GRi Business, Economics & Finance 30 – 04 - 2003

Saudi Prince expresses interest in Ambassador Hotel
Ghana's Securities Industry
Improvement in economy should reflect
Public sector Entrepreneurs urged to design


Saudi Prince expresses interest in Ambassador Hotel

Accra (Greater Accra) 30 April 2003- The visiting Prince of Saudi Arabia, Alwaleed Bin Talal Bin Abdul Aziz Alsaud, on Tuesday expressed interest in investing in the reconstruction of Ambassador Hotel as a joint partner, a venture estimated to attract about 40 million dollars.

Prince Alwaleed, who was conducted round the site of the Hotel in Accra by Jake Obetsebi-Lamptey, Minister of Tourism and the Modernisation of Capital City has, therefore, directed his representatives to enter into negotiations with owners of the Hotel for a possible agreement.

The once vibrant Ambassador Hotel, built in 1957 as one of the major state-owned hospitality plants, ceased to operate in the 1980s. The State, Social Security and National Insurance Trust (SSNIT), Grace Investments and Ghana Reinsurance Company were until recently the owners.

Prince Alwaleed expressed the hope that the evaluation of the project, negotiations and other deals would be finalised for reconstruction work to be completed within two years. Obetsebi-Lamptey, who later told Journalists that the project would attract an investment of between 30 million dollars and 40 million dollars, told the Prince that the government was interested in clearing all impediments within a reasonable time to revamp the hotel.

He said the Government was looking for strategic investors to speed up the establishment of hospitality plants to create jobs and increase earnings from the tourism sector, adding that all efforts would be made to restore Ambassador Hotel to its former glory as a classy hotel.

He said, considering the status of Prince Alwaleed in international business, he was encouraged by his interest in Ghana, as other major international entrepreneurs were likely to be attracted to the country as a result of his association.

"He is a major player in business and we are excited to have him here. The business community gravitate towards where their compatriots and it is possible that others would follow him here," he said. The 48-year old Prince, who is leading a 22-member business delegation on a three-day exploratory investment visit, is the Chairman of the Saudi-based Kingdom Holding Company.

His business holding cover Banking, Estate Development, Hospitality, Telecom, Agriculture, Information Technology, Broadcasting, Media, Entertainment, Travel, Automotive Manufacturing and other businesses.

George Amoako Temeng, an Official of SSNIT, said the reconstruction of Ambassador Hotel would light up the nightlife of its environs, Down Town Accra, which at present becomes virtually dead in the evening. He said tourists like to enjoy the nightlife of a city, but there was little to offer now.

Prince Alwaleed, who leaves Accra on Wednesday, would hold discussions with the President, Vice President, Ministers of State and other private and public officials. The Ambassador Hotel redevelopment programme began in 1992 when the Government of Ghana (GOG) entered into a joint-venture partnership Samed Associates; a company formed and sponsored by the Palestine Liberation Organisation, but was stalled due to technicalities.

Grace Investments took over the interest of Samed and invited SSNIT and Ghana Reinsurance and thus bringing the investment portfolio to SSNIT, 57 per cent; GOG, 27 per cent; Grace investments, 11 per cent and Ghana Reinsurance five per cent.

Before selling its interest Samed had carried out some renovation works but since it withdrew no further development took place thus compelling the government to re-possess it according to a release from Amoako-Temeng, made available to the Ghana News Agency.
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Ghana's Securities Industry

Accra (Greater Accra) 30 April 2003- The physical holding of share certificates would soon be over to give way to electronic shareholding in Ghana's securities industry. This is because stakeholders in the securities industry in Ghana are making serious efforts to establish an electronic central depository to modernise the holding of shares and put an end to the possession of physical share certificates as is done currently.

Dr Sam Mensah, Chief Executive Officer of SEM Financial Group Limited, who announced the novel shareholding efforts, said the modern trend in the industry "is that shares are held in electronic depositories so that a share is merely an electronic record."

Dr Mensah was speaking on Thursday at a roundtable discussion in Accra on the review of the Companies Code. The discussion, organised by the Private Enterprise Foundation (PEF) with support from the United Nations Development Programme was to make an input into the draft review Bill of the Companies Code prepared for the consideration of Parliament, identify key policy issues of concern to the Private Sector for further study so as to make concrete inputs into the law.

