Non-traditional exports jumps 10%
One-Touch mobile phone lines to be increased
Accra (Greater Accra) 27 May 2003 - The Social Security and National Insurance Trust (SSNIT) has described as unacceptable the refund of ˘5.38 billion made to it by Databank Financial Services Limited with regard to the investment it made in Obotan Developers Limited in 1999.
According to the trust, that amount which was equivalent to $2.24 million in 1999 is not of the same value today, adding that what was refunded is equivalent to $619,034.50 which is only 27.6 per cent of the original dollar offer price and indicated that it will not compromise its rights in the matter and is determined to receive its entitlement in full.
A highly-placed source at SSNIT, which disclosed this in an interview in Accra yesterday, said the trust is demanding either the $2.24 million or its equivalent at the current market rate since it would have made significant returns if the money had been invested by it in 1999.
It said it has consistently maintained in its correspondence with Messrs Databank Financial Services Limited, through its solicitors, that the offer price for the investment in the joint venture was quoted in US dollars in February 1999, even though payment was effected in cedis at the prevailing exchange rate.
It maintained that any refund, therefore, in cedis, should at least be equivalent to the original offer price of $2.24 million when converted into US dollars at today’s exchange rate.
It said the trust wishes to remind the public that its line of action is aimed at asserting its civil rights in a case such as this” and that issues requiring criminal prosecutions, if any, do not lie with the trust but with the Attorney General’s office.
The source said the board and management of SSNIT has noted the public interest generated by the report of the forensic auditors and the investigations by the Serious Fraud Office (SFO) on the investment of the sum equivalent of $2.24 million which was, ˘5.4 billion in 1999 made by the trust in Obotan Developers Limited.
It said upon completion of the investigations, the SFO informed the trust on October 7, 2002 that the docket on the case would be forwarded to the Attorney General for the necessary action to be taken.
The source said the letter concluded that the trust would be informed of any further developments and on November 29, 2002, the SFO forwarded to the trust a proposal by the solicitors representing Messrs Databank Financial Services Limited, one of the parties named in the SFO report, to buy out the trust from the venture by refunding the sum of ˘5.38 billion paid by the trust in 1999.
The trust responded through its solicitors that while it was desirous of seeking a resolution on the matter, it will only do so if there is full restitution of the original investment plus appropriate interest that will ensure that there is not an unreasonable dilution of the value of the original investment made by the trust.
The source said SSNIT has made it clear to the solicitors of Databank that although the original offer was made to SSNIT in dollars, payment must be made in cedis at the prevailing exchange rate.
It said "we suggested the use of an interest rate of the London Interbank Offer Rate (LIBOR) in addition to two per cent to accumulate the original amount of $2.24 million from the date that the trust effected the payment, to the date of refund".
Based on this, the source said the trust suggested conversion of the accumulated dollar amount into cedis at the prevailing exchange rate on the date of the refund and this the trust felt would be in line with the approach used in the original transactions.
Alternatively, it said the trust suggested that if Messrs Databank Financial Services Limited insists on using the cedi equivalent of the initial investment, that is the ˘5.38 billion, as the reference amount, then the interest rate to be used to accumulate the investment to the refund date should be the equivalent of the prevailing treasury bill rate in addition to two per cent for the period, from February 1999 to the refund date.
The source regretted that both options were rejected by the lawyers of Databank who rather insisted on making two instalment payments totalling ˘5.38 and further suggested that the issue of interest and the dilution in the value of the original payment should be settled by arbitration.
It said before the two parties could resort to arbitration, Databank, on May 13, sent a cheque for ˘5.4 billion to SSNIT and indicated that it was the full refund.
At the prevailing exchange rate, the source said, $1 is exchanged for ˘8,700 and that the payment of $5.38 billion the Databank is alleging to have made as the full refund of the original purchase price is, indeed, the equivalent of $619, 034 which is "woefully short of the original trust investment of $2.24 million by as much as $1,625 million.
The source said upon consultations with its external solicitors it was decided that at this point, the payment which Databank made constitutes part payment of the amount due and should thus be placed in an interest bearing Escrow Account, until the issues have been fully sorted out.
"This stance, the source stressed, is being taken so as not to prejudice our stated right to full restitution of the original investments of $2.24 (˘5.38 billion) in February, 1999.
GRi…/
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Accra (Greater Accra) 27 May 2003 - Receipts from non-traditional exports have reached an all-time record of $504.3 million. The breakthrough came after four years of stagnant export earnings, which stood at an average of $416 million between 1988 and 2001, a GEPC report on the sub-sector has revealed.
This represents 9.7 per cent increase over the previous year's figure of $459.6 million. A total of 3,083 firms and individuals exported 257 different items as compared to 3,117 that exported 260 items in 2001.
According to a report on the Export Performance of the Non-Traditional Export Sector published by the GEPC made avialable to Daily Graphic B&F it said the manufacturing sector recorded the highest revenue of $407.2 million, representing a
12.3 per cent increase over the previous year's figure of $362.727 million.
This is followed by the agricultural sector, which contributed $85.7 million, followed by the handicrafts sector, which recorded $11.3 million, a drop from $14.9 million recorded in 2001.
