Search News by Day
March 2014 M T W T F S S « Dec 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
The load shedding exercise has thrown a number of operators in the cold storage industry out of business.
Players in the business, especially retailers who operate small-scale enterprises, have had to shut down their businesses as a result of the frequent power outage, which has negatively affected their facilities.
A number of business owners, who have been affected, in an interview with BUSINESS GUIDE, called for government’s quick intervention before a total collapse of the industry.
Most operators at the Abobloshi Market, Kaneshie, Dansoman and Nima, all in the Greater Accra region have had to discard an unspecified amount of food items, which went bad.
Frederick Okoe, Managing Director of First Light Cold store, a large facility which supplies fish to most small-scale operators in the Kaneshie and Mataheko Area, said the power outage has been on-going for over eight months.
“You know our business depends on the continuous supply of electricity to enable us store the food items we sell so without electricity we suffer.”
He explained that due to the development, most operators have had to depend on stand-by generators to manage their businesses.
Currently, Mr Okoe, who buys GH¢400 worth of electricity daily to power his cold room, now spends GH¢500 every day on diesel for his generator.
“Diesel is not like electricity. It is very expensive and this has increased the cost of operation,” he said. “This has led to high prices of our items.”
The managing director, who has five employees, said his machines have been gravely affected, adding that it is expensive to get a new one or repair the cold room machines.
Mr Okoe stated, “We are really losing. The outage has destroyed the cold store business. Many people have gone out because they cannot afford to buy generators and fuel.”
He also called on government to consider subsidizing electricity or instituting a flat rate system for them.
“This will help because if electricity bill is low, it will reduce our cost and also stop people from engaging in illegal connections.”
At Agbogbloshie, Florence Naa Atoshie said, “I have lost GH¢12,000 and my three freezers have been damaged. Most of the food items, including fish, chicken parts, sausages, beef and offals of some animals have gone bad.
“I lost everything and now I do not know how I can repay my bankers,” said the mother of three who said her friends would support her to raise capital to purchase a new freezer.
The operator of “In His Time” Cold Store at Anyaa School Junction, a suburb of Accra, Mabel Mako said most people usually purchase her products.
He laid off two of her workers about two months ago, adding, “I leave the generator on even when I close for the day because I do not know when the ECG will switch off the power.”
By Emelia Ennin Abbey
A survey conducted in selected markets in the Greater Accra region has revealed that there is growing anxiety over the sale of fresh vegetables which are said to be unsafe for consumption due to the presence of chemical residues.
Information gathered from three markets including Agbobloshie, Kaneshie Complex and Mallam indicated that consumers, who raised concerns about pesticide residues in vegetables, have either stopped buying the produce or reduced their patronage.
This latest development comes after BUSINESS GUIDE reported on laboratory analysis of high levels of persistent organic pollutants in vegetables sold in the Accra metropolis.
It would be recalled that last week the paper reported that over 90 per cent of vegetables on Ghana’s markets were unsafe for consumption.
This was contained in the research findings of the Council for Scientific and Industrial Research (CSIR) carried out at the request of the Ecological Restorations, a Non-Governmental Organization (NGO) to ascertain the level of contamination in vegetables produced in Accra.
The study detected enormous amounts of chemical residues in selected vegetables including tomato, okro, lettuce, cabbage and cucumber produced in the Greater Accra Volta and Ashanti regions.
The vegetables were taken from five different locations in Accra including Weija, Kawukudi; a farm gate at Akomadan in the Ashanti region and Keta in the Volta region.
Ecological Restoration with financial support from the UNDP’s Global Facility for Small Grant Programmes sponsored the purchase of vegetables from various markets in the areas for analyses in the laboratory to find out whether the vegetables were contaminated with chemicals residues or not.
It was part of a campaign by the Ecological Restoration to raise awareness on the use and consumption of chemical residues in vegetables.
This is because vegetable farming in Ghana is fraught with the misuse and overuse of pesticides.
The end result was the high concentration of chemical residues in vegetables which pose a danger to human health.
Salomey Amoako, a vegetable seller at the Mallam Market, said most of her customers wanted to ascertain the source of the vegetables.
