Category: Finance

Accra, Some Bulk Oil Distributing Companies (BDCs) are going to the unregulated forex market (black market) to shore up dollar requirement to import oil into the country.

 

This is because the Bank of Ghana and the Commercial Banks are unable to meet the dollar supply, leaving a gap of USD350 to be filled to enable BDCs import needed oil monthly.

 

While BDCs require about $450m monthly, the Central Bank is currently providing $100 dollars per month, having reduced its supply requirement from $214m at the opening window.

 

Mr Senyo Hosi, the Chief Executive Officer (CEO), Ghana Chamber of Bulk Oil Distributors (CBOD), said the country could “over time have a major fuel crisis” if the forex challenges were not addressed immediately.

 

Responding to a question posed to him by the Ghana News Agency on Thursday during a virtual engagement with the media, he said, “BDCs do go to the black market, but it’s not the norm.”

 

“With this indication that 21 per cent is what’s been covered for this month, you’re going to find the commercial banks cover 79 per cent. They may do it in different phases, some of them will lag and that’s where the problems are. If there’re challenges with them filling that gap, over time, we’re going to have a major supply challenge,” he said.

 

“The black market isn’t the default option, it’s the commercial banks. Our solutions going forward will not include illegality, so we’re looking at working with the commercial banks to compensate for it,” Mr Hosi said.

 

Mr Hosi who is also a Finance and Economic Policy Analyst stated that: “All that BDCs want is petroleum prices reflecting the actual currency rate that they sell and them accessing the forex when they need it.”

 

He explained that the current challenge of BDCs on the forex market was due to the non-availability of liquidity as well as pricing, which is much lower than the requirement of companies.

 

“Those are the things that the international oil traders are seeing and it’s making them apprehensive, and that’s why Bloomberg will come and speak [about looming fuel shortage] because they’re seeing a possible withdrawal of supplies,” he said.

 

The Chamber’s CEO allayed fears of any shortage in fuel in the country, and said: “Thankfully, we’ve already initiated steps to address some of these, and we’ve been doing this with the Central Bank.

 

“I am confident that in the next two to three weeks we should resolve most of these challenges and as we resolve them a lot more confidence should come back into the system,” Mr Hosi added.

 

We’ve also had meeting with the Special Purpose Vehicle (SPV) jointly owned by CBOD and the Association of Bankers to develop de-risking mechanisms in the petroleum financing sector… and we’re making substantial progress.”

 

Ghana’s trading currency, the cedi has depreciated by 22 per cent against the dollar this year, while inflation also jumped to 27.6 per cent in May – the highest level in more than 18 years – all contributing to the forex challenges.

 

Meanwhile, Mr Ken Ofori-Atta, the Minister of Finance, has given the assurance that the Government was committed to implementing measures to address the persistent depreciation of the Ghana cedi against its major trading partners.

 

He said that: “The implementation of the 30 per cent cut in expenditures and other expenditure measures approved by Cabinet are all helping to reduce the fiscal deficit and thereby reduce the pressures on the exchange rate.”

 

He added that the Government was also arranging to raise about $1 billion to support the 2022 Budget and foreign exchange reserves, which was expected to improve the supply of the foreign currency and stabilise the Cedi.

 

The Minister said this when he responded to a question posed to him in Parliament by the Member of Parliament (MP) for Bongo Constituency, Mr Edward Abambire Bawa on Wednesday.

 

Source: Ghana News Agency

London, On the Day of the Seafarer, 110 years after the Titanic disaster, leading UK retailers and seafood companies operating across the globe are calling upon all Flag States involved in their supply chain to ratify the Cape Town Agreement for the Safety of Fishing Vessels, to finally put the protection of fishers’ lives at sea on an equal footing with that of seafarers’.

 

UK seafood retailers and businesses committed to improving human rights and labour standards in the fishing sector are calling on more than 40 Flag States involved in their supply chain to deliver on their commitment to protect fishers’ safety at sea, which is a priority for the fishing industry.

 

On the Day of the Seafarer, with only 4 months left to make a major international treaty protecting fishers’ lives at sea a success, the Seafood Ethics Action Alliance (SEA Alliance) – which gathers processors, retailers and food service businesses representing more than 70% of retail food sales in the UK – stresses that it is no longer possible for Flag States to overlook fishers’ safety at sea.

