Friday, March 28, 2014

Gold price pushes producer inflation upward

The slight revival in the global gold price has pushed the producer price index upward, as producer inflation in the mining and quarrying subsector increased by 8.9 percentage points over the January 2014 rate of -5.8 percent, jumping to 3.1 percent in February.

Head of Industrial Statistics at the Ghana Statistical Service Anthony Krakah confirmed that the global gold price increase has contributed to the jump in the producer price index.

“This was largely because the world price of gold is gradually increasing, pushing the mining index upwards,” he said.

World gold prices have risen 12.3 percent in 2014, following a 28 percent drop -- the first annual fall for 13 years -- in the metal’s price last year.

Announcing the figures at a media briefing in Accra, Government Statistician Dr. Philomena Nyarko said year-on-year producer price inflation was 27.1 percent in February -- representing an increase of 3.8 percentage points relative to the 23.3 percent rate recorded in January.

Manufacturing inflation, which constitutes more than two-thirds of the producer inflation basket, increased by 3 percentage points to 27.2 percent. The rate for the utilities sub-sector increased marginally to 55.7 percent.

The month-on-month change in producer prices between stood at 2.9 percent.

Dr. Nyarko said during the twelve-month period from February 2013 to February 2014, the highest year-on-year producer inflation of rate 27.1 percent was recorded in February 2014.

“Between April and August 2013, the rate declined continuously over a five-month period to record the lowest rate of 4.7 percent in August 2013, inching up to record 5.8 percent in September 2013,” she said.

She said the PPI has subsequently increased consistently over the last five months to record 27.1 percent in February, the highest in four years.

Five out of the 16 major groups in the manufacturing sub-sector recorded inflation rates higher than the sector’s average of 27.2 percent, while the manufacture of machinery and equipment recorded the highest inflation rate of 76 percent. Producer prices in the manufacture of electrical machinery and apparatus recorded the lowest inflation rate of -0.8% over the one-year period.

The monthly changes in the index indicated that utilities recorded a monthly inflation of 10.2 percent while mining and quarrying recorded 9.4 percent, with the manufacturing sub-sector recording the lowest monthly rate of 5.9 percent.

Tigo Cash promotes mobile financial services

Millicom Ghana Limited, the company that operates the Tigo mobile network, has launched a new campaign to promote and explore another dimension of mobile financial services and help diffuse mobile money and its benefits.

The campaign seeks to position Tigo Cash as a convenient enabler in the growth of customers’ businesses because of the convenience it presents, especially to small- and medium-scale enterprises, and the flexibility of receiving and making payments with mobile phones.
Selorm Adadevoh, Head of Mobile Financial Services of Millicom Ghana, explained: “From now, we are telling everyone, especially the small- and medium-scale businessmen, to explore receiving and paying for daily transactions through Tigo Cash”.
He added: “Tigo Cash is a credible alternative to the traditional way of making payments or transacting business. A consumer can call 100 to register or find an agent”.
Key features of the campaign are that customers can pay anyone on any network, pay for things they buy from friends, family and even strangers, as well as pay for things in the market.
While 75 percent of the market now know about mobile financial services, usage is currently not as significant in Ghana as it is in Kenya and other eastern African countries.
The goal is to educate customers that they can pay anyone on any network through Tigo Cash, Mr. Adadevoh said.
Tigo Ghana launched Tigo Cash, its mobile financial service, in 2011. At the time, it was the third mobile operator to do so.
In 2013, Tigo Cash won the best mobile money deployment award in West Africa at the Kalahari Mobile Money Awards.
Meanwhile, Tigo has also announced an upgraded Internet security system aimed at ensuring the cyber security of its numerous customers is guaranteed.
The system, which virtually eliminates spam activities in customers’ emails, also reduces incidents of phishing such as theft of passwords or credit card details.
The decision to roll-out the Internet security system follows the rising incidence of cyber crime in Ghana.
The anti-spam security system effectively cleans up all outgoing and incoming mail or harmful mail of Tigo Internet service users through Tigo’s network. Thus, all harmful emails with the potential to phish or damage a client’s IT systems are filtered by Tigo.
Gloria Adutwumwaa Frempong, Internet Offer Design Manager at Tigo, said the move is to “ensure that customers who use Tigo's Internet services for either social or business purposes can do so without having to worry about the security of their data”.
She added that this upgrade comes at no extra cost to consumers and will enhance Skyping on the network.

