Category: Business

Finance Minister, Ken Ofori-Atta, has assured that Ghana is in a position to meet the requirements for fiscal consolidation under the just approved International Monetary Fund programme for the country.

Addressing participants at the Capital Market Day’s event organized by the MTN Group in South Africa, Ken Ofori-Atta said despite the wave of conditionalities under the programme, government remains confident in meeting all targets set by the IMF.

“When we came into government, we inherited an IMF program which was supposed to take almost three to four years and within two years we exited that. So, our capacity to do that is very clear to us,” Ken Ofori-Atta said.

He continued, “In terms of the confidence to be able to follow through with the IMF, the post-COVID programme for economic growth is our programme in which the Fund’s structural bench mark were around that. We believe that we can do it because we have done it before. And the numbers in 2017 to 2020 suggest the type of trajectory we were on until these incidents occurred. We are confident about what we have to do within these 18 months.”

He further noted that government has made considerable progress with workers on the management of their pension funds.

Meanwhile, the recently issued IMF staff report on Ghana noted the design of tax policy measures continue to suffer widespread tax expenditures particularly in Value Added Tax and under exploitation of taxes such as property tax and excise tax.

The IMF further outlined certain weaknesses in revenue administration which continue to impact on recoveries and limited revenue compliance.

Source: Ghana Web

3Accra. May 31, GNA – The Vision for Alternative Development (VALD) and the Institute of Leadership and Development (INSLA) have called on the government to prioritise feeding of the citizenry over the production of tobacco. This was in statement jointly issued by the civil society organisations and copied to the Ghana News Agency as they join the globe to commemorate the 2023 World No Tobacco Day, which falls today, May 31, on the theme: ‘We need Food not Tobacco.’ Mr Issah Ali, the Executive Director of VALD said according to Tobacco Tactics of the University of Bath in 2014 stated that 2,545 metric tons of tobacco were produced in Ghana, covering 0.04 per cent of agricultural land. He said the 2023 global campaign was aimed at raising awareness about alternative crop production and marketing opportunities for tobacco farmers and to encourage them to grow sustainable, nutritious crops. He stated that the campaign was to call on governments and policymakers to step up legislation, develop suitable policies and strategies, that would provide favourable market conditions for tobacco farmers to shift to growing food crops that would provide them and their families with better life. ‘It also seeks to expose the tobacco industry’s efforts to interfere with attempts to substitute tobacco growing with sustainable crops, thereby contributing to the global food crisis. Tobacco use continues to be the leading global cause of preventable deaths. ‘Its influence extends into all corners of the globe, threatening lives and livelihoods and endangering the health and prosperity of developed and developing nations alike,’ Mr Ali stated. He added that tobacco consumption has contributed to climate change which has affected the environment, through deforestation and population, thereby hindering the attainment of the Sustainable Development Goals (SDGs). The Executive Director stated that Article 17 of the Framework Convention on Tobacco Control dictates that parties shall, in cooperation with others and with competent international and regional intergovernmental organisations, promote, as appropriate, economically viable alternatives for tobacco workers, growers and individual sellers. ‘It is therefore recommended that nations venture into economically sustainable alternatives to tobacco growing (alternative livelihoods). Tobacco, which is perceived as being economically viable, has led to farmers shifting from the growing of agro-products to the growing of tobacco which will lead to a reduction in the number of cash-crops produced,’ he stated. Mr Benjamin Anabila, the Director of INSLA stated that worldwide, there are over 1.3 billion people who use tobacco; the majority of whom live in resource-constrained countries. ‘Each year, tobacco claims the lives of more than eight million people, including 1.2 million lives lost from exposure to second-hand smoke. Unless urgent action is taken to reverse this global epidemic, tobacco will kill as many as one billion people this century, making it one of the greatest sources of preventable deaths and diseases. He said COVID-19 pandemic has also brought the dangers of tobacco further to the fore, leading millions of people worldwide to want to quit. Mr Anabila stated that the growing food crisis is driven by conflicts and wars, climatic shocks, and the economic and social impacts of the COVID-19 pandemic, adding that structural causes like the choice of crop also have an impact, and a look into tobacco growing reveals how it contributes to increase food insecurity. ‘Across the globe around 3.5 million hectares of land are converted for tobacco growing each year. Growing tobacco also contributes to deforestation of 200,000 hectares a year. Land used for growing tobacco then develops a lower capacity for growing other crops, such as food, since tobacco depletes soil fertility,’ he said.