Cocoa cake, liquor and butter were the highest earners, raking in $81.9 million, an increase of 24.7 per cent over the 2001 figure of $65.7 million.
According to the report the country exported non-traditional commodities to 115 destinations world-wide, during the 2002 export year.
The European Union had 59.6 per cent of the total volume of exports. Major European countries such as the United Kingdom imported 17.2 per cent; France, 11.9 per cent; The Netherlands, 7.6 per cent; Italy, 6.6 per cent; Germany, 5.6 per cent; Spain, 5.2 per cent and Belgium 4.1 per cent.
The report revealed that leading exports to these destinations were mainly wood products, horticultural products, canned tuna, cocoa butter, cake and liquor.
Other developed countries took a total of 11.2 per cent of the exports. They included the United States of America, 8.3 per cent; Switzerland, 0.91 per cent and Sweden, 0.7 per cent.
According to the report, the ECOWAS market accounted for 24.31 per cent of Ghana’s total non-traditional exports, with Nigeria taking 7.7 per cent; Togo, 6.2 per cent; Cote d’ d’Ivoire, 3.4 per cent; Burkina Faso, 2.4 per cent and Benin, 1.98 per cent.
The main products to the ECOWAS market were frozen tuna, edible salt, aluminium utensils, plywood, cigarettes, cotton fabrics, hair products, ammonium nitrate and articles of plastic.
Non-traditional export to other Africa countries was 1.5 per cent out of which 0.81 went to South Africa with imports such as plywood, raw cotton, processed tobacco and veneer.
Other countries took 3.4 per cent with products such as cocoa liquor, frozen tuna and builders woodwork. The list was dominated by India with 1.12 per cent of imports from Ghana.
On the performance of sub-sectors, the report disclosed that the agricultural sub-sector saw an increase of 4.57 per cent from $81.8 million in 2001 to $85.7 million.
A total of 1,442 exporter, exported 78 agricultural products in 2002, as compared to 1,570 exporters, who exported 75 products in 2001.
The major contributors to this sector were horticultural products, fresh pineapples, fresh yams, bananas, fish and seafood. The rest are maize, medicinal plants and cola nuts.
Foreign exchange earnings from the handicraft sub-sector plummeted from $14.8 million in 2001 to $11.3 million. This was due to a reduction in straw baskets, which recorded $555,000 as compared to $4.766 million in 2001.
The report indicated that aluminium products, cocoa cake, liquor and butter, aluminium plates, sheets and coils, and prepared foods and beverages were among the major contributors to manufacturing sector.
Other products under this sector include builder woodwork, articles of plastic, cotton fabrics, Ammonium nitrate, sheabutter, peeled pineapple and processed natural rubber.
GRi…/
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Agona Oketsew (Central Region) 27 May 2003 - The Government has secured a $1m loan from the World Bank to support small-scale industries in the Central Region under the Village and Infrastructure Programme (VIP) for the purchase machines.
John Kwesi Agyabeng, District Chief Executive for Agona, speaking at Oketsew at the weekend said 20 groups and six individuals in the District have applied for the facility.
He said the District Assembly was processing the applications to be submitted to the Agona Rural Bank, which is administering the fund in the District.
The DCE said the government of Ghana would also top the facility with 30 percent of the credit to the beneficiaries. Agyabeng said the loan would be used for sugar cane crushers, Gari processing machines and palm kernel and oil extractors.
The DCE expressed regret that few groups and individuals had shown interest, adding that, the facility had nothing to do with political affiliation since the government wanted to encourage small-scale industries.
Agyabeng urged those interested to come forward since the procedure was not cumbersome. He said that the Assembly was prepared to guarantee for communities ready to enter food processing.
The DCE called on small and medium industries in the district to show interest to create jobs for the youth.
GRi…/
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Kumasi (Ashanti Region) 27 May 2003 - The Ghana Telecommunications Company (Ghana Telecom), is set to increase its One-Touch Mobile Phone lines by about ˘100,000 by the close of the year, Nana Kwakye Tanor, Ashanti Regional Director of the Company, has announced.
He said funds for the expansion of the network were ready, adding, "we will certainly be back on the market, come the next three weeks". Nana Tanor was interacting with some Regional Editors and Presenters of the print and electronic media in Kumasi.
It provided the forum for the Company to shed light on ongoing expansion of its systems and to put to rest public anxieties over the poor telephone services currently being experienced particularly by customers in Kumasi.
He gave the assurance that the existing congestion and pressure that was making it difficult for customers to access the phone lines would soon be off-loaded as the Direct Exchange Lines were being expanded.
Buokrom and Tanoso for example would have their lines increased from the present 500 to 5,000 lines each. Nana Tanor said the switches had been installed and that very soon they would become operations, adding that, the Company was eager to get over the present crisis situation as quickly as possible.
The Regional Director noted that apart from the damage to its public image, the crisis was having a telling effect on the finances of the Company and cited the sales of its pre-paid cards, which got off well but had now slumped due to difficulty in accessing the lines.
He said the Company envisaged the use of six digits in Kumasi as part of plans to improve the quality of its service delivery to customers in the area.
GRi…/
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