation (EDC), lead managers of the transaction, Mr Mike Ashong, who gave an overview of the offer, stated that the bank sought to raise $500 million from the debt market in addition to the $2.5 billion to be raised on the capital market.
He said the transaction was a landmark one, being the first company to list on the three regional markets in West Africa.
Mr Ashong said the company had satisfied all the regulatory requirements from the three stock exchanges, as well as other regulators, and assured investors of value for their money should they invest in the company.
He said 52 per cent of the amount to be raised, which is $1.4 billion, would be used to capitalise existing subsidiaries, adding that “it is the vision of the bank to be among the first three banks in each market we operate”.
The remaining amount, he said, would go into acquisitions and branch expansion into new markets, and upgrade the groups technology.
The Managing Director of Ecobank Ghana Limited, Mr Samuel Ashitey Adjei, stated that the bank was committed to Africa hence its strategy to expand its operations to other parts on the continent.
Shareholders at the annual general meeting held in Accra early this year approved the board decision to raise $3 billion to finance its expansion programme, as well as capitalise some of its operations in Accra.
The bank currently operates in 25 countries and has targeted 22 more countries in central and southern Africa.
The rights issue and the public offer are at discounts of 20 per cent and 12.5 per cent respectively over a period of six weeks.
Ecobank Nigeria Plc, Stanbic IBTC Bank Plc and CIMG Securities Limited are joint issuing houses to the offer in Nigeria, while Ecobank Development Corporation (EDC) and First Africa SA (Pty) Limited are the financial advisers to the offer in all the three markets.

Provide useful information on economy, Baah Wiredu

2008-09-09T09:05:00.002-07:00

Story: Boahene Asamoah

THE Minister of Finance and Economic Planning, Mr Kwadwo Baah-Wiredu, yesterday launched the Graphic Business paper and challenged the publishers to use the medium to provide useful information on the economy to the people.
He mentioned the rapid expansion of banks, resulting in the opening of several branches in the country, and the construction boom being experienced in the country and added that ‘these reflect real development of the economy, which the people must be informed about in order to appreciate the strides that the country had made over the past decade.
Delivering the keynote address at the launch of the paper in Accra, which is the eighth title of the Graphic Communications Group Limited (GCGL), Mr Baah-Wiredu said “the time is ripe for a credible paper on business and finance from a credible newspaper”.
The minister said Ghana had recorded positive developments in the economy in spite of the global soaring oil and food prices and stated that “the economy is growing”.
He charged GCGL to endeavour to make the business newspaper the reference point for business people in West Africa and beyond.
He also called on the publishers to extend the same level of credibility, factuality and accuracy associated with its other seven brands to the Graphic Business.
The minister praised the management of GCGL and described the company as “a model of State-Owned Enterprises (SOE’s) that have consistently been profitable”.
He mentioned the increase in payment of dividends yearly by GCGL as very “handsome” and expressed the government’s appreciation to the board and management of the company for their performance.
The President of the Association of Ghana Industries (AGI), Mr Tony Oteng-Gyasi, who chaired the function, stated that there was the need for the media to extend what they had done for civil liberties of the ordinary Ghanaian to support the growth of the business sector.
He said the paper should go beyond the mere reporting of news to analyse the news to make it relevant to the business community.
Mr Oteng-Gyasi, however, did not doubt the ability of GCGL to extend its market leadership in news to cover the business and economic news and analysis.
The Managing Director of GCGL, Mr Ibrahim Mohammed Awal, assured the gathering that the company had assembled some of the best human resources in business and financial reporting.
He said the company would partner business to develop and grow as the country was poised for growth.
Mr Awal said with foreign direct investments at record highs, gross domestic product growing and also a growing confidence in the business sector, there was the need to provide the investors and business people with the relevant and timely information to make investment decisions.
The President of the Advertisers Association of Ghana, Mr Reginald Laryea, was optimistic that the new paper would give advertisers other options to reach out to niche market.
Mr Sameer Gupta, Managing Director of Honda Place, the major sponsors of the launch, said they were happy to be associated with the newspaper in light of the potential it holds.
He said the company as part of its efforts to support the paper had offered a 10 and 20 per cent discount respectively on any Honda and Audi vehicle for anybody who buys the paper until the end of September, 2008.
A representative of Ghana Commercial Bank, Mr Lord Badu; the Managing Director of Primex Ghana Limited, Mr Annu Gupta; and Mrs Pearl Essah-Mensah, the Finance Director of UT, all expressed their support for the paper.
The first copy of the paper was auctioned for GH¢2,000 and was bought by Mr Sameer Gupta. Mr Kwadwo Baah-Wiredu initialled the first 10 copies of the paper, which were auctioned by Mrs Naa Norkor Duah, Chief Executive Officer of Lowe Lintas.
The GCGL launched the paper to demonstrate its commitment to meeting the increasing need for a newspaper dedicated to the business community.

Intercontinetal Bank to increase branch network

2008-09-09T09:05:00.001-07:00

Story: Boahene Asamoah

INTERCONTINENTAL Bank, Ghana Limited, has said it hopes to double its branch network from the present 10 to 20 branches by the end of this year.
These branches would include two new branches at Tarkwa and Takoradi in the Western Region and eight more branches in Accra and other strategic locations in the country.
This was contained in the annual report of the bank for the 2007 financial year released to the press.
According to the report, the bank recorded a a profit of GH¢146,070, whiles the bank’s balance sheet also increased to GH¢98.7 million from GH¢19.6 million recorded in the previous year.
Profit after tax increased from a loss of GH¢693,687 in 2006 to GH¢127,307 for the year under review.
In his report, the Managing Director of the bank stated that ‘there is no doubt that this year we want to clearly take our deserved position as a leader in the industry’.
He stated that all the bank’s growth plans are to be vigorously pursued with all the necessary staff motivation benefits introduced.
The bank said to ensure high calibre of staff and professionals, the bank had trained nine senior staff in top European training institute as well as 129 staff locally to deliver quality service and sharpen their skills in various disciplines.
Again, 29 staff members were promoted to higher grades to motivate them.
The company presently employs 405 staff in Ghana, 14 of whom are expatriates.
The company last year undertook a re-branding strategy and launching of the new corporate logo.
On its social responsibility, the bank supported a number of initiatives, including the construction of the multi-purpose car park at the Ohene Gyan stadium to host the African Nations at the cost GH¢410,000.
The bank also supported the Southern Command of the Ghana Armed Forces in its awards to its outstanding soldiers and also a hole-in-heart patient at the Korle-Bu Teaching Hospital.

2008-09-09T09:04:00.001-07:00

Story: Boahene Asamoah

‘BUILDING a pan-African bank is our core strategy’, says the Chief Executive Officer of Ecobank Transnational Incorporated (ETI), Mr Anorld Ekpe, who is spearheading Africa’s multi-national bank.
Yet, Arnold remains humble and would rather attribute the success chalked by the bank during his time as the CEO so far to what he described as ‘a good team work’.
‘I am working with a dedicated team of professional who are passionate and committed to Africa’, he stated.
Mr Ekpe suggests that the achievement by the Pan-African bank and Africa’s own global bank is also partly due to the foresight and vision of some his predecessors, adding that ‘I have been lucky to be working with a good team of professionals’.
‘I came it at time when the group wanted to re-launch its growth strategy and expand into other African countries’, he said.
Today, that transformation has seen the bank move from 13 countries in 2006 to 25 countries at the first half of 2008, employing over 14 nationals with a workforce of 10,000 people across Africa.
Trained as a mechanical engineer, he also has a second degree in Banking and Finance, from the Manchester University in the United Kingdom and has a wide experience in banking and finance having worked for ten years with Citibank as head of Corporate and trade finance in Africa.
He described his relations with Ecobank as a ‘love story’, having joined the bank in 1996, left in 2001 and came back in 2003 as its group CEO.
Mr Ekpe and his team of executives have transformed the bank from purely a regional bank to become the biggest bank in Africa in terms of reach, with presence in over 25 countries.
The bank under his leadership was the first to list on three stock exchanges in Africa, propelling other banks in the sub-region to also look beyond their countries.
Today Ecobank is blazing the tale and has set its eyes to become the household name in Africa.
‘We have a dual mission, first, to build a world class pan African bank and secondly to help African economies to grow’, he stated.
The bank has chalked a number of success under the transformational leadership of Arnold and his team.
The recent is the landmark transactions believed to be Africa’s biggest rights issue and public offer to raise $2.5 billion for its expansion programme.
The landmark transaction in the history of Africa share offer and rights issue was simultaneously launched in 25 African countries and is also the first-ever cross-boarder transactions on three stock exchanges in Africa.
These are the Ghana Stock Exchange, the Nigeria Stock Exchange and BRVM of Cote d’Ivoire.
The transaction consists of $1 billion rights issue and $1.5 billion offer for subscription.
This constitutes a rights issue of 3,763,759,981 shares at $0.27 per share, which constitute 40 per cent or $1 billion, while the remaining $1.5 billion would be raised through an offer for subscription at $0.29 per share.
Arnold thinks, what he and his team are pioneering is nothing new but rather what the team has learnt from other global banks like HSBC and replicating such strategies in Africa.
He dismisses suggestions that the rights issue and public offer were ambitious saying, ‘three years ago when set our strategy to be in 20 African countries by 2009, back then it seemed ambitious, but today, we are in 25 countries, doubling the size of our workforce and helping African economies’.
‘We have to think big’, he stated and added that ‘We have not lacked ambition.
The bank during the past three years has made investments in other subsidiaries. Earlier this year, the bank opened its $100 million shared service centre in Accra to process the group’s back office activities.
It has also established the Ecobank Development Corporation, the investment wing of the group, as well as partnered Accion in setting up the micro-finance unit across the group.
‘Africa is our strategy’, he reiterated and explained that the group commitment to Africa was to ensure its operations were not closed down even in times of civil unrest as other businesses do.
Again, he said
One of the challenges Mr Ekpe has come to terms with at the top of the corporate ladder, he stated, is managing growth, getting the right people, service quality and culture as some of the major impediments that confront corporate leaders.
Arnold Ekpe who won African Business Leader of the Year award for last year, says Africa does not lack quality human resources capable of transforming organisations, but was quick to state that ‘some people are born ahead of time, while others live past their time.
In all his accolades, Arnold, remains a simple man and an affable personality and says Africa has good prospects, alluding to the improved good governance in most African countries, relatively stable and growing economies and an emerging middle class that offers tremendous opportunity for the bank.
Arnold prefers to have his private and family life ‘private’.

Economy should trible to achieve middle income status

2008-09-09T09:03:00.000-07:00

Story: Boahene Asamoah

GHANA’s rate of growth should increase by threefold in order to hit a per capital of $815 and $1020 by 2010 and 2012, analysts have predicted.
Ghana’s rate of growth has increased from 3.7 per cent in 2000 to 6.4 per cent by the end of last year.
The government has projected a per capital income of $1,000 by 2015, but analyst from Renaissance Capital thinks, Gross Domestic Product (GDP) growth has to triple to attain this feat.
The economy has been robust according to analyst and these robust growth if triple would deliver the increased in per capital income.
‘Furthermore, we think the $1,000 threshold in income per capita will represent an important pschological boost at a time when oil production starts accelerating structural change’, the analyst said.
However, a rise in GDP capital may not be fully indicative of actual income dynamics as a result of endowment differentials, notably in countries with small populations or oil exporters, leading in some cases to inflated GPD per capital levels.
According to Rennaissance Capital, in termsn of inequality, Ghana’s Gini Coefficient stands at 40.8 on a scale of 100, that is Ghana is ranged 135 among 177 countries.
This is far below most Sub-Saharan African countries having a relative level of development, but well above the level recorded in the developed world.
Research has revealed that recent economic reforms have sustained the consolidation of a domestic middle class which would become more evident when the results of new surveys are released in the future.
According to the United Nations Development Programme(UNDP), Human Development report for 2007-2008 shows cross-country comparisons were undermined by difference in survey methodology as well as the lack of updates since 2000’s.
The report reveals that Ghana has one of the lowest shares of income held by the 10 and 20 per cents richest segments of the population in the group of the SSA frontier markets.
The growth rate for Ghana is expected to hit seven per cent by the end of the year, but analyst expect that target to be review downwards.
The rise food and oil prices have taken a serious hit at the economy threatening the macro-economic stability.
However, government officials maintain the economy has been robust in the face of the global world crises.
Inflation has soared but has recently shown signs of marginal decline.
There is a large number of informal sector operators which constiute a huge number of people and as a result any increase in per capita income would only affect the small middle class and may not be indicative of a real growth in GDP.

CPC to operate second factory by the end of the year

2008-09-09T09:01:00.000-07:00

CPC (fin)

Story: Boahene Asamoah

COCOA Processing Company (CPC) exporters of cocoa liquor, cake and butter says its rehabilitation works on its second factory would be completed by the end of the year.
The rehabiltation of its old factory which was expected to have been completed in my middle of this year had to be postponed because of the inability of the West African Pipeline project which was expected to power the new factory.
The expansion works on the second factory constitued an upgrade of the old factory to modern standards which would increase its current capacity to from 25,000 tonnes to 34,000 tonnes.
The company last year completed the first phase of its expansion work which saw the installation of a new modern cocoa milling plant with a capacity of 30,000.
The complete expansion works would move the company’s total production capacity to about 65,000 tonnes per annun and generate over $100 million in revenue.
Speaking in an interview the Managing Director of the company, Mr Richard Armah-Tetteh, said as a result of the non completion of the West African Gas Pipeline an alternative arrangement has been made to procure a steman coil to power the factory.
The company as part of its expansion programme contracted a 22 million euro for its expansion works and a another $22 million for the rehabilitation and civil works.
‘Our aim is to be build a world class factory site comparable to any other factory in the world’, he stated.
Mr Tetteh added that the rehabilitation also includes the rehabilitation of the confectionery section to upgrade its capacity to about 3,000 metric tonnes per annum from the current 1,600 metric tonnes.
The company is currently replacing old machines with new ones.
He said there has been tremendous increase in the demand for confectionery products of the company over the past few years.
‘The Ghanaian market is expanding greatly and we need to position ourselves to take advantage of that to make the products available,’ the managing director stated.
He said to ensure availability of the its confectionery products the company has in collaboration with the Ghana Cocoa Board established a shop at the refurburshed Cocoa Houset to provide a one-stop shop for both wholesellers and retailers as well as servce as the marketing information centre.
Additionally, the company has opened new depot in Kumasi and Takoradi as part of efforts to promote its finished products.
Mr Tetteh said ‘our long term vision is process 60 per cent of the raw materials’, noting that the finished products are the high earning products.
He said the company has also embarked on a diverisfication of the markets for its products to new market areas such as Asia, Eastern Europe and other African countries.

Value addition to spur cocoa growth

2008-09-09T09:00:00.000-07:00

Boahene Asamoah examines the government’s policy to process about 40 per cent of cocoa products locally and the response of the policy by some foreign firms.

The government over the past few years announced a policy to process over 40 per cent of cocoa production locally in a bid to add value to the raw cocoa beans being exported.
Ghana’s cocoa is of premium quality on the international market, but it is the value addition that is the high earn value of the cocoa business.
Ghana exported about 730,000 tonnes of cocoa beans out of which about 13 per cent of total production are processed into semi-finished products such as cocoa liquor, butter and cake.
Again, out of the total cocoa production, only one per cent are processed into finished products such as chocolate, and other confectionery products.
Until recently, the West African Mills (WAMCO) in Takoradi, Cocoa Processing Company (CPC) and Barry Callebaut were the only major companies producing semi-finished products on large scale for exports.
However over the past three years, these companies have made significant investments into their operations and has subsequently increased their capacity, while new entrants have taken advantage of the government’s policy.
CPC has embarked on an expansion programme that would see its production capacity increased to 64,500 metric tonnes of cocoa powder, liquor and cake.
Barry Callebaut is also undertaken a expansion programme that would double its capacity to 60,000 metric tonnes per annum.
WAMPCO capacity has increased tremendously ever since it was divested and currently has a capacity of 80,000 metric tonnes.
New companies such as Gergens Cargilm, ADM, Afrotropic and Commodity processing are currently putting up capacities of 60,000, 60,000 15,000 and another 15,000 metric tonnes respectively to process raw cocoa into semi finished products such as cocoa butter, cake, powder and liquor.
So far Afrotropic and Commodity Processing Industries which is joint venture between some Ghanaians and their foreign partners are reported to have started operations.
Cargil and ADM which are part of a multi-national companies are expected to begin operations by the end of the year. These companies however, do process for their mother companies in Europe and America.
According to some industry experts, there is growing cost of processing raw cocoa beans in the developed countries and thereby many cocoa producing firms are looking towards Ghana to process cocoa for the european and the US market.
Again the emergence of of the Asian tigers especially China and India has stimluated the demand for cocoa products especially from Ghana and West Africa.
Ghana’s cocoa enjoy’s high patronage especially in Japan and other Asian countries. The industry presently is receiving very significant private investments and become vibrant.
The combine production of these companies is expected to reach 354,500 tonnes by the end of next year, nearly 50 per cent of total production.
However, some industry experts say the rising cost of cocoa price on the international market is source of concern for local processing companies.
Cocoa sales in Ghana are effected on contractual basis for future delivery and such products compete with other products from other major cocoa producing countries such as Cote d’Iviore, Cameroun, Brazil, Malaysia and Indonesia.
Cocoa prices on the international market currrently stands at $2,862 per metric tonne, the same price local processing firms have to pay for cocoa beans.
Cocoa has been grown in Ghana since the mid 19th Century.
Processing of cocoa in the country however, started in 1947 at the Cocoa was first exported at the end of the 19th century, and between 1911 - 1976 Ghana was the world's leading producer, contributing between 30-40 per cent of the world' s total output.
There are currently around 1.6 million people involved in growing cocoa and many more in associated industries.
In the late 1970s the world market price for cocoa plummeted by two thirds. Ghanaian cocoa farmers were getting less than 40 per cent of the world market price from Cocobod and so many stopped producing cocoa altogether.
The situation worsened after the droughts and accompanying bush fires of the early 1980s and production in Ghana fell from a third of the world's total in 1972 to just 12 per cent of total world production.
At this stage the World Bank and International Monetary Fund intervened with a Structural Adjustment Programme to "rescue" the economy.
Today the government offers over 70 per cent of the producer price to cocoa farmers.
Production of cocoa have soar on account of government intervention in the form of mass spraying of cocoa farms throughout the country since 2002, hitting record highs in 2005.

More investments means more risk

2008-09-09T08:59:00.000-07:00

Many investments firms are turning the eyes on emerging economies as mature markets offer little investment returns Boahene Asamoah examines the Renaissance Group, as its founder and CEO paids a working visit to Ghana today (Tuesday September 9)
Stephen Jennings, CEO of Renaissance Group

The founder and Group Chief Executive Officer of Reniassance, the World’s leading investment banking firm, Mr Stephen visits Ghana as part of the group’s investment drive in Africa.
His visit to Ghana comes at a time when the group had recently opened a full time office in Ghana and also at a time when Ghana was increasingly becoming an investment detination within the sub-region of West Africa.
Mr Jennings is here to meet key policy makers, financial markets regulators and industry and business leaders in Ghana.
As one of the founders of Renaissance Capital in 1995, Mr. Jennings has been actively involved in building the firm's investment banking and securities sales and trading businesses.
He played a key role during the early years of the Firm's development, including serving as Head of Investment Banking, Head of Sales, and Chief Operating Officer.
Prior to establishing Renaissance Capital, Mr Jennings served as Co-Head of Credit Suisse First Boston (CSFB), Moscow from 1992 to 1995.
He was directly responsible for Credit Suisse First Boston's investment banking during a period when CSFB was recognised as the dominant market player in developing and executing pioneering transactions in the Russian marketplace.
He has worked on numerous landmark financings and M&A transactions in Russia and throughout the CIS, many of which have won professional awards and commendations.
Before coming to Russia in 1992, Mr. Jennings was with CSFB in London, where he worked on investment banking and privatisation transactions in Central and Eastern Europe. Previously, he worked for Credit Suisse First Boston and the Treasury in New Zealand
Mr. Jennings earned his Bachelor of Business Studies degree from Massey University and holds an M.Phil. in Economics with first class honours from the University of Auckland.