Thursday, March 27, 2014

Civil society up in arms on EPA

Civil society organisations (CSOs) and private sector groups have increased pressure on government not to sign the ECOWAS-EU Economic Partnership Agreement (EPA), warning that the agreement will permanently lock the country’s economy deeper into a primary commodity- dependence trap and derail regional integration.

The organisations, comprising the Trades Union Congress, Ghana Chamber of Commerce and Industry, the Christian Council, Socialist Forum and the Economic Justice Network, presented a petition to President John Dramani Mahama in Accra ahead of a meeting of the ECOWAS Council of Ministers in Yamoussoukro, Côte d’Ivoire, from 25-26 March, 2014.

Negotiations at the technical level on the ECOWAS-EPA were concluded on January 24 in Dakar and the result will be submitted to the Yamoussoukro Council of Ministers meeting.

EU officials say the next step for the EPA is political ratification by ECOWAS heads of state and EU political leaders.

“We urge government not to adopt the ECOWAS-EPA, and we request that you instruct your Minister who will be representing Ghana at the forthcoming Yamoussoukro meeting of the Council of Ministers to act accordingly.

“Signing the agreement will be fundamentally worse than the country’s own Interim Economic Partnership Agreement (IEPA) that was initialled in 2007, which is inimical in the country’s own terms and which government has so far rightly refrained from signing,” Dr. Yao Graham, a representative from the Economic Justice Network, told the media in Accra.

According to him, the EPA will commit the country to start -- within six months of the agreement being adopted -- negotiations for an extensive agenda of deregulating a whole range of economic sectors such as services, investment, government procurement, intellectual property and areas that have never been part of the EPA negotiating agenda such as capital accounts.

He said none of these are required by any international rule or obligation undertaken by Ghana.

He said aside from all the negative provisions of the country’s IEPA -- with its implications such as revenue loss, attack on domestic industry and domestic value-addition, loss of policy space and constraints on South-South cooperation -- the new ECOWAS-EPA contains two fundamental threats to the economies of the country and the sub-region.

“Not only does it explicitly target the essence of the light manufacturing sector, the acknowledged catalyst for any transition of Ghana’s economy from a small-holder agrarian economy to an industrialised economy, the cumulative effect of this agreement will be to take away from government the very range of policy instruments that are needed to redress the multiple challenges the country faces at this critical time of economic life.”


The ECOWAS-EPA involves an agreement to liberalise 75 percent of all imports of goods into West African countries from the European Union in exchange for complete liberalisation on the EU side. The EU had wanted 80 percent of ECOWAS, whose offer then was 70 percent.

According to the civil society campaigners, the new 75 percent threshold was achieved by explicitly targetting for liberalisation a series of locally manufactured products and related sectors.

These include paper rolls, paper cartons, textiles, insecticides, fungicides, disinfectants, corrugated roofing sheets, paving stones, blocks, tiles, roofing tiles, corks, lids, bottle tops, baby walkers, prams and similar things, towels, sanitary towels, nappies, and similar products, garments and accessories for garments, chemical waste, among others.

“All these can now be freely imported from Europe, ultimately with zero import tariff, if the ECOWAS-EPA is adopted. Liberalisation of these products does not follow any sound economic logic and, in fact, ECOWAS technical personnel and officials opposed the Trade Commissioner who imposed this,” said Dr. Graham.

“These are products made locally, which are not exported to Europe but to the domestic and regional markets.”

The campaigners pointed out that mastery of manufactured products and their technology help breed the know-how, industrial discipline, planning, market competence for the country and the region’s ability to move to heavy industry and other more complicated and technology-based manufacture.

“By exposing these to untrammelled competition from producers in the economically better-endowed European Union, the ECOWAS-EPA will not only kill today’s enterprises, it will also kill the domestic platform for industrial transition,” they said.

Deregulation of capital accounts

The group again noted that the deregulation of capital accounts is an even more extreme example of the EU’s aggressive agenda toward West Africa’s economies, with negative effects for the region.
They said this issue has never been part of the negotiating agenda, but the EU is taking advantage of the pressures of the situation to impose this.

