Friday, May 28, 2010

US$10 billion invested in mining

Minister for Lands and Natural Resources, Collins Dauda has disclosed that an estimated total of US$10 billion has been invested in the mineral and mining sector from 1980 to 2009, which is the leading export sector.

“Since 1991 the mining sector has been the single largest contributor to total merchandise exports, except in 2004, when it was overtaken by the cocoa sector.

Mining however became the leader again from 2005 and has since provided an average of about 42 percent to the total merchandise exports,” he said.

The major minerals currently being mined in commercial quantities in Ghana include gold, diamond, bauxite and manganese.

Mr. Dauda who made these known at the opening of the 8th West African Mining and Power Conference and Exhibition (WAMPOC) in Accra explained that the sector contributes about seven percent of the country’s total corporate tax earnings, 12 percent of government revenue and 5.5 percent of Gross Domestic Product (GDP), whereas some 24,000 people are employed by the large scale sector, comprising eight companies producing gold and one each producing bauxite and manganese.

More than 800 registered small-scale mining groups and companies are also engaged in the mining of gold, diamonds and industrial minerals with an estimated 500,000 jobs in the small-scale sector.

The mining sector has implemented various socio-economic programmes as part of its corporate social responsibility including provision of portable water, electricity, health care, education, roads, and some alternative livelihood projects.

“In 2009, alone the producing members of the Chamber of Mines spent nine million as socio-economic contribution to host communities.

“If these projects are properly coordinated within the development programmes of the District/Municipal Assemblies, the net benefits could be greatly enhanced.” he said.

Mr. Dauda indicated that the key role of mining unsustainable development includes a contribution to economic growth through investment injection, employment and personal income generation, government revenue in terms of royalties, taxes, property rates and foreign exchange generation.

Mining also provides mineral-based products for the use of society as well as building blocks of all human activities, ranging from construction materials to inputs for manufacturing of automobiles and other products, he stated.

The two-day conference under the theme: “Promoting sustainable development through mineral resource development,” which brought industry operators, policy makers and stakeholders from the sub region provided the platform for extensive discussions on Africa's mining and energy sectors within a Ghanaian setting , said Joyce Aryee, Chief Executive Officer for Ghana Chamber of Mines.

The conference, powered by Ghana Chamber of Mines is also being endorsed by the Ministries of Energy, and the Lands and Natural Resources.

Metropolitan Life’s ‘Labbaika Provider’ targets Moslems

Metropolitan Life Insurance will unveil a new product christened ‘Labbaika Provider’ next month, targeted at the Moslem community to improve savings culture and investment towards a secured future.

Labbaika Provider’, that makes it easy for Moslems to invest in their ward’s education is a structured investment product and provides meaningful way to save towards the financial requirement for Haj-a cost that is escalating yearly. It also helps singles prepare financially for marriage.

Mr. Winfred Dodzih, Head of Retail Marketing, Metropolitan Life Insurance making a presentation to a group of Moslems in Accra, explained that the product which is targeted at all Moslems has been developed with unique attributes to ensure that customers derive the full benefit to meet their financial needs.

He explained that the Moslem community by their relegion is not permitted to invest in certain companies that deal in businesses like alcoholic beverage and pork meat trade, hence the products with the unique attributes to meet the investment needs of Moslem.

“This is tailored to meet specific requirements of the sophisticated market which is in consonance with the Sharia law. It can play a role in preparing financially for wedding, a quite costly affair nowadays.

“It is also to create an option to offer as dowry. A bride can now request that her husband –to- be invest in Labbaika Provider for her.”

The company recently constructed a new ward and renovated the existing recovery and labour ward of the Maamobi Polyclinic, a Moslem community at a cost of GH¢ 30,000.

The Polyclinic is the biggest health facility in the Ayawaso Sub-metropolitan area and was established about 42 years ago.

A daily average attendance at the Polyclinic is about 300 patients at the Out Patients Department (OPD) and 100 to 120 women attending antenatal clinic. It serves over 500,000 people, due to its strategic location.

Due to the location of this Polyclinic, it often complements efforts of the 37 Military Hospital, Ridge Hospital and Korle Bu Teaching Hospital.

Wednesday, May 26, 2010

Newmont reacts to allegations

Newmont Ghana Gold Limited has denied various allegations made by civil society organisation and some community members regarding its ongoing Akyem project, located in the Ajenua Bepo Forest Reserve at New Abriem in the Eastern region.

Adiki Ofeibea Ayitevie, Regional Manager, Communications, Newmont Ghana explained to B&FT that the proposed area to be mined within the Ajenua Bepo Forest reserve makes up only about 3.8 percent of the total footprint of the Akyem Project mining area. The rest of the project area will be situated outside Ajenua Bepo forest.

“The small fraction constituting about seven percent or 44 hectares of the 569 hectares Ajenua Bepo forest is the only area that will be directly impacted by the Akyem project. Moreover, the area is composed of only small true forest patches and not close to other forest communities.

“Several investigators including V. Hawthorne and M. Abu-Juam have classified this forest area as degraded and a secondary forest,” she stated.

She further explained that the impacted forest area forms 0.04 percent of the over 18,000 hectares of total District forest reserve area which cannot have lasting impact on rainfall levels of the area. All surface land disturbance areas, she said, will be revegetated during and after the mine operation and this will return those areas to normal hydrologic function in terms of rainfall runoff and retention.

This notwithstanding, she added that Newmont has, since early 2007, also installed a fully equipped meteorological (weather) station within the proposed mining area to collect and record data on and monitor wind speed, wind direction, rainfall, temperature, evaporation, and humidity. These data are validated, entered into the Project data base and are periodically reported. This information will continue to be collected and monitored throughout the life of the mine and through the reclamation period.

However, in a petition signed by 29 community members to the government and its related agencies, they said the Ajenua Mountain, together with the forest area improves the rainfall pattern in the region, thus boosting agriculture.

The Wassa Association of Communities Affected by Mining (WACAM), the civil society group leading the campaign explained that its decision to lead a crusade against Newmont’s action is motivated by the fact that the project will displace over 1,000 people, and destroy the livelihoods of over 7,000 additional people.

Mr. Daniel Owusu-Koranteng, Executive Director of WACAM said: “We have petitioned the government to withdraw the certificate given to Newmont Gold Ghana to mine in the Ajenua Bepo Forest Reserve.”

According to the petition, “Newmont Akyem project convinces us that the project would develop into one of the irresponsible mining projects in Ghana which are violating the rights of mining communities in terms of loss against community people, loss of livelihood, low compensation payment, pollution of rivers, poor resettlement and displacement of communities.

“Since Newmont received the mining lease in January 2010, the company had established a Task Force made up of paid community agents of the company and the company security to prevent us from carrying out our normal farming activities even when the company had not negotiated compensation with us.

This violates our right as contained in Section 13(9) of the Minerals and Mining Act (703), 2006 because the provision makes it obligatory for Newmont to negotiate compensation with affected farmers based on the compensation principles (Section 74 of the Minerals and Mining Act) before it can enter our lands.”

B&FT has gathered that the Akyem mine project has an equity reserve of 7.7 million ounces of gold with US$1 billion investment and has about 15 years mining life.

It is expected to produce between 480, 000 and 550, 000 ounces of gold a year for the first five years of its operation with production expected to start in early 2014.
Initial capital cost is estimated at $70-million, for infrastructure and compensation payment. Engineering for the project is about 70 percent complete. This is to pave way for the building of the mining plant that begins the full scale mining production.

College of Health Science calls for business partnership

The College of Health Science Council of the University of Ghana has launched its 10th Anniversary celebration with a call on the business community to partner with the college to help provide the country the needed health human resource.

The Chairman of the Board of Trustees of the Postgraduate Endowment Fund, Mr. Sam Okudzeto who made the call at the ceremony in Accra urged corporate bodies, non-governmental organizations, philanthropists, government and all stakeholders to support postgraduate training in order to save lives.

“The College would continue to help train world class doctors, specialists, Allied Health professionals and nurses who would serve as agents for the achievement of excellence that would propel the college agenda,” he said.

Mr. Okudzeto said the rampant loss of the best brains could be reduced if Ghanaians supported the institute, adding that the dangers in travelling abroad for medical attention entail the possible death of patients midway because of the distance involved.
Prof. Aaron Lawson, Provost of the College, speaking under the theme: “The College of Health Sciences: A decade of Achievement and future prospects,” indicated that some of the challenges bedeviling the College’s fortunes were limited budgetary support, poor infrastructure, aging faculty and inadequate capacity for research.

He stated that the College was developing its second strategic plan, which would include the liberation of the College legally, financial empowerment, and the establishment of a human resources framework that would inspire and motivate the organisation, infrastructural expansion and modernization and developing of new activities to bring a complete growth.

Prof. Lawson revealed that the College had planned to relocate to the University of Ghana campus, where a 400-acre land had been earmarked for a College complex. This will provide capacity for training more health professionals for the country.

“In the foreseeable future the college hopes to add a new Teaching Hospital, School of Biomedical Sciences, a central administration, a diagnostic centre and blocks for the school of Medicine, Pharmacy, Nursing and Dentistry.”

Mr. Edward Effah, Managing Director of Fidelity Bank Ghana said the College provides a central administration for all the health-related institutions in the University of Ghana.

“It fact, it is the umbrella under which all the health- related institutions come together to ensure that they are able to produce highly qualified and competent health professionals and medical scientist to provide preventive and curative services to meet the health needs of Ghanaians,” Mr. Effah said.