Dr Mensah said Section 46 (1) of the Companies Code required that 'each issued share in a company shall be distinguished by a definite number' "except that 46(2) allows numbering of shares to be dispensed with when issues are fully paid for."

He said that allowed for fungibility in the secondary markets as all shares traded in the secondary market are fully paid for, and pointed out that Section 50(1) imposes obligations for the issue of share certificates under the common seal of the company indicating among other things, number of shares held, the amount of money paid and name and address of the registered holder.

Dr Mensah said the new law must dispense with the requirement for numbering individual shares, amend the definition of debenture to allow electronic recording of indebtedness of the company to suffice as a debenture, and thereby dispense of the requirement for a written document to be issued.

 

It must also specifically provide that the registers of members and debenture holders can be kept in electronic form. Dr Mensah queried if the Annual Report, which was an important disclosure requirement of companies should be satisfied by posting it on a website or through an electronic mail under the new Companies Code.

He said the mandate of the new Companies Code was too limited to achieve the important public policy objectives with respect to business regulation, and added that what was needed was a much broader mandate from Government.

Dr Mensah said the revision of the Ghanaian Companies Code should be informed by best practices elsewhere in the world. He recommended a high-powered group in the form of a Commission to undertake the Company Law Reform, under Article 278 of the Constitution, or a broad-based National Steering Committee on Company Law Reform appointed by the President with a clearly defined mandate to develop proposals for the Company Law Reform.

Justice V. C. R. A. C. Crabbe, an expert on Company Law, and one of the drafters of the 1963 Companies Code, noted that the Ghanaian particular situation should be taken into account to review the Company Code without a wholesale replication of existing models outside.

He called for adequate re-sourcing of the Registrar General's Department and mechanisation to speed up its work. Dr Kwaku Addeah, Legal Department, Bank of Ghana, said there appeared to be a fundamental flaw in the existing Company Code as it treated both small and big companies equally and demanded the same requirements for registration.

He said it was time to look at the needs of small companies and identify the critical issues that affected them and to make appropriate recommendations to eliminate the problems of unilateral application of the requirements of both small and big companies.
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Improvement in economy should reflect

Accra (Greater Accra) 30 April 2003- President John Agyekum Kufuor on Tuesday appealed to the World Bank and the International Monetary Fund (IMF) to review their economic policies so that their implementation will reflect in the lives of the people.

He said: "It was normal for the two institutions to praise the government on its economic policies though those policies were not in interest of the people." Politicians are more concerned about improvement in the lives of the people they serve and not commendation for the implementation of World Bank and IMF policies", President Kufuor said.

He said this when Dr Abass Mirakhor, the IMF Executive Director for Ghana, paid a courtesy call on him at the Castle, Osu. The IMF Executive Director for Ghana said the IMF was encouraged by the government's performance to put the economy on an even keel and to improve the lives of the people.

Bredenkamp, Assistant Director, Africa Department and Head of IMF Mission in Ghana, said Ghana's economy was now on a very solid foundation and the 2003 Budget would put the country on a firm footing for growth. He said the monetary policy was on track, the exchange rate was solid and government was working on a wide range of reforms on the economy. Bredenkamp said: " I am very optimistic that in subsequent years,
Ghana's economy would improve."
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Public sector Entrepreneurs urged to design

Takoradi (Western Region) 30 April 2003- The Ghana Business Linkages Challenges Fund G-BLCF, an initiative of the Department for International Development (DFID) of the United Kingdom, was launched at Takoradi on Tuesday.

Grants for the G-BLCF, which is managed by Deloitte & Touche, Ghana, ranges between 50,000 and 500 billion pounds. Francis Kpogo Diaba, a partner of Deloitte and Touche, said it was a cost sharing grant, which encourages and support the formation of viable business linkages by entrepreneurs in Ghana.

He said G-BCLF linkages were meant to ensure competitiveness, reduce poverty and enhance sustainable development. Diaba said so far 34,200 pounds sterling had been disbursed to three organisations in the tomato and chemical industry since the fund was established a year ago.

He cautioned that projects that are not commercially viable to reduce poverty in their respective communities would not benefit from the fund. Diaba called on public sector entrepreneurs to design their own business plans and reduce their dependence on consultants. Participants, mostly business people, called on Deloitte & Touche to expand its training programme to enable more Ghanaian businesses to benefit from the fund.
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