“Just as it did when it used the deadlines in 2007 to impose the effective prohibition of export taxes in the IEPA -- hence depriving us of a policy instrument that all governments have applied to encourage domestic processing of and value-addition to raw produce -- by deregulating capital accounts, the EU seeks to facilitate for its investors and financial dealers the free flow of capital in and out of our economy. Ultimately, this would take away the very instruments used by the Bank of Ghana to manage our recent foreign exchange crisis.”

The campaigners said the EU agenda on government procurement, capital accounts, services and investment is even more unacceptable as the EU demands that negotiations on these issues must be started within six months of the adoption of the ECOWAS-EPA, with a complete road map identifying which issues and what treatment are to be adopted.

They argued that West African countries do not have national and/or common regional policies to negotiate on the subject, nor have they carried out any comprehensive, meaningful national assessments involving stakeholders to build strategic policies.

“Civil society organisations, the private sector, and many respectable bodies including the United Nations have demonstrated conclusively that there are credible alternatives to signing the EPAs, including Ghana’s own Interim EPA,” said Edward Kareweh, Deputy General Secretary of the General Agricultural Workers’ Union of TUC.

“At the very least, the savings in revenue that our countries can make by not signing the EPAs are, on conservative calculations, about three times the cost to the three or so groups of exporters who will be affected; and some of this saving can be used to support these exporters in the time that it will take us all to work and help them diversify their export markets,” he added.

Gov’t develops capacity to handle PPP projects

Deputy Minister of Finance and Economic Planning Cassiel Ato Forson has said developing the capacity of Ghana’s human capital and institutions to engage with the rest of the world on Public-Private Partnerships (PPPs) is critical in promoting and implementing effective policies and projects in the country.

Mr. Forson was speaking at the first training course in PPP programmes at the Civil Service Training Centre (CSTC) in Accra from March 18-20.

“The Ministry of Finance will continue to engage with the Civil Service Training Centre and other institutions of learning to ensure that we fully develop the capacity we need. Government has decided to adopt the PPP approach to get the private sector to invest some of its financial, human and technical resources in the development of public infrastructure and services.”

The training programme was part of a capacity-building initiative by the Public Investment Division of the Ministry of Finance to deliver the vision of a capable cadre of trainers, educators, transaction mangers and managers of Ghana’s PPP programme.

The programme’s aim was to develop trainers of the centre in the basics of PPPs, and was designed to explain the fundamentals of the project concepts to trainers.

The course contents included Foundational Concepts in PPPs; Making PPPs Work -- Tools and Techniques; Making PPPs Work -- Environmental Elements of a PPP Project; and Identifying the Actions that Enhance PPPs.

Mrs. Magdalene Appenteng, Director of the Public Investment Division at the Finance Ministry, said there will be at least four follow-up training courses for the participants as well as online courses.

She said there are also plans for the Ghana PPP programme to collaborate with business schools and the Ghana Law School to develop curricula over the next two years for academic programmes on PPP education in Ghana.

The country's PPP programme has adopted a number of capacity-building strategies to enable the public sector confidently engage the private sector in developing infrastructure.

The strategies include workshops, in-field and out-field training programmes, attachment programmes, expert shadowing, study tours in some of the relevant sectors; as well as identifying and working with training and academic institutions to develop curricula and programmes for training and education in PPP.

Mrs. Dora Gyawa Dei-Tumi, the Principal at CSTC, said the institute was pleased to partner with the Ministry of Finance to train civil and public servants for successful implementation of the PPP programme.

She applauded the work done in developing a comprehensive course to build the capacity of the civil service with CSTC as a major partner.

“Public institutions and agencies as well as private sector entities must develop and operate systems which make it easy for them to work together effectively and efficiently,” she said.

Tuesday, March 25, 2014

Fuel crisis threatens power target

Whether government can attain 5,000 megawatts of power by 2016 is not for want of generation capacity but the availability of fuel, Togbe Afede XIV, Director of Sunon Asogli Power Limited, has said, asking government to sit up.

He said if it were merely the capacity to generate power, private people or Independent Power Producers (IPPs) could have done that. But the lack of fuel for power generation is what holds generators back.

“In terms of investment in the energy sector, in particular power generation, I think we have a lot in the pipeline; what is missing is the fuel to support those prospective power plants. I believe that is where a lot of emphasis should be,” he told the B&FT.