Source: Ghana News Agency

Accra, The seventh African Leadership Forum (ALF) has ended in Accra with participants urging African countries to focus on agri-business rather than agriculture.

The Forum said agri-business encompassed agriculture and required a multifaceted approach across multiple stakeholders, including ministries beyond that of agriculture. Climate change.

Dr Emmanuel Maliti, an Economist, iReview Limited, presenting a statement at the end of the Forum, said the current and future effects of climate change were a wake-up call for Africa to reorient its agriculture development agenda.

The Forum was convened by Dr. Jakaya Kikwete, the ALF Patron and former President of the United Republic of Tanzania and AfCFTA Secretariat, and co-organized by the Institute of African Leadership for Sustainable Development (UONGOZI Institute).

‘Many best practices that have transformed the African agriculture sector are available to learn from and scale up,’ he said.

The one-and-a-half-day event on the theme: ‘Promoting Intra-Africa Trade to Unlock Agricultural Potential in Africa’ sought to provide a space to share experiences and insights to facilitate a successful agricultural trade among African countries.

It highlighted Africa’s agricultural potential and opportunities emerging from climate change, sharing experiences and lessons on the obstacles (internal and international) in maximizing agricultural potential in Africa.

It is also to discuss the potential and obstacles to, as well as practical and realistic requirements for implementing AFCFTA within Africa’s agriculture context and identify priorities and roadmap for implementation of the agricultural trade perspective under the AFCFTA to realize its transformative economic objective.

He said interventions could include technological-based, from introducing country-specific technology and innovation in adoption (climate-smart technologies) to diversifying farming systems.

The Economist said complementary non-technology interventions include evidence-based policymaking, tapping climate change financing, and advocating for compensation from large polluters.

Mr Wamkele Mene, the Secretary General of AfCFTA Secretariat, said access to affordable agriculture financing was necessary to facilitate expanding private sector participation in the agriculture sector.

This requires policies that de-risk lending to the sector (formalising agricultural land, introducing land banks), and central banks role in facilitating carbon trade financing as well as incentivizing regional and local banks to syndicate large loan portfolios for the sector.

He said Africa could also consider incentivizing market entry for venture capital funding, insurance products, trade financing, and commodity markets.

He said the latter could start with commodities that Africa largely consumes and intermediary finances such as guarantees, savings and credit societies, investment banks serving the sector, and credit facilities that cater to the needs of women and youth, which have proven to accelerate access to finance in some African countries.

Dr. Jakaya Kikwete, the ALF Patron and former President of the United Republic of Tanzania, said countries needed to commit to trading among themselves, invest in knowledge exchange and eliminate trade barriers as among the means to accelerate rural communities’ participation in the regional and global value chains.

He said robust private sector capacity in responding to trade opportunities was also vital in transforming intra-Africa trade.

‘Governments can identify, incentivize, and facilitate large private sector entities to invest in agriculture,’ he said.

Dr Kikwete said a lot had been achieved but a lot more was needed to be done to increase agriculture production on the African continent.

He said if the continent had to promote intra-Africa trade, in the area of agriculture, stakeholders needed to take a look at the supply side.

He commended President Nana Akufo-Addo for accepting Ghana to host the Seventh Edition of the Forum.

Source: Ghana News Agency

Over four decades ago, Ghana signed the United Nations Convention on Contracts

for the International Sale of Goods (CISG), a pivotal treaty that provides a

standardized legal framework for cross-border transactions between parties from

different nations. The treaty is yet to be ratified by Ghana’s Parliament.