“Vegetables are good but now my customers say they heard vegetables grown in Accra and some other places were bad. This is not true. I have been selling and eating vegetables for years and nothing has happened to me and my family,” she said.
Akwele Martey, who has operated in the industry for the past nine years, said she had to dispose carrots and letus worth GH¢450 after the publication.
“All my fresh vegetables went bad as my customers refused to buy them,” said the mother of two.
“I do not know what I can do if this continues. Something must be done about it.”
George Ortsin, Country Programme Coordinator of the UNDP’s Global Facility for Small Grants Programme, said farmers are not producing under healthy conditions.
“Just look at where vegetables are being grown in Accra, we find them behind cemeteries, near gutters with stagnant water and many other places which are not safe,” said Mr Ortsin.
He stated that the research showed that all the vegetables had chemical residues of banned chemicals such as DDT and others.
“The chemical residues were beyond the acceptable levels. There were some with the presence as high as 5000 per cent and as low as 500 per cent.”
Mr. Ortsin hinted that there are plans to repeat the research on vegetables next year, adding, “I guess the situation will be worse in 2013 when we conduct the next chemical analysis on sampled vegetables.
“The problem is on going because our borders are not tight enough when it comes to the flow of chemicals. There are all sorts of people carrying banned chemicals into the system.”
He explained that the integrated pest management which includes the use of organic pesticides would ensure efficiency and better yields for the farmers.
The Programme Coordinator advised consumers not to stop eating vegetables but rather patronize organic products which can lower their exposure to pesticides.
He encouraged the public to cultivate the habit of domestically planting their vegetables.
“I think it would be good for everyone to have their own garden to produce their own foods.”
He also mentioned that it would be important to know the source of vegetables “and do not buy vegetables from anywhere but identify the source and buy from there all the time.”
By Emelia Ennin Abbey
Government’s overall budget deficit for the first nine months of this year recorded GH¢5.1 billion, three percent higher than the expected target of GH¢4.3 billion.
The figure represents 7.3 per cent of Gross Domestic product (GDP) as against a target of 6.2 per cent of GDP.
Henry Kofi Wampah, acting Governor of the Bank of Ghana, who made this known, said the increase in the budget deficit was occasioned by the implementation of the Single Spine Salary Structure (SSSS) and the clearance of some government arrears which amounted to 1.1 per cent of GDP.
Checks by the Central Bank indicated that during the corresponding period of 2011, the overall budget deficit was equivalent to 1.9 per cent of GDP.
For the first three quarters of this year, GH¢4.8 billion was sourced domestically to finance government’s budget compared to GH¢1.3 billion over the same period in 2011.
At the end of September 2012, the stock of public debt stood at GH¢29.6 billion, representing 44.7 per cent of GDP, Dr Wampah adds.
Compared to figures of December 2011, the stock of public debt stood at GH¢23.9 billion, representing 42.6 per cent of GDP.
He explained that the domestic component of the total public debt was GH¢17.8 billion as against GH¢11.8 billion at the end of 2011.
Meanwhile, the stock of external debt was US$7.8 billion compared with US$7.6 billion in December 2011.
Government records a budget deficit when its expenditure exceeds its income.
The opposite of a budget deficit is a budget surplus, and when inflows are equal to outflows, the budget is said to be balanced.
Historically, from 2004 until 2011, Ghana Government’s budget averaged -7.70 percent of GDP reaching an all time high of -0.40 percent of GDP in December of 2004 and a record low of -24.20 percent of GDP in December 2008.
In the past, Ghana’s fiscal deficits have been particularly high in election years, which are followed by painful adjustments in subsequent years.
A World Bank report on its website indicates that ahead of the December 2012 elections, Ghana faces the risk of continuing its cyclical high deficits.
“Political pressure is mounting on the government to deliver infrastructural projects and settle demands from labor unions.
The rapid depreciation of the Ghana Cedi in the early months of 2012 is understood as the response to the expectation of politically driven fiscal slippages.
Demands by community service organizations (CSOs) for fiscal responsibility arrangements are mounting,” it said.
