DDEP: Domestic private banks to face capitalization, liquidity challenges – Ayariga to BoG

The Member of Parliament for Bawku Central, Mahama Ayariga has expressed concern over the impact of the Domestic Debt Exchange Programme on domestic private banks in Ghana.

In a letter written to the Bank of Ghana Governor, Dr Ernest Addison, the lawmaker contends that the programme will rather weaken the growth of banks whereas government believes it is necessary to restructure Ghana’s soaring debt situation.

He worried that the banks will face capitalization and liquidity challenges as they will not be able to receive timely and appropriate coupon payments from their bondholder which is the Government of Ghana.

“I also contend that the directive of the Minister of Finance, to those banks he has so emasculated, to approach the Ghana Amalgamated Trust Plc (GAT) for support from the Ghana Financial Stability Fund (GFSF) opens them up to a takeover by investors in the GAT, if the Ghana Financial Stability Fund is not wholly publicly funded.”

Mahama Ayariga further concluded that the policy and strategic options chosen by the Finance Minister enables the illegal and unconstitutional expropriation of the private property of the present owners of domestic private banks and possibly, private international banks operating in the country.

“I call for the mobilization of the available intellectual competencies and political forces to defend the bona fides property rights of owners of private banks in Ghana. Not to do so with a sense of urgency will constitute the greatest dereliction of duty of our political class and the collapse of present owners of these banks and the takeover of these banking interests similar to what was orchestrated in the PDS saga and the intended ‘Agyapa’ deal, will capriciously, unlawfully and criminally transfer enormous wealth and concentrate it in the hands of those who might enjoy the patronage of the Minister of Finance,” Mahama Ayariga lamented.

“This could disorient our democracy and potentially destabilize our politics. The history of the recent banking sector “cleanup” remains fresh in our memory,” the lawmaker concluded.

As part of efforts to secure an IMF bailout and address the country’s unsustainable debt situation, government launched the DDEP inviting bondholders to voluntarily exchange approximately GH¢137 billion domestic notes and bonds of the Republic including ESLA and Daakye for a package of new bonds.

Source: Ghana Web

Government launches National Rental Assistance Scheme

The government in 2022 hinted at plans to roll out National Rental Assistance Scheme to support lower-income earners to have decent rented accommodation in the country.

The move comes on the back of governing New Patriotic Party’s pledge made in its 2020 manifesto to pay rent advances of Ghanaian youth in its second term to in the short term cushion the youth from the problem of high rent and long rent advances.

Vice President Dr. Mahamudu Bawumia earlier explained that under the National Rent Allowance Scheme, loans will be granted to the youth to allow them to pay their rent allowance to their respective landlords which will later be deducted on a monthly basis.

Source: Ghana Web

Withdraw ban on importation of used electrical appliances – Minority

The Ranking Member on Parliament’s Mines & Energy Committee, John Jinapor, has urged government to immediately review what he described as a ‘harsh’ policy of banning the importation of all used electrical appliances.

According to him, this policy if not reviewed, will not only render a vast majority of those who trade in these appliances unemployed but would equally have severe economic consequences on the already impoverished Ghanaian consumer, since most many depend largely on these appliances.

He stressed that the way and manner in which the Legislative Instrument (LI) was rushed through Parliament without adequate consultation and extensive engagement with the various stakeholders was most unfortunate and appalling.

“It is important to remind the Energy Commission that best practices will require the Commission to engage in extensive consultations particularly with the Mines and Energy Committee of Parliament, to solicit their views and input on such an important LI before implementation.”

“Even more disturbing is the lack of a grace period or transition period before implementing this policy. For such a policy that has far-reaching consequences, it is only proper that some transition period is allowed to enable traders and consumers ample time to adjust to the policy, especially this time that the uncertainties in the Ghanaian economy are abound,” the former Deputy Energy Minister said in a statement.

The decision by the Government of Ghana, acting through the Energy Commission, to ban the importation of all used electrical appliances into the country is most unfortunate and must be reviewed immediately.

This policy if not reviewed, will not only render a vast majority of those who trade in these appliances unemployed but would equally have severe economic consequences on the already impoverished Ghanaian consumer since most many depend largely on these appliances.

The way and manner in which the Legislative Instrument (LI) was rushed through Parliament without adequate consultation and extensive engagement with the various stakeholders was most unfortunate and appalling.

It is important to remind the Energy Commission that best practices will require the Commission to engage in extensive consultations particularly with the Mines and Energy Committee of Parliament, to solicit their views and input on such an important LI before implementation.

Even more disturbing is the lack of a grace period or transition period before implementing this policy. For such a policy that has far-reaching consequences, it is only proper that some transition period is allowed to enable traders and consumers ample time to adjust to the policy, especially this time that the uncertainties in the Ghanaian economy are abound.