Renaissance Group is the number one financial institution in Russia and the former Soviet Union. The Group's core business is Renaissance Capital, a full-service investment bank founded in 1995 with leading market positions in Middle East and Africa and other markets and research.
The group also includes several other businesses, all of which are leaders in their fields: Renaissance Investment Management (asset management for institutions and high-net-worth individuals), Renaissance Credit (consumer finance), Renaissance Partners (merchant banking/private equity), and Renaissance Online (online trading platform).

Renaissance Group which is headquartered in Moscow has in the past several years, expanded to other high-opportunity emerging markets including neighbouring Ukraine and Kazakhstan, where the firm has similar market-leading positions in investment banking, asset management and consumer credit.
Over the last two years the Group has also aggressively expanded into sub-Saharan Africa, quickly becoming a leader in rapidly emerging markets like Nigeria and Kenya.
The groups’s unique strength is in combining hard-won and detailed local market expertise with very highest standards of operational and regulatory efficiency and integrity.
In Africa the group has expanded over the past 18 months to employing more than 150 people on the ground in last 18 months.
Operations across sub-Sahara including Nigeria, Kenya, Ghana, Zambia, Zimbabwe and South Africa.
The group currently has $6.5 million of funds unde management, and saw a nearly 100 per cent growth in assets.
The group is also a major issuer of credit cards, with more than 12,000 credit issurance centres with a total clientele of over two million customers.
Renaissance Group has built the largest and most experienced team of world-class market professionals dedicated solely to Sub-Saharan Africa and has created a fully-fledged investment banking, asset management and merchant banking operation run by Africans in Africa in the space of just two years.
Renaissance Investment Management's Africa Fund which was launched in 2007, had assets under management of approximately $110 million as of the end of June this year and is committed to bring this up to more than $200million by the first quarter of 2009.

Insurance Awards launched

2008-09-09T08:58:00.000-07:00

Story: Boahene Asamoah

INDUSTRY players in the insurance sector are gearing up for the maiden edition of an insurance awards based on customer survey as the Ghana Insurance Awards will be launched today.
The Ghana Insurance Awards awards which is modelled alongside the Ghana Banking Awards is the initiative of the Corporate Initiative Ghana (CIG) and supported by the Ghana Insurers Association, which is the umbrella organisation of all the insurance players in the country.
The awards comes at a time the insurance sector is attracting investments and transformation in the country.
The awards which is customer driven will give awards in 16 categories and would involve the interview of both corporate and individuals over a sample size of about 3,000.
According to CIG, the organisers of the awards, the insurance awards was part of its vision to enhance financial service delivery in the country.
Having organised successfully seven Ghana Banking Awards, CIG is set deliver yet another prestiguous awards in the insurance industry.
The collaboration with GIA is supported by the Graphic Communications Group, which has been a major sponsor of CIG awards over the past four years, Metro Television and JOY FM.
The Institute of Statistical, Social and Economic Research (ISSER) are the events stastician for the the first ever insurance awards.
To ensure transparency in the award categories, a Technical Committee made up of representatives of all participating insurance companies, members of CIG and also ISSER has been be set up to examine into details and agree on all aspects of the Approach and Methodology to be employed for the awards.
The committee members will comprise senior management personnel of all the insurance companies.
Copies of the approved approach and methodology document shall be presented to all CEOs for their further study.
For this year, the award which is expected to come off in October will coincide with the insurance week where deserving companies in the insurance sector would be awarded in various categories from the perspective of the consumer.
The launching of the awards marks the first step in process leading to the awards.
Members of the committee would further have a look at the awards and the survey and administration of questionaire is expected to start after the final review of the approved methodology.

Intercontinental Bank opens London office

2008-09-09T08:57:00.000-07:00

Story: Boahene Asamoah
Intercontinental Bank, one of Nigeria’s financial institutions, has opened its first European office in London.
The opening marks the bank’s continued international expansion that began in 2006 with the opening of Intercontinental Bank Ghana Limited
“The opening of the London office — the first outside of the African continent — signals our continued commitment to emerging as one of the top 100 banks in the world,” said Group Chief Executive for Intercontinental Bank, Dr Erastus Akingbola.
“Our London subsidiary will enable Nigerians, other nationals and organisations within and outside of the United Kingdom to execute seamless financial transactions in the UK,” he stated.
The London location will offer wholesale banking services in the UK, including trade services business such as letters of credit, collections and guarantees, structuring and funding of structured trade, and project finance transactions, as well as arrangement of funding for group entities.
“A London presence is critical for the bank’s future expansion and will allow the organisation to capitalise on opportunities in all segments of our business, both retail and wholesale,” said the CEO of Intercontinental Bank UK, Marcus Hopkins.
He said, “We are confident that the bank will be a valuable addition to the London banking landscape, continuing its mission to help its stakeholders build and preserve wealth”.
Intercontinental Bank currently operates more than 300 business offices in Nigeria with its first subsidiary in Ghana, which was established in 2006 and currently operating with 11 business offices in key commercial centres. The Ghana Subsidiary also operates three agencies.
Intercontinental Bank Plc was founded in 1989 as Nigerian Intercontinental Merchant Bank Ltd, and is today, one of Nigeria’s largest diversified financial services companies with subsidiaries in capital market, insurance, stock broking, discount house, finance and mortgage activities.
Intercontinental Bank is in partnership with BNP Paribas, one of the 10 largest banks in the world, and cooperate in areas of trade finance, asset management and product innovation. The bank’s shareholders’ fund of approximately $1.52 billion is the largest such fund in the Nigerian banking system and in the top five in Africa.

Review compensation Law- Joyce Aryee

2008-08-11T03:27:00.000-07:00

Story: Boahene Asamoah & Ryan Knutson

THE Chief Executive Officer of the Ghana Chamber of Mines, Ms Joyce Aryee, has called for a review of the compensation law that would ensure a sustainable livelihood of people affected by the activities of mining.
She said “ compensation should not only be monetary, but should include land”.
Speaking at the launch of the advocacy programme on the Establishment of Standards of Compensation on Mining concessions, she said there was the need to look at what she referred to as the “social dimension” of compensation.
The six-months advocacy programme, which is being funded by the Business Sector Advocacy Challenge Fund (BUSAC), is aimed at amending the mining law to ensure standards in compensation for mining lease.
The current mining law of 2006 leaves the negotiation of compensation to the parties involved and does not offer a standard compensation plan.
Ms Aryee stated that in most cases, the monetary compensation did not adequately cater for the needs of the people and stated that the mining law did not provide alternative lands as a form of compensation.
Ms Aryee stated that “ the Minerals and Mining law does not address the issue of compensation of alternative land”, adding that a new law could eliminate speculative land value among the communities.
She mentioned that the issue of land was an emotive one as well as a source of life, as such there was the need to have a practical way to reduce tensions between mining companies and the communities.
The BUSAC Fund Manager Dr Dale Rachmeler, told The Daily Graphic that the grant was worth roughly GH$ 100,000. He said the process of advocacy should lead to a change in the law that would ensure that businesses were able to operate within an environment devoid of mistrust.
“There is the need for actionable advocacy to solve these problems”, he stated.
A Consultant at AIDEC, Mr Ambrose Yennah, gave an overview of the issue on compensation under the Mining and Mineral law and stated that there were no clear guidelines on compensation.
The current law creates long disputes that delay mining firms access to lands to undertake their businesses, he said.
He also stated that the land owners most often felt dissatisfied with the compensation package and added that the law also deterred potential investors because of the lack of standardised compensation plan.
He said the goal of the project was to have a national policy that sets up a clear standard of compensation, adding that the current law left room for variations leading to speculative activities.
Mr Yennah stated that the project would involve stakeholder meetings, a visit to Tanzania to learn from that country’s best practises and sponsor appropriate legislation as well as establish the basis of standardisation of compensation packages.
The Social Investment Manager of Newmont Ghana Gold Limited, Mr Kwesi Amponsah Boateng, shared the experience of his company with the other stakeholders.
He mentioned that the company had undertaken to ensure that compensation came with both monetary and land.
“The objective is not to them leave worse off than we found them”, he stated.
The advocacy programme got off to a running start, considering two of the men who can have a great impact on changing the law attended Tuesday’s event, Mr Edward Ennin, the Vice -Chair of Mines and Energy Commitee of Parliament and Mr Alhaji Amadu Sonogho, Ranking Member on Mines and Energy each offered their direct support to the project.
Even still, Rachmeler, the BUSAC Fund Manager, told The Daily Graphic that he thought the programme could be successful after the conclusion of the December elections when politicians could shift their attention away from campaigns.

Is a single digit inflation elusive?

2008-08-11T03:26:00.000-07:00

Story: Boahene Asamoah

RECENT global events have cast dark shadows across the world economy, leaving fragile economies like Ghana with little options as to what to do.
The soaring oil and food prices on the world market have caused considerable effects to espeically develolping economies.
Allthough the country is yet to experience the full magnutiude of the problem, the effect at its initial impact has led to upward increase in the consumer price index.
The Consumer Price Index (CPI), which measures the rate of price increases over time has for the past five months been increasing, threatening the country’s fragile macro-economic stability.
The upward surge in the inflation rate while it may derail government monetary policies also put the country in a weaker position with regards to the West African Monetary Union.
From 12.81 per cent recorded in January, inflation for June now stands at 18.41 per cent, and indications are that that trend was likely to remain high.
Interestingly, inflation has since November last year, been on the rise.
A combination of both the non-food and food components of the CPI have accounted for the upward movement of inflation.
The current situation although expected, the magnitude of the rise in the inflation rate is a source of concern.
This outlook of the economy, among many others has made the Central to even review its prime rate upwards, with the spirall effect of interest rate hikes from the commercial banks, and the resultant high cost of doing business in the country.
Whiles, the floods that hit the country last year was expected to have an impact on the inflation with respect to the food component of the index, the same can be said of the non-food component, a major part of which has been the sky rocketing prices of crude oil on the international market and the resultant increases in fuel prices in the country.
Crude price has risen to record highs hitting $145 million per barrel and analyst expect the oil price to hit yet another record highs of about $200 million per barrel by the close of the year.
The government has indicated that its oil import bill is currently hovering around $2.5 billion for the same quantity of 60,000 barrels of oil it imports annually.
This has threatened the country’s import cover which was reported to have declined from three and half months of import cover to about 2 months of external reserves.
On the back of the weaken dollar, it remains to be seen how the government can manage the soaring oil price bill, given that the government has reduce the petrouleum taxes of petrol products.
Indications are that the privitisation of the Ghana Telecom to Vodacome, which yeilded an amount of about $1.5 billion would be a welcome relief in terms of cash injection to the economy, but how sustainable would this be?
Indeed inflation surge is not perculair to Ghana alone, indeed Nigeria, South Africa and even some developed economies have had to deal with upward increase in inflation as a result of the global crises.
According to the Monetary Policy Commeeting review of the economy, inflation outlook for the second quarter was likely to ramin high on expectations of higher future crude oil prices, which were expected to exert more inflationary pressures on the economy.
In view of the upward increase in inflation from 16.88 points in May to 18.41 points in June, anaylst expect again to see the Bank of Ghana review upwards its prime rate from the present 17 per cent.
Again the second quarter is also associated with the lean season for most food staples when there are food price pressures.
The government mitigation announced in May to absord of the shocks of the global crises are yet to have full impact on food prices especially on imported rice on the local market.
Another issue has got to do with imported inflation. With soaring world prices globally and with the economy driven mainly by imports, imported inflation seems uncontrolable and could account for the rather high inflation figures the country was experiencing.
Again the Public Utilities have announced its intentions to up the tariffs on utilities especially for commercial users. Although some industry expert indicate that the final cost of such increase in utilities would be pass on to the final consumer, indicating that prices of some commodties were expected to up.
With the central bank’s major focus of ensuring price stability as a policy and the effect of the global crises, a single digit inflation seems to remain elusive in the lifetime of this government as the year draws to a close.
Ghana has a commitment to the West African Monetary Union with the yet to be introduced single currency. That position seems to be a mirage considering that one of the four criterium for achieving covergence is a single digit inflation.
Government has also not indicated that it was going to cut back on its social investments such as roads, and other infrastructure. This does not look likely in an election year. All this again indicate that achieve a a single digit inflation does not look likely.
These developments place the country in a tight position and looks unilkely that a single digit inflation remains elusive as we strive to achieve a balance in economic growth and development.

Inflation for February edged up by 0.4 per centage points from 12.81 to 13.21
In that month the high prices of some basic foodstuffs such as fish, bread and cereals were responsible for the surge in inflation rate.
These products contributed 0.89 points and 0.55 points respectively.
Other contributors were vegetables, potatoes and other tuber vegetable groups accounted for 0.38 points and meat group accounted for 0.35 points.
The non-food component of the index contributed 0.85 percentage points to the index with furnishing, household equipment and routine maintenance group contributing 0.43 points.
Other contributors for the February inflation were clothing and footwear which accounted for 0.34 points to that sector.

The March inflation hit 13.79 per cent, representing an increase of 0.58 percentage points over that of February .
The rise in the rate of inflation for March was partly to high food prices, which contributed 5.85 points, while the non-food group contributed 7.94 points to the rate of inflation.
The high prices of some basic foodstuffs such as cereals, bread and fish were mainly responsible for the surge.
Information from the Ghana Stattiscal Service the increases in fuel prices, the upward adjustment in utility bills and the supply of money in the system were some of the contributory factors to the increase in the rate of inflation.
Again the officials cited the shift from local to exotic food, also contributed to the rise in inflation with its attendant .
The month of march was one of the major planting months and so during that month the demand for foodstuffs outweighed supply, making the subsequent price hikes to usually pull the rate of inflation higher, compared to the other months.
This was expected with the reason that by the middle of the year, prices for food prices would ease
It was expected that the rate of inflation would ease by the end of the March because of
In April however, prices increased sharply with most of the increase being accounted for by non-food inflation. Food prices increased jumped from marginally by 0.2 per cent point to 13.2 per cent, non-food prices jumped from 14.4 per cent to 16.9 per cent.
By April 2008m petrouleum prices had increased by 15.8 per cent which led a increase in transportation cost by the end of April

The April rate closed at 15.8 per cent in April.

Comparing the innflation trend for 2007, the year started with an inflation rate of 10.89 per cent in January, falling to 10.42 and 10.19 per cent in February and March, respectively.
However, the rate of inflation rose in April and May to 10.5 and 11 per cent, respectively, declining in June to 10.7 per cent and 10.1 per cent in July, dropping by 0.3 and 0.6 percentage points, respectively.
The rate of inflation for August rose by 0.3 percentage points but fell in September to 10.19 per cent, due mainly to increases in fuel prices and transportation fares.
In October, a reduction in the price of petroleum products pulled the rate of inflation marginally downwards by 0.1 percentage points, while the upward adjustment in the prices of utilities and petroleum products contributed to the high inflation of 11.40 per cent and 12.75 per cent in November and December, respectively.

THE rate of inflation rose by 1.59 per cent to close the month of May at 16.9 per cent in May, the Ghana Statistical Service (GSS) has said.
The major movers of the index was due to higher costs of transport and food items
The 1.6 per cent change from April to May indicated that consumer prices in the country were continuing to feel the pressure of higher global fuel and food prices.
Overall, food items, mostly fish, bread and cereals, contributed 7.2 per cent to the monthly increase.
Non-food items, including transport, contributed 9.7 per cent.
Ghana's consumer prices maintained their upward march despite the Bank of Ghana's decision last month to raise its prime interest rate by a bigger-than-expected 175 basis points to 16 per cent to try to control inflation.
It is the intension of government to bring inflation to a single digit by the close of the year. However, with geopolitical events coupled with the crude oil prices, it is impossible to bring inflation to a single digit by the close of the year.
Since January this year the rate of inflation has been rising steadily. At the beinging of the year the rate stood at 12.8 per cent and closed at 13.2 per cent by the end of February rising again in March to settle at 13.8 per cent.

Inflation (Finance) Read by E. agyeI

3 Media houses embrace Business Code

2008-08-11T03:24:00.000-07:00

Story: Boahene Asamoah
THREE media houses have signed up to the Ghana Business Code, a set of ethical business principles based on the United Nations Global Compact (UNGC).
They are the Business and Financial Times, Citi FM and TV3 Network.
At a short ceremony to present their certificates in Accra, the Co-ordinator of the Business Sector Programme Support at DANIDA, Mr Lars Jespen, said the code was modelled on the UNGC and had been largely accepted by stakeholders in the country.
“The Business Code is all about promoting work for the practice of corporate social responsibility and focuses on labour practices, human rights, environmental management and transparency in business,” he stated.
He said the code was not in any way against profit but noted that “if any business is unable to generate profit, it is a measure of its misuse of the society’s resources”.
Mr Jespen stated that the code also provided for the recognition and appreciation of all stakeholders in business.
He said an effective evaluation and certification system called the Ghana Business Clearing House would be developed to ensure that companies which signed on to the code did, indeed, practise the principles of the code.
“An effective clearing house and good business practices by members are the surest means to increase the brand value of the code brand name,” he stated.
The Executive Director of the Association of Ghana Industries (AGI), Mr Cletus Kosiba, in a speech read on his behalf, stated that the three media houses signing on to the code was a significant encouragement to its initiators.
That, he said, was because the media played a key role in educating the public; also it would get more people to sign on to the code.
He urged the companies to publicly endorse the code through their communication channels.
He said the idea of having a code of ethics demonstrated the private sector’s commitment to the growth of Ghana’s business sector and showed a conviction that business had evolved from solely concentrating on profits to paying great attention to the key issues of corporate social responsibility.

Ministry to adopt three-prong plan

2008-08-11T03:19:00.001-07:00

read by SSB
chamber (fin)

Story: Boahene Asamoah & Ayisha Dah

THE Minister of Trade, Industry, Private Sector Development and President’s Special Initiatives (PSI), Papa Owusu Ankomah, has outlined a three-pronged approach his ministry would undertake during the last six months of the government’s administration of the economy.
These are, to improve domestic trade, rationalise tariffs and improve the marketing of agricultural products.
Speaking during a meeting with executive members of the Ghana National Chamber of Commerce and Industry in Accra yesterday, the minister underscored the importance of these strategies to ensure the development of trade and industry in the country.
He said there was the need to improve domestic trade to ensure the development of local capacities that would develop local quality products capable of competing on the international market.
Mr Owusu-Ankomah stated that some of the policies would address the issues that affected domestic trade, such as infrastructure and other services, in order to push the industry further.
On the rationalisation of tariffs, the minister indicated that presently there were no proper procedures on tariffs and to that end, he stated that a national tariff board had been proposed to review all tariffs to ensure their effectiveness.
Mr Owusu-Ankomah mentioned for instance, the imposition of tariffs on tomato paste by the government only for the government to realise that the country lacked the capacity to produce tomato pastes to meet the local demand.
Touching on the marketing of local products, the minister stated that there was the need for a conscious attempt to market agricultural products in the country.
He called on members of the chamber to make their concerns known through the association for onward submission to the government for appropriate action.
The minister suggested a meeting with the members of the Chamber, the Ghana Union of Traders Association (GUTA) and the Association of Ghana Industries (AGI) to brainstorm on some of the challenges that faced the private sector.
The President of the GNCCI, Mr Wilson Atta Krofah, said the chamber had undertaken a campaign to create the needed awareness through a road show on major cities in the country on the need to patronise made-in-Ghana products.
He said members of the chamber were also going through skills training in management and entrepreneurship with a university in Israel and appealed to the government to support the chamber in that area.
Mr Krofah added that the chamber together with the Business Sector Advocacy Challenge (BUSAC) Fund were imparting advocacy skills to its members nationwide to equip them with the skills of business advocacy.
The president stated that the chamber again was spearheading the re-introduction of the West African Chamber of Commerce to deepen trade relations between member countries of ECOWAS.