The report projected Ghana’s economy to decelerate from 14.4 percent in 2011 to 7.5 percent in 2012. Growth in 2011 was driven primarily by the revised GDP in the oil sector, construction, transport and ICT.
Agricultural performance, cocoa in particular, was satisfactory with good rainfall and continued high prices. In the poorest regions of the North, rapid maize and rice production growth was recorded.
Early this year, the Ministry of Finance and Economic Planning said on its website that Ghana’s budget deficit last year was lower than targeted, as revenue and grants exceeded expectations.
The gap was 4.3 percent of gross domestic product as against a target of 5.1 percent, the ministry said.
Finance Minister Dr. Kwabena Duffuor said on February 20, 2012 that Ghana will probably have a budget deficit of 4.4 percent of GDP, this year, compared to a target of 4.8 percent in the 2012 budget.
The confidence of the business community in the Ghana’s economy is tipped to go down in the final quarter of this year, the Association of Ghana Industries (AGI)’s Business Barometer Indicator (BBI) for the 3rd Quarter 2012 has stated.
The third quarter of 2012 recorded a confidence level of 19.8 which indicates a drop in business expectation over 26.2 recorded in the second quarter of 2012.
This implies that the fourth and final quarters of 2012 are expected to be affected by the development.
The report stated that irregular power supply was the topmost constraint to the growth of businesses in Ghana.
This development, according to the report “could be attributed to the load shedding exercise embarked upon by the Electricity Company of Ghana over the last four months.”
It noted that depreciation of the cedi and high level of taxation were ranked second and third respectively as obstacles restraining expansion of businesses in the country in the third quarter of 2012.
Low access to credit and cost of credit placed fourth and fifth positions respectively. At the tail end of the table are inflation, low purchasing power and competition from imported goods were ranked eighth, ninth and tenth respectively.
The report additionally notes: “this is the first time since the inception of the AGI Business barometer Survey that competition from imported goods is being ranked tenth. It is normally ranked at mid or upper end of the table. This shows how realistic the AGI Business Barometer is, as it always identifies the most pressing challenges facing the business community.”
The AGI BBI measures the level of confidence in the business environment and predicts short-term business trends. It expresses the state of the business climate in one number, ranging between +100 and –100. It is calculated out of “current” business mood and “expectations” for the future.
Decreasing business confidence often implies slowing economic growth because business owners are likely to decrease their investment.
It emphasizes: “Whilst about 57 percent of the Chief Executive Officers (CEOs) interviewed in the second quarter of 2012 said they expect the performance of the business environment to improve in quarter three, only about 52 percent of the respondents interviewed in third quarter of 2012 feel same about quarter four.”
It further added that “the reasons assigned by the optimists are an improved market, increase in output of labour force and availability of raw materials.”
However, those who expect their businesses to perform poorly in quarter four 2012 compared to quarter three 2012 based their assertion on expected: depreciation of the cedi, increase in inflation and increase in the level of tax rate.
By Esther Awuah
The on-going load shedding exercise is taking a heavy toll on equipment of the Electricity Company of Ghana (ECG).
Robert Dwamena, Director of Procurement at ECG, who disclosed this to BUSINESS GUIDE, stated that the frequent power outages had weakened most of ECG’s network gadgets such as transformers and switch gears, thereby causing operational changes.
“Our equipment are not designed to be switched on and off like we do currently and this is sometimes responsible for unplanned outages due to unit trips from the generation and transmission sites.”
The irregular power supply, which is expected to end in the first week of December, emerged as a result of a damage caused to the West Africa Gas Pipeline (WAGP) by a vessel in August, this year.
WAGP’s gas supplies to Ghana’s Volta River Authority (VRA) are used to generate electricity from its thermal plants.
Mr. Dwamena, who spoke on the sidelines of a news conference organized by the Ghana Grid Company (GRIDCo) and the Volta River Authority (VRA) in Accra recently, told this paper that the problem had caused its network gadgets to age faster than anticipated.
