Category Archives: Business

Minority demands govt’s position on Ameri deal

By | Business | No Comments

The Ameri deal was signed in 2015

The minority in parliament is demanding government’s position regarding the Ameri deal.

In a press briefing Wednesday July 26, 2017, the minority leader, Haruna Iddrisu said there is a notice of a motion filed by the MP for Adansi Asokwa, Kobina Tahir Hammond seeking a rescission Order on the Ameri power deal.

The Order, according to the Tamale South MP, is requesting parliament to rescind its decision on the deal for reasons of gross misrepresentation. The minority is therefore demanding government’s position.

He said, “We want to know the official government position on the matter as the contract is in force and the matter even if parliament took a decision will have consequences on our energy generation and even ‘dumsor’”.

The minority leader went further to question the parliamentary procedure that K.T Hammond is using to seek for the abrogation of the contract.

“We are also at a loss whether a Member of Parliament can just wake up as disgruntled as a member may be to seek to rescind a decision of a previous parliament. This was a decision of the 6th Parliament of Ghana. We want to know the particular standing orders he is revoking,” he quizzed.

They advised the Adansi Asokwa MP to seek legal redress in the courts if he feels something is wrong with the contractual arrangements.

“I should think the appropriate forum for him [K.T Hammond] will be to go to court to attack the fundamentals of the terms of the contract which is in force but not to sleep and just wake up midday and say he wants a rescission by parliament”.

He maintained that the Ameri intervention has been useful for the country for which reason its abrogation will have consequences especially regarding the one who would bear the responsibility in the event that it is abrogated.

The John Mahama administration in 2015, agreed to rent the 300MW of emergence power from Africa and Middle East Resources investment group (AMERI) at the peak of the country’s power crisis to build, own, operate and transfer the plant to Ghana.

The decision was taken when Dr. Kwabena Donkor was Power Minister.

The cost of the deal was $510m, and received parliamentary approval on 20th March 2015.

However, the NPP government has raised some concerns about the contract alleging it emerged that the country has been shortchanged.

By P.D Wedam |3news.com | Ghana

We are ready for paperless transactions – GCNet Executive Chairman

By | Business | No Comments

Government’s directive to port operators to achieve total paperless processing of operational clearance procedures at the ports from September 1 is close to being realised as the main technical partner to the Ghana Revenue Authority, the Ghana Community Network Services Limited (GCNet) has declared its readiness to implement the initiative.

His Excellency, the Vice President, Dr. Mahamadu Bawumia at a recent Ports Efficiency Conference held in May this year directed that all trade transactions be fully paperless, as well as joint inspection by all regulatory and examination bodies mandated to do and removal of barriers along the trade corridors of the country.

According to the Executive Chairman of GCNet, Dr. Nortey Omaboe, the company had already deployed the infrastructure to give full effect to the pursuit of the paperless transactions regime, noting that “it is on record that GCNet provided a paperless clearance system several years earlier, and won a World Customs Organisation Award as far back as January 2014”.

Speaking at the second edition of the National Trade Facilitation Awards in Accra, Dr. Omaboe observed that ‘we at GCNet are mindful of the fact that an effective and efficient trade development and facilitation is dependent on a number of players and systems in the value chain, including exporters, cargo tracking, warehousing, freight forwarders, payment systems- e-payments, free zones, regulatory bodies, shippers among others. All these activities in the trade facilitation chain at the various ports are enabled by an electronic system powered by GCNet”.

He assured that GCNet was therefore collaborating with its diverse stakeholders including the Ghana Ports and Harbours Authority (GPHA), Ghana Institute of Freight Forwarders, Ghana Airport Company, the terminal operators, the courier providers, and scan operators in the value chain to ensure that this objective was fully realized within the timeframe stipulated.

Dr. Omaboe explained that GCNet recently deployed the e-CITES for the Wildlife Division, which would ensure that e-certificates were issued paperless and expressed excitement it was  very much in line with the  September 1 deadline alongside the e-manifest and e- warehousing modules already in operation .

