Government secures funding for GBC modernisation - Mahama

No flyovers for Kumasi yet - Minister

Government defends liquidation of banks

Accra (Greater Accra), 28^th January 2000

Mr. John Mahama, Minister of Communications, told Parliament on Thursday that the government has secured funding for a modernisation programme for the Ghana Broadcasting Corporation (GBC) to enhance its operations.

He said the Ministry would in the next month or two, submit to Parliament for approval, a project statement on the modernisation.

Mr. Mahama, who was answering questions in Parliament, said the project, which is to begin this year, has the potential of providing quality service and addressing the problem of poor transmission and reception of radio and television programmes.

Asked how many GBC FM radio stations are in the regional capitals, the Minister said currently, eight regional capitals have such facilities, adding that the two remaining regional capitals, Koforidua and Wa would be catered for under the modernisation programme.

He said the government is committed to encouraging the setting up of as many of such stations as possible, and noted that there are at present, 30 FM stations, both state and privately owned in the country.

Asked when Ghana Telecom will enter the cellular phone industry, Mr. Mahama said the company is currently installing equipment and it is expected that the mobile network would be operational by March, this year.

On whether the network would be national or regional, the Minister replied that he would not be in a position to know all the details but said it is possible for Telecom to start a national cellular service.

On problems associated with telecommunication services, Mr. Mahama explained that there is congestion in the network because of the expansion programme to change from analogue to digital switches.

He said before the expansion programme, there were 50,000 telephone lines nation-wide and since the expansion, Telecom has been able to provide close to 200,000 lines.

The Minister noted that since the expansion, a number of companies have entered the sector and are providing telecommunication services thus allowing more people to gain access to such services.

He said the heavy traffic thus created, has overtaken the capacity of the existing system resulting in a lot of inconveniences to people, who use such services.

He, however, expressed the hope that when the new digital switches become operational, the telecommunication sector would provide much better services.

On the question of privatising the fixed telephone system instead of giving the monopoly to Ghana Telecom, Mr. Mahama said that the monopoly, which is for five years, is to enable Telecom to recoup its investment in the modernisation programme.

He said the monopoly ends in two years time after which, the government would allow private operators into the fixed telephone service provision, adding that the Ministry will take steps to ensure genuine competition in the industry.

After the question and answer session, Mr. Kenneth Dzirasah, First Deputy Speaker, who was in the chair, said following the interest shown by members, the Minister should be invited to the House to make a comprehensive statement on the communications sector.

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Accra (Greater Accra), 28^th January 2000

The Ministry of Roads and Transport does not intend build flyovers in Kumasi and other regional capitals yet because of lack of funds, Mr. Steve Akorli, deputy minister of Roads and Transport, told Parliament Thursday.

Mr. Akorli said feasibility studies will have to be undertaken to determine the cost-effectiveness of such a venture before they are undertaken, he said while responding to parliamentary questions.

Dr Matthew Kwaku Antwi, NPP-Atwima Kwanwoma, had asked if the sector Ministry has plans to construct flyovers in Kumasi to ease traffic congestion

Asked for how long the Kejetia rehabilitation project in Kumasi could sustain both human and vehicular traffic when completed, Mr. Akorli said the project is expected to contain the current level of traffic for the next decade.

To a suggestion that the Kumasi Railway terminal be relocated at Fumesua, where the proposed inland port is to be sited, Mr Akorli said the Ministry would encourage any inter-modal transport system that would facilitate the movement of goods and services.

He said the Ministry would, therefore consider the suggestion, undertake a study on it and incorporate it in its programme if it is found feasible.

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Accra (Greater Accra), 28^th January 2000

The Minority group in Parliament on Thursday condemned the liquidation of the Bank for Housing and Construction (BHC) and the Co-operative Bank, saying the government could have taken other options.

They mentioned the " management, worker buy-out" in the case of BHC and " sell off" to other banks as some of the options.

The government spokesmen, however, responded that it has taken the two financial bodies through what it takes to make a bank viable and that "enough is enough"

Mr. Albert Kan Dapaah, NPP-Afigya-Sekyere, who led the opposition debate took the government to task for not informing the public enough on the conditions and reasons for the liquidation.

He said the inexplicable liquidation of the two banks "will further, dampen the enthusiasm of the average Ghanaian to save.

"Because of previous bitter experiences, many Ghanaians have not developed the habit of regular savings to support the government's desire for a saving rate equivalent to a minimum of 20 per cent of Gross Development Product (GDP) as required by its own economic strategy."

Mr. Moses Asaga, a Deputy Minister of Finance, said since 1992, the government had intervened on several occasions to save the two banks from collapse by injecting capital into them "even when they messed up".

He said the bad managerial practices that went on in the banks had eaten their resources up to a point "where there is no need to intervene".

"While the Co-operative Bank had a capital ratio of over negative 300 per cent at 29 December 1999, the BHC could manage only five per cent at the same period."

He said "the banks net worth was in the area of negative 40 billion cedis, and if it takes one only 10 billion cedis to start a new bank, who would risk?"

Mr. Asaga said very soon, four new banks would join the financial sector and some of the skilled workers of the liquidated banks would be taken on board.

He revisited the A-Life scandal, which, he said, happened because of pure dishonesty on the part of the BHC management.

Mr. Osafo Maafo had questioned the supervisory role of the Bank of Ghana in the clearing system.

He said from his personal experience as a banker, "no over-withdrawal can be made without the knowledge of the central bank because they can easily cross-check when in doubt".

Mr. Asaga said when top management personnel, who is an interested party in a dubious deal is supposed to answer queries from the Bank of Ghana, "he will definitely defend a bad transaction".

He allayed the fears of the minority on a possible loss of money from the consolidated fund as a result of government interim intervention to save depositors.

Mr. John Mahama, Minister of Communications, asked members to compare the problems that depositors of the defunct BCCI went through to the present situation for their personal judgement.

He said the government's action of ensuring that all depositors "get 100 per cent of the credit has saved them from getting the normal raw deal from liquidators".

He dismissed the Minority claims that the liquidation had something to do with "conditionalities of the World Bank and the International Monetary Fund (IMF) saying the action was taken to instil financial discipline in the system and to protect the ordinary man.

GRi