More recently, the African Continental Free Trade Area (AfCFTA) – a trade pact

involving 54 of the 55 African Union (AU) member states which aims to bolster

economic integration and invigorate intra-African commerce was entered into by

Ghana. This regional trade arrangement can be instrumental in strengthening

Ghana’s position in the global marketplace and attracting entrepreneurs who wish to establish their principal place of business within the country.

However, the AfCFTA’s full potential cannot be harnessed without an encompassing international sales of goods instrument like the CISG. The postponement of Ghana’s ratification of the CISG presents a considerable obstacle for participants in the sales of goods value chain.

What is the CISG and why is important?

The CISG is an important treaty that endeavors to establish a uniform legal

framework for international transactions involving the sale of goods between parties from different nations. Adopted in 1980 in Vienna, Austria, the CISG went into effect on January 1, 1988. A contract for the sale of goods is usually one that involves a legal agreement between a buyer and a seller and specifies the terms and conditions of the transfer of ownership of goods from the seller to the buyer in exchange for a specified sum of money or other agreed-upon consideration.

Examples of goods that can be the subject of a sale of goods contract include movable property of any description such as vehicles, raw materials, clothing, electronic appliances etc.

In the growing system of international trade, parties in different jurisdictions may have need to engage in a contract of sale. A tomato farmer in Ghana may need to sell his produce to an interested buyer in Canada. What law should govern the

transaction? When a dispute arises between the parties, which court may exercise

jurisdiction over the dispute? What remedies are available to either party when a breach has occurred? These are often questions that may arise in an international sale of goods contract negotiation.

Sometimes, parties in exercise of their freedom of contract, may have an express choice of law clause that dictates the particular jurisdiction that should superintend over the contract. The parties may also fail to make an express choice of law in which instance the rules of private international law

may be activated to determine ‘the proper law of the contract’.

In such contracts, the absence of an express choice of law can be problematic, as it can lead to uncertainty and disputes over which law should regulate the transaction. It may thus be necessary to apply the rules of private international law to determine the applicable law of the contract. Nonetheless, this procedure can be difficult and time-consuming, as it frequently entails analyzing various connecting factors, such as the domicile of the parties, the place of performance, or the location of the goods.

In addition, the application of various national laws can result in inconsistent interpretation and application, impeding the efficient resolution of disputes and creating an unpredictable legal environment for businesses engaged in cross-border trade.

Further, even in the presence of an express choice of law clause, the parties to the sale of goods contract may still face challenges in dealing with the complexities and uncertainties associated with resolving disputes, determining jurisdiction, and identifying available remedies. Despite agreeing upon a governing law, other factors can still complicate the transaction, such as differing interpretations of the chosen law, public policy exceptions, mandatory rules, and conflicting provisions.

The CISG helps to mitigate these challenges by providing a uniform legal framework specifically designed for international sale of goods contracts. By adopting the CISG, parties can reduce the uncertainties associated with choosing and applying different national laws, and instead rely on a consistent and harmonized set of regulations to govern their contractual relationship. In addition, the CISG outlines the rights and responsibilities of both buyers and sellers and the remedies available to parties in case of a breach.

The treaty also offers several other benefits that make it an attractive choice for parties involved in international sales of goods contracts. A few

are analyzed herein.

It is apparent that a uniform legal framework that reduces uncertainties and

inconsistencies resulting from the application of various national laws will invariably promote predictability and the smooth facilitation of dispute resolution. Second, the CISG is intended to accommodate the various legal traditions and customs of its Contracting States, establishing a balance between common law and civil law systems. This assures a more practical and equitable approach to international transactions.

Lastly, the widespread adoption of the CISG improves legal certainty and promotes international commerce, as parties from different jurisdictions can rely on a common set of rules when entering into and performing contracts for the sale of goods.

Why Ghana must take the important step of ratification

You may recall that at the beginning of this article, it was noted that Ghana had signed the CISG treaty. Signing does not conclude the process of treaty execution however. Ratification is a crucial step in making a treaty legally binding for a country.