He said among the other e-solutions deployed is the introduction of GCNet’s Letter of Commitment (LOC) for the Bank of Ghana which has aided in the elimination of human elements and interference in export monitoring as well as ensuring in the tracking of exports proceeds into the country and also boosting the availability of forex in the economy.

He announced that there has been service upgrades on GCNet applications for regulatory agencies and other players in the trade facilitation space, all in a bid to ensure that the vision to go paperless which GCNet spearheaded in 2011 is fully realised and the benefits accrued to the citizenry.

In a speech read on his behalf, Minister of Trade and Industry, Mr. Alan Kyerematen noted that trade facilitation had increasing become an important tool in integrating economies into global value chains, creating wealth among nations while generating employment.

He expressed his Ministry’s readiness to work with all stakeholders to ensure the full realisation of the recommendations from the Committee on Port Efficiency following the major reforms announced by the Vice President, H.E Dr. Mahamadu Bawumia at the Ports Efficiency Conference held in May 2017.

The Trade Minister expressed optimism about the benefits of the Government directive to go fully paperless which include reduced costs, enhanced collection of fees, streamlined and automated business processes and compliance to best international trade practices.

The National Trade Facilitation Awards (NTFA), is an annual event organised by the Ministry of Trade and Industry (MOTI) in partnership with Ghana Community Network Service Limited (GCNet) and Ghana Revenue Authority, to reward excellence in the country’s trade facilitation industry.

The award scheme is also to provides the platform to encourage Ministries, Department and Agencies (MDAs), freight forwarding agencies and other relevant bodies to work towards the attainment of international best practices in trade facilitation by reducing turnaround time in the issuance and approval processes of licenses, permits and exemptions for imports and exports transactions within 48 hours while ensuring safety and security.

This year’s event was on the theme ‘Deployment of e-Applications for the Efficient and paperless Processing of Trade and Customs Transactions’. It had new award categories including Best Shipping Line and Best Transitor among others.

Bollore Africa Logistics Ghana Limited was adjudged the Best Large Freight Forwarder for 2016 while Adu Max Limited emerged the Medium Freight Forwarder for the same period.

The Best Terminal Operator at the Tema port went to Safebond Car Terminal Limited while Swissport swept home the Best Terminal Operator at the Kotoka International Airport.

Grimaldi Ghana Limited came tops as Best Large Shipping Line while Antrak Ghana Limited Takoradi received Small Shipping Line in that category.

By 3news.com|Ghana

Cabinet approves Fiscal Responsibility Law to cap fiscal deficit to 3-5% of GDP

By | Business | No Comments

Dr. Mahamudu Bawumia

Days after the Vice President, Dr Mahamudu Bawumia, hinted of Government’s desire to place a cap on Ghana’s fiscal deficit as a percentage of Gross Domestic Product (GDP), Cabinet has given its approval for the submission of the appropriate legislation to Parliament to amend the relevant law.

The proposed amendment to the Public Financial Management Act is expected to limit the fiscal deficit to between 3% and 5% of GDP from the year 2018, to ensure greater fiscal discipline.

Fiscal deficit is the difference between the government’s expenditures and its revenues, excluding the money it borrowed. A country’s fiscal deficit is usually communicated as a percentage of its gross domestic product (GDP).

The decision to cap the deficit was taken after a Cabinet meeting on Thursday July 20, 2017.

Already Government, through the 2017 budget, has put a cap of 25% on its budgetary allocation to statutory funds.

Ghana’s budget deficit has been increasing steadily over the last few years, hitting 9.3% in 2016. Faced with a high debt-to-GDP ratio, and a generally unfavourable economic outlook from its predecessor government, the Nana Akufo-Addo government has begun introducing a mix of measures designed to ensure fiscal consolidation while stimulating growth.

Read: Gov’t moves to cap fiscal deficit at 5% of GDP with Fiscal Responsibility Law

Source: 3news.com | Ghana

Policy rate pegged at 21%

By | Business | No Comments

Policy rate has been reduced to 21 per cent, thus a 150 basis point.

This is the fourth time in the year that the Monetary Policy Committee (MPC) of the Bank of Ghana has reduced its policy by 150 basis points to 21 per cent from 22.5 per cent.