“Because we are subjecting them to the frequent on and off activities, we are hastening the ageing of these equipment. We therefore need to retire them, which will also affect the availability and quality of electricity supply.”
He said such equipment must be quickly replaced before something untoward happens.
“These assets would require a quick replacement within a very short time. This also has placed a huge financial burden on ECG because we need heavy investment to replace them,” Mr. Dwamena emphasized.
Though he did not disclose when the equipment would be replaced and the financial implication, he added that “immediately the load shedding exercise ends, we would commence the replacement programme.”
In an address, Chief Executive Officer (CEO) of VRA, Kweku Awotwi, explained that his outfit was aware of the challenges that industries and households were facing as a result of the load shedding programme, and gave the assurance that steps were being taken to quickly address the problem.
“Because of the current challenge, it is expected that the load shedding would end by December should all the additional generation come into service as scheduled,” Mr. Awotwi indicated.
By Esther Awuah
First Rand Bank’s acquisition deal with Merchant Bank has not been abrogated, BUSINESS GUIDE’s sources within the bank have indicated.
President John Dramani Mahama wanted the deal to be cancelled but South Africa’s First Rand Bank said it intends to play safe, especially as the December 7 elections draw nearer.
According to First Rand, it has not backed out of the deal.
A delegation from Merchant Bank travelled to South Africa about a fortnight ago to discuss the transaction and its consummation possibly by the end of this year.
The business deal is progressing steadily and is expected to be completed according to First Rand’s own schedule.
The prospects of Merchant Bank assumed some bleakness lately after reports suggested that the contract had been cancelled.
But a statement from First Rand noted: “As far as First Rand is concerned the transaction is still progressing according to timetable.”
In August, this year, Merchant Bank announced that First Rand Bank had completed the processes to obtain 75 percent stake in the bank.
This followed an approval by SSNIT, Merchant Bank’s largest shareholder and pension fund manager.
First Rand will be parting some $91 million to acquire a 75 percent stake in Merchant Bank.
Over 350 permanent staff of the bank in October, this year, gave their blessing to the deal.
In a press statement, they commented: “We are fully aware of the challenges the Bank has been grappling with regarding its non-performing loan book over the last few years and the untiring efforts management, staff and the Board of Directors have put in place to address same. First Rand is the second largest Bank in South Africa with assets in excess of USD 103 billion recording profits of over $2.8 billion as at the end of 2011(Annual report of First Rand).
“To put this in perspective, the total assets of the banking industry in Ghana, according to the Bank of Ghana (MPC report for June), was GHC23 billion as at April 2012 (about $13 billion), the staff highlighted, adding that First Rand has over one hundred years of banking history in South Africa.
First Rand had already invested over $580 million in various development projects in Ghana across various sectors including the recent Ghana Cocoa Board syndication, the transport sector, energy and oil sector, telecommunications sector, construction, among others. The total portfolio size could rise to over $1 billion soon.
First Rand is participating in this transaction by an agreed injection of cash of GHC176.4 million into Merchant Bank.
Meanwhile, the opposition New Patriotic Party (NPP) questioned provisions in the deal which includes “an unacceptable provision that SSNIT takes over the bad debt portfolio of the bank estimated to be some GH¢160 million of the bank’s GH¢330 million worth of advances to its customers, only five customers.”
By Samuel Boadi
MANET Properties was over the weekend presented with the overall property award for 2012 dubbed ‘Property Walk of Fame’ at the 5th Ghana Property Awards held at the Banquet Hall of the State House in Accra.
Dr Theresa Oppong Beeko, Chief Executive Officer (CEO) of the Manet Group, who received the award on behalf of her outfit, expressed gratitude to the organizers of the event and dedicated it to all customers of Manet for their continued dedication and support of the company’s operations.
According to her, since its inception in 1994, the Manet Group has continued to practically ‘manicure and style Ghana’s landscapes’ through the development and construction of entire communities.
Manet, which has earned a reputation of constructing quality, cost effective and innovative buildings, has a catalog of highly regarded building projects including Manet Cottage (Baatsona); Manet Cottage Annex (Baatsona); Manet Community 20; Manet Ville (East Airport); Manet Gardens (Baatsona); Manet Court (East Airport); Manet Palms (East Legon); Manet Paradise (Ada); Manet Towers (Airport City) and various upscale commercial and residential properties at Airport Residential area.