College of Health Sciences is an Institution of the University of Ghana under the Ministry of Education. The College provides human resources for the Ministry of Health.

Virgin Atlantic joins competition

Virgin Atlantic Airbus flight, A340-300, made its first flight from London Heathrow Airport to Kotoka International Airport in Accra last Monday to a great fanfare and pageantry.

This will make competition on the London-Accra route keener as the Virgin flight joins British Airways and the country’s struggling national carrier, Ghana International Airlines (GIA) as the only three commercial airlines that fly direct from Ghana to the United Kingdom.

While British Airways and GIA fly daily to London, Virgin Atlantic will now make three flights a week to the same destination.

The first Virgin Atlantic flight landed at the Kotoka International Airport on Monday at 15:45 GMT with the founder and Chairman of Virgin Group, Sir Richard Branson aboard the Airline.

The coming of Virgin Atlantic to Ghana makes the country the fourth on the continent after South Africa, Nigeria and Kenya to enjoy Virgin’s flight operations.

“We have made a very wise decision to come to Ghana,” said Sir Branson, the 261st richest person in the world according to Forbes' 2009 list of billionaires, with an estimated net worth of approximately £2.6 billion (US$3.9billion).

Sir Branson said the country’s thriving democracy largely informed the Airline to begin its operations in the country after 26 years in existence.

“Virgin doesn’t operate under military rule so we waited for democracy to thrive,” he said.

According to Sir Branson, the Airline sees British Airways as its only competition adding: “Every country needs competition and we are glad that we will be able to give British Airways competition.”

Currently, Virgin Atlantic is Britain’s second largest airline serving the world’s major cities. The Airline’s aim is “To provide the highest quality innovative service at excellent value for money for all classes of air travelers.”

He said the Airline expects to fly over 60,000 passengers to the UK in the course of the year, all whom will benefit from more choice, competitive fares and value for money.

According to the open source online portal, Wikipedia, Branson's business empire is owned by a complicated series of offshore trusts and companies. The Sunday Times stated that his wealth is calculated at £3.065 billion; if he were to retire to his Caribbean island and liquidate all of this he would pay relatively little in tax.


Monday, May 24, 2010

More ECOWAS members adopt axle-load regulations

The West African and Monetary Union States (UEMOA) member-states have agreed to adopt standards and procedures for control of the gauge, weight and the axle-load of every vehicle by close of 2010, Mr. Yaya Yedan, Country Representative of the Burkina Shippers’ Council in Ghana, has disclosed.

“Since mid-2009, Ghana, Niger and Togo have been enforcing the regulations and other UEMOA’s member-states have agreed to enforce the rules by 2010. Enforcement of the axle-load regulation by member-states is aimed at controlling and protecting the country's roads against premature deterioration,” Mr. Yedan said.

UEMOA member-states are Benin, Burkina Faso, Cote d'Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo.

The idea of regulating axle-loads in West Africa dates back to 1982 when ECOWAS member-states signed a convention11, which stipulates that the maximum axle-load of vehicles authorised to carry out interstate transportation, should not exceed 11.5 tonnes per axle.

Available statistics have shown that on the Burkina Faso road from the Ghanaian border to Ouagadougou, 84 percent of trucks were overloaded by an average exceeding 52 tonnes, with some trucks weighing up to 142 tonnes – almost three times the legal limit.

When made to endure such abuse, the life of a road is reduced to 1 - 4 years, compared to a normal lifespan of 15 years or more.

Mr. Yedan, who explained this at a ceremony in Accra organised by West Africa Trade Hub and funded by USAID, which was aimed at removing trade barriers in West Africa, said the elimination of trade barriers in West Africa was the key to economic growth of the sub-region, emphasising,” overloaded trucks have a serious negative impact on the West African road infrastructure.

The sudden decrease in tonnage that trucks are allowed to carry resulted in a decrease of profit per trip; transport prices from Tema to Niger, for example, rose phenomenonally.

Many trucks, particularly Ghanaian ones, have been heavily reinforced in order to carry excessive loads. This reinforcement increases the tyre-weight of the trucks, and thus limits how much cargo the trucks can legally carry and still respect the gross axle-weight limits. Many of these trucks are now working in countries that have not yet implemented the axle-load regulations.

Heavily overloaded trucks also make for dangerous driving situations as they are difficult to drive and, more importantly, difficult to stop once they are moving. Overloading also leads to more breakdowns, which have financial impacts on exporters and importers and represents a threat to the safe journeys of other road users.

Meanwhile, Mr. Niels Rasmussen, Transport Director at the West Africa Trade Hub, indicated that transport prices have gone up, at least for the time being. Failing to implement axle-load controls is clearly not a viable option.

“In the long-run, transport prices should go down as a result of better and safer roads - which will allow for faster trips and thus more revenue per truck, particularly if the regional trucking markets are de-regulated to allow for competition based on service and price,” he said.

Stanchart celebrates 114 yrs in style

Standard Chartered Bank climaxed its 114th anniversary celebration in the country last year by making history in its operations, chalking a number of firsts.

The Bank’s financial performance for last year ended with a record profit after tax of GH¢57.4 million, the highest so far in the bank’s existence in the country. This was about a 73 percent increase over the 2008 figure.

In the same year Standard Chartered Bank led a pack of consortiums to secure a syndicated facility of US$1 billion for the Ghana Cocoa Board, making the transaction the first large, structured soft commodity syndicated deal in Africa.

This pioneering performance was delivered despite the continued uncertainty in the financial sector both locally and international last year.

Again, in October last year, the Bank launched its Internet banking platform, Straight2Bank - the first of its kind on the market - which supports trade transactions and cross-border payments for its SMEs.

More impressively, the Bank reclaimed the accolade “Most Socially Responsible Bank” in Ghana at the 8th edition of the Ghana Banking Awards held last year and organised by Corporate Initiative Ghana in collaboration with the Association of Ghana Industries and the Ghana National Chamber of Commerce.

The award for Corporate Social Responsibility (CSR) is based on reviewed information obtained from banks regarding programmes they have financed aimed at improving the quality of life of their staff and the community at large.

“Our brand is all about commitment. We are here for good, to create value for our shareholders, to support and partner our clients and customers and to make a positive contribution to the broader community,” said the Chief Executive Officer of Standard Chartered Bank Ghana, Heman Shah.

Standard Chartered has shifted from Corporate Social Responsibility to the concept of sustainability – a way of doing business that is fundamental to its strategy, embedded across its businesses, and which contributes to shareholder value. The Bank has a Sustainability Agenda in place that is driven by 4 key pillars: namely Governance, Environment, Social and Economic contributions.

On its outlook, the bank wants to be very dominant in the corporate banking segment in the Ghanaian banking sector.

Mr. Shah said: “We are a not a mass market bank. This is the strategy we have adopted as a bank, and we will keep to that. We are interested in the high value segment of consumer banking.

“We want to be dominant in the corporate banking segment because we have a strong balance sheet, we have the best expertise, and we have the best products and services in that segment of the market. The combination of the skills, balance sheet, and our products and services puts us in a good position to be very competitive.”

Standard Chartered now is focused on a path of continuing to create new opportunities, diversify its portfolio and ensure it has the flexibility to anticipate and respond to challenges in the market.

“We are committed to forging an enduring partnership with the government and regulators by providing thought-leadership and market expertise.

“It is our aim to champion the development of a more modern and sophisticated financial system, leading the way as a key player in the market and demonstrating best practices in risk management, product development and financial discipline in the economy,” added the Board Chairman of the Bank, Ishmael Yamson.

Standard Chartered Ghana is listed on the Ghana Stock Exchange, is the market-leading financial services brand in the country and is presently the highest priced stock on the local bourse.

The Bank has a network of 42 ATMs, and 21 branches and corporate offices throughout the country.

Its operating income and balance sheet have doubled over the last five years; primarily as a result of its standards of service, risk management and a disciplined approach in the way it does business.

Standard Chartered Ghana aspires to be the best international bank for its customers in the country.

It is one of the leading foreign banks in terms of trading profit in the country generated from its Wholesale and Consumer Banking businesses, and continues to introduce its market-leading suite of products and services such as Straight2Bank, Direct Inter-branch Payment System, Bancassurance, the DIVA Club and various Thought-leadership programmes.

Leading by example to be the right partner for its stakeholders, Standard Chartered is committed to building a sustainable business over the long-term and is trusted in the country for upholding high standards of corporate governance, social responsibility, environmental protection and employee diversity.

Positioned as the “Great place to work”, Standard Chartered Ghana employs over 770 people from 11 nationalities and has woven a fine workplace culture-mesh which engenders trust, engagement, diversity and inclusion.


Friday, May 21, 2010

High transport cost hampers ECOWAS trade

The cost to deliver a container from Tema port to Ouagadougou is more than seven times the cost to deliver the same container from Newark, New Jersey to Chicago in the United States of America.

It also takes approximately 13 to 22 days to bring a container from a vessel in Tema port to the importer in Ouagadougou, costing US$4,800.Whilst from Newark to Chicago it costs about $650 and takes just five days. This is remarkable when labor costs in the U.S. are 25 times higher.

West Africa Trade Hub Transport Director, Mr. Niels Rasmussen said: “After completing the customs-clearance process in Tema, trucks leave on a three to five-day journey (881 km) to Paga at the Ghana-Burkina Faso border.

“However many trucks are in poor condition and therefore often break down or have accidents along the road. Because of this the journey from Tema to Paga can take more than a week.