Governor of the Bank of Ghana, Dr. Ernest Addison, said the move was influenced by the improvement of economic activity in the country.

The policy rate is the indicative rate the Bank of Ghana lends to commercial banks.

It attributed the reduction to the improvement in economic activity supported by a rebound in crude oil production and the implementation of fiscal policy measures towards providing stimulus through the key initiatives contained in the 2017 budget statement.

Despite the reduction in the policy rate, and the downward trend in other interest rate variables, banks are yet to respond in lowering their cost of lending to businesses.

This situation the governor of the central bank attributed to the current high levels of Non Performing Loans and cost of operations by banks.

By TV3|3news.com|Ghana

COPEC vows to ensure new fuel sulphur standards are enforced

By | Business | No Comments

The new fuel sulphur standards of 50ppm has been missed three times.

The Chamber of Petroleum Consumers says it will go any length to ensure that there are no longer delays in the implementation of the new national fuel sulphur standards which have been missed three times.

Following a 2016 BBC report that the quality of diesel shipped into Africa is toxic due to excessive sulphur content, the National Petroleum Authority in October 2016 reviewed the sulphur specification for diesel from 3000-pmm (parts per million) to 500-pmm.

However, consumers resisted the new standard causing further downward review to 50ppm and a January 2017 was set for the implementation of the new standard but was missed.

The NPA again set April 2017 as the new deadline but that was also shifted to May 2017 after it was missed.

The May 2017 was again missed, thus raising concerns about the willingness of the NPA to ensure the implementation of the new standard

“[It’s] 24th of July and the NPA is now making excuses again the new standards will only come into effect a month later,” despite assurance by vice president Dr Mahamudu Bawumia that the deadline will be July 2017, a statement signed by Executive Secretary, Duncan Amoah said.

“Our checks from the early part of July indicates some importers were bringing 50 and even 10ppm sulphur specifications but couldn’t confirm whether the new standards policy was in full effect and applied across board,” it claimed.

COPEC has thus questioned the measures that the NPA puts in place in setting these timelines which it said “seem to have only become a joke now to the suffering public”

“Is the NPA in any way committed to seeing to the needs of the taxpayer whose engines, public health, and the environment continue to suffer? What measures does the NPA put in place in setting these timelines that seem to have only become a joke now to the suffering public?,” it asked

By 3news.com|Ghana

Debt to GDP, Debt Stock and matters arising

By | Business, Features | No Comments

In 2016, the issue about debt stock and debt to GDP ratio were important part of public financial and economic management discourse in Ghana.

Discussions about the economy is still focused on these metrics because of the current position that it is possible to borrow to improve both the debt stock and the debt to GDP ratio of the country.

Though economic data is useful to politicians and they may quote such data from time to time either in assessing government performance (i.e. opposition political parties) or in defending economic performance (i.e. government), it must be verified from mandated independent institutions created by law such as the Bank of Ghana and Ghana Statistical Service.

For instance, in June 2017, the first quarter economic data released by the Bank of Ghana indicated that the GDP at the end of 2016 was GH¢167.3 billion, while the projected GDP for the year ending 2017 is GHc203.4 billion.

The data further revealed that the debt stock (total debt) by the end of first quarter of 2017 is GHc127.1billion indicating that the debt stock increased by GHc4.5 billion . It is therefore not correct to put in the public domain that the government is borrowing but the debt stock is not increasing.

The fact that current borrowing retires or refinances old debt does not lead to reduction of the debt stock. The only way to reduce the debt stock is to generate enough revenue to repay our debt obligation and moderate borrowing.

This is the reason why debt to GDP ratio maybe a misleading measures for Ghana, because while debt imposes actual cash payment or its equivalent, GDP is a notional measure that promises to generate revenue for repayment of debt.

Thus, huge GDP growth is very good for the economy but GDP growth that does not generate the needed revenue and jobs is unproductive. The implication is that since the first quarter revenue target was not met and same is expected of the second quarter any improvement in GDP does not necessarily reduce the debt burden of the country, especially when the $2.25billion (GH¢ 10billion) is added to the debt stock in the second quarter.