 

The Cape Town Agreement for the Safety of Fishing Vessels was adopted by the International Maritime Organisation in 2012 and aims to make every commercial fishing vessel a safe working place, from stem to stern. The safety of seafarers at sea was made a priority after the Titanic disaster in 1912, which resulted in the adoption of the very first convention for the protection of the safety of life at sea in 1914. But 110 years after this tragedy, there is still no international treaty to protect the safety of fishers.

Two treaties were negotiated on fishers’ safety in 1977 and 1993, but neither of them entered into force. Therefore, fishers have been waiting for more than 45 years for an international treaty to protect their lives at sea. To change this situation, 51 States signed the Torremolinos Declaration in 2019 to commit to ratify the Cape Town Agreement by October 2022. Six States committed or reasserted their commitment at the One Ocean Summit in February 2022.

 

“The Cape Town Agreement is one of the three international treaties which aim to tackle illegal, unreported and unregulated (IUU) fishing and poor labour standards, together with the FAO Port State Measures Agreement (PSMA), and the ILO Work in Fishing Convention (C.188)”, the SEA Alliance says. “Whereas C.188 and PSMA are already in force, the Cape Town Agreement is the missing link which could strengthen international law, since catch control, decent working conditions and safe vessels are three complementary and indivisible conditions to end illegal fishing activities.”

 

While the United Nations recognised that IUU fishing remains one of the greatest threats to sustainable fisheries, the SEA Alliance is calling on all Flag States to make fisher safety a priority and ratify the Cape Town Agreement by October 2022. The international community cannot fail to protect fishers’ lives at sea for a third time in history.

 

Source: Modern Ghana

Nairobi, June 23, GNA – As countries around the world try to deal with rising commodity prices caused by the war in Ukraine, in Africa the goal is to stop economies being undermined and poverty increasing.

According to the US-based International Food Policy Research Institute (IFPRI), many countries are witnessing high prices across a wide range of commodities such as fertilizers, edible oil and maize.

A recent IFPRI modelling study focusing on Kenya suggested that the country would record reduced GDP growth and increased poverty rates, thus pushing an extra 1.4 million Kenyans below the poverty line.

Experts now say that this model can be applied to most African countries with varying degrees of economic impact.

But in the main, the experts add, Africa will now have to expand agriculture and productivity in order to become more self-sufficient.

According to the IFPRI, this would mean governments increasing public and private investments in the sector to attract expertise and make use of technology to improve land efficiency.

“Although many African countries might find it difficult to raise the sort of money we are talking about when it comes to investing in agriculture, there is a way out,” a food security expert in Nairobi told the GNA.

“These countries could turn to European investment in Africa’s agriculture sector.

“Indeed, this is vital for global food security because European and other countries around the world have been forced to look for alternative sources of food supply as a result of the war in Ukraine.”

Writing for the EU Reporter last week, Candice Musungayi said: “It makes sense for Africa to take up a more significant role [in global food production].

“Home to 60 per cent of the world’s arable land, agriculture and its related businesses are a key driver of development and a leading employer on the continent.

“With over 70 per cent of Africa’s population in jobs linked to the production, processing or sale of food, these sectors make up 25 per cent of its GDP,” Ms Musungayi added.

But the continent is currently a net importer of food and struggles to feed itself, with 281 million classified as undernourished in 2020.

However, in Angola things are looking up for the food sector and the country is taking steps to reduce its reliance on foreign parties.

In 2017, as part of its Empowering Africa initiative, Paramount Energy and Commodities, in conjunction with an Angolan food production company, Carrinho Group, transformed the country’s food sector.

When Carrinho started in 1996 it was a catering company but by 2014 it had become a food production company and has now developed into one of the biggest such plants in Angola.

Paramount, a Geneva-based private energy and commodity trading company, invested $500 million in Carrinho’s industrial complex that consists of 17 factories.

This investment has allowed Angola to produce its own processed food products – pasta, tinned goods, etc – and even export them, as well as support the creation of jobs and opportunities in local communities.

The investor is also looking to expanding its footprint in Africa and to establish businesses through sustainable, long-term investment.

“This type of investment from abroad is crucial if Africa is to untangle itself from the web that has been cast by the Ukraine war,” an analyst in Nairobi told the GNA.

Earlier this week, Ukrainian President Volodymyr Zelenskyy told the African Union through video link that, by blockading his country’s food exports, Russia was holding Africa ‘hostage”.

