Government to cut down expenditure by 40 per cent
Gomoa Rural Bank holds 20th. AGM
Bogoso, Prestea mines reach agreement
All-Share Index makes slim gain
Tema (Greater Accra) 28 June 2001
Mr Boniface Abubakar Sadique, Deputy Minister of Trade and Industries on Tuesday said the government would cut down its expenditure by 40 per cent to ensure the stabilisation of the cedi.
He said less borrowing from the financial institutions by the government would help the private sector to secure loans to expand their businesses.
Mr Sadique was speaking to the management of the Cocoa Processing Company (CPC) in Tema after a two-hour tour of the factory.
He said it is only when the private sector businesses expand that they can generate jobs for the unemployed youth.
The government would also assist manufacturing companies to add value to raw materials for export to generate foreign exchange for the country, he said.
Mr. Sadique said it is in this light that the government is taking bold initiatives to ensure that cocoa is processed for both local and foreign markets.
Ghana cannot continue exporting primary products to feed the ever-hungry factories in Europe and America, he added.
Mr Sadique said his ministry is well positioned to help address issues that affect the industrial sector.
He commended the company for its impressive performance and assured it of government's support.
Mr Paul Awuah, Managing Director of the company told the minister that the company has planned to increase its production capacity from 25,000 to 50,000 metric tonnes within the next two years.
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Apam (Central Region) 28 June 2001
The Apex Bank, a supervisory bank to coordinate the activities of rural and community banks, has so far mobilised 911 million cedis in shares to be bought by the banks.
Mr Emmanuel Kwasi Kwapong, General Manager at the Apex Secretariat, told the 20th Annual General Meeting (AGM) of the Gomoa Rural Bank at Apam at the weekend.
Mr Kwapong said the Bank of Ghana (BOG) had issued the new bank with a certificate of operation and would soon start work.
Mr James Eric Nkrumah, President of the Central Region Chapter of the Association of Rural Banks, cautioned shareholders not to use provisions made by their banks to cover bad debts in their annual statements as a licence to refuse to pay back their loans.
He said the success of a bank depends on the attitude of its shareholders, and urged them to assist directors and management to ensure smooth business operations.
Mr Nkrumah commended the present Board of Directors of the Gomoa Rural Bank for bailing out the bank from liquidation following staff embezzlement of over 79 million cedis about four years ago.
Mr Francis Tandoh, Vice-Chairman of the Board, advised workers to use their salaries judiciously to avoid over-dependence on overdrafts.
Mr Andrews B. Simpson, Chairman of the Board, in his report, said the bank made a net profit of 62 million cedis last year as compared with four million cedis in 1999.
The bank's deposits increased from 490 million cedis in 1999 to 779 million cedis last year.
Mr Simpson expressed concern about the capital adequacy problem facing the bank, and appealed to the shareholders to mobilise more shares for it.
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Kumasi (Ashanti Region) 28 June 2001
The Ashanti Regional Office of the VAT Service has as part of measures to meet its collection target of 40 billion cedis this year, mounted a special exercise to bring more traders into the tax net.
The exercise targets the commercial areas in the Kumasi Metropolis and is also to be extended to cover all the district capitals in the region.
On its first day, 49 retail traders at the Adum Commercial Centre were served with VAT registration forms.
Fourteen readily completed the forms while the remaining 35 couldn’t because the right people to sign them were not available.
Mr Samuel Kofi Otabil, Acting Regional Head of the Service, who briefed newsmen described the response of the retail traders to VAT registration, following the lowering of the tax threshold from 200 million cedis to 100 million cedis, as "not encouraging".
He explained that the Service has already carried out extensive education campaign in the mass media to help get those, who meet the threshold to voluntarily register before July 4, which has been set as the deadline.
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Accra (Greater Accra) 28 June 2001
Bogoso Gold Limited (BGL) and Prestea Gold Resources Limited (PGRL) on Tuesday announced that they have reached an agreement, which paves the way for co-existence of both surface and underground mining within the Prestea concession.
A statement in Accra said the agreement also recognises the importance of developing the underground mining operations into a viable entity required to ensure the long-term future of mining in the area.
It said the agreement is subject to the finalisation of definitive documentation and the approval of the government and a separate agreement between Golden Star Resources Limited (GSR), which is BGL's parent company, and Barnato Exploration Limited (Barnex).
The statement was signed by Lt. Col. A.Y.K. Disu (rtd), Corporate Manager of BGL and Dr Albert Owusu Barnafo, Resident Director of PGR.
Barnex, which had a management contract with the government, closed down the 100-year-old Prestea underground mine in September, 1998 and retrenched the 1,721 workers.
The ex-employees of Barnex, backed by the senior staff association and the Mine Workers' Union of the TUC, formed PGR with their severance award benefits to continue the underground operations.
The statement said PGR obtained a six-month "sub-lease" that was subordinate to the mining lease over the Prestea concession held by Barnex.
It said in November last year, following the decision to abrogate Barnex's rights to the Prestea concession, government granted PGR a new mining lease over the Prestea concession for 15 years.
The statement said despite this assistance, however, the current low gold price has frustrated PGR's attempts to return the mine to profitability.
"The agreement now reached between GBL and PGR will, apart from an initial cash injection, lay the foundation for a thorough technical review which is expected to lead to significant further investment."
The statement said under the agreement between BGL and PGR, the mining lease granted to PGR in November last year would be surrendered. BGL and PGR would then make an application to government for the grant of two new mining leases, a surface mining lease to a depth of 200 vertical metres in favour of BGL and an underground mining lease below a depth of 200 meters in favour of PGR.
The statement said GBL would arrive at a commercial settlement with Barnex regarding its claim for compensation arising out of the purported abrogation of their rights in October last year by the government.
"On 21st June, 2001, a binding definitive agreement was executed between BGL's majority shareholder GSR and Barnex.
"Secondly, BGL will make an option payment to PGR at closing of 2.1 million dollars."
The statement said this option payment would give BGL the right, but not the obligation to exercise its option in six months from closing by making a further payment of 1.9 million dollars to PGR.
In return for these payments, BGL would acquire a 35 per cent interest in PGR and the right to manage the underground mine.
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Accra (Greater Accra) 28 June 2001
The GSE All-Share Index, the benchmark of the Accra Bourse, closed virtually flat on Wednesday making a slim 0.01 points.
The index closed the day at 931.80 as compared to 931.79 on Monday. The Market continues to struggle under heavy bearish sentiments as only 374,200 shares on Wednesday changed hands as against 683,000 shares on Monday.
Seven equities traded shares on the market with Ghana Commercial Bank (GCB) selling the highest number of 353,000 shares.
There were three price changes, two positive and one negative. SSB bank and Unilever Ghana Limited (UNIL) went up by one cedi each to close at 2,300 and 1,801 respectively.
The only loser was HFC, which lost two cedis to close at 950. The change for the year to date now stands at 8.60 per cent.
The Market capitalisation was down at 3,783.92 billion cedis as compared to 3,783.97 billion cedis on Monday.
The following are the last prices of listed equities in cedis:
ABL 630
AGC 18,500
ALW 12,000
BAT 550
CFAO 60
EIC 2,890
FML 750
GBL 1,300
GCB 1,600
GGL 900
HFC 950 -2
MGL 240
MLC 130
MOGL 19,400
PAF 330
PBC 450
PZ 640
SCB 21,000
SPPC 306
SSB 2,300 +1
UNIL 1,801 +1
CMLT 425
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