GRi Business, Economics & Finance 21 –
01 - 2003
Council approves 40 per cent increase in fares
Council approves 40 per cent increase in fares
Moses said, meanwhile, increases
in fares of commercial vehicles would be from 30 per cent to 40 per cent but
this does not go across board. The Chairman said this after a marathon
tripartite meeting in
"Drivers are sacrificing;
they are doing their best whilst waiting for the new percentage looking at
prices of spare parts." The two ministries and GRTCC on Friday announced a
30 per cent increase in fares following the almost 100 per cent hike in the
prices of petroleum products.
However, drivers have ignored
the new fares and are charging double the old fares. Moses described the
meeting as a difficult one called by the government to iron out the differences
in transport charges after the arbitrary increase in lorry fares. Moses said
the Council was finding a basis for doing the right thing and not to give
drivers the chance to do what they wanted.
He said the Council needed some
time to educate its regional Council members and transport owners on the issue
and called on the public to bear with them. Moses assured the public that the
issues were critically looked into and all imbalances in the previous system
have been addressed.
He said certain routes were
killing businesses due to poor fares charged. Moses said the Council reasoned
with drivers and the public and made sure that they came out with figures that
would enable drivers to break even. He said drivers should for the safety of
passengers carry only the registered number of passengers.
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The buses would have a sitting capacity
of 35 or 36 passengers. Albert Kan-Dapaah, Minster of
Energy, said on Friday that 10 large volume buses were being cleared from Tema
harbour and would be available on the road on Monday.
He said 50 completed Neoplan buses would be introduced by Wednesday, 200 Italian
buses were being delivered with the first batch expected by mid-February, 250
buses had been ordered from
Kan-Dapaah
said these initiatives highlighted government's commitment to delivering mass
transit, adding that the ticket pricing on the buses would be competitive and
would help hold transportation costs to an acceptable level. The buses were to
ease the burden of the fuel price increases on the population.
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The main market index, the GSE
All-Share Index, gained 4.46 points to 1,424.48 points from 1,420.02 points in
inactive trading that saw only 105,000 shares changing hands, down from
1,143,300 shares on Friday.
Aluworks was up at 3,700 cedis
while Ghana Commercial Bank, the only other gainer, was up by five cedis at
3,635 cedis. Only four equities traded shares on the bourse. Market capitalisation was up at 6,373.31 billion
cedis while change for the year was 2.09 per cent from 1.771 per cent.
The following are the last
prices of listed equities in cedis:
ABL 390
AGC 28,000
ALW 3,700 +200
BAT 1,001
CFAO 67
EIC 4,600
FML 1,800
GBL 510
GCB 3,635
+5
GGL 1,101
HFC 1,150
MGL 254
MLC 272
MOGL 19,730
PAF 750
PBC 390
PZ 2,010
SCB 28,700
SPPC 387
SSB 4,110
SWL 285
TBL 4,850
UNIL 4,860
CMLT 460
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The two agreements signed in
The second project is a $1.5m
grant to be released by the Canadian International Development Agency (CIDA) to
support the Agriculture Sector Structural Improvement Programme (ASSIP) to
improve on the capacity of farmer-based organisations and the promotion of
self-reliance programmes among other benefits.
Dr Agambilla
said the two agreements, witnessed by the Canadian High Commissioner in
“The implementation of the
projects would further enhance government's effort at building capacity at the
local level through the provision of training.” Over the years,
Mrs Jennings announced another
development package of $16.5m to complement the CIDA assisted project, an
additional $32m agriculture investment fund and a $5m budget aid to
She said such interventions were
in response to the progress Ghana had made in the area of good governance,
democracy that are some of the cardinal principles under the New Partnership
for African Development (NEPAD).
Mrs Jennings announcement
attracted the commendation of Dr Agambilla who described
it as "a big surprise" in addition to the grant. "You can't ask
for more than a grant," he said with a smile.
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When the GNA visited three
markets in the capital, both the sellers and the buyers rather complained of
arbitrary transport fares, which were having adverse effect on their personal
budget.
The markets visited were Mallam Atta, Kaneshie and Makola. At the Mallam Atta
Market, foodstuff sellers said prices of their items have not changed because
suppliers have not increased prices.
