Trade Ministry says policies created more
investment
Bank wants tax on development projects
reviewed
Stock market records
low volumes
Regional conference
on micro financing opens
BOG warns rural
banks against employing dismissed workers of other banks
Trade Ministry says policies created more
investment
Accra (Greater Accra) 28 November 2000
Mr Peter Wiafe Pepera, a Deputy Minister of Trade and Industry, said on Monday that business start-ups that emerged from the government's policies were more than double of those that collapsed.
The ratio of businesses that closed to official figures of business start-ups is 1:38, Mr Pepera told a press conference in Accra to react to statements by Dr Kofi Apraku, New Patriotic Party (NPP) spokesman on finance, that a large number of industries have closed down due to mismanagement of the government's economic policies.
Mr Pepera said: "It is disingenuous on the part of the NPP to quote rather dubious figures based on one side of the coin."
The Deputy Minister said the Economic Recovery Programme (ERP) and the Structural Adjustment Programme (SAP) killed some local industries due to the rapid changes that characterised the two policies.
"The policy changes were so rapid that many of the local enterprises could not manage them, especially, those that were inefficient, mismanaged, non-viable or no longer relevant," he said.
He said a number of local enterprises had their operations impaired by some of the free-market economic policies undertaken by government under the ERP and the SAP.
The following are the official figures of business start-ups from the registrar general's department from 1996 to 1999 compared with the NPP's figures:
Year Failed businesses Start-ups
(From NPP) (From registrar general)
1996 377 20,530
1997 422 19,902
1998 601 17,551
1999 608 18,473
Mr Pepera could, however, not give official figures of companies that collapsed under the ERP/SAP for the period reviewed.
He noted that government recognised the need to assist distressed enterprises as far back as 1988.
"In recognition of the problems and constraints in the face of the ERP, government provided both direct and indirect assistance to a number of industrial enterprises, which were distressed but potentially viable to undertake rehabilitation and restructuring."
Government gave the assistance under the Business Assistance Fund while other credit facilities were targeted for raw material imports, purchase of plant and machinery, training of personnel and corporate restructuring.
Areas that benefited from the assistance were the banking and financial sector, telecommunications, education, hospitality, transport, construction, foreign investment, and non-traditional export.
Mr Pepera said apart from the ERP and SAP, government has also pursued other programmes such as the establishment of the Ghana Free Zones board and the Gateway project to stimulate investment from the private sector.
A number of companies have also been divested to forestall their drain on the economy.
Since the inception of the free zone programme, a total of 72 companies have been registered.
Twenty-two foreign countries, including three West African countries, have invested in various local companies.
Britain, which had been Ghana's largest trading partner owns two companies and has interest in another five while Holland partially owns five
Mr Pepera said divestiture rather increased employment levels and gave employment levels from divestiture of certain companies as follows:
Name of Company Employment before Employment after
Golden Tulip 116 346
West Africa Mills Company 170 450
Tema Steel Company 130 584
On the export sector, the deputy Minister said "the allegation that more than 80 per cent of Ghanaian exports are primary commodities is misleading and inaccurate."
"It does not show that percentage of processed exports as against primary commodities...continued to increase during 1998 and 1999 from low percentages figure of about 1-2 per cent at the time of launching the ERP in 1983 to 22.43 per cent in 1998."
Mr Pepera said efforts to promote the manufacturing industry and find overseas markets for them have also contributed to the growth of the non-traditional export sector.
The sector registered about two million dollars in 1984 but the figure has grown to 404 million dollars in 1999.
"It is envisaged under the Vision 2020 programme that semi-processed commodities will amount to 12 billion dollars out of the 16 billion dollars envisaged for the export sector," he added.
He said government is making every effort to promote the economy in other areas through the promotion of the service industry and local consultancies and called on the NPP to cross check their facts with relevant authorities before coming out with pronouncements.
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Bank wants tax on development projects
reviewed
Pakyi Number Two (Ashanti Region) 28 November 2000
Mr George Kyei-Baffour, Chairman of the Board of Directors of the Atwima-Kwanwoma Rural Bank, at the week- end called on the government to review the tax on development projects undertaken by rural banks.
He said the current tax system could discourage most rural banks from engaging in community development projects.
Mr Kyei-Baffour was speaking at the 17th annual general meeting of the Bank's shareholders at Pakyi Number Two in the Amansie West district in Ashanti region on Saturday.
He indicated that the bank paid 2.4 million cedis as tax to government last year, for undertaking community development projects costing over 30 million cedis in its catchment area.
Presenting his report on the bank's operations for last year to the shareholders, Mr Kyei-Baffour said deposits increased from 4.2 billion cedis in 1998 to 5.6 billion cedes.
Investments in treasury bills rose from 2.6 billion cedis in 1998 to 3.8 billion cedis in 1999, while ordinary shares also increased from 117 million cedis to 173.5 million cedes.
"Customer base went up by 11.4 per cent with an average of 400 new accounts opened each month, raising the customer base from 20,835 in 1998 to 23,208 in 1999.
About 1,250 customers closed their accounts because of the closure of the Kejetia office, reducing the customer base to 21,958", he said.
Mr Kyei-Baffour said the Bank's total assets increased from 5.1 billion cedis in 1998 to 7.1 billion cedis last year.
He said profits increased from 182 million cedis in 1998 to 218 million cedis in 1999.
22.5 million cedis were paid to government as tax, while 196 million cedis was transferred to the reserves of the Bank.