Dr Beeko commented: “Whether commercial or residential, each structure is crafted to suit the unique tastes of its occupants. We bridge the gap between affordability and luxury and it is our belief that the finer things in life are not limited to the wealthy and this notion is reflected through our products and services.”
Hannah Bissiw, Deputy Minister of Water Resources, Works & Housing, in a keynote address, noted that to address Ghana’s housing deficit of about 1.7 million housing units, there was the need for a radical change in the country’s approach and also a paradigm shift from the way “we do things in the building and construction industry.”
“In our quest to maximize the usage of land, our estate developers should consider going high rise and building green i.e. constructing sustainable buildings that are energy efficient with rain water harvesting systems, solar panels and the treatment of waste both in liquid and solid to generate bio-gas for domestic use.”
To this end, the deputy minister called on organisers of the awards to institute an award for green building in the next edition of the awards.
Irene Agyenkwa, Director of Ghana Property Awards, in an address, stated that the biggest challenge to the execution of the awards was the feigned indifference on the part of major stakeholders, estate developers at the planning stage.
Ghana Home Loans won the Property Finance Organization award while Broll Ghana won the Facilities management award.
Edern Security was crowned the Property Security Company of the year while Interface Limited got the Property Inputs Supplier of the year award.
Westafco was adjudged the Inputs Supplier in Sanitary Wares and SIC Insurance, the Property Insurers of the year.
Property Company of the year award went to Devtraco Limited; Residential Builder of the Year (Upper Market) went to Trasacco Valley and Developer of the Year (Middle Income) was won by Koans Building Solutions.
Developer of the Year (Community and Social Housing) went to State Housing Company Limted, Developer of the Year (Lower Income) – Lakeside Estates, Up and Coming Development (Mixed Use) – La Beach Towers and Service Plot Company of the Year – Tema Development Corporation.
By Samuel Boadi
Small and Medium-scale Enterprises (SMEs) are expected to list on the Ghana Stock Exchange (GSE) by the end of the first quarter of 2013.
“With the approval of rules, procedures and structures by the Securities & Exchange Commission (SEC), we are just getting ready to launch the new market by the end of the first quarter of 2013,” Ekow Afedzie Deputy, Managing Director of GSE disclosed.
He stated that the new market, to be known as the Ghana Alternate Market, is going to be different from other security markets.
“All the requirements and obligations have been relaxed for this particular market in order to groom and entice SMEs to get a little more transparent.”
Mr. Afedzie, who was speaking at the media launch of SEC’s 2012 Capital Market Week in Accra, said SMEs needed a minimum capital of GH¢250,000, stated capital post flotation, a minimum of 20 shareholders and listing fee of GH¢2,000.
Explaining why the GSE failed to launch the market this year as announced earlier, the Deputy Managing Director explained that “because we want this market to succeed and help expand the fortunes of smaller companies, we had to take our time in outlining the rules and requirements, hence the delay.”
He noted that through the Ghana Alternate Market SMEs would be given the platform to grow and create employment opportunities while growing the economy.
Adu Anane Antwi, Director General of SEC, who officially launched the week, educated the public on the capital market and the benefits the economy could derive from the market to create wealth.
The capital market deals in stocks, bonds, and other long-term investments.
Touching on the theme for the celebration, “Capital Market: An Investment Avenue for Securing Your Future Financial Well-being,” he said it was to emphasize the importance of the capital market as a provider of investment opportunities.
The week celebrations will commence on 29thOctober, 2012 and end on 4th November, 2012.
Staff of SEC and some market operators will embark on outreach programmes in selected tertiary institutions in six regional capitals – Accra, Kumasi, Sunyani, Koforidua, Cape Coast and Takoradi when the celebrations kick off.
By Esther Awuah
World Bank Group, President Jim Yong Kim has called on governments to redouble their efforts to end absolute poverty in their countries.