Prices of vegetables are quoted
from 2,000 cedis to 5,000 cedis, smoked fish between 4,000 cedis and 10,000
cedis or more for a piece, fresh fish, from 20,000 cedis and above for four
medium-sized fish. Cassava is selling at about 5,000 cedis while four
small-sized yam sell at 6,000 cedis.
Sellers at Kaneshie
Market also quoted the same prices for their items. At the Makola
market, however, one tomatoes seller, Rita, said the price for a crate of
tomatoes went up on Friday from 80,000 cedis to 260,000 cedis.
A smoked fish seller quoted
11,000 cedis for one smoked-medium sized salmon but said the fuel price hike
had had no effect on the price of the fish. Another vegetable seller said
carrots and cabbage were seasonal and the prices increased when they are not
available.
Ms Leticia Hammond, a cloth
dealer, said there was no cause for dealers to increase prices unless the
wholesale prices changed. Plastic ware dealers and some sellers of sandals told
the GNA that the individual sellers bore the effect of the fuel price increases
to and from the market and there was no need to translate the extra cost onto
their wares when suppliers had not increased the prices.
In a related development, a taxi
driver explained to the GNA that he used to buy 60,000 cedis worth of fuel
daily and made an income of 140,000 cedis out of which he paid 50,000 cedis as
daily sales, 60,000 cedis for fuel and the remainder for himself.
From Saturday, however, the
driver who did not give his name said he buys 120,000 cedis of petrol and works
for the same period earning 124,000 cedis. Another taxi driver gave a similar
account and urged the government to reduce the price of fuel.
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Petroleum Products Pricing
Formula announced in February 2001 had the ability of meeting government's
drive to recover the 4.5 trillion cedis owed by the Tema Oil Refinery (TOR).
Dan Amoah,
a Director at the Ministry, told the Ghana News Agency (GNA) Business Desk,
that the formula had within it an efficiency element that would make the
refinery and any other private body that would come into the oil industry to be
efficient since you could not ignore the in-built costs that came with your
operations.
He said it took the government a
while to appreciate the formula, but now that they do, "we are going to
work with it and ensure that we recover the debts." The debt has made a
huge impact on the economy and saw the government almost doubling petroleum
prices last Friday.
The foremost objective of the
policy is to gear energy prices to levels, based on the principle of full cost
recovery of all investments made to procure, refine, transport and market
energy services and ensure that ex-refinery prices are set equal to lower than
the import parity.
It is also to be used to raise
revenue for government. Special levies and taxes have been incorporated into the
price structure of petroleum products by an Act of Parliament, Act 544 amended
by Act 593 and 577, to generate resources for current and future investments in
specific areas and provide a portion of the annual national revenue for
government's prioritized development programmes.
The formula put forward by the
National Democratic Congress (NDC) government is also meant to ensure that ex-pump
prices are uniform in the country. Amoah said the
formula to be used is the same as what was announced two years ago.
Giving the details of the
formula that is to be managed by the yet to be established National Petroleum
Tender Board, Amoah said the retail (ex-pump) prices
of petroleum products are made up of three essential components: the
ex-refinery price, government levies and the distribution margins.
The system provides for
automatic adjustments in the ex-refinery price of petroleum products to reflect
changes in the published prices of these products as well as changes in the
exchange rate between the Cedi and the Dollar.
Amoah said except for the FOB price
and the freight rate, all the line elements of the price build up to a landed
cost. He noted that the maximum allowable ex-refinery price is set based on import
parity plus a factor mark-up that would have previously been agreed between TOR
and government. Government in the last two years put that factor at zero.
The purpose of the factor mark-up
is to allow time for TOR to arrive at an efficient level of production after completion
of second phase of the expansion and modernization project called RFCC Project.
That factor adjustment is at almost 10 percent of import parity and is also
used to effect cross subsidy in the ex-refinery
prices.
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Currency Buying Selling
U.S. Dollar 8,318.55 cedis
8,529.55 cedis
Pound
Swiss Franc 6,059.19 6,208.35
Canadian Dollar 5,414.71 5,548.39
Danish Kroner 1,190.68 1,220.52
Japanese Yen
70.40 72.17
South African
Euro 8,852.78 9,074.76
CFA Franc 13.50 13.83
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