When the African Union Chairperson, the President of Senegal, Macky Sall, met the Russian President Vladimir Putin in Sochi earlier this month, the Senegalese leader raised concerns about the food crisis, pointing out that it would be difficult for Africa to continue to take a neutral stand on the war.

“Clearly, the need for food self-sufficiency in Africa is now crucial to the continent’s long-term development,” the Nairobi analyst told the GNA.

“So it would make sense to galvanise foreign investment in the continent’s agriculture sector, such as we are now seeing with Paramount and Carrinho in Angola.”

At the ongoing Commonwealth Heads of Government Meeting in Kigali, Rwanda, the President of the African Development Bank (AfDB), Akinwumi Adesina, said the continent must reduce its dependence on others for food and vaccines.

“Africa should not allow itself to be vulnerable in excessively depending on others, whether it is for vaccines or whether it is for food,” he told Reuters on the sidelines of CHOGM.

Source: Ghana News Agency

Gomoa West (C/R) -The Institute for Environment and Sanitation Studies (IESS), University of Ghana, Legon, through its Coastal Communities Resilience to Climate and Diarrhoea (C2R-CD) project, has inaugurated a 12-member Local Community Climate Change Governance Team in the Gomoa West District Assembly of the Central region.

The team is expected to liaise with the District Assembly in the implementation of the C2R-CD Project research findings, and the identification of new and emerging climate change trends that would need the attention of the Assembly.

The Coastal Community Resilience to Climate and Diarrhoea (C2R-CD) project aims to build resilience to climate change and improve diarrhoea management in Ghana’s coastal communities.

Since its inception, it has been generating long-term data series in Anyako, Anyanui and Atiteti in the Volta Region; Eastern Coast; Opetekwei, Greater Accra Region, and Mumford, Central Region, Central Coast of Ghana; to understand the interactions between environmental parameters and health management to improve diarrhoea management in coastal communities.

The team is being chaired by Apostle John Arthur.

Other members are Mr Isaac Ansah, Secretary and Assembly member for Mumford, Nana Kwamena Obo – First Trustee, and Chief fisherman of Mumford, Kyeame Kofi Mensah Second Trustee and Linguist of Mumford, Linda Koomson, Treasurer,

Mr Francis Acquaye, Organiser and Unit Committee member of Gomoa West District Assembly, Mr Henry Appiah, Financial Secretary and Secretary to Chief Fisherman.

The rests include Mr Stephen Acquaye, Fundraiser, Mr Kobena Amoah, member and Secretary to the GPRTU of Mumford, Mr Stephen Annor Crentle, member, Mr Obatan Kweku Ansah, member, and Ms Victoria Biney, member.

Speaking at the inauguration, the District Chief Executive, Mr Bismark Baisie Nkum, urged members of the Local Governance Team to help identify solutions to climate-related issues at the local level.

He said the issues of climate change were global with local consequences and solutions must be localised to impact the global challenge.

The Principal C2R-CD Project Investigator, Dr Dzidzo Yirenya-Tawiah, commended the Gomoa West District Assembly for their tremendous support of the project.

She said the goal of the project was to build resilience to climate change and improve diarrhoea management in Ghana’s coastal communities.

Dr Yirenya-Tawiah said scientific evidence revealed coastal communities, including those within the project areas, would bear the negative burden of climate change, hence, the need to build resilience to climate change in the country.

“Being evidence-based transdisciplinary research, the project work packages highlighted some preliminary findings from the data and samples collected from the communities.

“These are expected to inform sensitive and timely actions by the assembly to become more resilient to the negative impact of climate on health in the district,” she added.

The convener of the inauguration, Dr Benjamin Dankyira Ofori, lead of the Work Package 5 research team, encouraged members of the local governance team to look beyond the project timeline as there was no end in sight on climate change issues.

Source: Ghana News Agency

Accra, June 23, GNA – Vice President Mahamudu Bawumia Thursday inaugurated a 12-megawatt ONIX Tier IV Data Centre to deliver high-speed and secure data services to enterprises, consumers and public sector markets.

The Centre, located at Amrahia in the Adentan Municipality of the Greater Accra Region, is connected to undersea cables to accommodate and satisfy all international community requirements.