Persol launches software for SMEs

2008-08-11T03:18:00.001-07:00

The world's leading Enterprise Resource Planning (ERP) solution developer, SAP AG, has through its regional operation, SAP Africa and their Ghanaian Channel Partner, Persol Systems Limited, launched the SAP Business One software solutions in the country.
A statement issued by the company said the new product was targeted at small and medium businesses (SME) in the country and offered greater potential for that sector.
It said, “SAP is the natural choice for business applications software just about anywhere in the world.”
The statement added that customers used SAP applications to connect their businesses across function, country and culture, allowing decision makers to get a single view of their data.
In addition, SAP operates in an eco-system containing over 1,500 partner organisations, which means that customers have a choice as to how they wish to have their software delivered and deployed.
It said SAP was the world's largest business application vendor, with more than 91,500 installations and annual revenue in excess of 10 billion euros.
The company has customers of many different sizes, in different locations around the world, with many different business issues.
The Channel Manager for SAP Africa, Mr Nazir Jadavji, said “because of its size, SAP has in-depth knowledge in many industries, and experience working with customers of all sizes”.
He added that SAP's global revenue supported extensive research and development, a strong collaborative user community, proven best practices, and a high level of scrutiny around partner recruitment.
SAP controls a major share of the ERP market in large enterprises and is gaining ground rapidly in the SME segment, the statement said.
The Solutions Manager for SAP Africa, Mr Patrick Kisanya, said “SAP intends to push SAP BusinessOne in Africa by providing tools to local SMEs that enables them to compete with larger companies on a level playing field thereby stimulating increased growth”.
Since its introduction in 2002, SAP BusinessOne product has grown from a customer base of 900 to 20,000 as of the end of the last quarter.
The Managing Director of Persol Systems, Mr Michael Quarshie, said “SAP BusinessOne is designed for advanced SMEs, is competitively priced, flexible yet full-featured and can be implemented in record time because of available rapid implementation tools”.
Persol was selected by SAP because of Persol's strong presence, wide coverage and impressive client base in the Ghanaian marketplace thus enabling SAP to immediately access a large group of SMEs that are currently underserved in the ERP marketplace.
The statement said Persol was one of the leading software developers in the country and through this relationship with SAP it could now utilise SAP SDK (Software Developer Kits) that would enable Persol to develop interfaces of its products such as Persol Human Capital Management (HCM) and Mobile Hand held software to SAP BusinessOne.
Once certified, these add-on products from Persol would be made available to the 20,000 SAP BusinessOne customers to acquire, if desired, the statement concluded.

Zain installs services to help the poor

2008-08-11T03:17:00.001-07:00

Story: Boahene Asamoah, Nairobi, Kenya

ZAIN, the new owners of Westel, and an international mobile phone operator in the Middle east and Africa, through its partner, Ericsson has installed a mobile network service to support the less priveledged in society as part of the company’s social responsibility.
The project, which is under the Millennium Villages project at the Columbia University, is a bottom up approach of lifting rural villages out of poverty throughout its operations in Africa.
A tour of one of the projects in Dertu, a remote and isolated village, 800 kilometres from Nairobi by some international journalists from Africa, Middle East and Europe, revealed how mobile service was helping to lift over 4,000 residents out of poverty.
Zain has installed the terrestrial infrastructure that covers 24 kilometres and has provided the community with sim cards, while Ericsson provided affordable handsets to the villagers.
Briefing the journalists, the Project Co-ordinator of the Millennium Villages, Mr Ahmed M. Mohamed, said due to the provision of mobile telecommunication services the villagers could now have access to the global world, adding that the project has tremendously improved the lives of the people.
He said the mobile phones was now being used by the villagers to monitor the status of water, pasture, pests and diseases surveillance by animal health workers, the government and project workers as well as the pastoralists.
He said the mobile phone service had in addition, offered other business opportunities to the villagers such as cash earned from the use of the service, charging ,as well as using the service to make orders for goods and services from neighbouring towns.
Hitherto, the villagers had to travell over 90 kilometres to the nearest town, Garissa to make purchases or to sell their products.
Mr Mohamed said the service had also improved social networks by connecting the villagers to family members in Kenya and in the diaspora.
It has also made the tracing of lost animals and children within 20 km radius, helped in the health provision and improved security among other benefits, he stated.
Zain has provided the only primary school in the village with a computer with Internet facility to facilitate teaching and learning in the community.
The only health post in Dertu have also been upgraded and provided with Internet accessibility.
The District Administration Officer in charge of the area, Mr Evans Kyule expressed the government’s apprecation for the support of the two organisations by developing the area.
He said security in the area had improved tremendously since the installation of the mobile phone service in the community.
The Chief Executive Officer of Zain, Africa, Mr Chris Gabriel, said the company would support such initiatives that would help to uplift the lives of the rural communities from poverty.
He said the company would upgrade the current infrastructure to ensure the service was extended to cover more villages within the area.
The Millennium Villages Project (MVP) is a 5-year joint venture between the Earth Institute of Columbia University, 10 Governments in Africa including the Government of Kenya, the United Nations Development Programme (UNDP) and other partners. There are 14 Millennium Research Villages (two new) all in Sub-Saharan Africa.
Under the Zain and Ericsson partnership, mobile communications and Internet connectivity is expected to reach over 400,000 people in Sub Saharan Africa, including Ghana.

Zain to compete on quaity service, one network concept

2008-08-11T03:14:00.000-07:00

Proofread by era

CEO-Zain (fin)
Story: Boahene Asamoah, Nairobi, Kenya.

THE Chief Executive Officer of Zain, Africa, the new owners of Westel, Mr Chris Gabriel, has said that the company’s strategy in Ghana will be to compete based on its quality service, the one-network concept and coverage quality.
In an interview, Mr Gabriel stated that these strategies were expected to differentiate its brand and penetrate the local mobile market.
He said to ensure the quality service that the Ghanaian customer was yearning for as per their research work, the company intends to ensure an 85 per cent coverage of the whole country from the northern part of the country through to the southern sector using the road network of the country.
The CEO in addition said the company would be operating on the 3-G platform network that would offer superior service to customers.
"The 3G technology platform has added value services and we hope to provide these services to the Ghanaian customers", he stated.
He said the one-network service concept was to ensure that a customer of Zain in Ghana for instance would be able to access its service in Nigeria or any part of West Africa or any part of the world where Zain has a presence with the same number.
Touching on the competitive nature of the Ghanaian mobile telecommunications service in the country, Mr Gabriel stated that "we expect rational competition", adding that "we are not going to compete on price".
He explained that price cutting in the industry would lead to price wars and the whole industry would ultimately collapse, stating that such a behaviour would not offer returns on investments for shareholders.
Mr Gabriel added that the country offered more opportunities than challenges in spite of having about six multinational mobile phone operators.
Currently, the country has four operating brands, MTN a multinational mobile phone operator, TIGO, another international brand, Kasapa, which is an affiliate of Hutchison, another multinational and One-Touch, a local brand which could soon be affiliated with the world’s leading brand, Vodafone.
Zain and Globacom are the new operators soon to begin operations. Both are multinational brands.
On the question of whether the fixed line business of Westel would be part of its business, Mr Gabriel said, " we intend to maintain these lines," and emphasised that "we are a mobile phone operator".
On the new brand role out of the company in 14 African countries simultaneously under the brand name Zain, Mr Gabriel stated that the company aimed at being among the top ten mobile operators in the world by 2011, with a projected 110 million customers worldwide.
He said the company was operating in many countries under different brand names and the new brand was to position the company in the global competition " as one unique global brand company".
Mr Gabriel stated that Africa offered tremendous opportunity for the company, and stated that over the years the company had invested over $10 billion in its operations across Africa.
"We will continue to invest in Africa to returns on our investments and to our shareholders", the CEO stated.
Zain is to begin its operations in the next few months in Ghana.

Zain to double investments in Africa

2008-08-11T03:13:00.000-07:00

Story: Boahene Asamoah, back from Nairobi, Kenya

DR Saad Al Barrak, the Group Chief Executive Officer of Zain, the new owners of Westel and international mobile telecommunications company operating in the Middle East and Africa, has said the company plans to double its investments in Africa and double its customer base throughout its operations.
He said the company had, over the past few years, invested over $10 billion in its operations in Africa, adding that “we will continue to invest more in our operations across Africa”.
Speaking at a news conference which brought together some international media across Europe, Africa and the Middle East, Dr Barrak said as part of its vision, the company hoped to attract 110 million customers by 2011.
Zain, which operates in 14 other African countries, was previously known as Celtel.
He said the company had undertaken a strategy to re-brand its global business, adding that “by re-branding to Zain, we are bringing together our African and Middle East operations under a single, strong and unique identity”.
He said the re-branding was consistent with the strategic vision of the company to become a leading global brand in the next few years.
The Zain Group, which has operations in 22 countries in the world, including 14 operations in Africa, with Ghana as its new destination, has over 50 million customers throughout its operations.
Dr Barrak described the branding as a significant milestone in the history of the company from the company’s humble beginnings.
He said the company had, over the past few years, evolved from a regional company to become an international brand.
The group CEO said it had expanded its operations and now had operations in Africa and the Middle East, with Ghana and Saudi Arabia being the new subsidiaries of the group, adding that “we will long for opportunities to extend our brand and services”.
Dr Barrak stated that the company presently had a consolidated revenue of about $3.488 billion, with net income of $551 million.
“For us to become a global company, we need to have one identity that reflects our unique direction and reflects our values,” he said.
He explained that the Zain concept of one network was to create a seamless network across its operations with the offering of one local tariff, thereby abolishing the high cost of roaming charges.
Dr Barrak stated that its brand would bring about performance and place the company as the number one mobile company in Africa and among the top 10 global brands in the world.
Zain presently is the number one player in 14 out of 20 of its active operations in Africa and the Middle East.
He stated that it was part of the strategy of the company to list part of its operations on the local stock markets and mentioned, for instance, that the Ghana operations planned to list part of its shares on the Ghana Stock Market within two years.
He added that the group hoped to list shares on some international stock markets, adding that its initial public offer in Zambia achieved greater success.
Dr Barrak stated THAT the company had embarked on a number of sustainable projects under its corporate social responsibility to reach out to help deprived communities across Africa.
He mentioned its projects in Dertu in the northern part of Kenya where it had provided affordable handsets and installed a network service to help the farmers to do business.
Again, he mentioned the low-cost, affordable handset projects in Uganda to help the fishing communities along Lake Victoria to carry out their activities with low cost phones.

GT Bank launches money transfer service

2008-08-11T03:12:00.000-07:00

Story: Boahene Asamoah

GUARANTY Trust Bank, Ghana Limited, has introduced a new instant money transfer for its customers within the sub-region.
The new money transfer known as Guaranty Trust Monetary Transfer (GTMT) would offer common platform for all of the bank’s subsidiaries.
Speaking at the launch of the programme in Accra on Tuesday, the Managing Director of the bank, Mr Dolapo Ogundimu, stated that the new product was expected to add value its money transfer by offering lowest fee, ensure safety and was available at all its branches in the country.
“GTMT is a service for both customers and non-customers in Ghana, Nigeria, Gabon, Sierra Leone and Nigeria,”, she stated.
He said the bank has a network of 143 branches across its subsidiaries and stated that its services would be extended to its operations in Liberia as well as the London offices.
The Managing Director said one unique feature of the product was that the transaction was instant as compared to other money transfers available.
“A customer will receive instant cash from a sender sending money from any of our subsidiary anywhere”, he stated.
He said the product was intended to facilitate trade and economic growth in the sub-region and assured customers of the high quality service to support their businesses.
Research has revealed that about $300,000 of remittances are received from Nigeria to Ghana especially for Nigerian students in Ghana.
The Board Chairman of the bank, Alhaji Yusif Ibrahim, who launched the product said the product would lead to what he described as the “emancipation of African trade”.
He said “this promote would promote trade, harmony and deepen south-south co-operation.”
The Gambia Ambassador to Ghana, Alhaji Mohammed Jafah, stated that the product was a good business idea that needed the support of all stakeholders.
He reiterated earlier submissions that the product would further deepen economic relations between the countries within the sub-region of West Africa.

ETI partners ACCION international

2008-08-11T03:11:00.000-07:00

Story: Boahene Asamoah

ECOBANK Transnational Incorporated (ETI), the pan-African bank, has partnered ACCION International, an international micro-financing institution to assist in providing services to micro-lending institutions in the country.
The $1.5 billion investment is known as EB-ACCION Savings and Loans Company limited, with equity participation from the two companies.
The company, which is started in Ghana, will be replicated using ETI’s Africa operations which currently has 25 operations in Africa to support micro-, small-and medium-scale enterprises.
At the launch of the new company in Accra over the weekend, the Minister of Finance and Economic Planning, Kwadwo Baah-Wiredu, stated that the partnership was in line with the government’s vision of supporting the micro sector of businesses in the country.
“We need partnership to move forward this nation,” he said, while making references to the GT and Vodafone deal.
He said the economy had been growing at a steady pace and stated that there had been improvements in the financial services delivery.
Mr Baah-Wiredu called on beneficiaries of the loan facilities from the loan company to ensure early repayment of loans to enable the fund support other people.
The minister called on management of the company to ensure good corporate practices that would make the business more viable.
A Deputy Minister of Trade, Industry, Private Sector Development (PSD) and the President’s Special Initiative (PSI), Mrs Gifty Ohene-Konadu, stated that the partnership between the two companies would complement government’s initiative to support the micro and small industries in the country.
She said the government had signed a €20 million loan agreement with the Italian government to support the development of the private sector.
The Group Chief Executive Officer (CEO) of ETI, Mr Arnold Ekpe, said the mission of the group was to offer world-class banking service that would make a difference as well as contribute to the economic development of the region.
The President and Chief Executive Officer of ACCION International, Ms Maria Otero, said the event carried several messages to support micro and small businesses in the country.
She said ACCION operated in over 24 countries with 35 partners and had 3.3 million customers.
Ms Otero added that the company had so far granted $3 billion in loans to customers and had repayment rate of 96 per cent of all loans granted.
The CEO stated that partnership with ETI was to reach the low-income earners in the Ghanaian society, and stated that the company was honoured to partner ETI to provide financial services to the people.
The Managing Director of EB-ACCION, Mrs Frances Adu-Mante, stated that within the short period of existence, the company had 4,000 savings deposits and had granted about 1,000 applicants credit to turn around their businesses.
She said the partnership, primarily, was to identify an opportunity to support individuals and micro and small businesses in the country.
ACCION is an innovator in financial access, pioneering many of the best practices and emerging standards in the industry.
The company provides a full range of technical assistance and management services, as well as investment and governance support to help financial institutions build institutional capacity and financial strength in order to serve low-income households on a broad scale.
Over the past 35 years, ACCION has helped to build and strengthen some of the most successful micro-finance institutions (MFIs) in the world.

Oil marketing companies call for upward adjustment

2008-08-11T01:38:00.000-07:00

Business page August 4/2008

Story Charles Benoni Okine

THE Association of Oil Marketing Companies (OMCs) has called for an upward review of the margins paid to its members for lifting of petroleum products for the market to avoid a looming cash flow crisis within the sector.
Although the association did not state any particular level of adjusted margin, it said the increase would enable members to meet their operational costs, which kept rising by the day.
The Chairman of the OMCs, Mr Agyemang Duah, told the Daily Graphic in an interview that members of the association might be forced to close down some of their outlets and cut down on their staff numbers as some of the cost control measures.
Since the sector was deregulated about three years ago, the number of OMCs have increased to about 40 and the numbers still keep rising.
Each of the companies is currently paid GH¢6.5 per litre for any of the petroleum products lifted.
There is a consensus in the industry that the growing numbers of operators in the sector have drastically reduced the volumes carried by each of the players, and this is impacting negatively on their margins and the economies of scale associated with lifting larger volumes.
“Those who are able to brave the storm may also be tempted to cut costs by not adhering to safety and environmental issues, a situation that might spell doom for the country in the near future,” Mr Agyemang Duah stated.
He cautioned that some of the major or big players which were mostly multinationals with large numbers of employees might be forced to wind up their operations if they continued to post loses.
Although multinational oil companies have recorded huge profits as a result of the rising oil prices, such profits are mostly associated with upstream operations rather than with the downstream.
Mr Agyemang-Duah, who is also the Managing Director of the recently listed GOIL, said the half-year results posted by most of the major OMCs in the country showed negative profits, mainly as a result of their high operational costs.
“Many of the players rely on the banks for facilities and the high interest rates are affecting us,” he said.
He said the association had been in talks with the National Petroleum Authority (NPA) to secure a better deal going forward, but that had yielded little results, and expressed the hope that the authority would take lifeline actions in due course to save the industry from collapse.
The Chief Executive Officer of the NPA, Mr John Attafuah, also empathised with the concerns of the OMCs, describing it as “most unfortunate”.
He agreed that competition in the industry had significantly reduced the volumes carried by each OMC, a situation that was also negatively affecting their profits.
However, he said, most of the OMCs had also become inefficient and that had forced their operational costs up and affected their turnovers and profits.
He said should the authority review the margins upward, the market would look more attractive to more OMCs to even worsen the situation.
To Mr Attafuah, a drastic cut in operational inefficiencies will save the situation for the OMCs, and urged them to take a critical look at that while the authority considered other innovative ways to help them out of their predicaments without shifting costs with regard to inefficiencies to customers.