The fact is that the projected interest cost of accumulated debt is captured in the 2017 is GHc14 billion. Further implication is that if the projected Debt to GDP ratio of 71.7% is achieved at the end of 2017 in the face of poor revenue performance there will not be improvement in the debt burden of the country. In fact borrowing to retire old debts only means changing your creditors and repayment periods.

For instance, if Ghana borrowed cumulatively from different creditors $30billion and we borrow $ 40billion today (this does not mean Ghana has borrowed only $40billion) from BAA Financial House with maturity of fifteen years(15yrs) and use it to pay off the old indebtedness of $30billion.

Our current indebtedness is $40billion plus any interest Cost and not $10billion this is irrespective of any improvement in debt to GDP ratio. However, without retiring old indebtedness the total debt would be $70 billion. The fact that the debt is not $70billion because of the retirement or payment of the old debt does not in any way mean reduction in debt stock.

As a country our strategy should combine improvements in productivity and creativity to enhance the revenue envelop. If we significantly improve on sustainable revenue mobilization, high debt to GDP ratio will actually not be a threat to economic management, though moderate Debt to GDP ratio is even better.

By Dr. John Gatsi|Department of Finance , School of Business|University of Cape Coast

 

So far, gov’t adds GH¢3billion to public debt every month – MP

By | Business | No Comments

Vice President Dr Bawumia (2nd Right) was recently in CHina to secure a $15 ‘loan’

Member of Parliament for Bolgatanga Central Constituency Isaac Adongo has punched holes in the recent assertion by Vice President Dr Mahamudu Bawumia that the economy is growing.

Mr Adongo said Dr Bawumia did not paint a true picture of the nature of the economy.

At a media encounter last Tuesday at the presidency, Dr Bawumia asserted that the economy will not be burdened by the recent borrowings because they are strategic.

Though the Bolga MP agrees with the former deputy central bank governor that the economy has grown since the current government took over in January, the margin of growth proves that there is a slowdown, he said.

Comparing the same period to last year, when the National Democratic Congress (NDC) was in power, apparently its last year in charge, Mr Adongo said the mining sector, among others, recorded substantial growth.

He maintained that the real sector, without oil, even recorded growth better than what is being witnessed under the Nana Addo Dankwa Akufo-Addo government.

The NDC MP said statistics from the Ghana Statistical Service suggest that Ghana’s public debt, for instance, continues to grow.

For the first quarter, he cited, government added GH¢5 billion to the country’s debt.

He added that in the first five months of President Akufo-Addo’s reign, GH¢15 billion has been added to the public debt.

“What that means is that we are adding GH¢3 billion to our public debt every month,” he said on TV3’s New Day on Saturday.

He said the situation is increasing the debt-to-GDP ratio day-in day-out.

“So you have to look at the economy from the right perspective,” he stressed, challenging Dr Bawumia, who is the Chairman of the government’s economic management team.

He called for more work to be done by the current administration to save Ghana from further economic downturn.

“I believe that there is a lot of work to be done in order to develop the real sector minus oil.”

By Emmanuel Kwame Amoh|3news.com|Ghana

Premium Bank launches GHC5 million credit facility for startups

By | Business | No Comments

SME -focused commercial bank, Premium Bank, has announced a ₵5 million integrated credit facility for members of the Ghana Startup Club 100 through its HelpStation initiative.

Beyond the integrated credit facility, Premium Bank will also be providing digital solutions to the various startups to aid their online financial transaction.

Managing Director, Kwasi Tumi, made the announcement at a special business forum and networking cocktail held in honour of the 100 most outstanding startups in Ghana at Ghana Startup Awards.

Interacting with the Ekow Mensah, CEO of The African Network of Entrepreneurs (TANOE), curators of the Ghana Startup Club 100, Mr Tumi said Premium Bank the initiative is a welcome one for most startups in Ghana.

He expressed hopes that startups will make the best use of the opportunity to expand their businesses to become more innovative and globally competitive.

The Ghana Startup Club 100 (GSClub 100) is an annual ranking of the top 100 most outstanding start-up companies in Ghana spearheaded by The Startup Network a network under TANOE.

The Ranking celebrates Ghana’s entrepreneurs and innovators. It offers a unique chance for small to medium scale businesses to be recognised for their hard work, commitment and success.

