Ghana loses 500 billion cedis through
abolition of tax
"Stop export of Coca-Cola" –TCCBCGL
KLM to fly direct
to Ghana daily
Spacefon to provide satellite, e-mail
notification services
Ghana loses 500 billion cedis through
abolition of tax
Accra (Greater Accra) 30 March 2001
Ghana has lost nearly 500 billion cedis as a result of the abolition of the excise and advalorem tax on petroleum products last month, Dr Samuel Nii Ashong, Core Research Fellow of the Centre for Economic Policy Analysis announced on Thursday.
Addressing a quarterly seminar on "The 2001 budget, opportunities and implications for the financial sector", Dr Ashong said the elimination of the tax and the resultant loss has further deepened the government's cash flow problems and created a huge deficit, which the government must find money quickly to fill.
"It is also not clear whether the debt problem of Tema Oil Refinery (TOR) has been adequately addressed by the new prices of petroleum products," he said, adding that the increasing rate of depreciation may further aggravate the problem at the refinery.
The seminar, organised by Databank, brought together over 50 heads of financial institutions and companies to deliberate on the impact of the budget on their operations.
Dr Ashong said the only option for the government now is to either seek a Parliamentary approval for the reintroduction of the taxes or ask for an upward review of current petroleum prices to avoid incurring further deficit.
He said it is likely that the problems would be resolved by the mid-term when the budget is reviewed.
On the reconstruction levy of 15 per cent, he said the banks in the circumstances would be forced to push the cost to clients, especially those in the private sector, resulting in increasing cost of production.
"The rippling effects may impact negatively on the prices of goods, lead to job losses and stimulate demands for improved wages in the public sector," he said.
Dr Ashong called for a timely management of inflation induced by cost-push factors, cautioning that the expected increases in water and electricity tariffs should strike a delicate balance between consumer affordability and to avoid the accumulation of debt for the utilities.
He expressed doubts about any likely drop in the rate of inflation for the year since government is expected to borrow more than 760 billion cedis from domestic sources this year and feared that this might increase the cost of borrowing to the private sector and fuel inflation as well.
"With mounting domestic debt, it would be appropriate for government not to compete with the private sector in the domestic credit market and rather seek exceptional finance from development partners to bridge the financing gap," Dr Ashong said.
Domestic interest payment is estimated at 25 per cent for the year, a 3.5 per cent increase from last year.
He said that there is the need to put strategies in place to reap the maximum benefit from the Highly Indebted Poor Country (HIPC) initiative and added that government must ensure an effective monitoring and evaluation mechanism for efficient use of resources and a better delivery of government service.
Mr Yosi Amonoo-Neizer, Head Databank Asset Management Services Limited, noted that the conditionality, which requires that HIPC relief should be put into poverty alleviation is not inconsistent with government's own policies, since poverty is a serious issue affecting Ghanaians.
He cautioned against the use of foreign consultants at the expense of their local counterparts, sayings that past results have been negligible.
Mr Amonoo-Neizer saw nothing wrong with the reconstruction levy, saying that banks must help in resuscitating the economy, that allow them to make such huge profits, from its present crisis.
Dr Paa Kwesi Ndoum, Minister of Economic Planning and Regional Integration, said the single most important problem facing the country is its inability to manage its debts, giving the assurance that government would ensure fiscal discipline to manage the problem.
He underscored government's determination to make difficult choices to make real the aspirations of Ghanaians.
Dr Ndoum stressed the need for a reform of the civil service, saying without it no government project could be implemented.
He hinted of a national economic dialogue in May for stakeholders to deliberate on how to move the economy forward.
Mr Keli Gadzekpo, Executive Vice-Chairman, of Data Bank said macro economic stability would present the business community a more realistic benchmark with which to set their goals.
He urged the government to come out with a pro-business programme in the mid-year review of the budget to complement the efforts of the private sector.
Mr J. H. Mensah, the Majority Leader and Minister of Government Business, said government declaration of a 'golden age of business' should be seen as a serious intent to allow the private sector lead the growth of the economy.
He said there must be the dominant paradigm to leave investment and management of the agricultural and other service sectors to the private sector, although government would still be involved to drive it forward.
Mr Mensah bemoaned the absence of plans to overcome the problems plaguing the country over time, adding that such a posture of national psychic must be done away with.
He expressed the hope that most Ghanaians and corporate bodies, who do not have the confidence to invest in the past, would repatriate their monies back home to help boost the economy.
GRi…/
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"Stop export of Coca-Cola" –TCCBCGL
Accra (Greater Accra) 30 March 2001
The Coca-Cola Bottling Company Ghana Limited (TCCBCGL) Thursday directed the Ministry of Trade and Industry and the Customs, Excise and Preventive Service (CEPS) to halt the export of the company's products.
Mr Seth T. Asamoah, General Sales Manager of TCCBCGL told a group of journalists that "those exporting the products sell one bottle for 10,000 cedis (One pound sterling) in London. But the practice is illegal," he said, adding that, "we have forwarded a letter to the two institutions for them to effect a halt to it."
Mr Asamoah said this during a tour of the company's plant by a group of journalists. The facility visit was meant to expose the journalists to Coca-Cola's quality assurance programme "from-start-to-finish".