Dialogue Crucial

2008-08-11T01:36:00.000-07:00

Front (Lead) August 6/2008

Story: Charles Benoni Okine

Ghanaians of all political persuasions and responsibilities have been advised to embrace dialogue as a means to a peaceful, free and fair elections in December.
Speakers at the 3rd Daily Graphic Governance Dialogue that opened in Accra yesterday were unanimous that through dialogue Ghana would succeed in firming up the democratic credentials that have made it a continental icon for others to look up to.
The speakers — including notable politicians, bankers and entrepreneurs — said Ghana had, through its stable and peaceful nature, provided a shining example on the continent and could not fail the world as it goes to the polls to elect a new President and Members of Parliament to govern the nation for the next four years.
Their call comes in the wake of heightening tension among the political parties as a result of the stress and sometimes violence at many stations where new voters are being registered by the Electoral Commission.
The opening ceremony of the dialogue, which attracted the largest number of participants since its inception three years ago, was spiced by performances in dance and music by the Tema Youth Choir and the Ghana Dance Ensemble.
The theme for this years dialogue is: “Effective Democratic Governance: The role of stakeholders”, with the objective of explaining the multi-dimensional aspects involved in the governance of a nation; making civil society aware of their roles in shaping the destiny of their countries, as well as reviewing the progress on the democratic process in the West African sub-region.
Delivering the opening address on behalf of the Vice-President, Alhaji Aliu Mahama, the Attorney-General and Minister of Justice, Mr Joe Ghartey, said “since we are all stakeholders in this enterprise called Ghana, which we need to secure for our collective good and prosperity, we should all play our role in ensuring that the integrity of the election is without a shadow of doubt”.
He added that “as we stand at the threshold of a new and better Ghana, ruled by a better man or the best man, we should all be committed to moving forward”.
Mr Ghartey said the government had confidence in the electoral system, which is policed by the people at the polling stations.
“We have confidence in our Electoral Commission, whose independence, efficiency and integrity is recognised throughout Africa; we have confidence in our political process, we have confidence in our judiciary that had shown it has the capacity to resolve disputes, including election disputes, fairly and impartially,” he observed.
Mr Ghartey said the government was also confident about the security agencies, which had demonstrated a high sense of professionalism in Ghana and abroad, and indicated that “we are all committed to free and fair elections devoid of violence, bitterness, acrimony”.
He said Ghanaians needed to recognise that though they differed in views, “we are all each other’s keeper”.
Mr Ghartey said what confronted the nation today was that “whilst we applaud ourselves for the significant gains we have made in resisting rule by oppressors both internal and external, by creating laws, mechanisms and institutional good corporate governance, in furtherance of our natural and inalienable right to establish a framework of government which shall secure for ourselves and posterity the blessings of liberty, equality of opportunity and prosperity, we have not yet reached utopia”.
The Attorney-General acknowledged the management and workers of Graphic Communications Group Limited for organising the dialogue, saying, ”It is good for the country and it is a testimony to the credit of the Graphic group which is no doubt a socially responsible company.”
The Minister of Information and National Orientation, Mr Stephen Asamoah Boateng, for his part emphasised the need for a peaceful, free and fair elections in the country.
He said much as people might differ in ideology, dialogue was an important tool to ensure peace and stability.
The Managing Director of Barclays Bank, Ghana, Mrs Margaret Mwanakatwe, mentioned shared understanding, information flow in a transparent manner and uniformity of purpose as some of the key tenets to ensuring a peaceful nation.
She was confident that such tenets would lead to improved lives and create an environment conducive for business and democratic growth.
Mrs Mwanakatwe joined other speakers from the Finatrade Group, Stanbic Bank and Ghana Commercial Bank, all key sponsors of the programme, in congratulating the organisers of the dialogue for their foresight and commitment to ensuring the practice of good democratic governance not only in Ghana but in the sub-region in general.
The Managing Director of Graphic Communications Group Limited, Mr Ibrahim Mohammed Awal, in his welcoming address, said the move by the company formed part of the company’s resolve to ensure a peaceful nation and sub-region, to enable business to thrive while the democratic principles also get entrenched through the practice of good governance.

Persol partners SAP

2008-07-28T02:41:00.000-07:00

SAP AG, the world's leading Enterprise Resource Planning (ERP) solution developer has through its regional operation SAP Africa and their Ghanaian Channel Partner, Persol Systems Limited launched the SAP Business One software solutions in the country.
A statement isssued by the company said the new product was targed at Small and Medium Businesses (SME) in the country and offers greater potential for that sector.
It said “SAP is the natural choice for business applications software just about anywhere in the world.”
The statement added that customers use SAP applications to connect their businesses across function, country and culture, allowing decision-makers to get a single view of their data.
In addition, SAP operates in an eco-system containing over 1,500 partner organisations, which means that customers have a choice as to how they wish to have their software delivered and deployed.
It siad SAP is the world's largest business application vendor, with more than 91,500 installations and annual revenue in excess of €10 billion.
The company has customers of many different sizes, in different locations around the world, with many different business issues.
The Channel Manager for SAP Africa, Mr Nazir Jadavji, said “because of its size, SAP has in-depth knowledge in many industries, and experience working with customers of all sizes.”
He added that SAP's global revenue supports extensive research and development, a strong collaborative user community, proven best practices, and a high level of scrutiny around partner recruitment.
SAP controls a major share of the ERP market in large enterprises and is gaining ground rapidly in the SME segment, the statement said.
The Solutions Manager for SAP Africa, Mr Patrick Kisanya, said “SAP intends to push SAP BusinessOne in Africa by providing tools to local SMEs that enables them to compete with larger companies on a level playing field thereby stimulating increased growth”.
Since its introduction in 2002, SAP BusinessOne product has grown from a customer base of 900 to 20,000 as at the end of the last quarter.
The Managing Director of Persol Systems Mr Michael Quarshie, said “SAP BusinessOne is designed for advanced SMEs, is competitively priced, flexible yet full-featured and can be implemented in record time because of available rapid implementation tools”.
Persol was selected by SAP because of Persol's strong presence, wide coverage and impressive client base in the Ghanaian marketplace thus enabling SAP to immediately access a large group of SMEs that are currently underserved in the ERP marketplace.
The statement said Persol was one of the leading software developer in the country and through this relationship with SAP could now utilise SAP SDK (Software Developer Kits) that would enable Persol to develop interfaces of its products such as Persol Human Capital Management (HCM) and Mobile Hand held software to SAP BusinessOne.
Once certified, these add-on products from Persol would be made available to the 20,000 SAP BusinessOne customers to acquire if desired, the statement concluded.

Ministry to adopt three-prong plan

2008-07-28T02:39:00.000-07:00

Story: Boahene Asamoah & Ayisha Dah

THE Minister of Trade, Industry, Private Sector Development and President’s Special Initiatives (PSI), Papa Owusu Ankomah, has outlined a three-pronged approach his ministry would undertake during the last six months of the government’s administration of the economy.
These are, to improve domestic trade, rationalise tariffs and improve the marketing of agricultural products.
Speaking during a meeting with executive members of the Ghana National Chamber of Commerce and Industry in Accra yesterday, the minister underscored the importance of these strategies to ensure the development of trade and industry in the country.
He said there was the need to improve domestic trade to ensure the development of local capacities that would develop local quality products capable of competing on the international market.
Mr Owusu-Ankomah stated that some of the policies would address the issues that affected domestic trade, such as infrastructure and other services, in order to push the industry further.
On the rationalisation of tariffs, the minister indicated that presently there were no proper procedures on tariffs and to that end, he stated that a national tariff board had been proposed to review all tariffs to ensure their effectiveness.
Mr Owusu-Ankomah mentioned for instance, the imposition of tariffs on tomato paste by the government only for the government to realise that the country lacked the capacity to produce tomato pastes to meet the local demand.
Touching on the marketing of local products, the minister stated that there was the need for a conscious attempt to market agricultural products in the country.
He called on members of the chamber to make their concerns known through the association for onward submission to the government for appropriate action.
The minister suggested a meeting with the members of the Chamber, the Ghana Union of Traders Association (GUTA) and the Association of Ghana Industries (AGI) to brainstorm on some of the challenges that faced the private sector.
The President of the GNCCI, Mr Wilson Atta Krofah, said the chamber had undertaken a campaign to create the needed awareness through a road show on major cities in the country on the need to patronise made-in-Ghana products.
He said members of the chamber were also going through skills training in management and entrepreneurship with a university in Israel and appealed to the government to support the chamber in that area.
Mr Krofah added that the chamber together with the Business Sector Advocacy Challenge (BUSAC) Fund were imparting advocacy skills to its members nationwide to equip them with the skills of business advocacy.
The president stated that the chamber again was spearheading the re-introduction of the West African Chamber of Commerce to deepen trade relations between member countries of ECOWAS.

Journalists undergo advocacy training

2008-07-09T06:21:00.000-07:00

Story: Boahene Asamoah

Twenty-five journalists drawn from six regions in the country have attended a three-day training workshop in Business Advocacy at Koforidua.
The workshop was organised by the Ghana Journalists Association with support from the Business Sector Advocacy Challenge (BUSAC) Fund and KAB Governance Consult and forms part of the GJA/BUSAC Fund programme on using the Media to strengthen business advocacy.
Journalists were drawn from the Central, Western, Eastern, Ashanti, Brong Ahafo and Greater Accra regions.
According to Mr Kwesi Afriyie Badu of KAB Governance Consult, the training workshop was meant to equip journalists with the requisite skills of advocacy to support the nurture and growth of small and medium-scale enterprises (SMEs) in the country.
He said it was also to equip a group of business and financial journalists to understand the concept of advocacy to support SMEs.
The lead facilitator of the workshop, Mr Kofi Asante Frimpong, took participants through a number of training modules such as Micro and small business definition and type; constraints of small enterprise sector; promotional institutions and instruments and instruments for micro and small-scale development and the concept and practise of advocacy????.
Mr Frimpong encouraged journalists to advocate for support for SMEs for the common good of the whole economy.
He underscored the importance of the SME sector to the country’s economic development.
Other speakers were Dr Ben Kumbour, Member of Parliament and Minority Spokesperson on Finance, who spoke on “The Role of Parliament in the Public Policy Process.
The Head of Civil Service, Mr Joe Issachar, also gave a presentation on “Public Policy Making”, while Dr Esther Ofei Aboagye, the Chief Director of the Ministry of Local Government, spoke on “The Role of District Assemblies in Local Economic Development”.
A consultant and past president of the African Institute of Public Relations, Mr Allotey Pappoe, spoke on using the media for effective business advocacy.
Two follow-up meetings are expected to be held during the course of the year to assess the impact of the journalist’s work on advocacy.

NB: Use semi-colons to separate the various training modules (See the bolded section)

ETI moves a step further

2008-07-09T06:20:00.000-07:00

Story: Boahene Asamoah

ECOBANK Transnational Incorporated (ETI), the pan African bank, has signed a joint venture agreement with Computershare Limited, a global leader in share registration and custody, to offer investor services across the African continent.
The agreement would provide shareholder registry and custody services for clients in Africa, excluding South Africa, through Ecobank’s e-Process Centre in Accra.
The agreement will initially offer registry services to the three markets where Ecobank has been listed.
At a signing ceremony in Accra on Wednesday, the Group Chief Executive of the Bank, Mr Arnold Ekpe, in a satellite link from his base in Lome, welcomed the partnership between the bank and Computershare.
He said the joint venture was important because “it brings together Ecobank’s platform and local knowledge of areas where we operate and the expertise of Computershare in registry across the world”.
“The joint venture further demonstrates the commitment of Ecobank to leveraging strategic global alliances to provide convenient, accessible and reliable services for our customers who will derive immense value from the registry and custodial services of the joint venture company”.
The Chief Executive Officer of Computershare’s South African Office, Mr Stand Lorge, said the company was delighted to have found a partner like Ecobank with whom it could realise its African strategy.
He added that the Ecobank offered unrivalled market access across Africa, while Computershare added technology, product knowledge and expertise that had developed across the world over the past 30 years.
An Executive Director of the ETI in charge of Operations, Technology, Transation Banking and Retail Bank, Mr Patrick Akinwuntan, said “the setting up of the joint venture company to deliver cross-border registry and a custody and settlement system, will leverage the bank’s knowledge and experience of the African market, as well as our unique technology and shared services platform”.
Mr Akinwutan initialled on behalf of the bank while Mr Lorge signed on behalf of Computershare to seal the agreement.
e-Process is the technology and central processing arm of the Ecobank group, providing the technology and telecommunications platform for operations across the group’s network of 22 countries in Africa.
Computershare is a global leader in share registration, employee equity plans, proxy solicitation and other specialised financial, governance and communication services.
Computershare is listed on the Austrialian Stock Market and has a market capitalisation of about $4.8 billion.
The company recently was involved in the world’s largest Initial Public Offer of about $19 billion through its shares registry services to the Industrial and Commercial Bank of China.
The Ecobank Group currently operates in 22 African countries and it is Africa’s biggest bank in terms of coverage with its over 450 branches.

Graphic pays ¢800,000 dividend and earns praises all over

2008-07-09T06:19:00.000-07:00

Story: Boahene Asamoah & Sahadatu Atintande

SOME government officials and stakeholders have commended the board and management of the Graphic Communications Group Limited for the efficient running of the company that has ensured its continued profitability in the face of stiff competition.
At the annual general meeting of the company in Accra yesterday, representatives of the Ministry of Finance and Economic Planning, the State Enterprises Commission (SEC) and the National Media Commission (NMC) were full of praise for the management of the company for delivering another set of good financial results for the 2007 operational year.
The Chief Economic Officer of the Ministry of Finance, Mr Dominic Donkor, expressed his appreciation for the efficient manner the company was being run.
“This is a good performance of the company and we encourage you to maintain your strategic focus,” he stated.
He commended the company for exceeding the minimum threshold of dividend payment of 30 per cent requested by the government.
The company paid GH¢800,000 as dividend for the year 2007, representing a 32 per cent increase of the previous year’s figure.
An Executive Director of the SEC, Mr David Djanie, said the company’s performance indicators, such as renewal of the organisation, conformed to the indicators set by the SEC, adding that “we are very much happy with your performance”.
A representative of the NMC, Mr Joseph Dottey, who is the Deputy Executive Secretary, said the NMC was delighted at the financial results of the company and expressed the hope that the company would deliver even better results in the ensuing years.
Delivering the financial results, the Board Chairman of the company, Osahene Offei Kwasi Agyeman IV, said the company achieved a 14 per cent increase in net profit from GH¢2.2 million in 2006 to GH¢2.5 million during the period under review.
Turnover also increased by 20 per cent from GH¢17.1 million to GH¢20.5 million, adding that shareholders’ funds increased from GH¢11.4 million in 2006 to GH¢13.1 million last year, representing an increase of 15 per cent.
He said the company would complete the installation of a new web press by the end of the year in response to demands by customers for more colour pages for advertising.
“A design centre would also be set up very soon within the adverts and business development unit to assist clients with artwork and designs for their advertisements,” Osahene Agyeman IV stated.
The Managing Director of the company, Mr Ibrahim Mohammed Awal, said the year saw a remarkable performance in advertising sales with increases in both revenue and volume, which accounted for nine and eight per cent respectively.
He said revenue was 21 per cent higher than the previous year’s figure and constituted about 50 per cent of the 2007 turnover.
Mr Awal stated that sales of the company’s publications, especially its newspapers, achieved 95 per cent of the target, while subscriptions for the Daily Graphic and The Mirror increased by six and three per cent respectively.
Revenue from circulation was up by 20 per cent from last year’s figure and the Daily Graphic, the company’s flagship, contributed 80 per cent of the total newspaper sales of GH¢10.3 million achieved in 2007.
Touching on the company’s subsidiary, G-Pak, the managing director said the company made a sales revenue of GH¢1.3 million as against the GH¢900,000 it recorded the previous year, representing a 45 per cent increase.
“Even though the company did better in 2007 than in 2006, its board has begun a massive restructuring exercise in order to improve upon its performance in the coming years,” Mr Awal stated.
Mr Awal said in spite of the growth of various media organisations, Graphic would always strive to remain the best in the media industry.
He said by weighing its core competencies and stretching its ability beyond its competitors, Graphic relied on its ability to take advantage of its leadership role to ensure continuous growth and competitiveness of the company.
He said given the aggressive marketing posture and professional services, as well as the introduction of new and exciting products, the company was poised to maintain its status as the leading media company in the country.
On corporate social responsibility, Mr Awal stated that the company donated food items, used clothing and wax prints worth GH¢9,000 and presented a cheque for GH¢3,000 to flood victims in the three northern regions.
The managing director said the company also collaborated with Pepsi Cola Ghana Limited to hold a free medical screening exercise for 540 residents of Adabraka and also presented specially designed desks worth GH¢15,000 to the Ghana Medical School.

Standchart to refresh its brand

2008-07-09T06:18:00.000-07:00

Story: Boahene Asamoah

STANDARD Chartered Bank, Ghana, one of the leading banks in the country has undertaken a week long activity to refresh its brand.
The Blue and Green Week celebration which is being observed through out its network of branches in the world is meant to reinforce its brand values among its staff and other customers.
At a media interaction, the Area Head of Corporate Affairs for West Africa, Nii Okai Nunoo, said the Blue and Green colours which represent the colours of the bank were to align its human resources with its brand and core values.
“It is not just about the colours but about what we stand for, our people, our culture and how we treat our customers and how we contribute to our communities”, he stated.
He emphasised the need for the group-wide brand initiative which was vital in the face of stiff competition which could be the defining feature of success.
“To achieve this success therefore, we continue to highlight the very essence of our brand values, which are; courageous, responsive, international, creative and trustworthy”, Nii Nunoo stated.
He said as part of the activities marking the week’s celebration, refresher workshops for all managers and unit storming sessions of the values of the bank were being undertaken.
Again, he said the staff town hall and “people in action” night, staff competition and internal and external communication on the uniqueness of the bank’s brand has been done.
In her intervention, the Area Head of Human Resources, West Africa, Mr Florence Hutchful said the values expoused had made the bank distinct in the competition
“It is the combination of leading by example and being the right partner that makes us different, she stated, adding that “it is our people that make the difference”.
Mrs Hutchful said the company had developed a workplace culture which engenders trust, engagement, diversity and inclusion.
She said the celebration of the brand values went beyond the weekly celebration, adding that “ our vision is to double the brand value by 2011”.
The brand value of the bank currently stands at $4 billion.
Mrs Hutchfull stated that the bank would continue to deliver more quality services to its customers as outlined in the core values of the bank’s brand.
As part of the celebration, staff of the bank are wearing a combination of the two colours, while customers of the bank who unknowingly wear or dresse in colours of the bank receives a surprise branded promotional materials from the bank.
The bank will use the occasion to reward some gallant workers who have performed execeptionally at a programme dubbed the Staff Town Hall.

Ecobank managers visits Graphic

2008-07-09T06:17:00.001-07:00

Story: Boahene Asamoah

FOUR senior Managers of Ecobank Ghana Limited have paid a familiarisation visit to Graphic Communications Group as part of efforts to deepen relationship between the two organisations.
The four are Mr Enoch Osei-Sarfo, Head of Wholesale Banking; Mrs Ama Serwa Kwakwa, Relationship Manager, Wholesale Banking; Mr Carl Selasi Asem, Head, Public Sector Unit of the Wholesale Banking; and Mr Yves Rutayisire, Head of Wholesale Banking of Ecobank Rwanda.
They paid a courtesy call on the General Manager, Finance, Mr Baah Adade; and the General Manager, Newspapers, Mr Yaw Boadu-Ayeboafoh.
Mr Boadu-Ayeboafoh took the delegation round the company’s production cycle to familiarise themselves with the operations of the company.
He again took them to G-Pak, a subsidiary of the company.
Mr Osei-Sarfo stated that the visit was to acquaint themselves with the operations of the company and lay the foundation for a much stronger relationship between the two companies.
Ecobank is providing the $7 million medium-term loan to Graphic Communications Group to purchase a new printing machine.
Mr Osei-Sarfo stated that the bank was desirous to partner the company in its operations, especially the strategic focus to reach the West African sub-region through its products.
He said the bank offered the company tremendous opportunity to reach out to the sub-region due to its network of branches across West Africa and beyond.