In Ghana, the process of ratification involves the President executing a treaty,

agreement, or convention in the name of the country, after which it must be ratified by an Act of Parliament or a parliamentary resolution supported by a majority of members, as stipulated in Article 75 of the 1992 Constitution.

Ratification is important because it signals a country’s commitment to uphold the provisions of a treaty and incorporate it into its domestic legal system. Ghana’s ratification of the CISG treaty would bring numerous benefits to the country. A few of them are examined herein.

To begin with, the domestic law on the sale of goods, the Sale of Goods Act (1962) Act 137, is insufficient to govern contracts involving international sales. The Act’s primary emphasis on domestic transactions and its inadequacy in addressing the complexities of cross-border trade has a significant effect: many contracts involving international sales, including those concluded by Ghanaians or those with a principal place of business in Ghana, do not select Ghanaian law as the governing law of their contract.

This preference for other legal systems originates from the fact that, parties

involved in international sales frequently seek a more predictable and unified legal framework that addresses the unique challenges of international trade. The CISG, with its comprehensive and specialized rules, provides such a framework and is globally recognized and acknowledged by businesses and legal practitioners.

By ratifying the CISG, Ghana would provide its businesses with a uniform legal

framework that is more suitable for international sales transactions. This could

encourage more parties, including Ghanaians, to select Ghanaian law as the

governing law in international contracts for the sale of goods. The ratification of the CISG would therefore not only improve the legal environment for international trade in Ghana, but also promote the country’s legal system as a more desirable option for regulating cross-border transactions.

In addition, Ghana played an important role in the creation and adoption of the CISG. Ambassador Emmanuel Kodjoe Dadzie and Justice S.K. Date-Bah formerly of the Supreme Court of Ghana, were instrumental in its establishment. Ghana’s

commitment to the harmonisation and consolidation of international trade law would be strengthened by ratification of the treaty, which would recognise Ghana’s historical commitment.

With the headquarters of the AfCFTA located in Accra, it is crucial for Ghana to set an example for other African nations, the majority of which have yet to ratify the CISG. Establishing a uniform trade law is essential for maximizing the benefits of a regional free trade area, as it facilitates a more streamlined and efficient approach to cross-border transactions.

A consistent legal framework, such as that provided by the CISG, reduces the complexities and uncertainties frequently encountered in international commerce, especially when the parties involved are subject to different legal systems. By adopting a harmonized set of rules, countries within the AfCFTA will be able to circumvent these obstacles more effectively, resulting in improved trade relationships and a more trustworthy legal environment.

In addition, a uniform trade law promotes economic integration among AfCFTA member states by streamlining the legal landscape and facilitating cross-border business transactions.

This not only promotes regional trade, but also investment, innovation, and economic growth among member nations. Ghana’s ratification of the CISG would not only improve its own legal environment but also encourage other African nations to do the same. This collective ratification of a uniform trade law is essential for maximizing the benefits of the AfCFTA and advancing continental economic integration.

Finally, the ratification of the CISG would considerably enhance Ghana’s reputation for ease of doing business, as it would demonstrate the country’s commitment to establishing a more stable and predictable legal environment for international trade.

As a result, Ghanaian investors and businesses will be in a more advantageous

position when engaging in cross-border transactions, as they will be operating within a legal framework that is widely recognized and acknowledged. The CISG with all of its attendant benefits, would enable businesses to approach the global market with greater confidence.

Further, foreign and domestic investors would feel more confident conducting business in Ghana. This increased confidence attracts foreign investments, which are essential for Ghana’s economic growth and innovation. The enhanced ease of doing business would encourage local businesses to expand into international markets, thereby contributing to the economic growth of the nation.

Concluding reflections

In light of the numerous benefits discussed, it is essential for Ghana to embrace the wisdom of ratifying the CISG without delay. Such a decision would align Ghana with its key trading partners, creating a harmonious environment for businesses engaged in international trade, and fostering stronger bonds and economic growth.