He said some businessmen in the country have in recent times been exporting the company's products to a number of African countries, the UK and United States.
He said: "Almost all the country's in the sub-region have bottling plants and since we all have the same product, there is no need to export it. Besides, each bottle can be traced to where it was manufactured."
Mr. Asamoah explained that most advanced countries which shifted to the production of canned drinks some years ago are coming back to the use of bottled drinks, which is currently in short supply.
Some people are cashing in on the situation, Mr Asamoah said and expressed regret that the practice could result in the shutting down of a plant if it persists.
"The fact that we have the franchise and we can use the trade name does not permit us to export the product in anyway," he added.
He said Coca-Cola products are the same worldwide and no one needs to import or export it because of perceptions that their products differ from country to country.
GRi…/
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KLM to fly direct
to Ghana daily
Accra (Greater Accra) 30 March
2001
The Royal Dutch Airline, KLM, on
Tuesday launched its Accra-Amsterdam-Accra "seven direct flight"
operations with the landing of its Booing 747 at the Kotoka International
Airport in Accra.
On the inaugural flight was a
delegation of the airline's officials from Amsterdam led by Mr Bruceguus
Jonker, Director in charge Industry and Government Affairs.
Later at a news conference, Mr Rob
Westerman, General Manager responsible for West Africa, expressed his
appreciation to the company for fulfilling a promise it made during the 40th.
anniversary celebration of its operations in November last year to fly seven
times a week to Accra.
He said the daily direct flight a
week is expected to increase its revenue in Ghana to about 40 per cent, in
addition to assisting to develop tourism as well as trade and business
activities between Ghana and The Netherlands.
He noted that Ghana Airways will
be an important partner in "this seven direct flight" operation as
far as its West African route is concerned.
Mr Jonker said the daily flight
will assist in sustaining economic growth in the aviation industry.
He said KLM would hold discussions
with Ghana Airways to work out details on how both airlines could co-operate to
open Ghana to the rest of the world.
Captain Joe Boachie, Deputy
Director General of the Ghana Civil Aviation Authority, said Ghana's
liberalised aviation policy is not only to bring as many airlines as possible
but also to create healthy competition among them.
"With the increase in
flights, airline fares will drop, especially the Africa-Europe route, which is
deemed to be one of the most expensive".
He advised other airlines to take
advantage of the policy and fly to Ghana especially as the airport is
undergoing an expansion programme.
At the airport to meet the
delegation was the Dutch Ambassador, Mr Alexander Helding, and staff of the KLM
in Accra.
GRi…/
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Spacefon to provide satellite, e-mail
notification services
Accra (Greater Accra) 30 March 2001
Scancom Limited, operators of Spacefon mobile phone services, in collaboration with Dubai-based Thuraya Telecommunications Limited, will from July introduce satellite services into the Ghanaian mobile phone industry.
Mr. Fouad Chalabi, Commercial Manager of Spacefon, who announced this in an interview with the GNA, said the company would also introduce an e-mail notification service on its network this year.
This service, he said, would allow users of GSM handsets with Spacefon to receive notification of e-mails on their mobile phones.
He said the satellite service is currently under test in the country, adding that when it becomes fully operational in July, it would enable users of Spacefon to have a nation-wide and international reach.
"The service comes with special Thuraya-Spacefon handset which gives subscribers a double opportunity.
"Users can make calls within the Spacefon coverage area through the already existing network and can also switch to the satellite when they are outside Spacefon coverage area."
Mr. Chalabi said Thuraya has operated satellite services for the past four years in Dubai and other countries, adding that Ghana is its first destination in Africa. Spacefon is the sole representative of Thuraya in Ghana.
He noted that the Thuraya handsets and services are targeted at the industrial and commercial sectors due to the relatively high cost involved in using it.
"In spite of the satellite services, Spacefon will continue with its expansion project to enable those who cannot afford the satellite service to stay on the regular network and still have a wide reach," he said.
Mr Chalabi said this year, the expansion project would involve improved capacity in the existing areas of operation such as Accra and an extension to other areas such as Aflao.
He said that, currently, the customer base of Spacefon is over 80,000, adding that the introduction of GSM services by Ghana Telecom has not affected it.
Mr Chalabi said initially some Spacefon customers switched to GT's One-touch services, but later returned to Spacefon due to technical problems they discovered.
"At least they understood that we were not to blame for the hitches," he said.
He urged the new government to study the problems facing telecommunications operators and introduce the needed policies and programmes to ensure fair competition and growth in the industry.
GRi…/
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Accra (Greater Accra) 30 March 2001
The Ghana Association of Bankers on Thursday announced the following average inter bank exchange rates of the cedi to the dollar and derived rates for other major foreign currencies:
Currency Buying Selling
US Dollar 6,998.55 7,212.00
Pound Sterling 10,091.21 10,399.70
French Franc 944.08 972.05
Swiss Franc 4,049.44 4,169.39
Deutsche Mark 3,165.37 3,261.12
Canadian Dollar 4,468.30 4,600.21
Japanese Yen 56.66 58.35
Dutch Guilder 2,810.22 2,893.47
S/African Rand 872.70 896.83
Euro 6,195.49 6,376.27
CFA Franc 9.44 9.72
Naira 64.56 66.52
Ecowas/WAUA 9,043.80 ========
GRi…/
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