Merril Lynch tours Aluworks

2008-07-09T06:16:00.000-07:00

Merrill Lynch, one of the world's leading financial management and advisory companies, has led a delegate of institutional investors to visit the country.
The 10-member delegation’s visit formed part the investor’s visit to Africa to meet leading African companies and to find attractive investment opportunities in the region.
As part of their investment tour, the company visited Aluworks Limited, a leading manufacturer and exporter of aluminium products in West Africa.
The group was led by Mr Winston Monale, Merrill Lynch’s, Global markets & Investment Banking Group.
Other members are Mr John Storey, also of Merrill Lynch, Global Markets & Investment Banking Group, Mr Michael Konstantinov and Mr Thomas Orthen of Allianz Global, Frankfurt, Germany, Mr Ryui Takezaki, Mr Yutaka Kontani and Mr Isao Uesaki of Nomura Asset Management, Tokyo,
The rest are Mr Peter Heilner of RP Capital Group, London, Mr Urban Larson of F& C Investments, London and Mr Mr William Pang of ING Investment Management. The Hague , The Netherlands .
Mr K. Venkataramana, the Managing Director of Aluworks and Mr Francis Agboada, Chief Finance Officer of Aluworks Limited took them through the operations of the company and later walked them through the company’s facilities including the new projects and explained the growth potential of Aluminium Industry in Ghana.
A Group photograph of the distinguished investor team with Aluworks Management team.

PNC will pursue industrial development

2008-07-09T06:14:00.000-07:00

Story: Boahene Asamoah

THE presidential aspirant of the People’s National Convention (PNC), Dr Edward Mahama, has said a government under his administration would work in partnership with the Association of Ghana Industries (AGI) to develop industrial infrastructure and zones to favour industrial development, efficiency and competitiveness.
His government, he said, would also develop the human resource base of industries, to improve financing opportunities for industrial development as well as reforming the tax system of the country.
Speaking at a meeting with members of the AGI in Accra yesterday, Dr Mahama said “a priority area for me would be working with the Electricity Company of Ghana (ECG) and the Ghana Water Company Limited to ensure reliable and efficient supply of these two essential commodities of industrialisation”.
He stated that industries in Ghana today were in crisis, adding that the high level of unemployment, the high number of companies filing for bankruptcy and the recent escalating oil prices were clear indications of the crisis industries were faced with.
Dr Mahama, whose paper was titled “Creating Giants -The PNC Commitment”, said his vision would be creating giants in industry, stressing that creating giants would bring about economic growth and national development, which required partnership between the government and industries.
He said his government would usher in the Golden Age of increased productivity with focus on two primary areas, namely agriculture and industry.
“There cannot be development economically or socially without increased production of food and other goods and services, he stated, adding that “government must partner the agricultural sector to lead an increased food production”.
Dr Mahama stated that agro-based industry must be firmly established to anchor the country’s industrial take-off which would follow the petrol chemical industrial complex waiting to be developed.
“A solid agro-industry industry will partner the petrol-chemical industry to create an African Industrial Giant in Ghana,” the presidential aspirant stated.
Dr Mahama underscored the need to link science and technology to agriculture and industry to ensure accelerated growth and development.
Dr Mahama, after his presentation, signed a Memorandum of Understanding (MoU) with the AGI.

pursue policies to absorb economy from shocks

2008-07-09T06:12:00.000-07:00

Story: Boahene Asamoah

THE World Bank’s Country Director, Mr Ishac Diwan, has said that the country must pursue efforts that will saveguard the economy from external shock, by taking advantage of price increases in agricultural products and gold on the international market.
He said although the economy had been resilient in spite of the multitude of shocks, macro balances had been pushed to the limit.
Speaking at the Annual Ghana Consultative Group/Partnerships Meeting in Accra yesterday, Mr Diwan stated that high food prices had a great potential for agriculture, adding that it was important therefore that ambitious programmes were put in place to take advatage of the situation.
The one-day meeting on the topic “Ghana’s Aid Policy-A Joint Approach to Accelerate Development” was attended by the country’s developmental partners.
The aid policy is set against the background of the country’s vision of becoming a middle income country by 2015.
The World Bank Country Director said the global context of development offered both challenges and opportunities adding that “leadership, policy and serious implementation will make all the difference.”
Mr Diwan said according to the bank’s research there were mounting evidence that the country was a star performer with a rating of four out of six.
“The past six years have put Ghana in an enviable position”, he stated and outlined some of the achievements as the stable macro, good growth rate and shared growth.
Mr Diwan stated that the economy was more resilient and had a better stabilisation as witnessed by the recent safety net packages.
He said there had been progress on some of the Millennium Development Goals (MDG) such as poverty reductions, which he said had declined from 40 per cent to 28.5 per cent in 2005, good improvements in health and education among many others.
He congratulated the government for its forward looking long-term development plan, describing the document as rightly outlining several areas where systematic progress was required.
Mr Diwan mentioned some of the challenges as the infrastructure agenda, with difficulties in the energy sector, effective decentralisation and the use of technology in all efforts.
He said with the discovery of oil the country could more confidently envisage the path to middle income, adding that “the government must commended for the preparatory work to make oil a blessing rather than curse.
Mr Diwan called for the need to factor in the private sector more into the infrastructure gap especially in the area of energy, information technology and water.
The country director underscored the importance of Overseas Development Assistance (ODAs) and said there was the need to work together on harmonisation and aid effectiveness.
He said there was the need for ODAs as the country progressed because it had the potential to support inclusive societies by investing in the poor, reducing financing costs and could reduce risks linked to the international market.
“But the role of ODA will need to continue to evolve. It must foster and not crowd out local capacities”, he stated.
Over the last two decades, external assistance has constituted an important source of financing Ghana’s development and would continue to play a vital role over the medium to long-term.
Currently,\ aid accounts for about 20 per cent of the total annual government budget resources.

Vepp urges development partners to align procedures

2008-07-09T06:10:00.002-07:00

Story: Boahene Asamoah

THE Vice-President, Alhaji Alui Mahama, has called on the country’s development partners to re-organise their support to the country to ensure the proper alignment and the harmonisation of procedures.
That he said would also help strengthen the public financial management systems.
Delivering the keynote address at the annual Ghana Consultative Group/Partnership Meeting in Accra yesterday, Alhaji Mahama said “we are all witnesses to how instrumental aid delivery can be to the development of a nation when it is delivered on the principles of ownership alignment while using country systems”.
He again called on the international community to take up the challenge of addressing the difficult but necessary policy and procedural reforms required to maximise the development impact of aid.
Speaking on the topic Ghana’s Aid Policy- A joint Approach to Accelerated Development”, the Vice-President at the meeting offered to take account of the national development process and reminded the country of where it had come from and where it was headed.
He said “the government had achieved some impressive results in our development agenda for the various sector”.
Alhaji Mahama stated that the economy had been under severe pressure due to the escalating crude oil and food prices, as well as wage agreements necessary for the stable governance of the country.
“It has remained fairly resilient due to the strong macroeconomic fundamentals sustained in 2001”, the Veep stated.
He said it was as a result of the global crises that the government announced mitigation measures to lessen what the Vice-President described as “harsh global crisis”.
“It is estimated that the government will loose about GH¢92.47 million in revenue as a result of the mitigating measures on food and oil”, adding that the government would subsidise the cost of fertiliser to farmers and increase subsidies on energy.
He said the Ministry of Food and Agriculture had been directed to hasten the supply of tractors at subsidy rates and to also fast track the creation of small irrigation dams and improved seedlings to farmers.
The Vice-President urged the discussants to deliberate on the type of aid architecture the country had with its partners and the response needed to move the economy to a middle income status by 2015.
On the oil find, the vice president said the government would work with the various oil and gas sub-committees to evolve a policy and strategic position on how to utilise the resources to harness the transformation of the economy prudently with a positive impact on the national development agenda.
THE Minister of Finance and Economic Planning, Mr Kwadwo Baah-Wiredu, has said that the pressure from the global crises could potentially wipe away the country’s macro-economic gains.
He said Ghana’s crude oil import bill had risen from $500 million in 2005 to $2.1 billion at the end of 2007 and is currently moving to $2.5 billion for the same quantity of oil imports.
Ghana imports about 60,000m barrels of oil annually to the country.
He said the government had used price and tariff adjustments, restructuring of normal government business and tightened its fiscal stance to address the problems and was currently implementing new measures to ensure that these measures were sustained and mentioned some of the measures as the adjustments in electricity special load tariffs.
“In additionally the increase in tariffs for the high voltage users, the use of the hydro component for generation will be increased, while the emergency power plants will be shut down”, Mr Baah-Wiredu stated.

a Community to expand operations

2008-07-09T06:10:00.001-07:00

THE La Community Bank, a community and rural bank in La is to open two new branches in order
to bring banking to the door steps of its customers.
The new branches will be sited at Teshie Nungua and Mamprobi respectively.
Speaking at the annual general meeting of the bank, the board chairman, Mr K.B. Asante said “this strategy will achieve increased net results”.
He said among its branch expansion drive the bank would also pursue policies to ensure a more active accounts, increase its loan portfolio and improve operating standards.
Giving the financial performance of the bank for the 2007 financial year,Mr Asante said the bank recorded a net profit of GH¢282,257 as compared to the figure of GH¢223,376 in 2006, representing a 26 per cent increase.
He said total income rose by 43.6 per cent from GH¢831,750 in 2006 to Gh¢1,194,685, at the end of last year.
Mr Asante stated that the bank saw its assets increased by 32.3 per cent from GH¢7,289,376 in 2006 to Gh¢9,643,356 for the year under review.
He explained that the growth was mainly accounted for by increase in loans and advances as well as investments in government securities and other instruments on the money market.
Total deposits increased by 43.01 per cent from Gh¢5.043 million in 2006 to Gh¢7,212 million last year
The bank paid 86,999 of its net profit as dividend to shareholders, representing a GH¢0.006 per share, an increase of 30 per cent over the previous year’s figure.
Mr Asante urged shareholders to increase their stated capital by buying more shares in the bank to enable it expand its branch expansion.

Making Ghana the Financial Hub-Banks urged to integrate financial services into global economy.

2008-07-09T06:08:00.000-07:00

Story: Boahene Asamoah

A Deputy Minister of Finance and Economic Planning, Dr Anthony Akoto-Osei, has challenged banks in the country to ensure that the sector becomes a robust and sophisticated one that will anchor the country’s integration into the global economic and financial system.
He said “the country lacks a financial sector, well robust and sophisticated enough to anchor Ghana’s integration into the global economic and financial system.”
Speaking today at the inauguration of the new branch office of Amalgamated Bank at Osu, one of the booming economic centres in Accra, Dr Akoto-Osei stated that the government, on the other hand, was committed to providing the necessary environment to ensure that the country had the expected robust, financial sector.
He reiterated the government’s vision of making Accra the financial hub of the sub-region, with a world class, globally competitive financial services sector.
The minister said banks had deepened financial ???intermidiation??? in the country by expanding credit to worthy individuals and businesses, adding that “all these help fuel economic activities and give crucial momentum to the growth of our economy”.
He said the vibrancy of the financial sector being witnessed was as a result of the forward-looking reforms of the government.
Dr Akoto-Osei commended the bank for expanding its operations in the country and for doubling its staff strength in two years.
The opening of the new branch office at Osu brings the bank’s branches to 12.
The Managing Director of the bank, Mr Oluwole Ajamole, said “we set ourselves the mission to lead the market in providing customer-focused financial services to meet the peculiar needs of our dear customers.”
He said the bank’s decision to open a branch at Osu was part of its drive to make its convenient, customer-centred brand of banking solutions available to a wider range of the Ghanaian public.
He assured the banking public that the bank would by the end of the year add eight more branches to its network of branches and bring the total to 20.
Mr Ajamole stated that new branch was equipped with modern and state-of-the-art facilities and a team of smart and committed staff to serve the needs of customers.
The managing director said this was an exciting time to do business in the country and referred to the economic growth that the country was witnessing, the opening of new businesses in the country as well as the oil find.
“These provide a dynamic environment with constantly changing opportunities and threats to businesses”, he added.
He said the bank would continue to expand in all spheres and increase its footprint, business lines and capacity to offer better services to its customers.

Uphold good corporate, hygienic practices— Prez urges companies

2008-07-09T06:07:00.000-07:00

Story: Boahene Asamoah

PRESIDENT J.A. Kufuor today inaugurated the $40 million Accra Mall, a shopping centre, with a call on the companies it hosts to ensure good corporate and hygienic practices.
The President acknowledged the employment generation that the mall had brought to Ghanaians and used the occasion to woo foreign investors to take advantage of the prevailing investment friendly atmosphere to invest in the country.
The pioneering retail venture is the brain child of Mr Joseph Owusu-Akyaw and supported by Actis, a leading private equity investor in emerging markets.
The shopping mall is situated on a 20,000-square metre retail space at the Tetteh-Qaurshie roundabout, it accommodates 65 line shops, of which about 30 per cent is operated by Ghanaian retailers.
It is home to some international brands such as Shoprite, Game, Mr Price, Barcelos, Ocean Sting, Rhapsody, Puma, Sony and luxury car dealers.
President Kufuor urged the youth to take advantage of the industry with specific skills in order to brace themselves for more of such opportunities.
He said the government’s policy had been a public-private partnership to develop the economy.
He said the government had embarked on reforms such as reforming the public sector to be more efficient to respond to private sector needs.
The Chairman of Accra City Hotels, the local partners of the mall, Mr Owusu-Akyaw, said the inauguration of the mall was borne out of a long time vision to build a shopping mall to meet needs of the burgeoning middle and upper classes in Accra.
“It was borne out of the determination to prove that the surest way to attract foreign direct investment is when local entrepreneurs themselves identify the felt needs of our people,” he stated.
He said the Accra Mall would be an instrument for growing new entrepreneurs for the creation of jobs estimated for 5,000 people and generate revenues from over 64 enterprises under one roof, adding that “the Accra Mall points to the future of the retail sector”.
A Partner of Actis, Dr Nkosana Moyo, stated that the company had so far invested $1.6 billion in the project and had about $6 billion investible funds, stressing that access to capital was longer a problem for businesses in Africa.
The Accra Mall is the second of such investments in Africa after the one in Lagos, Nigeria.
He said Africa was open for business and that Actis, would partner local investors who had the requisite skills and business strategy to develop.
The Accra shopping mall is the first large-åscale shopping centre in the country and one of the modern shopping malls in West Africa.
The design of the mall is contemporary and incorporates trradional internal mall circulation with open skylights, modern flush plastered ceileing and tiled floors.

Oil find must yeild maximum benefits to all-GNCCI urges gov’t

2008-07-09T06:06:00.000-07:00

Story: Boahene Asamoah

THE Ghana National Chamber of Commerce and Industry, the umbrella organisation of the industry and commerce, has said that exploitation of oil in the country would yield maximum benefit for all Ghanaians.
A policy paper issued by the chamber on the impact of the oil find in the country said recent history of poorly managed oil resources in developing countries made life worse for most of its peoples, adding that, instead “the discovery of oil in Ghana should be a blessing”.
The chamber’s position was that the government’s intention to create a stabilisation fund was in the right direction, but explained that the design and operation of the fund should be based on transparent integration into the budgetary process to avoid off-budgetary spending.
“Parliamentary/legislative oversight should be included, with the aim of preventing the Executive from maintaining sole discretionary powers over the fund’s resources,” the chamber stated.
It said to ensure a proper integration of the fund into the budgetary process, there should be no independent spending authority for it.
“Moreover, the fund should be prohibited from holding public debt. Assets in the fund should not be used as collateral to increase uncontrollable fiscal spending,” the chamber stated.
The chamber suggested that an asset management strategy for the fund to be designed should be consistent with the debt management operations of the Ministry of Finance, the treasury’s management of government cash flow and the financial assets already held as part of the government’s balance sheet.
“This will help ensure that the overall net asset position of the government is maintained in an appropriate way,” the chamber added.
It said the country’s experience in this regard suggested that success lay in some combination of expenditure restraint and revenue management.
It added that the aim of these approaches was to eliminate instability in aggregate demand, and consequently the real exchange rate, by smoothing expenditure over time, which implies self-insuring against revenue downfalls.
On the impact of the oil find on the economy, the chamber urged the government to promote a diversified economy by maintaining incentives for a competitive non-oil tradable sector.
The chamber observed that currently there was a slowdown of the industrial sector in the country, as a result of competition from foreign cheap imports.
“We do not anticipate any improvement as a result of the oil find until we are able to develop the human resource capacity and provide utilities efficiently and generally upgrade the quality of locally produced goods,” the chamber stated.
It went further to state that priority must be given to investment in affordable and renewable energy sources, water and rail transport which was key to industrialisation as well as to modernisation of agriculture.
The chamber suggested that the country could use its oil wealth to manage resources efficiently, by ensuring that the country processed 50 per cent of its cocoa production, refine 50 per cent of its gold as well as train and retain 100,000 doctors and other health workers.
Additionally, the chamber said the government should use the oil to invest in affordable nuclear energy technology, construct additional oil refineries and also expand University of Mines at Tarkwa to include a faculty of oil drilling.
The chamber also urged the government to pursue modernisation of agriculture to improve real income, enhance local raw material supplier and ensure food security.
“With a successful implementation of the agricultural land management action plan, investment in large commercial farms and making use of latest technology would ensure that Ghana meets shortfalls in food security,” the chamber stated.

BANK PHB to extend its operations to Ghana

2008-07-09T06:05:00.000-07:00

BANK PHB Nigeria, the title sponsors of the Africa format of the world famous business reality show The Apprentice Africa, says it has plans to extend its arms to Ghana and West Africa as a whole.
A statement issued by the bank said the overall winner of the Apprentice Africa TV business reality show, Mr Isaac Dankyi-Koranteng would be assigned to work on a special West Africa expansion project of the Bank, which would include its entry into Ghana.
“He will be assigned special responsibilities by the Managing Director and CEO of the bank which include research and development of products, and roll-out strategy for the bank, in new markets with supervision by the Apprentice Africa 'CEO', Mr Biodun Shobanjo,” it said.
Mr Dankyi-Koranteng is one of the three Ghanaians who competed with 15 others from six African countries including Africans who studied and lived in Europe and America.
He is a graduate of Kwame Nkrumah University of Science and Technology, Kumasi, and holds Bachelors degree in Publishing Studies and an MBA from the University of Technology, Wuhan, China. By coming tops from this gathering of what can be described as Africa's best young minds, Isaac has lent credence to the quality of Ghanaian education.
Two other Ghanaians were also part of the maiden Apprentice Show. They are
Ms Hannah Acquah and Regina Agyare who made it to the last six.
The Group Head of Corporate Communications of the bank Mr Charles Odibo, said by producing The Apprentice-Africa, Bank PHB was living its commitment of identifying and nurturing a new crop of future leaders and also broadening the bank's continuing engagement with programmes and initiatives to extend the frontiers of education, innovation and leadership.
He also indicated that 15 other contestants have accepted to work in various job positions offered by the bank, which include its expansion roles into East Africa.