The facility was constructed by the ONIX Data Centres Limited to provide a platform for a waive of transmission of organisational and business processes.

It is the only African based carrier neutral co-location data centre outside South Africa.

At its inauguration at Amrahia, Vice President Bawumia commended the African Infrastructure Investment Managers, owners of the Data Centre, for investing over US$ 48 million in Ghana’s digitalisation space to improve data services.

He said the Centre would assist the Government to realise its digitalisation goals towards transforming the Ghanaian economy from analogue to a digital-based one.

The establishment of the Centre fitted perfectly into government’s policy directive of ensuring that the country had adequate data for the digitalisation drive, Dr Bawumia said.

The Vice President enumerated some digital infrastructure initiatives implemented by the Government, which were already yielding positive results including the National Digital Property Address System, Ghana-Card, Ghana.gov, Mobile Money Interoperability Payment System, Paperless Port System and the Universal QR Code.

Mr Michael Nahon, the Chief Executive Officer of the ONIX Data Centres Limited, in his welcome remarks, said the Centre would add more impetus into Ghana’s digital transformation drive and improve data quality accessibility.

He assured of the Centre’s commitment to social and environmental best practices in safeguarding the environment and job creation.

Mr Nahon said the Centre was first to be established in the West African sub-region and chose Ghana to host it because of her achievement as the gateway to the Sub-region.

Source: Ghana News Agency

Accra, June 16, GNA – Mr Seth Emmanuel Terkper, a former Finance Minister, has asked the Government to institute measures to make Ghanaians willing to contribute to revenue generation through taxes.

This follows an observation that some Ghanaians are avoiding tax payment because of the introduction of the 1.5 percent Electronic Transactions Levy (E-Levy).

The transactions that the levy cover include Mobile Money (MoMo) payments, bank transfers, merchant payments, and inward remittances.

At a dialogue on the state of the Ghanaian economy he hosted on a virtual platform, Mr Terkper, who is a Tax Professional, noted that the introduction of the tax measure to increase Government’s revenue had led people to avoid the payment of the tax.

Rather, many Ghanaians have started dealing directly with MoMo Agents for transfer to avoid the payment of the 1.5 percent levy, which would affect the revised projected revenue of GHS4.5 billion from the initial GHS6.9 billion.

Mr Terkper, who is also a Chartered Accountant, said that due to the delays in the start of the levy and the “high rate” of the tax, the E-Levy would not yield the expected revenue outcome for this year.

He explained that “Because the E-Levy is taxing savings and loans, what it will mean is that if you’re a worker and you go for a loan at the bank and your workers are in the field and you send e-transfers to them, it will attract the tax.”

“For these reasons, people are going to find a way around it, and truly they’ve started by going to deal directly with the MoMo businesses by the roadside to avoid the tax,” he emphasised.

As such, the Tax Professional said that because the levy was delayed from the original implementation date of January to May, it was likely not to yield much this year.

Mr Terkper said the government must implement the needed legislation to allow the Ghana Revenue Authority (GRA) seal the loopholes.

On the current inflationary pressures, Mr Terkper said there was the need for handlers of the economy to make homegrown policies a critical part of their interventions.

“They need to come up with a homegrown policy. My only worry is that despite the mention of a homegrown policy by government agents I have not seen it. It may exist internally,” he said.

“If it exists in the budget then the markets don’t have any confidence in it. We, therefore, need to do something very drastic on our own, which will be laudable,” he added.

On the country’s debt, which recorded an increase of GHS40 billion from GH¢351.7 to GH¢391.9 billion in March 2022, he cautioned the Government against defaulting.

“I would sound a note of caution and it’s that the worst thing that could happen to us is to default. Given the fact that our turning to the domestic market to finance the budget is not working out as planned because of the auction shortfalls and the rest,” Mr Terkper said.

Source: Ghana News Agency

Tumu, (UWR), Jun 23, GNA?– Mr Fuseini Kanton, the Chairman of the tractor owners Association in Tumu in the Sissala East District, has appealed to the government to subsidise the price of seed planters and harrows for farmers.

This, he said, would help cushion the current increasing cost involved in farming, especially in accessing human labour for ploughing and seed planting and agro-inputs.

Mr Fuseini Kanton made the appeal on Thursday when the Ghana News agency visited his farm in Tumu.

Mr Kanton said the use of a harrow and planter was cost-effective as compared to accessing human labour.

