GRi Business News 25-01-99

Accra (Greater Accra), 25 Jan

Mr Kwasi Abeasi, Director-General of the Private Enterprise Foundation (PEF), today said there is the need for a dynamic partnership between the government and the private sector for accelerated and sustainable development. He said the private sector has been recognised as the engine of growth because private capital is an indispensable ingredient in the development equation not only as a means of accelerating growth but as a sustainable and efficient source of investment.

Mr Abeasi was presenting a paper on: "The new role of the private sector in Ghana's developmental process towards the next millennium", at the eighth in the series of the "Speaker's Forum" in Accra. Mr Abeasi told the forum that Ghana, like most African countries, adopted a public-sector-led development strategy after independence to address her industrialisation requirements in an effort to advance the socio-economic conditions of her people.

"Most of these governments, however, sought to confront this challenge single-handedly, neglecting the potential of the private sector as an agent of and a partner for economic change", he said He said the past unimpressive performance of the private sector can be attributed to the fact that successive governments in almost all African countries, have always looked at the sector more as a parasite than a partner, sometimes even as an opposition to the government of the day.

Mr Abeasi said for the private sector to become the engine of the country's economic growth both the local private sector and the multi-national private sector should be nurtured, encouraged and supported. He said there is the need, therefore, to take the necessary measures to facilitate the required domestic and international private sector investment to achieve the country's growth and developmental aspirations.

"This is particularly important if Ghana is to succeed in attracting a greater share of international private investment flows, given that only a small percentage of these flows currently come to Africa."

Giving a background to the formation of PEF as an apex body for the various associations of the private sector, Mr Abeasi said the sector's scene was covered by a proliferation of associations, some of which sometimes even worked at cross-purposes. He said the situation could not engender efficiency in the development and nurturing of the private sector and there was, therefore, the need to bring all these groups together. The design, he said, proved acceptable to all parties and with the sponsorship of the United States Agency for International Development (USAID) and encouragement of the government, PEF was established in January, 1994 and started operation a year later.

The foundation has as its constituent members the Association of Ghana Industries (AGI), Ghana National Chamber of Commerce, Ghana Employers' Association (GEA), Federation of Associations of Ghanaian Exporters and Ghana Association of Bankers (GAB).

Accra, (Greater Accra) 25 Jan.  

The Produce Buying Company (PBC), a subsidiary of the Ghana Cocobod, has been earmarked for divestiture on the Ghana Stock Exchange (GSE) as part of the government=92s policy of liberalizing the macro-economic environment with the active participation of the private sector. Mr Kwame Peprah, Minister of Finance, said this when he opened a two-day stakeholders workshop on the Cocoa Sector Development Strategy in Accra last Friday.

The proposed divestiture of the company is part of an overall reform within the cocoa sub-sector, he said. Other companies mentioned for listing on the GSE this year include the State Insurance Company and National Investment Bank. The workshop is being attended by major players in the cocoa industry. It is aimed at collating views on cocoa production, internal and external marketing of cocoa, local processing of beans, taxation and pricing. Cocoa buyers and sellers, and other people in the industry have welcomed the proposal saying it will enhance its overall performance citing the success stories of companies such as the Ashanti Goldfields Company,

SSB Bank and the Mechanical Lloyd Company. Mr Peprah said the reforms embarked upon in the cocoa sub-sector have made a significant impact adding that the number of staff has been cut from 101,000 in 1994 to about 10,500. He said under the reforms, 52 cocoa plantations have so far been divested, the number of extension districts reduced from 99 to 39 and procurement and marketing of cocoa inputs transferred from Cocobod to the Ghana Cocoa and Coffee Farmers Association. Private buyers have been allowed under the programme to compete with PBC in the internal marketing of cocoa since the 1992/93 season.

The proposal for the divestiture of PBC, Tema Oil Refinery, Volta River Authority and other strategic government institutions generated a lot of debate when it was laid before parliament last year.

Tarkwa (Western Region), 23 Jan.  

Mr. P. K. Thompson, Managing Director of SSB Bank Ltd. has said in spite of the financial sector adjustment programme implemented in 1990, the banking industry still has room for improvement. Mr. Thompson said people have lost faith in cheques because they have proven to be ''fraudulent'' in some cases, adding that a number of business people prefer to transact business using cash which carries unbearable risks. He stressed the need for a more dependable and convenient alternative payment arrangement in a challenging economic environment. In an address read for him at the launching of the Sika Card at Tarkwa on Friday, Mr Thompson said, the card which =91holds=92 money electronically, was launched by SSB Bank to solve problems associated with the excessive handling of currency notes which included loses through theft and degradation of thenotes through improper care.

Mr. Solomon Amoah, Wassa West District Chief Executive, called on financial institutions to evolve policies and services to redress the problem of excess cash in circulation and its effects on the economy. He said Sika Card has a lot of potential that must be exploited for the improvement of the economy.

The Central Regional Minister, Lt. Col. (rtd) Charles Agebenaza, launching the card at Cape Coast, described Sika Card as a new financial practice designed to address the crucial question of excess liquidity in the economy.

It serves as an "electronic wallet or purse," he said, adding that the card has a lot of potentials not yet fully exploited for the improvement of the economy. Apart from affording the user the personal convenience and safety in carrying huge sums of money for business transactions, the card "will ease the resources and pressure on the government to print new currency to replace defaced and mutilated notes".

The Regional Minister called on people in the region to patronise the card to make it widely acceptable and called on the management of the bank to extend the card to other commercial towns in the region including Kasoa, Mankessim, Swedru, and Assin Foso.

Accra (Greater Accra), 25 Jan.

The GSE All-Share Index today continued to climb as it gained almost four points to push the market index up to finish trading at 892.27 points. The GSE All-Share Index went up 3.88 points from Friday's close of 888.39 points.

Total volume of shares finished lower at 284,760, about half of what was registered at the last session. This puts the GSE Index change to date at 2.75 per cent. Total shares offered were 2.387 million compared with 2.733 million offered on Friday while bids closed at 429,300. Market capitalisation was high following the performance of four equities. It ended at 3,406 billion cedis, up from 3,400 billion cedis at the last trading session.

In the broader market, seven equities registered price changes - five made gains while two declined.

Standard Chartered Bank (SCB) gained 300 cedis to close at 25,300 cedis. It posted a 400-cedi gain at the last trading. Guinness Ghana Limited (GGL) made 25 cedis at 980 cedis, Unilever (UNIL) gained 20 cedis to close at 1,650 cedis, Mechanical Lloyd Company (MLC) gained 12 cedis to end at 242 cedis while Metalloplastica Ghana Limited (MGL) earned five cedis to close at 225 cedis.

On the losing counter, Ghana Brewery Limited (GBL) lost 100 cedis to finish trading at 1,700 cedis. On Friday GBL lost 50 cedis. Pioneer Tobacco Company (PTC) was the other loser dropping by 20 cedis to end at 400 cedis.

The following are the last prices of listed equities :

ABL 800

AGC 19,000

ALW 2,800

CFAO 58

EIC 2,300

FML 1,680

GBL 1,700 -100

GCB 1,100

GGL 980 +25

HFC 750

MGL 225 +5

MLC 242 +12

MOGL 20,000

PAF 400

PTC 400 -20

PZ 900

SCB 25,300 +300

SPPC 250

SSB 2,280

UNIL 1,650 +20

UTC-E 125