New tariff will worsen Obuasi’s Plight

2008-07-09T06:04:00.000-07:00

ANGLOGOLD Ashanti has said that it would be unable to recover from its performance from its Obuasi Mine if the recent announcement of upward prices in utilities was implemented.
A statement issued by its Corporate Affairs Manager, Mr John Owusu said the situation was a delicate one, adding that “even at US$0.9cent per kilowatt-hour, power tariff is breaking our neck.”
“We do not have cash flow to talk about; so additional power cost will turn our cost structure and new projects asunder”, the statement said.
The statement mentioned two main reasons for Obuasi’s ‘unprofitability’. “Unlike surface mines, the over 100 years operation is not gaining from the current gold price due to high cost of production and the hedge book it is carrying”, the statement said.
It said total production costs, according to the company’s 2007 financial statement jumped from $481 per ounce in 2005 to $698 per ounce in 2007 and it was now in the region of $755 per ounce.
In contrast, gold price increased progressively from $410 in 2004 to $697 in 2007.
The statement said hedging the mine, which dated back to the ex-Ashanti Goldfields era, means that with its current hedge book, Obuasi was not in good stead to benefit from the current spot, which is well over $900 per ounce.
The company has launched this year a turn around strategy, backed with $44.4 million and additional $130 million for capital considerations, aimed at modernising and expanding the mine but these transformation projects may not be a reality if the new tariff is imposed on the mine, which is the only underground mine and hope that the mine’s competitiveness will be restored in three to 5 years time.
Nothwistanding, the mine continues to contribute its quota to the economy. It employs more than 7000 Ghananaians, including contractors and has paid $38 million in the past four years in the form of royalties and $15.4 million as dividends to the government.
The statement said the mining industry was talking to the VRA and other parties concerned, through the Ghana Chamber of Mines and expressed the hope that “something good, which was acceptable to all parties will come out of these meetings in the near future”.
It said Obuasi mine may be one of the richest, in terms of reserves, underground gold mines in the world.
However the statement said “at the current gold rally, which has seen a skyrocketed price from $410 per ounce in 2004 to about $900 this year, the AngloGold Ashanti operation is not making it, and is not likely to recover if the current maximum indicative power tariff announced by the Public Utility Commission is implemented.”

Review compensation Law- Joyce Aryee

2008-07-09T06:03:00.000-07:00

Transol to raise additional capital

2008-05-01T23:38:00.000-07:00

Story: Boahene Asamoah

TRANSACTION Solutions, an information, communications and technology firm listed on the Ghana Stock Exchange, has said it plans to source additional funds from the capital market to expand its operations.
Speaking at the Facts Behind the Figures programme of the Ghana Stock Exchange (GSE) in Accra, the Chairman of the company, Mr Paul Jacquaye, said the company planned to deploy 300 additional automatic teller machines (ATMs) throughout the country. The company presently has 42 ATMs across the country.
He said the company also planned to expand its operations by pursuing a policy that would ensure that banks out-sourced the operations of their ATMs to the company.
The company operates in three broad areas which are: the telecoms sector, where it operates electronic voucher recharge cards for MTN; the banking sector, where it operates the ATMs and Point of Sale (POS) deployment; and electronic inventory and hosting and the retailing section, where it operates the Ezi shop outlets at Shell shops and some supermarkets.
Mr Jacquaye said the company hoped to diversify its operations in the telecoms sector to leverage its experts to cover other networks as well in order not to be too dependent on one network.
He said the company’s market share in the telecoms sector had dropped from 12 per cent to 4.5 per cent as a result of MTN’s decision to appoint six more distributors, bringing the total number of distributors to 12.
The chairman said presently the company had added Ghana Telecom and Tigo to its list of clients while there were opportunities for adding new networks in the near future.
On the POS, Mr Jacquaye stated that the company also intended to take advantage of the introduction of the Biometric Smart Cards by deploying 5,000 POS in the country.
He said the company was currently in the process of preparing for the VISA and Mastercard third party processing status which would help the company to process the international card locally and attract banks in the country.
“We hope this will present us with opportunities to process transactions for issuers”, Mr Jacquaye stated.
He said the company hoped to expand its Ezi shop concept to cover travelling and ticketing as well as embark on franchising of its brand.
“The Ezi Travel is a new business to leverage on Ezi Shop“, he stated.
Touching on its financials, the chairman said the company projects a net profit of GH¢540.86 million from the loss it recorded in 2007.
He said assets grew buy 104 per cent on account of its ATM expansion works from GH¢932.36 million to GH¢1,905.38 million and projected 23.66 per cent increase to GH¢2.4 billion
He said “ our growth strategies will be to look at possible mergers and acquisitions, raise additional capital for expansion and expand retail presence”.
He said the company would also establish the Transol business model in neighbouring countries.

Aluworks diversifies product lines

2008-05-01T23:37:00.000-07:00

Story: Boahene Asamoah

ALUWORKS Limited, manufacturers and exporters of semi-finished aluminium products, has completed the installation of a 20,000 tonne coil coating plant in a bid to diversify its products and add value to its aluminium products.
The $6.5 million continuous coil coating line, the first of its kind in the country, would offer opportunities for downstream industries in areas such as roofing sheets, ceiling tiles and window blinds.
It will also meet the local demand as well as the export market, especially within the West African sub-region.
Briefing a cross-section of journalists, representatives of financial institutions and institutional investors over progress of work on the new plant, the Managing Director of the company, Mr K. Venkataramana, said the company had to install the new plant because of a growing market for the downstream products as “coloured coils are being imported to the Ghanaian market.”
“The market is demanding various technology which provides long life to the roof and also improves the aesthetic appeal,” the managing director added.
He said the coloured sheets were preferred because of their long life and the visual appeal of various colours.
Taking the delegation through the process of coil coating line, Mr Venkataramana said the technology was in surface preparation and oven baking of the paint, adding that the coil which was fed into the line underwent pre-treatment such as alkaline degreasing, acid, neutralising, demineralised water and steam cleaning and dying.
He said the line had the capacity to coat aluminium alloys, aluzinc and galvanised sheets to cater for the various market segments.
The managing director said currently test runs were being held, and that commercial production would begin by the end of May this year.
Mr Venkataramana indicated that the company in addition to the new plant had also embarked on additional 30,000 metric tonnes per year Cold Rolling Mill in response to the rising demand of the aluminium market.
Last year, the company signed a $12.5 million contract with Fata Hunter, a division of FATA S.p.A of Italy for the supply of a 30,000 metric tonnes per year capacity Cold Rolling Mill.
The new mill is expected to be completed by December this year, which would complete the old mill.

Put taxes of aluminium imports

2008-05-01T23:36:00.000-07:00

Story: Boahene Asamoah

THE Board Chairman of Aluworks Limited, manufacturers and exporters of semi-finished aluminium products, Mr William E. Inkumsah has hinted that the Company has presented a petition to the government for import tariffs to be slapped on imported aluminium products into the country.
He said the proposal was to ensure the survival of the aluminium industry on cheap imports from especially China, which had flooded the Ghanaian market in particular and the West African markets in general.
Speaking in an interview after a tour of the newly installed coil coating line at the company’s premises, Mr Inkumsah said the government was studying the proposal and was hopeful that it would consider the request to place tariffs on imported aluminium coils into the country.
He said the closure of Volta Aluminium Comapny (VALCO) had posed tremendous challenges to the company, which now had to import aluminium ingots from South Africa, India and other places at a very high cost of international prices.
“But for the VALCO closure, we would have been very competitive”, the board chairman stated, adding that presently the company had to melt the imported aluminium ingots at huge cost, which was not the case when VALCO was in operation.
Aluworks had a pipeline connected to VALCO where its raw material, the alumna flows through the factory and was processed into semi-finished products.
VALCO was shut down at the height of the energy crisis that the country faced last year after nearly a year of power cuts.
Sources close to the industry hinted that ALCOA, the partner to the government has packed bag and baggage and left the country following the closure of VALCO.
According to Mr Inkumsah, Nigeria also faced a similar situation where cheap aluminium products nearly collapsed the industry, but for the timely intervention of the government which placed 25 per cent tariffs on aluminium.
He said he was optimistic that the government through the Ministry of Trade and Industry would heed to the call to ensure the survival of the industry.
Aluworks offers opportunities for downstream industries in the aluminium industry that employs over 600 people.
The company exports most of its products to neighbouring countries, mainly Nigeria and recently Burkina Faso and Togo.
The company has recently completed the installation of a 20,000 tonne coil coating plant in a bid to diversify its products and add value to its aluminium products.
The $6.5 million continuous coil coating line, the first of its kind in the country, would offer opportunities for downstream industries in areas such as roofing sheets, ceiling tiles and window blinds.
It will also meet the local demand as well as the export market, especially within the West African sub-region.
In addition to the new plant, the company had also embarked on an additional 30,000 metric tonnes per year Cold Rolling Mill in response to the rising demand for the aluminium products.
Last year, the company signed a $12.5 million contract with Fata Hunter, a division of FATA S.p.A of Italy for the supply of a 30,000 metric tonnes per year capacity Cold Rolling Mill.
The new mill is expected to be completed by December this year, which will complement the old mill.

NIB focuses on capitalistion through organic growth

2008-05-01T23:34:00.000-07:00

Story: Boahene Asamoah

SHAREHOLDERS of the National Investment Bank Limited, (NIB) have approved the board’s decision to transfer an amount of GH¢13 million from the bank’s income surplus to its stated capital.
The move is to gradually raise the minimum capital to GH¢60 million by 2012 as directed by the central bank.
At the annual general meeting in Accra yesterday, the Board Chairman of the Bank, Dr Charles D. Jebuni, said the bank was hoping to meet the new capital requirement by 2012 through its own internal growth strategies.
The Bank of Ghana (BoG) has given local banks in the country up to 2012 to raise their minimum capital requirement from the present Gh¢ 7 million to GH¢60 million.
“We are focusing on capitalisation of the bank through organic growth”, Dr Jebuni stated.
Giving the financial performance of the bank for the 2007 financial year, the board chairman said the total income increased by 54 per cent from Gh¢25.19 million in 2006 to Gh¢38.8 million by the end of last year.
He said Profit after tax stood at GH¢5,989 million from the previous year’s figure of GH¢4,427 million.
Dr Jebuni said total deposits of the bank grew by 44 per cent from GH¢169.75 million in 2006 to Gh¢244.58 million at the end of December 2007.
Again, the board chairman stated that total assets grew by 23 per cent from GH¢344.26 million in 2006 to GH¢279.8 million in 2007.
The board has declared a dividend of GH¢0.0374 to shareholders representing a 50 per cent increase over the previous year’s figure.
He said during the year under review, the bank undertook a number of projects which included the expansion of its branch network.
The bank, according to him also established a joint venture capital company to provide equity and debt financing to small and medium scale enterprises.
“The 2006-2008 strategic plan of the bank was reviewed and the board of your bank approved a revised organogram in order to align departments and units to the new strategic choices which have been crafted and to sustain our competitive posture in the banking industry”, Dr Jebuni stated.
Giving the outlook, Dr Jebuni stated that the bank would strengthen its use of information, communication and technology (ICT) to ensure quality and timely service delivery.
That, he said would be undertaken by integrating the accounting software into the bank’s commercial banking application to enable it improve on its financial efficiency.
“We will also introduce Internet and SMS banking and credit cards for more convenience banking solutions”, he stated.
The Managing Director of the Bank, Mr Daniel Charles Gyimah, said “the bank’s attention will be geared towards generating more non-interest income in order to reduce the over reliance on traditional interest income”.
He was hopeful that the positive economic outlook for this year would provide the right environment and the platform for the banking industry in general and the bank in particular.

Our tariffs must be structured, transparent — Baidoe-Ansah

2008-05-01T23:33:00.000-07:00

Story: Boahene Asamoah

THE Minister of Trade, Industry, Private Sector Development and President’s Special Initiative (PSI), Mr Joe Baidoe-Ansah, has said there is the need for a well structured and a transparent approach to tariff reviews to ensure compliance with international best practices.
“This will offer the private sector refuge against unfair competition as is the case in other countries that use tariffs to protect local industry against unfair competition,” the minister said.
Speaking at a stakeholders’ meeting on the establishment of a tariff advisory board in Accra on Thursday, Mr Baidoe-Ansah stated that the lack of structured processes for seeking tariff review had led to many economic operators and the private sector to exert pressure on the government to back their demands for an adhoc tariff review.
“This is not the best”, the minister stated, adding that the ministry was seeking through consultative meeting to solicit inputs from stakeholders to bring into operation a Tariff Advisory Board (TAB).
The Minister explained that the establishment of the board was consistent with other policy initiatives and actions that were already underway, including the development of a competition law among others.
“Our goal under this thematic area or component is to provide a level playing field for all our economic operators through effective and systematic application of a transparent tariff regime.
The Minister said the establishment of the board constituted one of the ministries major series of programmes under the imports/exports component under the Trade Sector Support Programme (TSSP).
“Tariffs are at the core of our trade policy matters. Tariffs can be an effective tool not only for revenue but can also serve as a vital instrument for enhancing the competitiveness of domestic industries and for promoting the welfare of consumers”, Mr Baidoe-Ansah stated.
The minister underscored the objectives of the country’s trade policy and the TSSP which was meant to improve the legal and regulatory framework for business and consumers and thereby increase the country’s competitiveness in both the domestic and international markets.
Recently, the Board Chairman of Aluworks Limited, manufacturers and exporters of semi-finished aluminium products, Mr William E. Inkumsah hinted that the company had presented a petition to the government for import tariffs to be slapped on imported aluminium products coming into the country.
He said the proposal was to ensure the survival of the aluminium industry on cheap imports from especially China, which had flooded the Ghanaian market in particular and the West African markets in general.
Mr Inkumsah said the government was studying the proposal and was hopeful that it would consider the request to place tariffs on imported aluminium coils into the country.
Some industry players have also called on the government to impose taxes on cheap imported wax prints and textile which had almost brought the textile industry on its knees.
Again, during the 2004 budget statement, the government imposed tariffs on poultry imports into the country, only for the government to withdraw the tariffs.

SG-SSB to sustain growth through innovation

2008-05-01T23:32:00.000-07:00

Story: Boahene Asamoah

THE Board Chairman of SG-SSB, Mr Philippe Vigue, has said that the bank will continue to look for innovative ways of maintaining profits and ensure growth in the bank’s operations.
“We will continue to seek ways to strengthen and develop our operations and I am confident about the future”, Mr Vigue stated.
The Board chairman made this known when he addressed shareholders at the annual general meeting in Accra.
He explained that his confidence about the future was because the economy remained sound and the environment, positive due to the pursuance of prudent and appropriate macro economic policies of the government.
Giving the financial performance of the bank for the past year, Mr Vigue stated that the bank recorded a net profit of GH¢11.6 million as against the previous year’s figure of GH¢9.9 million recorded in 2006.
He said “net banking income increased by 12 per cent and current operating expenses grew by 18 per cent”.
The Board chairman noted that shareholders funds also increased from GH¢57.4 million to GH¢58.4 million representing an increase of 2 per cent.
The board recommended a dividend pay out of GH¢0.03. Having already paid an interim dividend of GH¢0.03, brings the total dividend to GH¢0.06 per share.
In his address, the Managing Director of the Bank, Mr Allain Bellissard, said during the year under review the bank witnessed an efficient growth in its treasury, positive evolution in business banking and strong growth in its retail banking, among others.
He said the bank also saw an increased financial support to the Small and Medium Scale Enterprises (SMEs) market segment and assured the shareholders that the financial support to that sector would be built upon.
“The segment is considered a major strategic business portfolio and therefore, in 2008 your bank will increase lending to the sector to combine with aggressive marketing, improved customer care and contact as well as monitoring to sustain portfolio quality”, Mr Bellissard stated.
Again, he said credit to business customers increased by 44.7 per cent over the previous year’s figure, which was fuelled by exposures to multinational and large local corporate businesses, particularly in the Information and Communication Technology (ICT), real estate and other productive sectors of the economy.
“Your bank’s commitment to the development of Ghana’s economy was underscored by the active role it played towards the success of Societe Generale and its partner lenders, regarding the $900 million sydincation for the 2007/2008 cocoa season”, the Management Director stated.

Build human resources on negotiation skills-African governments advised

2008-05-01T23:30:00.000-07:00

Story: Boahene Asamoah

The lack of trained human resources to negotiate on behalf of the state has been a major source of exploitation of the continent’s natural resources, the Chief Executive Officer of the African Investments Limited, Mr Kwasi Abeasi, has said.
He said African countries had comparative advantages that could be harnessed and fully exploited to yield greater resources for the continent, but lacked such personnel who understood the major issues.
In an interview on Globalisation and its effects on Africa at the ongoing United Nations Conference on Trade and Development (UNCTAD) in Accra, Mr Abeasi, who was one-time the Chief Executive Officer of the Ghana Investments Promotion Centre (GIPC), called on African governments to build human resources on negotiation skills.
He said “Africa had natural resources as its main comparative advantage”, adding that in negotiating for its exploit emphasis should be placed on value addition”.
He said globalisation had come to stay, and African economies should better be prepared to play their part in the global village, adding that Africa had all it takes to compete in the global world.
On the effects of Foreign Direct Investment (FDI), Mr Abeasi said “Africa needs FDIs to complement its domestic resources to develop”.
He said FDIs also had the potential to bring in the technical know-how that was needed badly for the continent’s rapid development.
He dismissed suggestions that FDI was not needed and stated that while local resource mobilisation was crucial, FDI was indeed a welcome relief to many African economies.
Mr Abeasi, however, stated that the focus should be on FDI that would be able to target where a country had both comparative and competitive advantages.
Mr Abeasi stated that there was also the need to create the enabling environment that would ensure that Africa took full advantage of FDI to the continent.
The UNCTAD XII conference would, among other things, discuss such topics as globalisation, Global Systems of Trade and Preferences (GSTP) and Trade and Gender: Perspectives for sustainable growth and poverty reduction.
Other topics are; Making sustainability standards work for pro-poor agricultural development and trade, Creating an institutional environment conducive to increased foreign investment, and sustainable development.
There will also be regional group meetings, which would consist of Africa, European Union and Group of 77 and China.

"Lets tackle social inequality"-UNCTAD Secreatary-General

2008-05-01T23:29:00.000-07:00

Story: Boahene Asamoah

THE Secretary-General of the United Nation’s Conference on Trade and Development (UNCTAD), Mr Supachai Panitchpakdi, has called on countries to tackle and address the issue of economic and social inequality brought about by globalisation.
“We must tackle poverty” and “reverse the trend of inequality,” Mr Panitchpakdi stated at the ongoing UNCTAD XII conference in Accra.
Contributing to a discussion on Enhancing Coherence at all Levels for Sustainable Economic Development and Poverty Reduction in Global Policy Making, including the contribution of regional approaches, Mr Panitchpakdi said globalisation had come to stay and “the least we can do is take care of the poor”.
He said there was growing disparity between the rich and poor and also increasing regional disparities in trade.
Mr Panitchpakdi suggested that while there was the need for sustainable growth, it was equally important to ensure the quality of growth that would ensure that resources were deployed to the productive sectors of the economy.
He said in most cases, some countries accepted investments that had led to the movement of resources from the productive sectors, stressing that “this is not the kind of investments we want”.
Mr Panitchpakdi, who touched on states and markets and the social conditions, stated that in many cases growth had led to child labour, which was not conducive to the entire communities.
The Secretary General questioned whether South-South co-operation would spur trade and investments that would ensure labour-intensive jobs.
Again, he asked whether the issues of Small and Medium Scale Enterprise (SMEs) support could work to improve trade and investments among countries.
Mr Panitchpakdi called for “ inclusive growth that will incorporate women and gender equality and ensure equal treatment”.
In her presentation, the President of Finland, Ms Tarjas Halomen, urged developing countries to respond positively to the globalisation phenomenon and not to give up on it.
She also called on women to be active participants in the development process to ensure the development of their respective countries.
Ms Halomen stated that it would be unwise to neglect gender issues in the economic development of any country and stated that women should be encouraged to participate in business and other economic activities to ensure that they benefited directly.
The Netherlands Minister of Development Co-operation, Mr Albert Koenders, observed that there was indeed increasingly inequalities with regards to globalisation.
He said African countries should take advantage of globalisation, especially in the agricultural sector, where it could generate a lot of employment opportunities for the continent.
“One needs to choose their own growth path,” Mr Koenders stated, adding that that was one of the surest ways to take advantage of globalisation.
The minister reiterated the need to build and strengthen regional blocs and trade, as well as enforce rules and regulations that would ensure the development of regional trade and investments.
Touching on trade liberalisation, he said the challenge was to develop comparative advantage and ensure global equitable integration.