“Along the roads in Ghana, drivers encounter about 15 control points operated primarily by police and customs agents. These barriers cause on average a total of 160 minutes delay and the payment of the equivalent of US$11.84 in bribes between Tema and Paga. These bribes are paid by the transporter and are included in the trucking price.”

Mr. Rasmussen made these known at a launch of a comprehensive study of transport and logistics costs on the Tema-Ouagadougou corridor report in Accra.

He explained the problems at Tema port can be resolved by reducing congestion at the port and streamlining port and customs procedures.

“The high costs related to the trucking leg for both import and export is best resolved by deregulating the trucking market in the ECOWAS region, while the high level of informal payments incurred during the clearance process at Ouagarinter would be greatly reduced if ECOWAS governments were successful in establishing a single market with no internal borders.

“The impact on trade would be significant, making it easier for West African companies to compete in a globalized world while lowering the prices of goods for consumers and producers within the region, he said.

He indicated that the study identifies the time and delays as well as official and unofficial costs incurred at various points in the transport chain as the goods travel along the Ouagadougou-Tema corridors. Some costs are paid directly by the importers whereas others are paid by the forwarders and transporters and are included in the price of their services.

The study is also aimed at providing importers and exporters with the information they need to make informed decisions about choosing the transport corridor that offers the fastest, most cost-effective and reliable quality service.

It will as well provide traders with the information they need to lobby governments effectively for appropriate reforms, better transport infrastructure, more streamlined import and export procedures, less corruption and the elimination of unnecessary delays.

Tema port is the country’s main gateway to international trade and the country’s most important port for transit traffic to the Sahelien landlocked countries. Ghana Ports and Harbors Authority (GPHA) has invested to promote transit trade, conducting marketing campaigns in the landlocked countries, operating an office in Burkina Faso, leasing port land to landlocked countries to develop their own storage facilities, and building transit sheds and truck parking facilities.

In 2008, Tema port handled nearly 8.7 million tones of imports constituting about two-thirds of port throughput; exports account for about one-third. Containerized cargo amounted to 4.8 million tones, or 55 percent of total tonnage.

Tema is the country’s most important container port, handling close to 550,000 20-feet equivalent units in 2008.Since 2003, annual transit traffic has remained fairly stable at about 850,000 tonnes. About 85 percent of Tema transit cargo is transported to/from Mali, Burkina Faso and Niger.

Main One Cable to leverage broadband costs

A US$240 million project that involves the laying of 7,000 kilometres of submarine fiber optic cable between Seixal, a suburb of Lisbon Portugal, Accra and Lagos in Nigeria to unlock the constrained West African telecommunications market and catalyze the economic potential of the region arrived on the shores of Tema on Wednesday.

Powered by Main One Cable Company, a company owned by Main One Cable of Mauritius with a Pan African vision to build a private sector led and funded international telecommunications highway between Africa and the rest of the world via Portugal, the company is led by Ms. Funke Opeke, an experienced telecommunications executive who returned to Nigeria as Chief Technical Officer of MTN after a twenty-year career in the United States.

Announcing the completion of the first phase which links Portugal, Ghana and Nigeria with branching units in the Canary Islands, Morrocco, Senegal and Cote D’Ivoire,the Business Development Executive of Main One, Bernard Logan said the cable system will deliver 1.92tbps of high capacity bandwith equivalent to 10 times the available capacity of the existing fiber optic cable serving West Africa and more than 20 times the satellite capacity currently available across sub-Saharan Africa.

The 1.92Tbps of available bandwith will be leased wholesale to telecom operators and internet service providers on an open access basis, thereby encouraging competitive pricing and a large customer base.

Africa’s average monthly price for broadband is over three times higher than for Asia and almost six times higher than Europe if expressed as a per centage of gross national income per capita.

The African Finance Corporation (AFC), an African-led financial institution with a mission to improve African economies by developing and financing infrastructure and industrial and financial assets financed the project with the African Development Bank signing a loan agreement of USD61 million towards the development of the project.

Typically, better communication infrastructure reduces transportation time and costs and improves access to markets for inputs and outputs. Currently West Africa is served by 50 Gps from both satellites and cable. Main One capacity implies a dramatic bandwith increase of more than 1,000 per cent and a considerable reduction in cost.

Ms. Funke noted with the coming on-stream of Main One in the country, economies of scale will eventually reduce the cost to 10-20 per cent of current costs today of internet connectivity.


Ban on telecom mast off today

The Minister of Communications, Haruna Iddrisu has said that the government has resolved to lift the ban on the erection of telecom masts by the close of today.

This, he said, follows the completion and adoption of new guidelines on the construction of communication towers in the country.

Mr. Iddrisu who said this at the celebration of the World Telecom and Information Society Day earlier this week explained that the inter-sectoral committee comprising personnel from the Environmental Protection Agency (EPA), the National Communications Authority (NCA), the Ghana Atomic Energy Commission (GAEC) and National Security set up to develop a set of guidelines for the institution of a one-stop-shop permitting scheme for the deployment of communication towers has just completed their job to bring some order in the way communication towers are erected in the country.

The guidelines are also expected to ensure that the relationship between cell site network availability is strengthened.

“I know the ban on the erection of masts has affected your operations but it was necessary to bring sanity into the system. I want to assure you that we have now resolved to lift the ban by the end of this week,” he told a gathering of the telecom operators at the World telecom day.

“Government will not just ignore the concerns of the public and therefore the initial decision by the Ministry was to put in safety gap that will assure people that government is concerned about the associated health hazard, which is also directly linked to electromagnetic effect,” Mr. Iddrisu emphasized.

The directive communicating the ban was contained in a letter dated January 12, 2010 from the Ministry of Environment to the EPA.

There are estimated 15.7 million mobile phone subscribers in the country now and the growing demand for mobile services have necessitated the increase in communications infrastructure such as towers; which are needed to ensure that there are adequate network coverage and access that guarantee minimum Quality of Service (QoS).

In recent times, the rampant installation of telecommunication masts throughout the county has raised concern over public health and safety. The rush for land for that purpose also stirred some land disputes, sparking public protests and conflicts.

According to the EPA, about 50 per cent of all communications masts in the country were erected by service providers who did not obtain the required permit.

Source: B&FT

Brussels Airlines set to operate in Accra

Brussels Airlines, member of Star Alliance a conglomerate of 29 airlines operating worldwide, is set to operate in the country starting July 5th this year.

Brussels Airlines replaces the defunct Sabena and has eighteen destinations in sub-Saharan Africa including its new routes Accra, Lome, Cotonou and Ouagadougou.

It is the first Belgian carrier to operate in the country and will run four times in a week from Accra to Brussels where passengers will be connected fifty destinations in Europe and more than 900 destinations worldwide through its Star Alliance partners.

Mr. Frederic Stiels, Country and Ground operations Manager Ghana briefing the media in Accra said the airline’s decision to begin operations in the country is because Ghana is considered as one of the economic powerhouse of the West African coast.

He said the country also has huge and vibrant tourism potential which can be promoted and boosted through the operations of the airline in the country while helping in economic development and tourism.

The airline will offer 3000 direct and indirect employment opportunities while providing great travel solution that can stimulate tourism ex Belgium and Europe to the country.

He said the airline is committed to the safety, reliability and comfort of its passengers owing to its vast experience and knowledge in the aviation business stressing it is one of the most punctual airlines.

Mr. Stiels said the airline has a well located and modern infrastructure with multilingual staff and provides short walking times and quick connection making all flights timesaving and hustle free.

He said as part of reaffirming its passion for the continent, the airline is the only carrier with an In-flight magazine on Africa. It also a generous luggage allowance for passengers coupled with attractive fares.

Mr. Stiels affirmed that the airline offers maximum flight comfort and classic experience to passengers with LCD screens distributed throughout the cabin with ergonomic seats to offer more legroom in the economy class while the business class has seats that can easily be converted into comfortable beds measuring nearly 2 meters long, with massage functions and integrated lumbar support.

Brussels airlines currently have 51 aircrafts including five A330-300 Airbuses, a long-haul aircraft that boasts of recent design, offers maximum space and top entertainment possibilities with an average of over 5 million passengers as at 2009.

Source: B&FT

Wednesday, May 19, 2010

G.M foods: great promise, great dangers

Ghana has defied all odds to join other countries to adopt GM foods despite home pressure to shun such an idea. Ekow Essabra-Mensah looks at the implications.

The terms genetically-modified (GM) or genetically-engineered (GE) foods and genetically-modified organisms (GMOs) refer to crop plants created for human or animal consumption using the latest molecular biology techniques.

GM foods are derived from genetically modified organisms. Genetically modified organisms have had specific changes introduced into their DNA by genetic engineering techniques. These techniques are much more precise than mutation breeding, whereby an organism is exposed to radiation or chemicals to create a non-specific but stable change.

GM foods were first put on the market in the early 1990s. Typically, genetically modified foods may include soybean, corn, canola, and cotton-seed oil. But animal products have also been developed.

In 2006 a pig was controversially engineered to produce omega-3 fatty acids through the expression of a roundworm gene.

Researchers have also developed a genetically-modified breed of pigs that are able to absorb plant phosphorus more efficiently, and as a consequence the phosphorus content of their manure is reduced by as much as 60 percent.

Critics have objected to GM foods on several grounds including perceived safety issues, ecological concerns, and economic concerns raised by the fact that these organisms are subject to intellectual property law.