Furthermore, as the home of the AfCFTA headquarters, Ghana bears the

responsibility to serve as a beacon for other African nations, inspiring the adoption of a uniform trade law to unlock the full potential of regional free trade. Considering the persuasive arguments and the positive ramifications for Ghana’s economy and international trade relations, it is vital for all stakeholders, especially the Ghanaian Parliament, to act with deliberate speed on this matter.

Priority must be accorded to the ratification of the CISG treaty, allowing Ghana to fully reap the benefits and strengthen its position as a vanguard in international trade and regional economic integration.

Source: Ghana Web

Accra, Businesses are likely to experience increased cost of production as the IMF conditionalities prohibit tax exemption and phases out tax holidays.?

Rev Dr Samuel Worlanyo Mensah, Economist and Executive Director, Centre for Greater Impact Africa, said the $3 billion loan-support secured from the International Monetary Fund (IMF) came with conditions, including removal of value added tax exemptions.

Others were the reformation of corporate income tax by phasing out tax holidays and exemptions, reducing Customs exemptions and quarterly tariff adjustment including electricity and water.

Speaking in an interview with the Ghana News (GNA), Rev Dr Worlanyo Mensah, said companies who had been given some number of years to operate without paying taxes could have the exemptions reversed or the duration reduced.?

He said such actions would affect the balance sheets of most of the companies that had signed into the exemption agreement.?

‘The industries should get prepared especially those enjoying this level of tax exemptions. The moment there’s a review on these taxes it will definitely increase the cost of production and cost of doing business,’ he said.?

The Executive Director said most organisations had not prepared for such eventualities and cut down or downsize their labour force whilst some reduce their workers’ remuneration.?

‘Laying workers off will affect livelihoods, it is gong to affect cost of living and reduce standard of living. It is going to be a tough time for individuals and the State,’ he said.?

Rev Dr Worlanyo Mensah said the removal of the exemption together with reformation of corporate income tax would affect the unit cost of products, thus, consumers would see increment in prices of goods.?

He said Government in reforming the corporate income tax would review withholding tax upwards and once government did that it would reduce the operational capital of organisations and by far affect productivity.?

‘Exemptions on certain goods that we import like the toiletries, sanitary pads are likely to be taken off and the implication is that we are likely to pay more for such products on the market,’ the Economist said.?

He said Government might include some more commodities, especially those that had comparative advantage if produced in Ghana to protect infant industries and the market.

Source: Ghana News Agency

British retailers saw sales return to growth in April as shoppers continued to spend despite continued high inflation, according to official figures.

Supermarkets were among retailers to report higher sales despite food inflation remaining close to a 45-year-high.

The Office for National Statistics revealed that retail sales volumes increased by 0.5% last month, following a fall of 1.2% in March.

Economists had only predicted an increase of 0.3% for the month.

However, the ONS added that sales volumes were down 3% on the same month last year, although shoppers spent more due to higher pricing.

ONS chief economist Grant Fitzner said: ‘Retail sales grew, partially rebounding from a poor weather-affected March, with jewellers, sports retailers and department stores all having a good month.

‘Despite continued high food prices, supermarkets also recovered from the fall in March.

‘However, these were partly offset by a drop in the amount of fuel sold, despite prices also dropping.’

Non-food retailers reported that sales grew by 1% in April, after March’s wet weather had knocked high streets.

This included strong sales in watches and jewellery, while sports equipment was also in high demand.

Meanwhile, department store sales increased by 1.7%, as they recovered from a 3% fall in the previous month.

Elsewhere, sales volumes at food stores increased by 0.7% for April.

It comes despite the ONS revealing earlier this week that food inflation has remained at high levels, with prices up 19.3% in April compared with the same month last year.

Rises for supermarkets and other high street stores were partly offset by the lower demand for fuel, with petrol stations and forecourts reporting a 2.2% decrease for the month.

Lisa Hooker, leader of consumer markets at PwC, said: ‘Overall, the trajectory remains positive, with the best quarterly improvement in retail sales volumes since August 2021.