By 3news.com|Ghana

 

ADB wins Best Bank in Agric, Forestry and Fishing Financing

By | Business | No Comments

The Agricultural Development Bank (ADB) emerged as the best bank in Agriculture, Forestry and Fishing Finance at the 16th Ghana Banking Awards.

The bank also came up as the second Most Active E-zwich Bank.

The Ghana Banking Awards, organized by Corporate Initiative Ghana (CIG) is regarded as the most prestigious award in the Ghanaian banking industry, which affords winners the opportunity to leverage the laurels received to woo new customers.

ADB continues to commit a substantial portion of its lending portfolio to Agriculture and allied sectors.

Mr Daniel Asiedu, MD of ADB

Mr. Daniel Asiedu, Managing Director of the Bank, said the awards would not have been possible without the esteemed customers of the Bank noting that.

“As with other awards we have won in the past, we dedicate this to our loyal customers and farmers to whom we remain committed to in growing their business” he said.

“Having won the same award last year is an indication of the bank’s commitment towards the agricultural sector and we hope to continue supporting the sector going into the future” he added.

Mr Asiedu said it was an honour to be the best amongst its peers in a critical sector like Agriculture, Forestry and Fishing, adding, “I wish to assure our customers to expect more innovative and tailor-made products, which will boost their businesses.”

Two years ago, the Bank facilitated a 17.7 million Euros credit for the production of 8,000 hectares of rubber in the country.

ADB also remains the major sponsor of the annual National Farmers’ Day and all the activities connected with event including the Farmers’ Forum and Cocktails for the Award winners.

The Bank recently upgraded its IT infrastructure to help deliver better services. The upgrade is supported by cutting edge technology infrastructure, which has excess capacity to deliver the very best banking experience to the Bank’s customers.

This technology has reduced waiting and transaction times across all service channels.

By 3news.com|Ghana

 

Govt’s Planting for Food and Jobs gets boost in N/R from SARI

By | Business | No Comments

The Savanna Agricultural Research Institute of the Council for Scientific and Industrial Research (CSIR-SARI) in the Northern Region has launched a Core Of Excellence Initiative to enable SARI increase its production of breeder and foundation seeds to support government’s Planting for Food and Jobs Programme.

The $5.5 million paid to SARI in 2015 which is a USAID-sponsored programme through its Feed the Future Initiative was hitherto aimed at improving the infrastructure of the research institute. But upon review, it has been channeled into developing seed production, business development, and communication units to better place SARI to diver on its mandate.

The project seeks to establish seed research facilities at the main SARI office in Nyankpala and provide a center for agricultural research which will provide a cutting-edge scientific research to serve as a catalyst for the rolling out of the project in the Northern Region.

The Director at SARI, Dr. Stephen Nutsugah, intimates, “the goals are to strengthen SARI’s capacity to conduct cutting-edge scientific research, build a business model suitable for supporting transformative research, and improve our capability of disseminating research result to various stakeholders”.

He outlined the roles of the initiative as “to achieve these objectives, a group of SARI personnel will be trained on strategies, principles, tools and practices to enhance SARI’s infrastructure,facilities, research agenda, and operational procedures”.

Dr Nustugah revealed that each team member will lead a specific development area and create an action plan for heightened performance in consultation with the institute’s personnel in the head office and outstation in the Upper East and Upper West regions.

“The team has the will to craft business plans to generate income to sustain the facilities and improve operation to communicate research results within and beyond SARI’s ears of influence”.

To this end, he reiterated the need to provide certified and affordable seeds for farmers as Ghana’s actual production lags behind its potential.

“There is an urgent need of quality seeds to farmers that they can afford because but our actual production considerably lags behind our potential to make available foundation and breeder to farmers. Therefore, there is much to be gained by promoting the growth and development of the seeds industry”.

The Deputy Agriculture Minister and also the Member of Parliament for the Walewale Constituency, Dr Sagre Bambangi, cut sod for the construction of a Seed Laboratory.

The minister revealed government will heavily depend on SARI for seeds for its project.

By Zubaida Ismail|3news.com|Ghana