Loans and advances totalling 1.7 billion cedis were granted to 1,512 customers engaged in agriculture, cottage industries, transport and trading as well as workers.
Mr Godfried Odame Asare, Supervising Manager, said the Bank has laid the foundation for increase in profits and higher dividends in the future.
He told the shareholders that the Bank had launched two "susu" products aimed at mobilising more funds for safe lending purposes, adding that the project would be operational from January, next year.
Baffour Appiah Danquah III, Anantahene and President of the Ashanti Region chapter of the Association of Rural Banks advised the shareholders to limit their involvement in the operations of the bank.
He also called on management and staff not to be complacent with the success of the past year, but should work assiduously to chalk more successes.
Nana Serwa Amponsah, Queenmother of Pakyi, asked the people to continue to patronise the Bank since it thrives on savings and other operations.
She called on the bank to grant more loans to farmers to enable them to diversify and also expand their farms.
A new 350 million-cedi head office complex for the bank was commissioned after the meeting.
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Stock market
records low volumes
Accra (Greater Accra) 28 November
2000
The market index of the Accra
bourse slipped by 0.02 points during a trading session that saw the market
recording low volumes in trade.
The All-Share Index opened the
week down at 861.19 points when Pioneer Aluminium Factory (PAF), the only
equity to record a price movement lost two cedis. The index closed last week at
861.21 points.
Shares traded were one of lowest
at 2,600, down from 210,900 sold on Friday. Five equities sold their shares
with PAF selling the highest of only 1,000 shares. Accra Brewery sold 600,
Paterson Zochonis sold 800 and Ghana Commercial Bank and Standard Chartered
sold 100 shares each.
Offers declined to 488,400, but
still outstripped bids, which were 12,700. They closed last week at 726,390 and
233,800 respectively.
Market capitalisation finished
Monday's trading down at 3,608.90 billion cedis from 3,608.87 billion cedis.
In the broader market, PAF lost
two cedis to close at 268 cedis.
The following are the last prices
of listed equities in cedis:
ABL 630
AGC 18,600
ALW 4,100
BAT 400
CFAO 50
EIC 2,400
FML 1,000
GBL 1,350
GCB 1,579
GGL 740
HFC 952
MGL 200
MLC 145
MOGL 8,600
PAF 268 -2
PBC 503
PZ 400
SCB 21,500
SPPC 255
SSB 2,200
UNIL 1,650
CMLT 425
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Regional
conference on micro financing opens
Accra (Greater Accra) 28 November
2000
Mr Mark Owusu Ansah, Micro-finance
Co-ordinator, Ministry of Finance, said on Monday that there is a need to
search for the root causes of the weaknesses of financial inter-mediation and
improve upon it to ensure a rapid development of small and micro-enterprises.
This, he said, would require new
perspectives on rural finance that permit a broader view of the process of
inter-mediation necessary to meet the financing needs of small and
micro-enterprises in an effective, efficient and sustainable manner.
Mr Ansah said this at the opening
of a five-day Africa regional conference of the International Network of Alternative
Financial Institutions (INAFI) in Accra.
INAFI is a coalition of
alternative savings and credit institutions outside the main conventional banks
with its target being people in low-income groups.
Starting with four members in 1996
on a budget of 10,000 dollars, the Nairobi-based INAFI now has 18 member
institutions from Africa, Asia, Latin America and Europe. Its present budget is
in excess of one million dollars.
More than 20 participants from
member institutions attending the conference will share experiences and reflect
on the way forward with particular emphasis on exploring new innovations that
could broaden members' initiatives in the micro-finance area for enhanced
impact.
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BOG warns rural
banks against employing dismissed workers of other banks
Gomoa-Dawurampong (Central Region)
28 November 2000
The Bank of Ghana (BOG) on
Saturday renewed its warning to rural banks not to employ dismissed workers of
other banks, saying any rural bank that flouts the directive would be
sanctioned.
Mr Anthony K.A.Ducker, Manager of
Banking Supervision Department who gave the warning at the 15th annual
shareholders meeting of the Akyempim Rural Bank at Gomoa-Dawurampong, said BOG
views with utter dissatisfaction the practice by rural banks giving "
solace and shelter" to dismissed staff of other banks.
Mr Ducker said this practice is
unacceptable, adding that henceforth, rural banks should make appropriate
reference to the BOG before engaging staff.
He said BOG has noted with concern
the rampant cases of fraud in rural banks and urged directors and management to
strengthen internal control mechanisms to check fraudulent deals in order to
maintain customer trust and confidence.
Mr Ducker further charged rural
banks to give attention to loan recovery in order to improve on their capital
adequacy ratio, saying it is only when the banks are adequately equipped with
funds that they can operate more effectively and efficiently.
He commended the Akyempim rural
bank for increasing its deposits level to 2,5 billion cedis as at September
this year.
Mr E.F. Anno, a former Deputy
Governor of BOG and now chairman of Akyempim rural bank, urged the shareholders
to increase their shares to enable the bank to grow and provide more amenities
to communities in its catchment area.
Mr Anno said the bank has extended
various forms of assistance to individuals and institutions, including two
television sets to Apam catholic mission hospital, scholarship to students and
cash donation to Dawurampong senior secondary school.
Mr Kingsley Owusu-Ansah, senior
manager of the bank, said the bank has established agencies at the South and
North campuses of the University College of Education, Winneba.
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