The great promise

GM crop production is reported to have reduced the need for external inputs, thus saving 356,000 mt of pesticides from 1996 to 2008. Its contribution to climatic change is estimated as equivalent to removing seven million cars off the road.

It is expected that hectares under cultivation will double by the second decade of commercialisation in 2015.

Future prospects of a new wave of biotechnology crops between 2010 and 2015 are encouraging, therefore top priority must be assigned to operation of appropriate responsible, cost-effective and timely regulatory systems.

GM foods have great promise and great dangers, said the African American Environmentalist Association (AAEA), indicating that if all goes well one thing is certain - we will have to feed about 12 billion people every day by the end of the next 50 years.

Ghana’s position on G.M Foods

Ghana in May 2003 signed the Cartagena Protocol, which affirmed the country’s position on the safe use, handling and transportation of Genetically Modified Organisms (GMOs) which might find their way to into the country.

The Cartegena Protocol states: “Parties shall ensure that the development, handling, transport, use, transfer and release of any living modified organisms are undertaken in a manner that prevents or reduces the risks to biological diversity, taking also into account risks to human health.”

Ghana’s Cabinet has approved the Bio-safety Bill which will allow the full commercialisation of biotechnology and the deployment of the Genetically Modified (GM) products in the country.

The draft bill, which should be in the parliamentary calendar for debate later this month, when passed will authorise the use and consumption of GM foods in the country’s consuming market, said Dr. Alhassan Yakubu, Member of the Parliamentary, Select Committee on Environment, Science and Technology; explaining that the passage will have enormous implications for the country’s future biotech crop production in the agricultural sector.

This will be the second GM foods- related bill that Parliament will pass after it earlier passed the Legislative Instrument on Bio-safety (LI 1887), which along with other existing legislation could be used to start field-trials of GM crops in the country’s agricultural sector.

Promulgation of the bill into law will enable the Customs, Excise and Preventive Service and the Immigration Service to monitor, regulate and control genetically modified food products imported into the country.

The Bill on Bio-safety, will as well promote the exchange of biotechnology data between Ghana and her neighbours, said Ms Sherry Ayittey, Minister for Environment, Science and Technology.

"Ghana is not opposed to genetically modified food products."

The problem with genetically modified products in Ghana, she said, was that it has not been properly understood; that is why the mention of the technology creates panic among people.

She therefore urged scientists in the country to break the myth about GM through public education.

This is expected to increase productivity and augment income of farmers, while promoting the protection of biodiversity, environment and climate change and other socio-economic benefits.

Prof. Walter Sandow Alhassan, Coordinator, African Bio-safety & Technology Policy Platform, and also a consultant to the Forum for Agricultural Research in Africa (FARA), said: “there is no scientific evidence after 13 years of commercial GM crop production globally that GM crops pose specific risks to the environment and human health.”

He explained that the strict regulatory regime accompanying GM crop production makes them even safer than conventional crops.

Trade in Europe and Africa

In response to negative public opinion, Monsanto announced its decision to remove their seed cereal business from Europe; and environmentalists crashed a World Trade Organisation conference in Cancun that promoted GM foods and was sponsored by the Committee for a Constructive Tomorrow (CFACT). Some African nations have refused emergency food aid from developed countries, fearing that the food is unsafe.

During a conference in the Ethiopian capital of Addis Ababa, Kingsley Amoako, Executive Secretary of the United Nations Economic Commission for Africa (UNECA), encouraged African nations to accept genetically modified food and expressed dissatisfaction at the public’s negative opinion of biotechnology.

Advice from developed economies

In New Zealand, no genetically modified food is grown and no medicines containing live genetically-modified organisms have been approved for use. However, medicines manufactured using genetically modified organisms that do not contain live organisms have been approved for sale, and imported foods with genetically modified components are sold.

United States

In 2004, Mendocino County, California, became the first state in the United States to ban the production of GMOs. The measure passed with a 57% majority.

In California, Trinity and Marin counties have also imposed bans on GM crops, while ordinances to do so were unsuccessful in Butte, Lake, San Luis Obispo, Humboldt, and Sonoma counties. Supervisors in the agriculturally-rich counties of Fresno, Kern, Kings, Solano, Sutter, and Tulare have passed resolutions supporting the practice.


The cultivation of Monsanto's MON 810 corn was forbidden in France on February 9, of 2008. It was the only GMO authorized in France. The safeguard measure is taken as far as side effects on human health will be known. Germany placed a ban on the cultivation and sale of GMO maize in April 2009.

Other European Countries

MON 810 is the only GMO crop cultivated in European soil. However, in addition to France and Germany, other European countries that have placed bans on the cultivation and sale of GMOs include Austria, Hungary, Greece, and Luxemburg. Ireland has also banned GMO cultivation, and has instituted a voluntary label for GMO-free food products.

Poland has also has tried to institute a ban, with a backlash from the European Commission. Bulgaria effectively banned cultivation of genetically modified organisms on March 18, 2010.

Private investments

The development and implementation of policies designed to encourage private investments in research and marketing biotechnology that will meet the needs of poverty-stricken nations, increased research on other problems faced by poor nations, and joint efforts by the public and private sectors to ensure the efficient use of technology developed by industrialised nations have been suggested.

In addition, industrialised nations have not tested GM technology on tropical plants, focusing on those that grow in temperate climates even though undeveloped nations and the people that need the extra food live primarily in tropical climates.

Many European scientists are disturbed by the fact that political factors and ideology prevent unbiased assessment of the GM technology in some EU countries, with a negative effect on the whole community.

Great dangers

Friends of the Earth-Ghana (FoE) - a non-governmental organisation - opposes the introduction of GM foods into the country, observing that GM foods are harmful and unsafe for human consumption and that their impact on the human health is hazardous.

“Ghanaians should take a precautionary approach to the adoption of GM food.”

GM food watchers say that supporters of GM foods, including heavyweight organisations like The Bill and Melinda Gates Foundation, The Rockefeller Foundation, Monsanto Inc, and USAID will continue to push for the adoption of GM foods in Ghana and other developing countries.

In the 1990's, scientists from the US FDA (Food and Drug Administration) warned about the health problems associated with GMO foods.

However, high-ranking officials in the FDA quashed these reports. According to documents released from a lawsuit, the scientific consensus from the agency was that GM foods were inherently dangerous and might create hard-to-detect allergies, poisons, gene transfer to gut bacteria, new diseases and nutritional problems. (See

New industrial policy framework out next month

Parliament is to approve a draft industrial policy bill next month to help promote accelerated growth and enhanced competitiveness in the country’s industrial environment, disclosed Ms. Hanna Tetteh, Minister of Trade and Industry.

The new policy framework, which will be the government blueprint, will also guide the development of industrialisation in the country.

The thrust of the document when approved is intended to provide clear and transparent guidelines for industrial development in Ghana, with a strong emphasis on the development of the manufacturing sector.

It will as well create a consistent and stable policy environment within which the private sector in Ghana can promote competitive industrial activities effectively - and do so with certainty.

Available data indicates that in 2008 the Industrial sector grew by 3.8 percent, down from an annual growth target of 5.9 percent. The lower than expected performance of the sector was driven primarily by activities in the construction sub-sector, the largest contributor to industrial output, which experienced output contraction by one percent against a growth target of eight percent.

The Electricity and Water sub-sector registered the highest growth in the Industry Sector, posting a provisional growth rate of 9.0 per cent against a target of 5.0 percent. The Mining sub-sector also grew at a remarkable rate of 8.0 percent.

The good performance of the mining sub-sector is partly due to the rise in demand for gold which has pushed gold prices to unprecedented high levels. Mining companies in the country have responded positively to the price hikes by increasing production.

B&FT has gathered that among some thematic areas the policy will cover are: Industrial Legislation and Regulations; Strategic Interventions in Industrial Development; Privatisation and Public-Private Partnerships for Industrial Development; Labour and Industrial Relations.

Also, Technology for Industry; Innovation; Research and Development; ICT for Industrial Development; Intellectual Property Rights in Industrial Development; Manpower Development and Training for Industrial Development; and Raw Materials and Inputs Supply and Financing for Industrial Development, among others.

Ms. Tetteh, who made these disclosures in Accra at the opening of the maiden domestic content and matchmaking exhibition/conference in the oil and gas industry, organised by the Association of Ghana Industries (AGI) in collaboration with Ghana National Petroleum Corporation (GNPC) and Tullow Ghana Limited, said: “This concept is based on the utilisation of Ghana’s human material and natural reduces for the provision of goods and services to the petroleum industry, among others, within acceptable quality health, safety and environmental standards as will be determined by an appropriate Ghanaian regulatory body.”

Government will focus on increasing the local content concept in the manufacturing process by encouraging the use of local raw materials and fabrication of plant and machinery locally. This will help promote accelerated growth and enhance Ghana’s international competitiveness in goods and services, she explained.

“To achieve this, there will be need to develop a comprehensive local content Act for provision of clearly outlined regulations geared towards the competence of locals in the oil and gas industry.

“The development of this framework will help reduce conflict, tension and dissatisfaction while ensuring fairness. This will be reviewed from time to time in order to stimulate development of indigenous capabilities.

Meanwhile, Mr. Frank Agyeman, Public Relations Officer of Reroy Cables Ghana Limited, in an interview with B&FT welcomed government’s decision to promulgate the draft industrial policy framework into law as a positive sign, emphasising that it will also help address difficulties in the procurement law, adding that it would seek to provide a lot of opportunities for local procurement.

