Ghana calls for halt to gold sales by IMF
All-Share Index plunges in active market
Ghana calls for halt to gold sales by IMF
Accra (Greater Accra), 24th June 99 –
Ghana has described as "unfortunate" the decision of the International Monetary Fund (IMF) to sell gold to enable it to provide aid to poor nations, saying it could have a crippling effect on gold producing economies.
Mr Fred Ohene Kena, Minister of Mines and Energy, said the world body must look for other alternatives of supporting distressed economies.
He was speaking in an interview with the Ghana News Agency in reaction to the IMF's intention to sell gold, and put the revenue into a trust fund and use the interest to fund debt relief and lending programme for poor countries.
The Minister said most gold producing economies are already reeling under the pressure of the recent depreciation in gold price and cannot afford to experience another price fall.
Gold prices tumbled recently on the world market from about 269 dollars an ounce to 259.25 dollars forcing some emerging gold mines to live on the edge and totally realign their production and marketing strategies.
Mr Ohene Kena said the intended sale must be stopped as the assurance by IMF Managing Director Michel Camdessus that it would make every effort to ensure the sales do not unsettle the markets, cannot be guaranteed.
"The proposal must be stopped entirely. The IMF must look at some other means of supporting distressed countries that depend heavily on gold to fund their economies instead of selling gold, especially when the price of the commodity is already down".
The IMF started lobbying for gold sales in 1996, viewing them as a way to close a funding gap in its programme of concessionary lending for poor countries.
It would sell up to 10 million ounces of gold and use the money as debt relief for Highly Indebted Poor Countries (HIPC).
Mr Ohene Kena did not say how much the fall of world market price of gold would cost Ghana but repeated that the decision is bad and must not be implemented.
Ashanti Goldfields Company, the nation's leading gold mine company, has said the price fall will not affect it much as it has hedged all its sales.
Meanwhile, the South African gold mining industry has warned that the proposed sale of IMF gold reserves will undermine the current fragile gold market and place further downward pressure on the price.
Finance Minister Trevor Manuel warned that up to 80,000 miners could lose their jobs in South Africa's gold-mining sector if the decision was carried out.
A partial scrapping of Third World debt was decided at the Cologne meeting of the Group of Eight - Britain, Canada, France, Germany, Italy, Japan, the United States and Russia - over the weekend.
The US Senate Foreign Relations Committee Chairman Jesse Helms joined lawmakers on Tuesday in opposing the International Monetary Fund's decision.
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Kumasi (Greater Accra) 24 June ’99
The Ghana Breweries Limited (GBL) could not pay dividends to its shareholders despite a profit of 1.42 billion cedis.
Mr. Ishmael Yamson, chairman of the Board of Directors of the Company, announced this at its annual general meeting in Kumasi on Wednesday.
He said since the income surplus account after the merger between Kumasi Brewery Limited (KBL) and Achimota Brewery Company Limited (ABC) read negative, the Board could not legally recommend the payment of dividend.
Mr. Yamson said, however, that realising profit in the first year after a merger with ABC, a company with "significant deficit", was a commendable feat.
"Your Board is optimistic about the prospects for continued volume growth and profit improvement, which should enable the company to resume payment of dividends as soon as it is practicable to do so", the Board Chairman told the shareholders.
He said despite the impact of the energy crisis, intensified competition among the three national breweries and the challenges posed by the management of the merger, the financial performance after the first year of GBL was commendable.
"A strong push for growth in our major lager brands, effective cost management to protect margins and the improved level of productivity culminated in 31 per cent growth in turnover", he said.
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All-Share Index plunges in active market
Accra (Greater Accra) 24 June ’99
The Ghana Stock Exchange (GSE) All-Share Index on Wednesday plunged again as a result of high losses by some equities but active trading on the bourse saw other indicators inching up.
The All-Share Index closed mid-week trading at 788.17 as it lost by 3.62 points. It closed at 791.79 on Monday.
The change in the year to date stood at a negative 9.23 per cent.
Volume of shares traded ended higher at 130,600 shares up from Monday's 93,500 shares while demand was up at 403,200 shares compared to the previous 269,500 shares.
Offers were higher at 3.4 million as against 3.1 million shares posted on Monday.
Market capitalisation, however, closed down at 3,280.21 billion cedis from 3,285.89 billion cedis.
In the broader market, five equities made losses. There was no price appreciation.
Aluworks Company Limited (ALW) lost 100 cedis to close trading at 2,700 cedis while Mechanical Lloyd Company (MLC) lost 15 cedis to finish at 200 cedis.
Standard Chartered Bank (SCB), the highest priced equity, lost 199 cedis to close trading at 22,300 cedis.
Super Paper Product Company (SPPC) and Unilever Company Limited (UNIL) lost 14 cedis and five cedis to finish the session at 230 cedis and 1,730 cedis respectively.
The following are the last prices of listed equities in cedis:
ABL 600
AGC 18,700
ALW 2,700 -100
BAT 380
CFAO 40
EIC 1,990
FML 1,250
GBL 1,890
GCB 800
GGL 925
HFC 750
MGL 225
MLC 200 -15
MOGL 16,800
PAF 300
PZ 850
SCB 22,300 -199
SPPC 230 -14
SSB 1,910
UNIL 1,730 -5
UTC-E 125
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