Ghana, China adopts measures to reduce trade imbalance
Accra (Greater Accra) 25 July 2000
The Ghana Stock market was weaker
on Monday with all the major market indices unchanged as the bourse continued its
downturn under intense negative pressure.
The key GSE-All share index stood
still and closed trading at 821.86 points same as it ended on Friday.
The market capitalisation and the
change in the year to date were equally unchanged at 3,574.04 billion cedis and
11.64 per cent from their previous close levels respectively. Trading was
low-keyed and dominated by bearish sentiments.
Eight equities sold 11,600 shares
as traded volumes slipped from 17,900 and most institutional investors
continued to shy away from the market.
Offers fell from 2.2 million to
1.9 million, although most equities had huge numbers of shares on offer. Social
Security Bank had offers of 722,700 but could only sell 200 shares. Bids were
up at 24,900 compared to 18,100 on Friday.
On the broader market, there was
no price change. Only Camelot could manage a positive pressure. Eight equities
had no pressure on them while the remaining 14 returned negative pressures.
Below are the closing prices of
listed equities in cedis:
ABL 620
AGC 18,600
ALW 2,600
BAT
440
CFAO 38
EIC
1,880
FML 1,200
GBL
1,400
GCB
1,000
GGL
990
HFC 950
MGL 200
MLC 150
MOGL 17,500
PAF
300
PBC
520
PZ 800
SCB 22,000
SPPC 150
SSB 1,990
UNIL 1,845
UTCE 125
CMLT 425
GRi../
Accra (Greater Accra) 25 July 2000
Ghana and the People's Republic of China are adopting a three-pronged approach to reduce the huge trade imbalance between them, the Chinese Economic and Commercial Counsellor, Mr Yu Yingfu said on Monday.
"The measures are to balance the scale of trade so that the two countries mutually benefit from their co-operation," Mr Yingfu told the Ghana News Agency in an interview.
Trade between the two countries has generally tipped in the favour of China, which exports light industrial products and electrical appliances to Ghana and imports mostly timber and cocoa beans.
Statistics available indicate that while exports to China in 1998 and 1999 was about 17 million dollars, imports from that country amounted to about 216 million dollars.
Mr Yingfu said this does not augur well for the mutual co-operation, hence their desire to balance the trend and ensure that both enjoy equal benefits.
The measures involved include a discussion between Chinese purchasing delegation and Ghanaian companies to enable the two groups reach an agreement on goods that China could procure and the payment of subsidies by the Chinese government to companies, which import cocoa beans and timber from Ghana.
Furthermore, the embassy is also encouraging Chinese companies to buy Ghanaian products, mostly palm oil, fish and fresh fruits as well as artefacts.
He blamed the trade imbalance on the rapid depreciation of the cedi, which he noted was scaring away most Chinese Investors and companies with genuine desire to do business as they tend to lose their investment.
"This is eroding confidence and actually a lot of companies are moving out."
On the other hand Chinese companies find it more lucrative to buy from Ghana since prices are relatively cheaper.
Mr Yingfu said, in spite of this, Chinese investment concerns in the country currently stands at 83.
They include joint trade offices, industrial and manufacturing concerns, mostly in textile, steel, fishing nets, ropes, ceramics and building materials.
The Economic Counsellor hinted that plans are underway to establish a 10,000 tons cocoa processing plant in the country next year to enable the nation add value to the beans.
Also, feasibility studies have been completed on a cassava processing plant to produce good quality starch to be used in the food, drug and ceramics industries.
Mr Yingfu said an improved stable political climate has given added impetus to Chinese investors, saying, "investors are careful with where to invest their money."
Besides the impressive political atmosphere, the country has a developed infrastructure base, which include electricity, transport and communications as well as a good investment code that quickly facilitates investment.
In addition, the Chinese government 'Walk Out' policy, which encourages businesses to invest in Africa, has also contributed in boosting Chinese investments.
Mr Yingfu asked Economic analysts and individuals to desist from painting a gloomy picture of Ghana's economic position, saying the use of words that paint a negative picture would only help scare away potential investors.
He said his government would continue to pursue policies that would enhance co-operation in sectors such as Education, cultural and economic and politics to ensure that the two countries achieve their aspirations.
GRi../