He indicated that the policy will provide an enabling environment and opportunities for Ghanaians to benefit from the economic wealth that is to be derived from the oil and gas industry through the deployment of the local content policy platform, and should be replicated in other sectors of the economy.

“This will help achieve a degree of influence and control over development initiatives for local and domestic stakeholders, like REROY CABLES, in areas such as the housing sector. This will create several indigenous supportive industries that will reduce the high unemployment rate and sustain economic development.

2,500 fraudulent call lines detected

About 2,500 telephone lines employed to commit international call crimes against the state have been detected by the Ministry of Communications,.

The Minister of Communications, Haruna Iddrisu, explained that as of last Sunday, May 16 this year, the government had identified the lines that are used to trick incoming international calls to appear as local numbers, saying “government is going to work on the identified lines to track down those criminals.”

The re-routing of international calls through local lines helps criminals avoid paying charges on international call tariffs to government.

Government has estimated that the country loses more than US$6 million monthly through the activities of unidentified persons who engage in the practice.

Mr. Iddrisu said it was in view of these activities that government has procured national gateway monitoring equipment to know all international calls that are coming in and going out.

The move is expected to help government halt the incessant revenue leakage and generate an estimated US$50 million annually.The equipment will also help the operators obtain reliable information to track interconnectivity charges from foreign operators.

He however allayed public fears that the equipment will be employed to monitor individual calls.

“I want people to know that government has no intention of monitoring and interfering in the private communications of Ghanaians,” he said.

Per their practice, those ‘unidentified’ persons (criminals) rely on the use of a Simbox or GSM gateway card, whereby the incoming call is first routed to a local number and then the same call is re-directed from the local number to the number the foreign call was originally meant for.

The amount of revenue loss, according to the minister, was only for the month of March and the expectation is that from that time till now it would be much more.

The practice has persisted for some time; however, the comment from the minister has heightened the deep-seated problems inherent in the mobilisation of revenue loss to the state. But has also opened the debate as to whether or not the cards should be registered so the mobile companies can track down criminal elements that use the numbers to perpetuate fraud on people.

The minster has directed the regulator to charge a uniform levy of US$0.19 on all the mobile networks, being unhappy about the negative effect the practice continues to have on the country’s effort to generate substantial revenue to boost development.


Comprehensive study on transport costs out

In March of this year, ECOWAS, UEMOA, USAID, the World Bank, governments across the region and private companies launched Borderless, a partnership to remove trade barriers in West Africa.

The West Africa Trade Hub Transport Director, Niels Rasmussen, notes that it costs about US$4,800 and takes anywhere from 13 to 22 days to bring a container from Tema to Ouagadougou and to move one on the same distance in the United States, for instance, from Newark to Chicago costs about US$650 and takes just five days.

Mr. Rasmussen says it is even more remarkable is when you realise that labour costs in the U.S. are 25 times higher. “Lowering West Africa’s transport costs - among the highest in the world, is critical.”

The Director of the Trade Hub, Vanessa Adams, notes with concern that high transport costs ultimately mean consumers pay more for goods at market - and in West Africa where people spend as much as 80% of their incomes on food alone, this is very important.

Additionally, she said high transport costs also make it very hard for exporting companies to compete in world markets. “When they cannot compete, they do not create the jobs that West Africans need.”

To lower the costs, private and public stakeholders must work together to create a single regional market, eliminate excessive documentation for importing and exporting, streamline procedures to reduce delays, and deregulate trucking.

To this end, the USAID’s West Africa Trade Hub will today release a comprehensive study that analyses the structure of transport costs and related inefficiencies on the Tema-Ouagadougou corridor. Reducing the high cost of transport would significantly increase business activity across West Africa, creating jobs and lifting incomes.

Source: B&FT

Monday, May 17, 2010

Time to Push for Strong Local Participation in Mining

Ghana’s Mining and Metal contracts need a holistic review to ensure local content participation so as to encourage mining firms to use services and inputs from domestic sources and retain earnings for the growth of the economy, Ekow Essabra-Mensah writes.

Local Content is a documented policy indicating the desire of a government to actively engage indigenous or local companies in economic activities hitherto reserved for foreign investors, especially the industries operating in the extractive sector like the mining and metals and oil and gas industries.

Local content means the development of local skills, technology transfer, use of local manpower and local manufacturing.

The Local Content Policy is also a commitment on the part of the state to ensure that companies owned by its citizens actively participate in all aspects of activities and not just on the periphery. For example, Malaysia, Singapore, and Brazil have pursued aggressive local content policies to the benefit of their national economies. There are lessons also to be learnt from these developed economies.

Significance of local content initiative

The Local Content Policy provides a huge opportunity for job-creation and builds the indigenous capacity or technical expertise of local companies and entrepreneurs. This indirectly becomes a stimulant for growth of other sectors of the economy which eventually contributes to the nation’s Gross Domestic Product (GDP) or output.

A local content policy in Ghana’s sensitive industries would serve as a tool for the advancement of local development not only in the identified industries but in the economy as a whole. Such policies backed by the appropriate legislation and procedures would build human capacity as well as capabilities of local companies, which will certainly have a multiplier effect on the rest of the economy.

Already, we have as a country missed the opportunity to adopt a local content policy in the mining and metals sectors.

The sector is fully taken over by foreigners, though we have equally capable Ghanaians who could have ventured into that field and raised capital from within to manage similar entities given the opportunity. Can you imagine the amount of money that is taken out of this country by the multinational mining operators?

For now a Local Content Policy initiative should be a major priority for the government, looking at the overall economic implications.

Thankfully, Cabinet has approved the policy framework for the local content and participation in the petroleum activities which is aimed at ensuring that Ghanaians obtain maximum benefits from the oil discovery, said Mr. Emmanuel Armah-Kofi Buah, Deputy Minister of Energy.

The policy initiative should not only being directed towards the Oil and Gas industry, but to other areas of the economy such as the buoyant mining industry.

An urgent call from industry watchers

As an indication of governments’ commitment to seeing to the realisation of the policy within the sector oil and gas sector, Dr. Thomas Akabzaa, Senior Lecturer at the Earth Science Department of the University of Ghana, called on government to immediately develop a national mineral policy spelling out the country’s expectations of her mineral wealth.

The development of such a policy should involve effective and well-coordinated public participation with a clear national vision to ensure that the country gets the best deal out of the sector as happened in Botswana.

Government must foster development and closer collaboration among mining sector governmental institutions, including academic institutions, to critically assess the contributions of mining to the national economy and fashion out a way forward for the sector, said Dr. Akabzaa, emphasising that it would promote transparent mineral revenue distribution mechanisms that will deliver benefits to communities affected by mining - because activities of the sector have affected the environment and left the inhabitants with little or no meaningful livelihood.

Dr. Akabzaa called for national consensus on development mining andresources to solve the contentious issue of mining in protected areas, whichhad been a source of antagonism between environmentalists and inhabitants ofthose areas on one hand, and mining firms on the other.

Unlike other productive sectors, mining does not offer opportunities for others on the other side of the productive chain to benefit. “All its opportunities end in the mines,” he said, and called for a carefully crafted local content policy with timeliness to achieve optimal benefits from the sector throughout the value-chain.

Government’s 2010 budget direction that mining firms should pay six percent royalty, instead of the current three percent being paid, is not feasible. This, Dr. Akabzaa revealed, would not be adhered to because the legal regime in terms of agreements signed with the firms are against the recommendation.

Undeniably, from the pre-colonial mining era to date, mining contracts have descended to the current generation in which government enters into agreements with international mining companies for exploration of mineral resources.

Industry watches have argued that mining contracts since ages have been based on profit made by the mining companies, which is simply inadequate given that the resources mined are non-renewable and mining activity has far-reaching implications for the environment.

The African Initiative on Mining, Environment and Society (AIMES), a network of organizations, recently advocated mining contracts should make provision for local content participation. This will encourage mining companies to use services and inputs from domestic sources, and retained earnings for the local economy should be linked to the broader economy.

“If the benefits African countries get from mineral resources are primarily based on the profit of the mining companies, what would they get should prices of minerals collapse on the world market?” Dr. Yao Graham, Executive Director of Third World Network Africa, asked.

“When the gold mines, for instance, can have the same mining company mining the gold throughout the lifetime of the mine, it would place more responsible demand on the company to work hand-in-hand with the governments to make mining activity development-oriented.

“This will bring to an end the unproductive and environmentally devastating ten-year contracts which our governments continue to sign with all kinds of mining companies,” he added.

The mining contracts need a holistic review to get the mining sectors to contribute greater value to the development of local economies.

Give the indigenes a chance

An estimated 34 percent of annual mineral profits currently enjoyed by foreign firms and expatriates providing mining services in the country could pass to locals if they take steps to make themselves capable of providing those services.

Estimates according to the Minerals Commission show that the services procured by the mining firms in 2008 alone came to US$680 million, and they continue to go to foreigners because the locals have not positioned themselves to take advantage of opportunities in the mining sector.

Total revenue from minerals, the leading foreign exchange earner for the nation, went up 28 percent to US$2.3 billion in 2008 from US$1.79 billion in 2007. The performance of minerals in 2008 accounted for 46 percent of the nation’s total exports. Cocoa, which came in second position, earned the nation US$1.42 billion - representing 27 percent of total export revenue in 2008.

By way of contribution to total government revenue, the mining sector accounted for 14 percent in 2008, which in absolute terms stood at US$1.2 billion. Out of this, corporate taxes were US$73.5 million, royalties US$59 million, employee taxes US$47 million, small-scale mining US$227,934 and dividends US$178 million.