It must be noted that some of these used electrical appliances can be more energy efficient and durable than new ones depending on the make, brand, and standards.

This policy clearly contradicts the Government’s position that the country has so much excess capacity.

For the records, it must be noted that the current electricity tariff structure is graduated in bands with higher payments for higher electricity consumption which serves as a gentle caution for consumers to acquire energy-efficient appliances whether new or used ones.

By this policy, even a returnee Ghanaian is not allowed to come along with his or her 3-month-old electrical appliance, which, by all intends and purposes, could still be as good and useful as a new one. This current policy is not only unfair but discriminatory.

The solution to achieving energy efficiency and preventing DUMPING is to resort to the use of standards and effective regulatory measures rather than this very harsh policy of banning all used electrical appliances.

So, the government must be ready to engage, learn from best practices, and adopt sustainable regulatory measures to achieve results other than reacting inappropriately to situations such as this.

We therefore, call on the Energy Commission and for that matter the government, to as a matter of urgency, withdraw this current policy and allow for further consultation, engagement with the relevant stakeholders and a possible review and adjustments before the implementation of the policy.

Source: Ghana Web

See the 19 electrical appliances, products banned from importation and sale

Government through the Energy Commission has announced a ban on the importation and sale of 19 electrical appliances and renewable energy products.

The move has been widely opposed by secondhand dealer groups who make a living on the importation of appliances and products into the country. They also contend that the decision will impact the livelihoods of about 20,000 people who deal in the secondhand electronic appliances value chain.

But the Energy Commission in a statement has explained that the ban is hinged on preventing Ghana from becoming a dumping site for substandard and used appliances.

It further indicated that the ban aims to conserve high electricity demand which impacts additional power generation thereby impacting the economy.

“The ban is to protect the environment and safeguard the health of citizens from air pollution caused by increased power generation and to protect the consumer from purchasing unsuitable appliances and the payment of unnecessarily high electricity bills,” a statement issued by the Commission said.

Meanwhile, some of the products banned from importation and sale by the Energy Commission include Television sets, Rice cookers, and washing machines among others.

Source: Ghana Web

Alan Kyerematen proposes alternative solution to Debt Exchange Programme

New Patriotic Party (NPP) presidential hopeful, Alan Kyerematen, has proposed an alternative to the government’s intended Domestic Debt Exchange Programme (DDEP).

Speaking in a Good Evening Ghana interview, on Monday, January 31, 2023, Alan posited that the current plan of the government is not the best and it will harm individual bondholders as well as businesses.

According to Alan, his plan, which is dubbed the “10,10,10 Solution” will reduce the principal of bondholders by 20 percent, pay them an interest of 10 per cent per year and will last for only 10 years.

“The 10,10,10 (Solution) that was earlier proposed was that there will be a 10 per cent haircut in the principal of bonds held by institutional bondholders. And then there will be a shorter maturity period of 10 years and then also there will be a 10 per cent interest that is paid on their total bond holding.

“So, 10 percent reduction in principle, 10 per cent interest for a maturity period of 10 years. What is on the table now is 0 percent for 2023, 0 percent for 2024 and in the subsequent years 5 percent, (which is a) very complicated formula,” he said.

Alan, a former Minister of Trade and Industry, also said that individual bondholders will not be included in his proposed debt restructuring programme.

He explained that government does not need to include individual bondholders in the programme because only 80 percent of its debts are required to be part of the programme.

“The requirement under the funds (the International Monitory Fund’s) parameters is that 80 percent of your total debts must be subject to this exchange… institutional holders have almost about 70 percent (of the government’s debts) and 15 per cent is held by the Bank of Ghana.

“So if you combine Bank of Ghana and let’s say the banks, insurance and other entities, you will have more than 80 percent of the total bondholders that will have been subject to this debt exchange in which case the vulnerable groups that you are protecting are not up to 20 percent,” he explained.

He added that institutions that will be included in his proposed programme will be given some assistance to recover.

Source: Ghana Web

Don’t depend on monetary policy rate alone in curbing inflation – Lord Mensah to government

A lecturer at the University of Ghana, Professor Lord Mensah, has advised the government to look for other alternative ways in curbing inflation.

The Bank of Ghana after its 110th Monetary Policy Committee for the year 2023 has announced an increment of the Monetary Policy Rate on 100 basis points to 28 percent.

According to BoG, the MPC sees the need to remain vigilant and moderate liquidity in the system to underpin macroeconomic adjustments taking place to drive inflation on a downward path.

Commenting on the new policy rate on Starr Today with Joshua Kodjo Mensah Monday, Mr. Mensah added that the government should look at the fiscal discipline – how the government spends rather than target the expenditure in a way of producing food.

“You can also spend in ways of getting food to the market which ultimately results in getting cheaper prices of food in the economy. If you look at the inflation aggregation you can see that it is food that is leading together with transport. So with all these put together it tells you that if we spend in a prudent way it will have a way of controlling our inflation.”