‘With this month’s sales likely to be helped by the coronation and additional bank holidays, we expect the positive momentum to continue in the short term.

‘However, retailers will be hoping that the current green shoots are not dampened by higher interest rates or other macroeconomic challenges over the summer.’

Helen Dickinson, chief executive of the British Retail Consortium, said: ‘Sales should improve further as we enter the summer months, especially with inflation starting to ease and consumer confidence slowly stabilising.

‘Government must ensure it does not sabotage this momentum by adding cost pressures onto retailers from new policies, as these will mainly serve to push prices back up for people up and down the country.’

Source: Ghana News Agency

The Ghana Enterprises Agency (GEA) has hosted a stakeholder engagement for women and youth in Micro, Small, and Medium Enterprises (MSMEs) to help them better their enterprises.

The project is part of efforts to let women and youths in MSMEs ask questions about their varied jobs and obtain answers.

The Chief Executive Officer of GEA, Kosi Yankey-Ayeh, believes that stakeholder involvement can help enhance MSMEs in the country.

The stakeholders’ engagement comes after the institution launched Women in MSME and Youth in MSMEs, with over GHC100 a million invested in this new project.

She stated that the government seeks to strengthen an entrepreneurial nation by giving some of the enablers that make a success through the women in MSME and youth in MSME programmes.

Access to funding and markets, mentorship, strategic partnerships and digital linkages, technical assistance, and business advisory support services are examples of these.

Kosi Yankey-Ayeh went on to say that this stakeholder engagement is taking place at the local level to achieve successful results.

She further noted that her institution follows up on funds supplied to entrepreneurs in MSMEs to ensure that the funds are utilised for their intended purpose.

“Two weeks ago, we launched the women’s MSME programme and the youth in MSME programme. We’ve come to the local community to interact with them so they may ask any questions they have about the application process or any issues they face. This involvement would help them comprehend our job so that they could effectively complete the processes,” Kosi Yankey-Ayeh said.

“I would also encourage individuals who have applied and been successful to use the loans for the reason for which they applied. The majority of the businesses that benefited from our loans expanded, while others hired more employees. Individuals in farming, medicine, and ICT, among others, have benefited. We always follow up on these companies. We’ve had multiple successes.”

Source: Ghana Web

Dr Ernest Addison,? the Governor of the Bank of Ghana, says the Financial Industry Command Security Operations Centre (FICSOC) is a key component of the systems to address the challenges of cyber security.

He said the Centre would help provide real-time visibility into cyber threats and attacks targeting the banking sector.?

Dr Addison was speaking at the commissioning of the FICSOC Project in Accra.

He said in October 2018, the Bank of Ghana issued the Cyber and Information Security Directive for banks and other Bank of Ghana-regulated financial institutions to implement the required?Information Security Management Systems (ISMS) controls.

He said it was to ensure the delivery of a safer digital financial Industry.

The implementation of the Directive was phased over 36 months, and through effective monitoring and supervision among regulated banks.

He said as these institutions worked towards full implementation of the directive, it became evident that the Central Bank had to establish an industry Security Information and Event Management (SIEM) system to enable those institutions implementing SIEMs to send logs/alerts, aggregate information and reports.

‘To achieve this, the Bank initiated the SIEM project which we call the FICSOC Project,’ he added.

Dr Addison said the FICSOC Project, which had now been completed and operational with reports/alerts in the form of threat intelligence provided to the banks to improve their incident response mechanisms.

He said three years ago, the Bank started working with commercial banks as key external stakeholders to create a secure cybersecurity environment in the financial sector, hence the completion of the FICSOC project.

He said the Bank and the Cyber Security Authority were collaborating to improve the cybersecurity posture in the banking sector.

The two institutions are discussing various ways to approach the implementation of the Cybersecurity Act, 2020 (Act 1038) for the sector.?

He commended the implementation partner, Virtual InfoSec Africa, and the FICSOC Consultant, Mr Samuel

Amoah, and BoG FICSOC Project Team members for their commitment and diligence in achieving the success of the project.

Source: Ghana News Agency