Government consideration

Local Content and Capability issues are national issues and so call for a collaborative approach across all political divides.

The best way to keep the mining industry as an integral part of the country’s economy is to put in place deliberate and sustained local content and capability development policies backed by legislation and enforcement mechanisms, not just resorting to appeals or pleas to mining exploration and production companies.

The non-existence of capacity currently in the country should not be an excuse for inaction, there must be conscious and systematic development of local capability. Ghanaians can participate in exploration and production in a more significant way if it is made policy to encourage them to do so. Yes, it is capital intensive - but it is not rocket science.

Government should as a matter of urgency set up a local content and capability development committee with a specific timeframe to do broad consultation with industry, academia and the public sector to identify areas in the entire extractive sector value-chain in which involving local participation will lead to the Ghanaian economy deriving maximum benefits.

This agency should also be measuring and reporting on the performance of operators in the sector and periodically comparing the local content and participation performance amongst operators, between projects and operations, and with other countries to establish benchmarks and targets.

There should be an agency charged with the responsibility of ensuring that there is compliance. This agency could be a separate entity or a unit under the Minerals Commission, which should be facilitating the development of local capability to undertake local value-addition.

It should also be tasked with removing barriers to local participation and set targets for local content and participation that will be assigned to individual projects, operations and/or operators and supporting those targets with appropriate contract terms.

Increased direct government revenue as a result of mining production through rent, taxes and royalties, though important, should not pre-occupy government attention because they are just a small portion of the bigger pie.

It is my greatest hope that policymakers and industry stakeholders will find these recommendations very useful as we build a buoyant mining industry that will benefit Ghanaian indigenes and the local economy.

Black-outs cost economy US$974m annually

The cost of energy disruptions in the country has been computed to cost the economy about US$974 million every year, the country’s energy producers have said.

This is about six percent of the country’s Gross Domestic Product (GDP).

The Director of Engineering of the Ghana Grid Company Limited (GRIDCo), Norbert Anku said the cost of power outages to the economy is more than two-fold what the company needs to generate and produce energy to prevent outages.

“Compared to the level of investment in electricity generation and transmission infrastructure needed to prevent outages, US$320 million, for example, is more than six years of GRIDCOs revenues under the existing tariff structure,” he said.

Anku said it the recent power outages are a manifestation of the problems which have forced the power producers to seek an increment in the existing tariff for power supplied.

Currently, the utility companies have laid a proposal before the Public Utilities and Regulatory Commission for a 150 percent increase in tariffs charged to consumers - a proposal consumers, especially the Association of Ghana Industries, have kicked against, claiming the increment will kill domestic manufacturing industries.

“As a society we pay the full cost of reliable power - whether we choose to pay a low tariff and endure the deleterious effect reliability failures have on the economy, or we choose to pay fair power prices to assure high availability and reliability,” he said.

The World Bank has estimated that thecost of power outages to countries in sub-Saharan Africa each year is about US$320 million.

However, Mr. Anku said the cost to the Ghanaian economy is much higher because the country’s level of electrification is higher than many countries in the region, and so the country is much more reliant on electricity

He explained that the company uses an estimate of the value placed by an average consumer on an unsupplied unit of electric power, which he said is a critical component of evaluating the cost of power outages as it measures consumers’ willingness to pay to avoid such outages.

He explained that the financial impact on a consumer of power when their power is curtailed differs depending on whether or not the power outages were planned, and depending on the type of consumer.

“First, outage data was collected and the cost per outage estimated for each sector, reflecting the inherently different unit value of electricity to each sector. According to data provided by the Electricity Company of Ghana (ECG), its average customer was without electricity for about 10 hours each month in 2007. Using this as a comparison for the bulk power system, this translates into 120 gigawatts per hour of lost load in 2009.”


High airport charges impedes business

Chairman of the Board of Airline Representatives-Ghana (BAR-Gh), Mr. Jonas Sowah Quaye, has observed that high cost of operating at the Kotoka International Airport (K.I.A) is affecting business activities in the aviation industry.

The charges include high airport tax regime and high fuel cost.
Parliament last year passed the Airport Tax Amendment Bill 2009 to increase the Air­port Tax from US$50 to US$75.
This increase, according to some industry players, has made Ghana one of the most expensive destinations in the sub-region to visit.

Mr. Quaye, who made these disclosure at a conference in Accra, said: “As airlines try to survive, the service providers such as travel and top operators in the country strive to decrease their cost and improve their margins, institutions go back and forth without any workable policy to support the industry and passengers make their purchase decisions with little product and service information.”

He explained that the airport is faced with system-challenges, including amenities and infrastructure to manage cargo and passenger handling.

He therefore called for a tripartite approach among industry players to act in consonance in order to address the current challenges.

“Linkages must be created among operators, information gathered must be shared among them and they must be the ultimate sources of policy framework formation to guide the industry in the country.

“We are confident that the combined effect of these actions will make Kotoka International Airport (KIA) the most attractive airport in West Africa and the increased number of passengers, tourists and kilos of cargo will certainly generate more revenue and provide more employment opportunities for our country.”

He also indicated that effort will be made to provide airstrips in various regional capitals to facilitate the operations of light aircraft requirements, including charter operations. This will ably support the oil discovery.

More than 70 percent of the international tourists enter the country by air, with tourism emerging as the fastest-growing sector of the economy.

Approximately 50 percent of the value of total export is shipped through the Kotoka International Airport (KIA), hence the role of air transport cannot be over-emphasised.

The country’s aviation industry stands out as one of the fastest-growing and most competitive in the West African sub-region. The number of cargo and scheduled carriers flying in and out of the country has almost doubled from 15 in 2000 to about 30 and increasing, with interest being shown by other foreign carriers.

Passenger rate has also improved from 900,000 in 2007 to over 1.29 million as at the end of 2009. The number of scheduled airlines operating to Ghana has also increased, from 13 in the 1990s to 28 in recent years. Encouragingly, some of the airlines already operating into Ghana are requesting for increased frequencies.

Thursday, May 13, 2010

Newmont eyes 7.7m reserves from Akyem

Newmont Ghana Gold Limited,(NGGL), the US gold explorer has eyed new equity reserves of 7.7 million ounces of gold in its Akyem mine project, a mining area located in the Eastern Region, B&FT has gathered.

The US$1 billion investment project has about 15 years mining life and is expected to produce between 480, 000 and 550, 000 ounces of gold a year for the first five years of its operation.
Production in the Akyem mine located in the Ajenua Bepo Forest of the Birim North District in the Eastern Region is expected to start in early 2014.

Newmont has recently been granted a mining lease and environmental permit from the Environmental Protection Agency to commence the Akyem project, and engineering for the project is about 70 percent complete.

Initial capital cost is estimated at between $70-million and $1-billion, in the infrastructure and compensation payment. Adiki Ofeibea Ayitevie, regional manager, communications who made this disclosure to B&FT in an interview explained that the project is currently in the planning phase, with feasibility studies under way to assess development requirements.

Following completion of further economic and power analysis to ensure sustainability, the project would advance to its next phase of development which will involve the building of the mining plant to pave way for the full scale mining production, She said.

“We are still engaged with the community to determine appropriate compensation. We are also undertaking a rapid access survey to help determine the real custodians of the land. It’s going to be to be a continuous process.”

Mrs. Ayitevie indicated that the company’s commitment to its social responsibility at the Akyem project has been studied extensively by international and national environmental experts, members of the communities living in the area, and by agencies and departments of government.

The Akyem project has for the past five years, been subject to a thorough environmental impact study, public consultation process and an independent review process.

“Newmont’s industry leading performance is reflected through Newmont Ghana’s high standards in environmental management, health and safety and creating value and opportunity for its host communities.

“In implementing our commitment, the company assures all individuals with farms and immovable properties, which have or will be impacted by our Akyem Project, that they will be duly compensated consistent with the express provisions in the Minerals and Mining Law and relevant provisions in the Constitution of Ghana.

“This will ensure that conflict at the mining community is minimised and also position the company as good corporate citizens.”

Meanwhile, the gold mining giant, has been facing stiff opposition from a civil society group and some farmers regarding its decision to mine gold commercially in the over 70 hectares of the protected Ajenua Bepo Forest Reserve.

The Wassa Association of Communities Affected by Mining (WACAM), the civil society group leading the campaign explained that its decision to lead a crusade against Newmont’s action is motivated by the fact that the project will displace over 1,000 people, and destroy the livelihoods of over 7,000 additional people.

Newmont’s Ahafo Mine and Akyem Project together have approximately 17.4 million equity ounces of proven and probable gold reserves, representing about 20 percent of Newmont’s global equity reserves of 86.5 million ounces of gold as at the end of the 2008.

The Ahafo mine poured its first gold in 2006 and commenced commercial production in the same year. Ahafo sold 202,000 ounces of gold in 2006 and was expected to produce between 410,000 and 450,000 ounces of gold in 2007 as the mine entered its first full year of production.

It currently produces about 500,000 ounces of gold annually from its three mining pit which also has 15 years of mine life.

Newmont purchased both the Ahafo and the Akyem projects as part of the Normandy Mining acquisition in February of 2002.

Ghana’s April inflation drops to 11.66%

Ghana’ Headline inflation rate fell for the tenth consecutive month to its lowest level in almost two years in April, making way for further interest rate cuts.
The rate of inflation for April stood at 11.66 percent, representing a further decline of 1.41 percentage points from the March figure of 13.32 percent.