UNCTAD-What it stands for

2008-05-01T23:28:00.000-07:00

Compiled by Boahene Asamoah

THE United Nation’s Conference on Trade and Development (UNCTAD) was established in 1964 to, among other things, promote the development-friendly integration of developing countries into the world economy.
In the early 1960s, growing concerns about the place of developing countries in international trade led many of these countries to call for the convening of a full-fledged conference specifically devoted to tackling these problems and identifying appropriate international actions.
Simultaneously, the developing countries established the Group of 77 to voice their concerns. (Today, the G77 has 131 members.)
The prominent Argentinean economist, Raúl Prebisch, who had headed the United Nations Economic Commission for Latin America and the Caribbean, became the organisation's first Secretary-General.

The first United Nations Conference on Trade and Development (UNCTAD) was held in Geneva in 1964.
Given the magnitude of the problems at stake and the need to address them, the conference was institutionalised to meet every four years, with intergovernmental bodies meeting between sessions and a permanent secretariat providing the necessary substantive and logistical support.

Over the past years UNCTAD has progressively evolved into an authoritative knowledge-based institution whose work aims to help shape current policy debates and thinking on development, with a particular focus on ensuring that domestic policies and international action are mutually supportive in bringing about sustainable development.
The organisation works to fulfil this mandate by carrying out three key functions:
It functions as a forum for intergovernmental deliberations, supported by discussions with experts and exchanges of experience, aimed at consensus building.
It undertakes research, policy analysis and data collection for the debates of government representatives and experts.
It provides technical assistance tailored to the specific requirements of developing countries, with special attention to the needs of the least developed countries and of economies in transition. When appropriate, UNCTAD cooperates with other organisations and donor countries in the delivery of technical assistance.
The Secretary-General of UNCTAD is Dr Supachai Panitchpakdi (Thailand), who took office on September 1, 2005.

In performing its functions, the secretariat works together with member governments and interacts with organisations of the United Nations system and regional commissions, as well as governmental institutions, non-governmental organisations, the private sector, including trade and industry associations; research institutes and universities worldwide.
The 1960s and 1970s
In its early decades of operation, UNCTAD gained authoritative standing:
*As an intergovernmental forum for North-South dialogue and negotiations on issues of interest to developing countries, including debates on the “New International Economic Order”.
*For its analytical research and policy advice on development issues.

Agreements launched by UNCTAD during this time include:
The Generalized System of Preferences (1968), whereby developed economies grant improved market access to exports from developing countries.
A number of International Commodities Agreements, which aimed at stabilising the prices of export products crucial for developing countries.
The Convention on a Code of Conduct for Liner Conferences, which strengthened the ability of developing countries to maintain national merchant fleets.
The adoption of a Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business Practices. This work later evolved into what is today known as “Trade and Competition Policies”.
In addition to these, UNCTAD was a key contributor to the definition of the target of 0.7 per cent of gross domestic product (GDP) to be given as official development aid by developed countries to the poorest countries, as adopted by the United Nations General Assembly in 1970.
It also spearheaded the identification of the Group of Least Developed Countries (LDCs) as early as 1971, which drew attention to the particular needs of these poorest countries. UNCTAD became the focal point within the UN system for tackling LDC-related economic development issues.
In the 1980s, UNCTAD was faced with a changing economic and political environment:
There was a significant transformation in economic thinking. Development strategies became more market-oriented, focusing on trade liberalisation and privatisation of state enterprises.
A number of developing countries were plunged into severe debt crises. Despite structural adjustment programmes by the World Bank and the International Monetary Fund, most developing countries affected were not able to recover quickly. In many cases, they experienced negative growth and high rates of inflation. For this reason, the 1980s become known as the “lost decade”, particularly in Latin America.
Economic interdependence in the world also increased greatly.
In the light of these developments, UNCTAD multiplied efforts aimed at:
Strengthening the analytical content of its intergovernmental debate, particularly regarding macroeconomic management and international financial and monetary issues.
It was also aimed at broadening the scope of its activities to assist developing countries in their efforts to integrate into the world trading system. In this context,
the technical assistance provided by UNCTAD to developing countries was particularly important in the Uruguay Round of Trade negotiations, which had begun under the General Agreement on Tariffs and Trade (GATT) in 1986. UNCTAD played a key role in supporting the negotiations for the General Agreement on Trade in Services (GATS).
UNCTAD’s work on trade efficiency (customs facilitation, multimodal transport) made an important contribution to enabling developing economies to reap greater gains from trade.
UNCTAD assisted developing countries in the rescheduling of official debt in the Paris Club negotiations.
Promoting South-South cooperation.
In 1989, the Agreement on the Global System of Trade Preferences among Developing Countries (GSTP) came into force. It provided for the granting of tariff as well as non-tariff preferences among its members. To date, the agreement has been ratified by 44 countries.
UNCTAD addressed the concerns of the poorest nations by organising the first UN Conference on Least Developed Countries in 1981. Since then, two other international conferences have been held at 10-year intervals.
Key developments in the international context:
The conclusion of the Uruguay Round of Trade negotiations under the GATT resulted in the establishment of the World Trade Organisation in 1995, which led to a strengthening of the legal framework governing international trade.
A spectacular increase in international financial flows led to increasing financial instability and volatility.
Against this background, UNCTAD’s analysis gave early warning concerning the risks and the destructive impact of financial crises on development. Consequently, UNCTAD emphasised the need for a more development-oriented “international financial architecture”.

Foreign direct investment flows became a major component of globalisation.
UNCTAD highlighted the need for a differentiated approach to the problems of developing countries. Its 10th conference, held in Bangkok in February 2000, adopted a political declaration – “The Spirit of Bangkok” – as a strategy to address the development agenda in a globalising world.
In recent times, UNCTAD has further focused its analytical research on the linkages between trade, investment, technology and enterprise development.
It has also put forward a “positive agenda” for developing countries in international trade negotiations, designed to assist developing countries to better understand the complexity of the multilateral trade negotiations and in formulating their positions.
UNCTAD expanded work on international investment issues, following the merger into UNCTAD of the New York–based United Nations Centre on Transnational Corporations in 1993 and has expanded and diversified its technical assistance, which covers a wide range of areas, including training trade negotiators and addressing trade-related issues; debt management, investment policy reviews and the promotion of entrepreneurship; commodities; competition law and policy; and trade and environment.
UNCTAD XI
UNCTAD has continued to play a crucial role in emphasising the development dimension of issues in the fields of international trade and investment and related areas.
In particular, UNCTAD has been addressing the imbalances of globalisation and the need to overcome the supply constraints of developing countries, so as to ensure development gains and poverty reduction.
This is captured in the theme of the UNCTAD XI Ministerial Conference, Enhancing coherence between national development strategies and global economic processes towards economic growth and development, particularly of developing countries.

The Trade and Development Board

In the four years between the meetings of the conferences, UNCTAD’s work is guided by the Trade and Development Board. Board membership is open to all members of UNCTAD, and accredited intergovernmental and non-governmental organisations enjoy observer status.
The board meets in Geneva once a year in regular session and up to three times a year in executive sessions to deal with ad hoc policy and institutional issues.
The Commissions
The Trade and Development Board currently has three commissions that meet once a year to address policy issues in specific areas and provide guidance for the work of the secretariat. These commissions are the Commission on Trade in Goods and Services; the Commodities, Commission on Investment, Technology and Related Financial Issues,
and Commission on Enterprise, Business Facilitation and Development.
The UNCTAD Secretariat also services the Commission on Science and Technology for Development (CSTD), which is a subsidiary body of the United Nations Economic and Social Council.
These commissions allow governments to exchange views on policy issues in their respective ambits.
As in all of UNCTAD’s intergovernmental bodies, decisions of the commissions are taken by consensus, and thus agreed conclusions and recommendations reflect the collective political will of UNCTAD’s membership.
Expert Meetings
The work of the commissions is supported by discussions among specialised technical experts in specific fields. Up to 10 such expert meetings are convened by the commissions every year. They allow the government representatives attending the commissions to take advantage of valuable technical input from academics, practitioners and the private sector.

President Inuagurates e-zwich

2008-05-01T23:26:00.001-07:00

Story: Nehemia Owusu-Achiaw & Boahene Asamoah

THE President, Mr John Agyekum Kufuor, yesterday inaugurated the national electronic payment system, popularly called e-zwich, with a call on micro, small and medium businesses to take advantage of the platform to be part of the financial system.
“Small and medium-scale businesses and those involved in micro-credit transactions must be encouraged to take advantage of this new platform to be linked to the financial system so as to benefit from the various services that the financial sector can offer,” he said.
Delivering the keynote address, President Kufuor stated that the main objective of the platform was to extend the coverage of financial services and transactions to a large segment of the population, adding that “this system is safe, secure and efficient”.
The e-zwich is a biometrics smart card which works both online and off-line which is meant to ensure cashless transaction and rope in the large untapped informal sector.
The President said the e-zwich would facilitate access to and transfer of money and remove the cumbersome and insecure processes of using cash.
President Kufuor underscored the importance of technology among emerging and developed countries which remained dependent on cash and paper transactions.
“Ghana must, therefore, phase itself from such dependency as it steadily progresses into the middle-income status,” he stated.
President Kufuor said in spite of the impressive growth of financial institutions as a result of reforms and stability in macro-economic environment, there were still a lot of people outside the financial system.
“An estimated 80 per cent of eligible population is still either ‘unbanked’ or ‘under-banked’ and seems to have no access to financial services,” he added.
The President again called on those responsible for the payment of wages, salaries, pension and other social support funds to consider the use of e-zwich to bring transparency and integrity to the payrolls.
The Governor of the Bank of Ghana, Dr Paul Acquah, said the e-zwich platform would transform the payment system into one that was state-of-the-art of the future to serve all financial institutions in the country.
“It is a platform to link all the existing 25 banking institutions, savings and loans companies, 123 rural banks and their branches and provide access to financial services and the national payment system for all economic transactions,” Dr Acquah stated.
He added that the platform provided a level playing field for institutions to compete on comparative advantage and innovation to drive the financial services industry.
“The e-zwich smart card can be used by anyone, everywhere to do business. It can store value, your money and your savings and you can use it to buy anything, anywhere, thanks to the e-zwich platform,” the Governor stated.
The acting President of the Ghana Association of Bankers (GAB), Mr Joe N. B. Tetteh, said the members of the association welcomed the introduction of the electronic platform as it had the potential to ensure an effective intermediation function of the financial system and the efficiency of funds flow as integral to the overall functioning of the system.
“The project is a manifestation of the banking fraternity’s contract to make Ghana a financial hub, with the government, the private sector and the community joining hands to ensure that the community at large is given easy and secure access to banking services,” Mr Tetteh said.
The Minister of Finance and Economic Planning, Mr Kwadwo Baah-Wiredu, stated that the government would continue to undertake reforms that would further propel the financial services sector to become the financial hub in the sub-region.

DVLA automates its operations

2008-05-01T23:25:00.001-07:00

Story: Boahene Asamoah

THE Driver and Vehicle Licensing Authority (DVLA) has launched its automated services project aimed at speedy customer service delivery.
The project is expected to reduce especially the number of paper work and the number of hours for services offered by the authority.
Launching the project, the Minister of Transportation, Dr Richard Anane, said the automation of DVLA’s activities would deal with the menace of the “Goro” boys whose activities was a thorn in the flesh of the authority.
He said “today’s occasion sets the DVLA on the course to matching up to the much touted world class standard”.
Dr Anane pledged the government’s support to the authority to continue to implement programmes in the interest of the nation.
The minister reiterated the number of reforms that the authority had undertaken since 2001, such as the opening of more branches throughout the country, and mentioned that a number of infrastructural facilities had also been undertaken.
He also mentioned the setting up of a client service unit and a banking facility at the authority’s premises as part of the reforms.
The Chief Executive Officer of the DVLA, Mr Joe Osei Owusu, stated that the automated project would help address the long period in processing of documents at its offices.
“It goes without saying that DVLA will be better placed to serve its customers better by automating its services delivery system and operations,” he stated, adding that “DVLA sees this project as an indispensable component of the process towards making it a world-class service provider”.
He said the project would also help in the monitoring of all DVLA’s activities nationwide and would ensure compliance of laid down standards and procedures and harmonise all the authority’s processes.
Mr Owusu stated that the automation project would encompass the authority’s area of work including its administrative and external works.
“The success or failure of a project such as this, aimed at improving service delivery and better equipping the DVLA to carry out its mandate therefore, would have a strong impact on the socio-economic development of the nation in the long term,” the chief executive officer stated.

20 Corporate bodies open off-shore banking facilities

2008-05-01T23:23:00.000-07:00

Story: Boahene Asamoah

TWENTY corporate bodies and 91 individuals from 14 countries mainly from the United States, the United Kingdom and China have established an off-shore banking facility in the country, the Managing Director of Barclays Bank Ghana, Mrs Margaret Mwanakatwe has stated.
Speaking at the 29th annual Management Day organised by the University of Ghana Business School, Mrs Mwanakatwe said “the large volumes of deposits that will flow will form the basis of developing more lending solutions to Ghana’s private sector”.
She said that the offshore banking services established in the country in September last year offered great opportunities of attracting Foreign Direct Investments into the economy.
Mrs Mwanakatwe who was speaking on the topic “Offshore Banking and the Ghanaian Economy” mentioned other benefits that the off-shore banking concepts would bring as aircraft financing and leasing, ship registration, trust incorporation assets management, insurance pension funds, consultancy services among others.
She dispelled suggestions that off-shore banking was associated with underground economy, organised crime and money laundering, stating that while Ghana’s off-shore banking was evolving and that the bank has learnt from best practises and has put in place strict rules and procedures that would check all such illegal transfers.
She noted that although off-shore banks may decide not to report their income to other tax authorities and have no legal obligation to do so, that did not make the non-declaration of the income by the tax payer or the evasion of the tax on that income, illegal.
Mrs Mwanakatwe cited examples of countries which had made use off-shore banking services such as Bermuda which had a population of about 70,000 and which ha attracted about 28 per cent of the world’s captive insurance market with 1,491 insurance companies having assets worth over $290 billion.
She added that the country’s banks held assets worth over $22 billion and the financial services sector accounted for 26 per cent of the Gross Domestic Product.
“Indeed off-shore banking provides a more friendly legal regulation, tax benefits and protection for customers”, adding that “offshore banking however is not only about access to investments products and opportunities that might not be available from domestic banks.
The Head of Banking Supervision, Mr Dela Selormey, said parliament had recently passed the anti money laundering act which was part of processes to check the transfer of illegal funds into the banking system.
He said the bank of Ghana would establish the Financial Intelligence Centre in collaboration with stakeholders to complement the activities of the banks to check the safety and soundness and to protect foreign deposits.
Mr Selormey stated that the central bank has adopted several policies such as the Customer Due Diligence (CDD) and the Know Your Customer (KYC) policies which were all meant to address some of the challenges that confronted the banking sector.
He also stated that the off-shore banking concept would help mobilise international funds, strengthen infrastructure of the banking sector and also improved the human resources of the country as well as ensure transfer of skills to the economy.
Mr Selormey mentioned some of the challenges that confronted the country in terms of attracting foreign direct investments as the need to sustain political stability, ensure efficient and effective legal system as well as ensure good corporate governance practices.

Inflation goes up

2008-04-06T04:37:00.000-07:00

THE Consumer Price Index (CPI) which measures the average changes in prices of goods and services in the country for the month of February edged up from 0. 4 percentage points to 13. 21 per cent.
This is the third consecutive time that inflation has been on the rise since November last year.
The January inflation rate was 12.81 per cent.
Announcing the figures at the monthly press conference in Accra yesterday, the Head of Economic Statistics Division of the Ghana Statistical Service, Mr Magnus Ebo Duncan, said the high prices of some basic foodstuffs such as fish, bread and cereals were responsible for the surge in inflation rate.
He said these products contributed 0.89 points and 0.55 points respectively, adding that some other contributors are vegetables, potatoes and other tuber vegetable groups accounted for 0.38 points and meat group accounted for 0.35 points.
Mr Duncan said the non-food component of the index contributed 0.85 percentage points to the index with furnishing, household equipment and routine maintenance group contributing 0.43 points. Other contributors were clothing and footwear which accounted for 0.34 points to that sector.
Inflation has been on the rise since November, 2007 where it stood at 11.40. It went up in December last year to 12.75 per cent and was up again in January this year to 12.81 per cent.
Mr Duncan said the monthly rate of inflation as compared with the previous month was 1.59 per cent.
The monthly rate shows how much the general price levels have changed in two consecutive months.

Non-traditional exports post strong growth

2008-04-06T04:35:00.000-07:00

Story: Boahene Asamoah

NON-TRADITIONAL Exports (NTEs) have shown strong performance over the past years, reaching $1.164 billion, above the $1 billion target for 2006.
The exports increased from $460 million in 2001 to $1,164 million in 2007, showing a growth rate of over 150 per cent.
On annual basis, the growth translates into a 20.7 per cent increase yearly.
According to a report from the Ghana Exports Promotion Council (GEPC), made available to the the Daily Graphic, total national merchandise exports of Ghana had shown positive growth over the past three years.
They have grown from $2.74 billion in 2004 to $4.19 billion in 2007, representing a 53.08 per cent growth in 2007 over the 2004 figures.
Within the same period from 2004 to 2007, NTEs grew from $705 million to $1,164 million, showing a growth rate of 65.08 per cent.
However, the percentage contribution of NTEs to total exports rose from 26.14 per cent in 2006 to 27.76 per cent in 2007.
Although the current year under review, 2007 follows the general trend of increase in NTEs achieved over the last five to six years, the export earnings achieved in 2007 exceeded the $1 billion earmarked for 2006 but falls below the expected amount of $1.2 billion forecast for the year 2007.
NTEs percentage contribution to total exports in 2004, 2005, 2006 and 2007 were about 25.74 per cent, 28.09 per cent, 26.14 per cent and 27.76 per cent respectively.

Review of NTEs Sector 2007
Total value of NTEs in 2007 was approximately $1,164 million. This depicts a growth of 30.42 per cent over the 2006 figures ($892 million). Previous year's performance showed an increase from $778 million in 2005 to $892 million in 2006, representing 14.8 per cent growth.
The performance of the sector over the period 2004-2007 is shown graphically below:
The total earnings of the non-traditional export sector in 2007 were made up of earnings from three main sub-sectors as follows:
The agricultural sector contributed by $197.24 million, representing a 16.9 per cent of the total exports. The manufacturing sector contributed $963. 5 million, representing 82.7 per cent while the handicraft sector contributed $3.79 million representing 0.32 per cent.
The GEPC report said the performance of semi processed/processed and the agricultural sub-sectors grew positively by 35.53 per cent and 11.14 per cent over the 2006 earnings. However, the handicrafts sub-sector recorded a negative growth of 15.59 per cent over 2006 earnings.
This was because major buyers of Ghanaian crafts in the United States of America (USA) turned to the Far-East, especially Indonesia, India and China for handicraft supplies with relatively good finishing and functionality.