Speaking at the group’s annual meetings which ended in Tokyo, Japan yesterday, Dr Kim commented: “We still live in a world that has more than one billion people living in absolute poverty.”
He noted: “We must all work to make sure that the impressive gains in Latin America, Africa and Asia over the past generation are not lost now. In just the last few years, growth from developing countries accounted for more than half of global growth.”
A day earlier, Dr. Kim outlined his plan to transform the bank into a solutions bank that will use evidence and experience to tackle development problems and also establish ambitious targets for eradicating poverty and boosting shared prosperity, among other measures to modernize the institution.
At the opening of the meetings, Dr. Kim acknowledged that the world was in challenging times which were marked by high and volatile food prices, weak growth in high income countries, and slowing growth in developing countries.
In its communique, the committee called on the bank to work with other organizations to accelerate efforts to help the African Sahel, where hunger threatens the lives of 19 million people and the stability of the region.
The response should bring solutions that enable the region to permanently escape the cycle of emergency aid, and reach a more resilient and sustainable future in the medium term.
Food security and food price volatility remain persistent threats to development in general and need more attention, the committee added.
Donors who met on the sidelines of the annual meetings pledged to support the Global Agriculture and Food Security Programme launched by the World Bank in 2008 at the request of the G20.
The United States pledged to contribute an additional $1 to the fund for every $2 contributed by other donors (up to a total US contribution of $475 million), attracting $30 million contributions each from Japan and the Republic of Korea, with the Bill & Melinda Gates Foundation also indicating it would double its commitment.
“The World Bank Group must also continue to help countries strengthen conditions for job growth. Recent financial crises mean fewer jobs where millions are needed, said the committee,” he stated.
According to the bank, its private sector arm – IFC and the Multilateral Investment Guarantee Agency – will be especially crucial in supporting the private sector, it said.
The bank should also provide support to countries that want to use natural capital accounting a method of valuing natural resources and phenomena often left out of national budgets.
A business desk report
Ghana has no comprehensive statistics on its labour market, Moses Asaga, Minister of Employment & Social Welfare has said.
Disclosing this in an interview with BUSINESS GUIDE during the opening of the 52nd Annual General Meeting (AGM) of the Ghana Employers’ Association (GEA) recently in Accra, the minister said the lack of data makes it difficult to tell the actual number of people without jobs in the country.
“We do not know what the true unemployment rate is and that is one of our problems as a country,” he emphasized.
Many experts believe this situation has hampered the accurate assessment of the labour market while government’s policies and programmes directed at improving the labour force in the country have not yielded the expected results.
Mr Asaga however said there were plans to put together a labour market information scheme.
“By next year, we will have statistics on our labour force,” he said, adding that the Ghana Statistical Service (GSS) was expected to conduct an annual labour force survey to provide the needed data on the nation’s labour market.
He said the move will facilitate the measurement and provision of relevant policies.
The unemployment rate in Ghana was reported at 12.9 percent in 2005. Historically, from 2001 to 2005, Ghana’s unemployment rate averaged 12.1 percent reaching an all-time high of 12.9 percent in December 2005 and a record low of 11.2 percent in December 2001.
The unemployment rate refers to the share of the labour force that is without work but available and seeking employment.
Mr Asaga commended the Ghana Employers’ Association (GEA) comprising 1,500 employers from both the formal and informal sectors of the economy, for developing over the years.
Government, he said, would continue to support the National Tripartite Committee, which the Ghana Employers Association was a member.
Furthermore, he said government had initiated a number of interventions including the entrepreneurship development programme aimed at monitoring the business environment and undertaking regulatory reviews for sustainable development of small, medium and large-scale enterprises.
GEA’s meeting was themed: “Democratic governance and Enterprise development in Ghana.”
Terence Roland Darko, President of GEA, in an address, observed that “a conducive democratic environment that promotes sustainable enterprises is about strengthening the rule of law, institutions and governance systems that nurture enterprises.”
He called for a new form of cooperation between government, business, workers and society “to ensure that the quality of present and future employment is maximized.”
Emelia Ennin Abbey