The continuous drop reflects the effects of government’s relatively tight fiscal and monetary policies and stability of the cedi against major trading partners in the past quarter.
Likewise, petroleum prices over the last six months remained unchanged, therefore avoiding any price increases of goods and services due to the sensitive commodity.

The decrease was mainly driven by the non-food group which constitutes 55.09 percent of the consumer price index (CPI).

The items in the non-food basket such as recreation and culture (34.64%), hotels, cafes and restaurants (19.71%), transport (18.44%), and furnishings, household equipment and routine (18.36%) were the main drivers of the current inflationary. Ginger and spices (38.07 %), sugar, jam, honey, syrup, and confectionary (34.92%) were the highest contributors in the food group.

The current fall puts inflation at its lowest level since December 2007 and leaves the West African frontier economy in line to reach single digit well before the central bank's end-of-year target. The government’s end of period target is 9.2%.

Director of Economics and Industrial Statistics, Ghana Statistical Service (GSS), Ebo Duncan at a media briefing in Accra said government’s wage bill for the year would be the main determining factor for future inflation.

"We're expecting significant increase in the wage bill if the single spine salary scheme is implemented in July, as planned" he said, referring to a revamped public sector pay structure.
"If this happens the propensity to spend will increase and this is likely to directly and indirectly affect inflation." he noted in addition.

Encouraged by falling inflation rates, the Central Bank has cut prime interest rates twice in a row since November, in what analysts said is a clear shift towards focusing on growth. The most recent cut in April was by a larger-than-expected 100 basis points to 15.0 percent.

The outlook, as assessed by the Bank of Ghana (BoG), points to lowering inflationary risks - an indication that the real value of money will continue to rise, and banks would become more willing to reduce lending rates.

The rate of inflation, which stood at 18 percent in October 2009, declined to 16.9 percent in November and then to 15.9 percent in December 2009.

Ghana’s HFC threshold on meeting BoG’s 2012 deadline

HFC Bank is to raise an additional GH¢15million capital from new institutional investors by June 2010.This is the second phase of its recapitalisation process aimed at positioning the bank to meet the Central Bank’s GHC 60 million new capitalization ahead of 2012 deadline.

The Bank had already raised GH¢12.4 million from existing shareholders through private placement.

“The second phase of the recapitalization process is being pursued diligently to attract additional equity from new institutional investors and to enable it to invest in subsidiaries to better position them for higher earnings as well as achieve the five year strategic plan.” said, Mr Asare Akuffo, Managing Director of HFC, at the 'Facts Behind the Figures' Programme organized by the Ghana Stock Exchange, in Accra.

He disclosed that the bank has commenced the implementation of its new strategic plan over the next five year with which it seeks to become a major player in the industry.

Mr Akuffo said despite the challenging environment, the bank chalked significant success, achieving its targets under the previous five years strategic plan.

“The current economic indicators and the first quarter results points to improvements in the macroeconomics environment which should engender increase in business activity.
“The banking segment of our business will still focus on aggressive deposit mobilisation and prudent growth in the loan portfolio in response to growth and expansionary trends and indicators in the economy,” he said.

Besides, micro-finance lending operations would also be given a further boost with recapitalisation and expansion.

Mr Akuffo said branch expansion would continue to achieve representation in most commercially active centres of the country.

He said the bank would pursue cost reduction strategies and ensure aggressive cross-selling of their products to beat the competition and reward shareholders.He indicated that the bank grew its mortgage portfolio by 32.27 per cent last year, while its consumer loan portfolio experienced a decline due to increased emphasis on recovery.

Deposit level grew by more than 30 per cent over 2008 at GH¢138.73 million at the end of 2009 from GH¢106.95 million a year before.

Total Assets grew by an average of 266.9% from GH¢71.14 million in 2005 to GH¢261.10 million at end of 2009.

Mr. Akwete Akita, Executive Director of HFC Bank, making a presentation said:“The vision of the Bank is to become "a leading universal banking institution in the West African Sub-region providing world class financial service and to create wealth for its customers,”

He explained that the Bank which started its operations with one branch in 2003, has grown to have 21 fully-networked branches across the country, providing its wide array of universal banking services to customers in the Greater Accra, Ashanti, Brong Ahafo, Northern and Eastern Regions.

Tuesday, May 11, 2010

HFC foresees brisk mortgage market in 2010

The country‘s mortgage market has been predicted to be robust as a result of the continuous decline in inflation rate and the central bank’s policy interest rate, the executive director HFC Bank, Mr. Akwete Akita, has said.

This year will see more of the banking institutions providing credit facilities to finance mortgages.

“As inflation and interest rates fall much appreciably in the economy, confidence is rising among financial institutions to provide financial assistance to borrowers and operators in the mortgage market,” said, Mr. Akitta at a media briefing in Accra as part of HFC’s 20th Anniversary celebration.

Meanwhile, housing properties developed for sale in the country are quoted in US dollars, perhaps intended to protect the value of investment and also prevent re-pricing of the properties as often as the local currency depreciates against other currencies.

Available checks indicate that the price of semi-detached houses on the market range between US$40,000 and US$140,000. Detached houses are going for between US$50,000 and US$160,000 while flats range between US$40,000 and US$140,000.

Based on the 2000 Population Census and estimates by the Bank of Ghana, the number of households in Ghana should have increased from 4.59 million in 2008 to 4.71 million in 2009, which translates into a housing deficit of 2.77 million. Based on the projection that the number of households will increase to 4.84 million in 2010, the nation’s housing deficit should rise to 2.85 million this year.

According to a policy brief of the Bank of Ghana on the housing industry in June 2007, outstanding mortgage loans to customers for the purchase of residential properties increased tremendously over the previous three years to over US$50 million at the time. Assuming an annual growth rate of 10.0 percent, the outstanding mortgages should now be valued not less than US$65 million.

Mr. Akitta said the Bank has mortgage products for all income-earning groups, be it high, middle or low, while some competitors cater for only the high income bracket group.

He assured shareholders and customers of the Bank’s desire to implement innovative programmes to enable it become one of the leading banks in the country and which flies the flag high across the sub-region.

As of December 2009, HFC Bank had financed 174 mortgages under its mortgage scheme.
In November 2007, HFC was appointed manager of the Public Sector Employees’ Housing Scheme by the Government of Ghana, with the intention of providing affordable housing for public sector workers.

HFC Bank has strategic alliances in neighbouring West African countries such as Nigeria, Sierra Leone and The Gambia

HFC Bank was incorporated as Home Finance Company on May 7th 1990 to implement the housing finance component of the World Bank (IDA) financed Urban 2 Project.

It was after fulfilling its initial mandate - by fully utilising the project funds of US$24million in the form of over 4,500 home-loans to qualifying applicants - that the company was transformed into a Universal Banking institution in November 2003.

Since becoming a Universal Banking institution, the bank’s profitability has been robust. Its Net profit after tax increased from GH¢0.82 million in 2005 to GH¢5.75 million in 2009, an average growth of about 579.3 %

Total Assets grew by an average of 266.9% from GH¢71.14 million in 2005 to GH¢261.10 million at end of 2009.

From one branch in 2003, HFC Bank has grown to have 21 fully-networked branches across the country, providing its wide array of universal banking services to customers in the Greater Accra, Ashanti, Brong Ahafo, Northern and Eastern Regions.

The bank also has twenty (20) on-site and off-site ATMs.

HFC Bank has incorporated HFC Capital Partners Limited, a private equity firm, to manage the Ebankese Venture Capital Fund and other funds. The aim is to take advantage of some projects which would not have been possible due to regulatory issues.

‘Inkjet Computer-to-Plate’ system’ unveiled

New Image Transfer Technology (NITT) has unveiled a new technology capable of producing press-ready aluminium plates without the use of chemical processing.

The product, ‘Inkjet Computer-to-Plate system’ - the first in Africa - is being introduced in partnership with Technova, AGFA and Epson.

TechNova is India’s image transfer manufacturing giant. The company offers a full range of world-class and best-in-value imaging products for offset, digital and screen printing, signage & digital photography, business graphics, textile, engineering and architectural drawings.

Kwame Blay, Chief Executive Officer of NITT, in a media interaction in Accra explained that the Inkjet Computer-to-Plate system is an innovative technology that sets new standards in the cost, flexibility and speed of off-set printing for small to medium format printing.

“With the introduction of an Inkjet Computer-to-Plate system, Ghana’s commercial printing industry has finally been provided with an opportunity to compete on the global market in printing quality and technology,” he stated.

He assured that a total imaging solution, technical know-how and support systems have been planned for those in the local industry who will purchase the technology.

“State of the art printing systems, PosiJet, PoliJet and MetiJet printing plates, chemicals, films and Inkjet media have been developed to guarantee a comprehensive and complete solution for the Ghanaian market,”

Mr. Blay stated.Technova executives - namely Mr. Dilip Paul and Vinayak Rane, were among the dignitaries that attended the successful launch of the new technology.

K.I.A master plan to cost $US579m

Kotoka International Airport (KIA) has initiated a master plan programme to take into consideration its growth over a 20 year period, Mrs. Doreen Owusu-Fianko, managing director of the Ghana Airports Company Limited, GACL, has disclosed.

The plan estimated to cost $US579 million has the objective of facilitating the development of physical facilities at the airports.