“It is a system that is being managed; you shouldn’t look at it from one side. Day in and day out I keep on drumming that economic theories have moved away from inflation being managed by just increasing monetary policy and all that,” Prof. Mensah stated.

He added that with the way the government is managing the economy interest rate will not come down anytime soon.

“The consequences will be that inflation will always be on the high side and it will deny the private sector the kind of funds they need to grow the economy. Because the private sector will be competing with the government and instead of the Central Bank to channel the funds through the banks to get to the private sector they will prefer directing it straight to the government,” he stated.

Source: Ghana Web

Mammoth crowd welcome Alan Kyeremanteng to Kumasi

Kumasi, Jan. 31, GNA – Thousands of supporters of Mr Alan Kwadwo Kyeremanteng, a flagbearer hopeful of the New Patriotic Party (NPP), thronged the Kumasi Airport to welcome him to the Ashanti Region.

Alan Kyeremanteng visited the region on Monday to seek the blessings of the Asantehene and regional executive of the party on his political journey.

Clad in ‘Alan branded’ T-shirts and other NPP paraphernalia, the crowd waited amidst brass band music until the Africa World Airline, carrying the former Trade and Industry Minister and his entourage, touched down at exactly 1030 hours.

It was a charged atmosphere when Mr Kyeremanteng disembarked as the excited supporters touted his achievements.

They led his convoy to the Manhyia Palace, creating massive traffic on the Airport Roundabout-Manhyia stretch and giving the police a hectic time in controlling traffic.

Most motorists using that stretch had to look for alternative routes to get to their destination on time.

Mr Yaw Buaben Asamoah, Spokesperson, Alan Campaign Team, told the Ghana News Agency that Mr Kyeremanteng, being a native of the region, deemed it important to formally inform the King and the people of the Asante Kingdom of his intention to contest the flagbearer slot of the NPP and to seek their blessings.

Source: Ghana News Agency

Ketu South MP reacts to scuffle between Wode Maya, Togo Immigration officials

Aflao (VR), Jan. 31, GNA – Madam Abla Dzifa Gomashie, Member of Parliament (MP) for Ketu South, has waded into circumstances leading to a scuffle between popular Ghanaian YouTuber, Wode Maya and some Immigration officials at the Togo side of the frontier.

The incident was captured in a viral video circulating on social media.

The MP in a video shared online by Wode Maya, complained bitterly about the lack of free movement between countries within the continent, particularly in the ECOWAS sub-region.

The former actress and deputy Creative Arts Minister asserted that free movement within the continent and between nations should be made a reality as it was the case in the past before colonialism divided the various nations.

“We have to tell the story of who we are – we can continue blaming colonialists for all we want but they have been gone for so long and we need to wake up and smell the coffee,” Mad. Gomashie said.

“We need to wake up, all these seemingly “hen coop” thing we are doing business with is against ourselves is depressing, truly depressing – I am willing to break a few protocols speaking the way I am,” she was heard saying in the Video.

Wode Maya and the Immigration officials from the Togolese side of the border were said to have got into a scuffle after the popular YouTuber refused to make a CFA 2000 bribe payment, infuriating the officers, who forcefully seized his camera in the process, attracting some Ghanaian officials to his rescue.

Speaking to the Ghana News Agency on Tuesday, Madam Gomashie said she intended to make a strong case on this happening on the floor of Parliament, when the house reconvenes in February.

“These back and forth between border security officials and persons travelling across our frontiers – I mean not only Ghana and Togo but across West Africa and the rest of the continent, my brother, is becoming something else.

I am not from a security background, but I strongly believe this is a security issue that should be taken a second and serious look into by the authorities responsible for these things,” Mad Gomashie, who chairs a four-nation Ewe speaking Committee of member states, said.

“I think as a people with a common identify as Africans, we should find a way to deal with these things – our structures must be made to operate properly, rather than always blaming colonialists for our failures – I think this issue has to be raised on the floor of Parliament, yes these things have to stop,” she added.

The development and previous happenings not only along Ghana’s border with Togo, but elsewhere in the sub-region and the continent, brings into question the commitment of member countries to adhere to the ECOWAS Protocols on Free Movement of Persons, Goods and Services and the promotion of Free Trade and Business among member countries under the Africa Continental Free Trade Area (AfCFTA) regime.

Wode Maya, in a media interaction, said he would continue to persevere for a borderless Africa, where citizens could move from one country to the other without impediments like the Togo experience.

He and his crew were travelling to Benin by road when the unfortunate border altercation ensued sharing some of his worse experience as suffering a slap attempting to enter the Gambia and the demand for $250 before accessing Congo.

Wode Maya pledged to wage a relentless crusade against the menace till continental Heads of State reached a practical agreement on the matter.

Source: Ghana News Agency