“The cost involved in using a harrow and a planter is cheaper as compared to human and physical labour, with labour you will need a dibble that charges GH¢40 and the one to sow also takes another GH¢40.00, whereas eight hours a day cost GH¢30 per person for a day, provide food and transport,” he said.

Mr Kanton also lamented that the hikes in fuel prices had also affected the activities of tractor operators in the area, thereby increasing tractor services by 100 per cent per acre this farming season.

“Last year a gallon of diesel cost GH¢27 but is now sold for about GH¢54.9. Last year, an acre of land with a size of 70 x 70 yards was ploughed for GH¢100 but currently goes for double the amount, ” he said.

He said, “Generally parts and tractor maintenance had all gone up, even servicing diesel and oil filters had all changed, servicing that cost GH¢400 in the past, now need over GH¢1,000 to run and maintain a tractor for farming”.

“Those who bought tractors this year to do business may find it difficult to break even, let alone paying as a lot of people are not Ploughing this year due to the cost of fertilizer and other agro-inputs?seed, weedicide, among others had all gone up”.

Mr Kanton also said the weather was a threat to crop cultivation in Tumu as the area only received rain showers in May, adding that “Maize production and the market will drop next year because I and many other people have cut down on acreages and shifted from maize field to do Soya, Cowpea and, Sesame.”

Mr Samuel Akuetteh, an official from the Department of Agriculture, observed that the Sissala East area alone could cultivate over a hundred thousand acres of maize in a seasonal year.

Source: Ghana News Agency

Accra, June 23, GNA – Parliament has approved a €74.1 million buyer’s credit facility agreement for the Tarkwa Water Supply Project.

The amount is made up of €65 million for a commercial contract and the associated Credendo premium of €9.1 million for the Export Credit Guarantee from Belgium.

It involves KBC Bank NV and Commerzbank AG (as arrangers and original lenders) and KBC Bank NV (as agent.

The project aims to expand access to potable water supply for the inhabitants of Tarkwa and its adjoining communities by expanding the capacity of its existing Bonsa Water Supply System and extending access to adjoining communities such as Bonsa/Bonsaso, Bankyem, Charliekrom, Efuanta, Kwabedu, Mantrem, Agona Wassaw and Nsuta.

The rest are Tamso, Fanti Mines, Senyaekurase, Akyempem, Simpa, Dompin-Papase, Brofroyedu, Atoabo, Aboso, University of Mines and Technology and other settlements.

The Project will expand the capacity of the existing water supply system from 2.8m3/day (0.6MGD) to 27,000m3/day (6MGD) to meet the present demand of 15,000m3/day (3.3MGD) and also to meet the projected water demand for the Municipality for 2040.

The project is expected to be completed in 36 months with a defect liability period of 12 months from handing over each complete element to the client.

Mr Kwaku Agyeman Kwarteng, the Chairman of the Finance Committee of Parliament, who moved the motion for the approval of the loan, said the Committee after a careful examination of the Agreement was convinced that the Facility when approved would help expand access to water in Tarkwa and its surrounding areas, and therefore recommended to the House for its approval.

Dr Cassiel Ato Baah Forson, the Ranking Member for the Finance Committee, who seconded the motion, said the terms of conditions of the loan facility were 1.1 per cent plus six months libor, and that they were informed that the Government of Ghana would be paying a commitment fee of 0.4 per cent and an upfront fee of one per cent to support the Tarkwa Water Supply Project.

“Mr Speaker, my concern relates to the fact that Government of Ghana is taking a loan of €65 million but we are paying an insurance premium of €9.1 million,” he said.

“Mr Speaker, this means that the insurance for the facility alone is 14 per cent of the loan amount, I recognise that this is high but I will only urge the Ministry of Finance going forward to start working on our insurance premium.

“Mr Speaker, it looks as if Ghana is paying so much insurance on some of these export credit agency loans.”

He said the loan itself was quite cheap but the associated insurance was something that Ghanaians should be worried about.

He also raised concern that the value for money audit was not done by the Finance Ministry before the loan became effective.

Mr Osei Kyei-Mensah-Bonsu, the Majority Leader of Parliament, who agreed with the Ranking Member on the value for money audit, noted that going forward, it was high time Parliament begins to engage the services of experts to do value for money audits before loans were approved by the House.

Source: Ghana News Agency