Mrs. Owusu-Fianko explained in Accra that the design works which are currently on-going for the remodeling of the entire terminal building to ease traffic will provide for about 13 aerobridges to facilitate boarding of passengers.

“A significant facility in addition, is to implement a plan to establish Dubai shopping mall concept at KIA, a multi-purpose car park would be constructed, a Commercial Important Person (CIP) lounge would also be opened to the general public, as well as enhancing the basic hygiene and the establishment of a Port Health unit to conform with World Health Organisation’s requirement.

GACL is determined to secure and maintain all airports and airstrips in the country to reflect best practices as well as ensure that all airline operators conduct business in conducive environment.”

She indicated that consultations are in progress to expand office and warehousing facilities at the KIA to adequately meet expected high demand in office and related accommodation facilities.

She again stated that to adequately position KIA to meet expected growth, the following projects are being considered airline office complex for airline operators, airside premises for ground handlers, warehouse facilities at courier enclave and international trade hub.

She mentioned that improvement of the transit procedures at KIA, replacement of the current common user terminal equipment and flight information display systems with ultra facilities to ensure a more reliable passenger check-in and worldwide baggage tracking system are among some of the short term projects underway aimed at enhancing quality of service at the airport.

KIA Phase two development project which was completed in 2005 has the following expansion projects: a dedicated cargo apron and additional passenger apron have been constructed and ultra-modern communication, navigation and surveillance equipment installed.

“The aviation industry in the country has enjoyed steady, if not phenomenal, growth in recent years and this has been made possible as a result of the stable political, social and economic climate that the country is enjoying. It is also as a result of the liberalisation of the regulatory framework in which the industry operates,” Mrs. Owusu-Fianko observed.

Geological mapping uncovers untapped mineral resources

Geological and geochemical mapping of eight selected areas are showing very good unexplored mineral resources, such as gold in the Ashanti belt and iron, nickel and chrome in the Nkwanta area along the border with Togo.

Making a presentation at an exhibition to showcase the achievements of the Mining Sector Support Programme (MSSP), Mr. Claude Maerten, Head of the European Union Delegation to Ghana said the areas discovered through their support programme hold enormous promise for future mining prospecting in Ghana.

He said that there are potential for the discovery of new resources in gold and base metals outside the Volta Basin.

A total of 39 million euros has been disbursed since the programme’s inception in December 2002, and has minimized mines' negative environmental impacts.

“The support provided through the MSSP is unparalleled and it is the strong hope of the European Union that the very best efforts are made of utilizing the finding and achievements of the project.”

He indicated that the country is at the forefront in implementing the extractive Industries Transparency Initiative (EITI).

“Already much has been achieved under this project which has been assisted also with funds from the natural resources and environmental governance sector budget supports.

“The implementation of initiatives such as the EITI and Kimberly Process Certification Scheme (KPCS) send strong signals to the citizenry that the government seeks accountability and transparency in vital sectors and for investors.”

Mr. Henry Ford Kamel, Deputy Minister for Lands and Natural Resources, who read a speech on behalf of the Vice President, John Mahama, said the MSSP had achieved institutional development and modernization at the sector Ministry as well as some related departments and agencies, which has enabled them to perform efficiently.

Dr Joyce Aryee, Chief Executive Officer of the Ghana Chamber of Mines, urged government to pay special attention to the mining sector, especially the development of the Western Corridors.

The Western Corridor Infrastructure project when completed will help in improving the Western Railway line and to augment haulage of bauxite and manganese from the mines to the ports.

Newmont’s ALP creates 15,000 jobs

Newmont Gold Ghana Limited says its Ahafo Linkages Programme (ALP), designed to maximise procurement from local Ahafo businesses, has created more than 15,000 direct and indirect jobs.

The programme, estimated to cost US$3million, is a partnership concept between Newmont Ghana and the International Finance Company (IFC) aimed at building the capacity of local businesses to help ensure the development of a diversified economy outside the Mine.

It offers broad training in records-keeping, business management, market diversification, finance facilitation and technical as well as productive assistance to local small and medium-sized supplier in its Ahafo host communities.

Between 2007 and 2009, 99 suppliers from its local Ahafo host communities were awarded contracts to the tune of US$14.5 million, whilst the programme contracted business worth US$272 million in 2008 with Ghanaian businesses. The businesses under the initiative also accessed US$6.8 million from other clients apart from Newmont Ghana in 2009.

A total of 341 Ghanaian businesses were also awarded contracts worth over US$144.3 million, accounting for over 60 percent of Newmont Ghana’s total purchases in 2009.

Mr. George Brakoh, Manager, Local Supplier & Contractor Development, Newmont Ghana, explaining during a media interaction said: “We are proud to continuously partner with interested organisations to develop business opportunities with local business people for the wellbeing of our host communities in Ghana and all our other operations the world-over.”

Newmont Ghana appreciates all its partners in the Ahafo Linkages Programme, including, Ahafo Local Business Association (ALBA), Technoserve International, CDC Consult Limited and FIT Ghana for their efforts in the drive to provide the needed local content to help attain sustainable development.

Meanwhile, the business initiative has won the most awards at the recent 2010 Chartered Institute of Purchasing & Supply UK (CIPS) Procurement Awards for the African continent, held on April 19 in South Africa.

ALP was the leading award recipient with three awards: the Best Community Procurement Award, the Best Supplier Diversity Project Award while Newmont Ghana’s Manager, Local Supplier & Contractor Development, George Brakoh, was named the Best Procurement Professional of the Year (Male Category) at the 2010 CIPS UK Annual Procurement Awards.

“We are encouraged that our efforts at creating income and employment opportunities for local businesses in and around the Ahafo area, substantially improving the environment for local business development and long-term survival have been recognised at an international level,” the company’s Regional Vice President, Environment & Social Responsibility, Nick Cotts, said.

The awards covered eight categories and were open to a range of businesses including smaller entrepreneurial businesses and large, thriving organisations.

The Best Procurement Community Award was given based on the role Newmont Ghana’s supply chain management function had played in safeguarding and enhancing the company's reputation and brand values while undertaking a role in using procurement for social and economic enhancement.

The Best Supplier Diversity Project was awarded based on the company demonstrating that it had addressed the use of local suppliers, in particular local small and medium-sized enterprises (SME's), and had also engaged them in supplier development programmes.

The judges also looked at how the Newmont Ghana had increased employment, profitability and revenue generation of its local suppliers, while at the same time not over-exposing them to unnecessary commercial risks. George Brakoh, Newmont Ghana’s Manager, Local Supplier & Contractor Development, won the Best Procurement Male Professional of the Year award.

He was adjudged to have made the most effective contribution to his organisation in terms on innovation, leadership, knowledge-sharing and demonstrating that he is a good team-player.

The judges also determined that his initiatives had impacted considerably upon the bottom-line of Newmont Ghana and its customers by promoting good procurement.

Wednesday, May 5, 2010

Ghana to complete digital television in 2013

Ghana is to complete migration from analogue service to digital television by 2013, ahead of the International Telecommunication Union’s 2015 deadline.

Government has so far invested 2.3million euros in the first phase of the project, which is operational in Accra and Kumasi, to serve some part of southern and the northern sectors of the country. The pilot project has been running faultlessly and continuously for 12 months.

Director-General, Ghana Broadcasting Corporation, William Ampem-Darko, made this disclosure in Accra at the launch of the first phase of the migration - which is in collaboration with Next Generation Broadcasting (SMART TV) and will provide 10 channels on GTV’s platform.

The digital TV service, enabled by a Set Top Box (STB), offers a sharper, brighter picture with reduced “ghosting” and interference; the audio signal is much clearer, so users can enjoy improved sound quality.

Meanwhile, most of the television sets currently in peoples’ homes cannot receive digital pictures and viewers will have to purchase STB devices to be able to receive digital signals. And this will come at extra cost to the viewer.

Mr. Ampem-Darko explained that the development will be seen as the moment when the industry, government and other stakeholders showcase their commitment in moving forward digital migration in the country.

He explained that the benefits of digital TV are numerous and far-reaching: better quality TV, more choices and better consumer service.

“Because digital signals take up much less bandwidth than analogue signals, we can broadcast up to 10 television channels in the same bandwidth - giving the potential of many more channels to choose from.

“Ghana will rely on digital transmission as the basis for delivery of e-Government, education, health-care and other socially valuable Information Communication Technology (ICT) services and eventually contribute to connecting the world,” he indicated.

Currently, no African country has completed the migration process - although seven African countries including Kenya, Sudan, Tanzania, Uganda, Rwanda, Mauritania and South Africa have published their plans and established committees to manage the migration process.

All around the world, the migration to digital broadcast transmission technology has begun.

Countries already advanced in their migration programmes are France, United States, United Kingdom and New Zealand, whilst in countries like Sweden, Finland and Mauritius, the analogue switch-off has already been completed.

A 24-man National Migration Technical Committee has been established to ensure that Ghana achieves the target.

The Committee has been mandated to make policy recommendations to situate the transition from analogue to digital broadcasting networks within the broader context of strengthening and developing Ghana's Information Infrastructure, and to determine how the transition of existing broadcasting services to digital broadcasting transmission networks and the introduction of new services will facilitate national government priorities, among others.

Ghana has since 2006 been signatory to the Geneva 2006 (GE06) Agreement established during the Regional Radiocommunications Conference (RRC-06) held in Geneva which established the Digital Terrestrial Broadcasting Plan.

The RRC-06 set 17 June 2015 as the deadline for the cessation of international protection for analogue broadcasting transmissions.