Performance of NTEs by leading products
The 10 top performing products included cocoa paste which contributed 12 per cent worth $139.75 million, followed by canned tuna with 8.51 per cent of total exports amounting to $99.15 million.
Veneers accounted for 7.50 per cent with $87.8 million worth of veneers exported, $86.6 million worth of cocoa butter was exported, representing 7.45 per cent of total exports.
Other products including plastic wares, plywood, fresh or chilled tunas, nutural rubber sheets, shea nuts and cut pineapples, all made impressive gains during the 2007 export year. The total value of the top 10 earning products amounted to US$ 671,112,968 representing 57.63 per cent of the total NTEs for 2007.
According to reports, the increase in cocoa paste and butter earnings was due to increases in the futures prices for the product during the period on the London futures market.
Moreover, the increase in earnings was partly due to capacity expansion of a major exporter of cocoa paste, Barry Callebaut Ghana Limited and a major exporter of Cocoa butter, Cocoa Processing Company Limited.
The report said veneer sheets and plywood earnings increased significantly. This is mainly because a major exporter, John Bitar Company Limited, expanded its plant capacity and also acquired a defunct wood export company, Metro Star Limited together with its buyers.
Canned tuna also increased significantly because of the increase in the average world market price of the product and partly to the contribution of Myroc Food Processing Company Limited which did not feature in 2006.
In the agricultural sub-sector, the top export earner was frozen tuna which saw a 33.78 per cent increase from $39.4 million in 2006 to $52.8 million
Shea nuts, pineapple, cashew nuts and banana recorded negative growths of -0.88%, -29.40%, -9.99% and -3.54% respectively, compared with the 2006 performance.
Earnings from frozen tuna and other frozen fish grew significantly over the period, due to a huge investment and the utilisation of modern fishing implements by Panofi Company Limited.
Export of pineapples experienced a negative growth because of the fall in pineapple production due to many of the outgrowers leaving the industry.
Cashewnuts earnings decreased over the period due to the inability of one of the exporters, Rals Commodities Company Limited to export in the year under review. The company made US$3.2 million in the year 2006.
In the handicraft sub-sector, hides and skins were the top earners in that sector with 274 per cent increase in exports in that sector from $378,873 to $1,416,980.
The ten leading general product categories each contributed over US$30 million to NTEs earnings. The lead earning category, cocoa products, contributed 21.11 per cent to total NTE earnings in 2007, while rubber and rubber products, the tenth earning category, contributed 2.63 per cent to total NTE earnings in 2007.
The 10 leading general product categories were made up of seven processed or semi processed and three agricultural products. One out of the ten product categories, namely; horticultural products recorded a negative growth of -6.37 per cent in 2007 compared with 2006.
The performance of the NTE sector by markets indicates that the markets of the European Union and ECOWAS absorbed 46.55 per cent and 31.36 per cent respectively of NTE exports from Ghana. Other African countries and other developed countries as well as other countries including emerging or transitional economies/markets absorbed 2.36 per cent, 9.25 per cent , 10.48 per cent respectively of NTE exports from Ghana. This is shown in the chart above.
According to the GEPC report, a comparison of the performance of the various markets in 2007 to 2006 reveals that all the markets recorded positive growth. The EU market performance grew by 29.10 per cent whereas the markets of the other African countries, other developed countries and other countries including emerging markets grew by 8.97 per cent, 8.93 per cent and 14.89 per cent respectively.
In 2007, Ghana's single largest market for the NTEs was the United Kingdom, absorbing 11.42 per cent of total NTEs during the period
Nigeria which was overtaken by Burkina Faso in 2005 and 2006 has resurfaced as Ghana's leading market in the ECOWAS sub region.
Significantly, there was a positive growth in Nigeria's market share of total NTEs of 67.93 per cent in 2007 relative to 2006. Burkina Faso, the second most important market in the sub region registered a negative growth of 8.13 per cent in 2007 market share over 2006.

Tullow Oil pays $2.3 million tax

2008-04-06T04:34:00.001-07:00

Tullow Oil (fin)

Story: Boahene Asamoah

TULLOW Oil Plc, an oil exploration, developing and producing company, has presented a cheque for $2.3 million withholding tax to the Internal Revenue Service (IRS) for two operations it carried out last year.
At the presentation ceremony in Accra today, the Commissioner of the IRS, Major (retd) Dan Ablorh-Quarcoo, commended the company for their initiative, adding that in most cases the service had to chase companies to pay their withholding taxes.
He said the company had demonstrated high sense of responsibility by adopting self compliance in the payment of the witholding tax.
The Country Manager of Tullow Oil Plc, Mr Kofi Esson, said the payment of the tax was part of the company’s obligation to the state and that the tax represented two operations the company undertook last year.
Tullow Oil signed an agreement with the Ghana National Petroleum Corporation (GNPC) to explore, develop and produce oil in the country last year.

Picture:

Tullow Oil pays $2.3 million tax

2008-04-06T04:34:00.000-07:00

ECOBANK is Best Emerging Market Bank

2008-04-06T04:33:00.000-07:00

ECOBANK has been selected as the Best Emerging Market Bank in Cote d'Ivoire, in an exclusive survey to be published in the May 2008 issue of Global Finance magazine.
Global Finance editors - with input from analysts in the industry, corporate executives and banking consultants, selected ECOBANK based on the criteria which includes growth in assets, profitability, strategic relationships, customer service, competitive pricing and innovative products.
A statement issued by the bank quoted Mr Joseph D. Giarraputo, Publisher and President of Global Finance, as saying “We have identified the banks that provide service to corporations seeking to take advantage of substantial opportunities for growth in a sometimes challenging environment”.
It said the ECOBANK Group's Chief Executive Officer, Arnold Ekpe, said “The choice of ECOBANK confirms our position as a leader in the emerging African banking industry and our long-term commitment to the African continent”.
Ms Evelyne Tall, ECOBANK Executive Regional Director for the UEMOA Region, stated that “we are proud of this distinction. It highlights our commitment as a world-class Pan- African bank, to provide convenient, accessible and reliable banking and financial products and services to our customers in Africa”, the statement added.
Mr Charles Daboiko, Managing Director of Ecobank Côte d'Ivoire said “this distinction rewards our dedication to provide superior customer service, before and during difficult times. It motivates us to work harder for our customers, including investors, during this post-conflict era”.
Incorporated in 1985, ECOBANK Transnational Incorporated (ETI) is the parent company of the largest independent regional banking group in Africa.
The ECOBANK Group currently operates in 22 African countries, namely: Benin, Burkina-Faso, Cameroon, Cape Verde, Central African Republic, Chad, Congo-Brazzaville, Côte d'Ivoire, Gambia, Ghana, Guinea, Guinea-Bissau, Malawi, Mali, Niger, Nigeria, Liberia, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, and Togo.
In addition, ETI is listed on the stock exchanges in Lagos, Accra and Abidjan (BRV).
The group has over 8,000 employees in over 450 branches. ECOBANK is a full-service bank providing wholesale, retail, investment and transaction banking services and products to governments, financial institutions, multinationals, international organisations, medium, small and micro-businesses and individuals.
Global Finance, which celebrates its 21st year of publishing in 2008, has 50,000 subscribers and more than 284,000 readers in over 158 countries. This audience includes chairmen, presidents, CEOs, CFOs, treasurers and other financial officers responsible for making investments and strategic business decisions for large global companies and financial institutions.
Global Finance also targets the 8,000 key portfolio investors who control over 80 per cent of all assets under professional management.

Prudential Bank to roll out e-banking products

2008-04-06T04:32:00.000-07:00

Story: Boahene Asamoah

THE Managing Director of Prudential Bank Ghana Limited, Mr Stephen Sekyere-Abankwa, has said the bank would soon role out electronic banking products in its bid to attract more customers to the bank.
He said the introduction of electronic banking services “will provide convenient, time saving and easy access to banking services”.
Mr Sekyere-Abankwa made this known during the official inauguration of the branch office of the bank at Weija, a suburb of Accra, last Wednesday.
The managing director mentioned some of the electronic banking services as the Auto Teller Machines (ATMs), mobile phone banking, debit and credit cards, point of sale terminals, e-payment, e-marketing and Internet banking.
He said the new services being introduced would complement the traditional banking services that the bank had over the years offered to its numerous customers.
Mr Sekyere-Abankwa said the new branch at Weija was necessitated by the rapid expansion of the area and brings to two, the number of branches in that area.
“The bank plans to add seven more branches to its branch network by the middle of the year 2009,” he stated.
He said the bank had established its presence firmly in the banking sector of the economy and had delivered excellent performance in banking services and products that had made the bank to win numerous awards.
He said the bank was recognised for its service during the Ghana Banking Awards over the past two years and was adjudged the Best Bank in Long Term Loan Financing in 2005.
“The name Prudential Bank Limited is now synonymous with excellence, and today, we have brought our services to the business centre of Weija,” he said, adding, “We assure you that you will find us a vital partner in the growth of your businesses.”
Mr Sekyere-Abankwa encouraged micro, small and medium-scale enterprises to do business with the banks to ensure the growth of their business.

Inflation goes up

2008-03-30T06:48:00.000-07:00

Story: Boahene Asamoah

The annualised rate of inflation for the month of February has hit 13.2 per cent sending strong signals to economic watchers as to whether a single digit inflation would remain elusive to the country.
This is the fourth consecutive time inflation rate has urged up, having increased consistently from 10.14 per cent in October 2007 to 11.40 per cent in November, to 12.75 in December to 12.81 in January and then to 13.2 per cent.
What is worrying is that the food component of the consumer price index seems to have contributed to the increase in the inflation figure for February.
Although it was anticipated that food prices could increase as a result of the floods that hit the three northern regions which happens to be the food basket of the country and the cyclical nature of food prices during this period of the year.
The last previous upward movement in the inflation rate has by and large been attributed to the increase in the non-food component especially the upward increase in fuel prices in November and the higher spending patterns of the consumers during the yuletide in December.
Ghana has struggled to achieve a single digit inflation. In 1999 a nine per cent inflation rate was achieved, whiles in 2006, inflation inched closer to the single digit inflation.
The 2007 year started with inflation rate of 10.89 per cent in January and fell to 10.42 and 10.19 per cent in February and March respectively.
However, inflation rose again in April to 10.50 and 11.02 per cent May as a results of insufficient supply of staples such as maize, yam, cassava and plantain.
The February 2008 inflation increase was also due to high prices of some basic foodstuffs such as fish, bread and cereals were the major cause of the upward surge in inflation.
Considering the anticipated fuel price increases for this month as a result of the continous crude oil prices on the world market, the outlook of the economy look quiet uncertain.
The cyclical nature of the food prices normally would have started in March, but because of the floods this year’s food component impact on the CPI seemed to have started quiet early.
Again the rains seems to have delayed slightly which could
Last June for instance, the inflation rate declined which is the
The weakening of the currency especially against the United States dollar is also a source of great concern to economy.
The outlook of the economy seemed unbalanced although there has been some improvements such as the non-traditional exports hitting an all-time record of $1 billion at the end of the year, and also gold and cocoa prices hitting near records.
However, the continuous increase in crude oil prices coupled with

UBA open more branches

2008-03-30T06:47:00.000-07:00

Story: Boahene Asamoah

THE United Bank of Africa (UBA), Ghana has opened six new branches in Accra simultaneously as part of its strategy to enter into the retail business.
The new branches are located in Madina, Teshie, Spintex Road, East Legon, Dzorwolo and the Ring Road Central all in Accra.
The new branches also come with new model edifices designed with the customers in mind and conforms to the bank’s new banking edifices throughout its operation in Africa, Europe and America.
Speaking at the opening of the new branches at the Ring Road Central branch of the bank in Accra yesterday, the Managing Director and Chief Executive Officer (CEO) of the bank, Mr Nnamdi Okonko, said “ the opening of our additional six branches is a reflection of our expansionary posture and shows that we are on course as far as the bank’s branch roll-out strategy is concerned”.
He said “UBA bank also aims to develop a branch foot-print and delivery that will ensure that the banks services are always within reach of valued customers and thus position ourselves among the top five banks in terms of geographical reach”.
Mr Okonko said the bank which presently has 12 branches including the six new branches would add four more branches next month, adding that “UBA Ghana will continue its policy of opening new branches across all regions of the country”.
That he said would be supported with a roll-out of electronic channels such as point-of-sale terminals and auto teller machines in line with the objectives of the Ghana Inter-Bank Payment Settlement.
He said the strategic location of the new branches was to address the constraints of proximity to ensure that the bank’s services and products reached the door steps of the customer.
“It is a further opportunity to reach out to the mass retail customers who for various reasons, such as high initial deposit requirements and access to business loans have decided to stay out of the mainstream banking”, the CEO stated.
UBA Ghana, a subsidiary of UBA Plc one of the largest banking groups in Africa has expanded its operations to other countries in Africa, which includes, Liberia, Cote D’Ivoire Cameroun and Sierra Leone. The bank recently opened in London as Capital (Europe).

All set for e-Zwich introduction

2008-03-30T06:46:00.000-07:00

Story: Boahene Asamoah

ALL is set for the introduction of the national electronic payment system, the e-Zwich, next month.
So far necessary tests on the system, such as the user acceptance test, have been completed, proving a high user acceptance.
The Chief Executive Officer of the Ghana Interbank Payment and Settlement Systems (GIPPS), Mr Fred France, who gave the assurance said staff of banks and other point of sale outlets had undergone the necessary training needed to introduce the project in the coming month.
Speaking to a cross-section of the media in Accra, Mr France stated that the e-Zwich would afford everybody the opportunity to access financial services using a biometric smart card.
GIPPS has been established by the Bank of Ghana to work with banks to improve the payment systems to provide a range of technology-driven solutions and associated support services to improve the general efficiency of the payment systems.
The system is to provide an overall affordable and convenient public access to banking services.
Mr France stated that from April, there was going to be mass deployment of Point of Sale (PoS) terminals throughout the country, adding that it would also be a period of piloting the project.
The Chief Operating Officer of GIPPS, Mr Yooku Korsah, explained that the e-Zwich would offer a common platform for electronic payment system transactions, integrate all existing bank switches and also enable both online and off-line payment and settlement transactions.
He said currently about 46 per cent of banks were concentrated in the Greater Accra Region and such banks were limited in terms of branch network throughout the country.
Mr Korsah said there was a large unbanked public, while there was strong competition for the few who were doing business with the banks.
Again, the heavy dependence on cash for payment as well as limited infrastructure for electronic payment, such as low ATM spread, insufficient Point of Sale (PoS) terminals and unreliable power and communication networks were some of the reasons that had accounted for the introduction of the national payment system, Mr Korsah stated.
He said the e-Zwich used a biometrics card for both off-line and online and also works on Global System of Mobile (GSM) communications, adding that “from both a merchant and the bank’s perspective, it is a very safe platform”.”
Mr Korsah said banks in the country had up to June this year to make their ATMs compatible to the e-Zwich platform.

AMAL Bank improves profit base

2008-03-30T06:45:00.000-07:00

Story: Boahene Asamoah

Amalgamated Bank Ghana Limited has increased its net interest income by 108 per cent from GH¢6.3 million in 2006 to GH¢14.8 million last year.
The bank’s operating income also went up by 123 per cent from GH¢ 5.5 million in 2006 to GH¢12.3 million in 2007, bringing profit after tax to GH¢1.1 million in 2007 from a net loss of GH¢417,218 recorded in the previous year.
The Board Chairman of the bank, Mr Stephen Ata announced at the 8th annual general meeting of the bank that total assets also saw a significant growth of 125 per cent from GH¢66.35 million in 2006 to GH¢149.38 million as of December 2007.
“The appreciable growth in the total assets base was funded by the 126 per cent growth in deposit liabilities from GH¢55.64 million in the previous year to GH¢125.7 million in 2007,” Mr Ata stated.
Shareholders funds also increased from GH¢7.533 million to GH¢14.232 million by December 2007 as a result of the injection of additional GH¢5.091 million received from shareholders and the growth in retained profit.
The management of the bank said the introduction of the electronic payment platform, e-Zwich, by the Bank of Ghana (BoG) is essential for the economy to move from being cash based to a cashless regime.
“Information technology infrastructure in the banking sector is crucial if the economy is to move from being predominantly cash based to an economy with reduced cash transactions,” Mr Ata, said.
Mr Ata said the bank was working assiduously towards becoming e-Zwich compliant before the system became operational on April 1, 2008.
The BoG will from next month introduce the national payment system platform in a bid to encourage electronic payments in the country.
Giving an overview of the bank’s performance in the country over 2007, the board chairman stated that the bank was finalising plans to raise additional capital to position it to become a dominant player in the retail business of the banking sector in the country.
The plan will also enable Amalbank to raise additional capital to meet the BoG’s requirement for banks to raise their existing capital requirements from the present GH¢7 million to GH¢60 million by the end of 2009.
“The strategic focus for 2008, among others, will be to consolidate the gains made in previous years by improving upon service quality to grow customer loyalty and profitability,” Mr Ata said.
The Managing Director of the bank, Mr Oluwole Ajomale, said management would pursue the branch network expansion programme already underway in its bid to penetrate the market further and be closer to the banking public.
“We will seek to introduce innovative and customer friendly products and services to distinguish ourselves in the market as innovative product leaders,” Mr Ajomale stated.
He said the bank during the year under review increased its branch network from five to 10 and had added two more branches this year, bringing the total number of branches to 12.

Intercontinental Bank rolls out two products

2008-03-30T06:44:00.002-07:00

Story: Boahene Asamoah

THE Intercontinental Bank Ghana Limited has introduced two new products, namely, the Auto Loan Promo and the I-Cash International, onto the country’s financial service industry.
Launching the products in Accra, the Managing Director and Chief Executive Officer of the bank, Mr Albert O. Mmegwa, said the bank had made conscious efforts to identify the needs of its customers and had come out with innovative and tailored products to meet their needs.
“This is to give the best to our customers and provide them with the financial flexibility needed to go about their day-to-day businesses”, he said.
Mr Mmegwa said the I-Cash was designed to help travellers and traders to remit funds within the West African sub-region to meet their financial obligations.
The product would initially be accessed by travellers and traders in Ghana and Nigeria using Intercontinental Bank Ghana and Intercontinental Bank Plc of Nigeria structures and branch network in the two countries, the CEO stated.
He said the services would be extended to include other countries in West Africa as the bank rolled out new subsidiaries.
Mr Mmegwa stated that the customers and general public would have the benefit of security for their cash, same day delivery of funds, lower cost of transfer, safer and easier means of sending money within the sub-region.
Touching on the auto loan, the managing director stated that the bank, together with its partners in the automobile industry, came out with the package, to offer the opportunity to individuals, corporate entities and NGOs to own brand new cars.
Mr Mmegwa said access to vehicles was no longer a luxury in today's world, adding that “vehicles are essential accessories to social life to the extent that the lack of it could make life sometimes so uncomfortable.
“All one has to do is to pick a car of his choice from any of our automobile partners, namely Universal Motors, Auto Plaza, Silver Star Auto Ltd, Auto Parts, Rana Motors and Honda Place and pay five per cent of the value of the car as deposit and drive a brand new car”, he stated.
The Managing Director used the occasion to announce the opening of two new branches of the bank at Madina and Agbogbloshie, which brings the total number of branches of the bank to seven in Accra.
The Minister of Finance and Economic Planning in a speech read on his behalf by Mr Paul Asimenu, the Director of Legal Division, commended the bank for initiative to facilitate a fast and secure money transfer system between Ghana and Nigeria.
“The targeted beneficiaries are the business persons who transact trade finance deals and those carrying out commercial activities between our countries and across the region and beyond”, he added.
The minister said: “I see this cross-border product as one very important step in promoting interstate commerce.”
Mr Baah-Wiredu, however, cautioned that the bank needed to establish strong measures to secure all transactions through the use of the product to instil confidence in the business publics and prevent criminals and groups from using the product for illegal purposes.