Government gives liquidator of banks 90 billion cedis

IEA says economy rocked last year by poor gold, cocoa prices

Ghana and European Union sign Agreement

Creditors of liquidated banks to contact liquidator

Accra (Greater Accra), 21^st January 2000 

The government has put 90 billion cedis at the disposal of the official liquidator of the two failed banks to make immediate payment to depositors and for the entire entitlement of their staff.

Investigations by the Ghana News Agency (GNA) in Accra on Thursday revealed that government made the money available as promised so that the staff and depositors of the Bank for Housing and Construction and the Ghana Co-operative Bank do not suffer unduly.

Reliable sources said payment of the money might commence on Friday at the designated banks of depositors.

The official liquidator on Thursday gave details of specific banks where accounts of depositors have been transferred.

It said the government, recognising the adverse impact of the liquidation of the two banks on depositors, has put in place arrangements to adequately protect their interests.

The government will underwrite the losses that depositors would "otherwise have suffered in their capacity as unsecured creditors of the failed banks".

It said the government will arrange for funds to be deposited to the credit of each depositor at the branch of either the Agricultural Development Bank (ADB) or the Ghana Commercial Bank (GCB) that is near to the branches of the failed banks at which the depositor banked.

The statement said depositors would be requested to complete account opening procedures and other formalities only at the banks their accounts have been transferred to.

They will also be expected to bring with them proof of identity such as voter's identity cards, passports, driver's licence or an employer's identity cards with photographs.

"Funds being credited to each depositor will be equal to the verified balances of the date of liquidation inclusive of accrued interest due to the depositor and adjusted by any loans or advances owed to the BHC or the Co-operative Bank by the depositor."

The liquidator said efforts are being made by "a large team of professional staff" with selected members of the accounting staff of the banks to complete the processing of the transfer of these deposits as quickly as possible.

"By the end of this week, the first batches of deposit transfers will have been completed in each branch and the depositors will be able to have immediate access to their deposits."

GRi

Accra (Greater Accra), 21^st January 2000

The Institute of Economic Affairs (IEA) on Thursday said Ghana's economy suffered last year following the fall of cocoa and gold prices because the economy was not diversified enough to absorb the shocks.

This was contained in the economic think-tank's publication on its "mid-year 1999 economic review and outlook" presented by Professor Bartholomew K. Armah, a member of the Institute, in Accra.

He suggested the re-ordering of national priorities to reflect changes in the circumstances to counter the effect of such negative developments.

As a long-term measure, Prof. Armah called for export diversification into primary and manufactured goods, enhancing agricultural productivity and encouraging domestic service and investments.

"There should also be effective control of the size and quality of the country's population and at the same time promoting value added goods for export.

"Already, the economy's performance is clearly out of line with the benchmarks and targets of Vision 2020."

Prof. Armah said a comparison of key macro indicators in the first half of 1999 with corresponding indicators for the same period in 1998 reveal a decline in economic performance.

He said while trends in the broad money supply, the bank rate and the point-to-point rate of inflation were positive, there were clear indications that the economy's movement towards macro-economic stability, which began some 18 months earlier, might be losing steam.

Cocoa, gold and timber, which account for more than 80 per cent of earnings from export, were vulnerable to external shocks.

Between 1987 and 1999 trade declined by a cumulative 21 per cent while targets to achieve single inflation digit and higher GDP growth rate could not be achieved.

Prof. Armah said the only way to get back on track in reasonable time is to exercise the strictest economy in the use of available meagre resources.

There should also be greater efficiency both in revenue mobilisation and the use of resources.

This requires that all types of waste, including those arising out of corruption and extra budgetary expenditures, are avoided.

Prof. Armah cautioned that prudent economic management programmes should not be abandoned just because the country is approaching elections.

Nana Wereko Ampem, Gyaasehene of Akwapim Traditional area and Chancellor, University of Ghana, Legon, who chaired the function called for the publication of up-to-date statistical data that are reflective of the economy to help planners.

He asked for the revival of the Economic Society and publication of economic bulletins to discuss issues and come out with suggestions that will help solve the economic problems.

Nana Wereko Ampem, who launched the publication, said the role of direct private foreign investment in the economy is low and everything must be done to attract more funds.

Dr George Apenteng, Director, IEA, said the Institute will continue to support efforts in finding solution to the nation's economic problems.

GRi

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Accra (Greater Accra), 21^st January 2000

Ghana and the European Union (EU) on Thursday signed a 93 billion cedi (27 million Euros) agreement for the second phase of the National Indicative Programme (NIP) to enhance the decentralisation process.

Mr. Victor Selormey, Deputy Minister of Finance and Mr. Charles Brook, EU Ambassador and Head of Delegation of the European Commission in Ghana signed for their respective countries.

Mr. Selormey said the money is a grant fund that will enhance the government's decentralisation process.

The programme covers balance of payment support, road rehabilitation, water and electricity supplies, health, audit service and technology training.

The amount is part of the EU's total commitments to Ghana promised at the last donors meeting.

A further 38.5 million Euros is expected for the execution of about 2,000 micro projects, Mr. Brook said.

Seven hundred projects have been listed for for completion this year and the rest in within the next three years.

Mr. Brook, said the total amount will be in two trenches of which 3.2 million Euros will first be released as start up phase and 23.8 million Euros as the main programme.

Building on past experience, the new programme, essentially community self-help, will be focused in 56 districts within the Central, Volta, Northern, Upper East, Upper West and Ashanti Regions.

He noted that in the past, communities have concentrated on education, health and water supply facilities with the aim of reducing poverty and improving living standards in the rural areas.

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The Registrar-General's Department is requesting all creditors of the Bank for Housing and Construction (BHC) and the Co-operative Bank to lodge with the department their proof of debt on or before the close of business, Tuesday, February 29, 2000.

A statement issued on Thursday by the Department and signed by Mr. J.K. Harlley, a Chief State Attorney, on behalf of the official liquidator said the banks are being wound-up officially.

It said creditors who default will be excluded from the benefit of any distribution of dividends.

The statement said this action is in pursuant to Section 22 of the Bodies Corporate (Official Liquidations) ACT,1963 (ACT 180).

The office of the Official Liquidator can be located at Price Waterhouse Coopers, fourth floor, Gulf House, Off Legon Road, near Tetteh-Quarshie Roundabout, PMB CT.42, Cantonments, Accra.

The statement said all persons owing the two Banks are also required to make payments or arrangements to that effect with the official Liquidator on or before the Tuesday, February 29, 2000.

GRi

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