Sunon Asogli has put on hold the second phase of its power project in Ghana, involving some 360 megawatts, due to the lack of fuel.

Already, the first phase of the project (200megawatts) which was completed and put to use since October 2010 is struggling to produce power due to the challenges with gas from Nigeria.

The company’s main Chinese shareholders told Energy Minister Emmanuel Armah Kofi Buah in China recently that it lost approximately US$15million due to the interruption of gas supply from Nigeria from August 2012 to July 2013.

Approximately 2,240 Gigawatt hours (GWh) of power per year will be added to the national grid if the second phase of the project comes on board.

Various thermal power projects have been proposed by Independent Power Producers. The Energy Commission says it has given “provisional licences” to seven IPPs to provide about 2,000 megawatts of electricity.

The country already has around 2,800 megawatts of installed capacity, but the lack of fuel has meant that less than 2,000megawatts is in use.

With thermal power becoming increasingly important in the country’s generation mix, the availability of gas, which is less expensive than crude oil, has also become critical to power generation.

Currently, electricity consumption in Ghana is estimated at over 7.095 billion kilowatts per hour (kWh), while production capacity is pegged at over 6.489 billion kWh.

According to the VRA, the country requires some 400 million MMBtu of gas for VRA’s own thermal plants as well as the Asogli plant.

Even if the much-awaited Jubilee gas comes on board, it will not meet this demand.

With the country’s probable gas reserves estimated at approximately 5TCF (trillion cubic feet), there is however potential for self-sufficiency.

In the meantime, Ghana continues to rely on gas from Nigeria, but with supply becoming increasingly unreliable, the government has been urged to consider importing Liquefied Natural Gas (LNG) from other countries to help manage the gas supply challenge.

EU addresses maritime insecurity in the Gulf of Guinea

The European Union (EU) says it has adopted a broad-based strategy on the Gulf of Guinea to support the efforts of the region and its coastal states to address the challenges of maritime insecurity and organised crime.

Challenges of countries in the Gulf of Guinea region include increasing piracy and armed robbery, violence, widespread organised crime in the forms of trafficking and smuggling drugs, people, arms, money-laundering and illegal fishing.  

These challenges, the Union said, threaten stability in the wider sub-region and pose a growing threat to the EU. 

One major challenge that poses a maritime security threat and is currently on the ascendancy is piracy and armed robbery against ships operating on the coast of West Africa, as figures indicate that over the last two years quite a number of cases have been reported.

According to the Union, the value of drugs and contraband shipped from West Africa to Europe has been estimated at around US$1.25billion.

The piracy rate off the coast of West Africa has now overtaken that of Somalia, a report by the International Maritime Bureau (IMB) and other seafarers’ groups has shown.

According to the report, a total of 966 sailors were attacked along the Gulf of Guinea in 2012 compared to 851 cases off the Somali coast, which previously recorded higher numbers of attacks. 

According to Control Risks, pirate attacks in the Gulf of Guinea had by mid-November 2013 maintained a steady level of around 100 attempted hijackings in the year, a close second behind Southeast Asia.

The cost of piracy in the Gulf of Guinea due to stolen goods, security, and insurance has been estimated to be about US$2billion. 

Piracy acts interfere with legitimate trading interests of the affected countries, which include Benin, Togo, Côte d’Ivoire, Ghana, Nigeria, and the Democratic Republic of Congo

Rear Admiral Jurgen Ehle, Chairman, EU Military Committee Working Group, speaking at a media briefing in Accra said: “The adoption just ahead of the EU-Africa Summit showcases the strong relationship between the EU and Africa, and the importance we attach to close and comprehensive cooperation with our African partners. 

“It is crucial now to support our West and Central African partners’ efforts to tackle the complex challenges of maritime insecurity and organised crime.”

He explained that the EU Strategy on the Gulf of Guinea aims at addressing the myriad problems in the region, and has four objectives including building a common understanding of the scale of the threat in the Gulf of Guinea and the need to address it among countries in the region and the international community.   

It is also targetted at helping governments of the region build robust institutions, maritime administrations and multi-agency capabilities to ensure maritime awareness, security and the rule of law along the coast. 

It will as well support prosperous economies in the region to create employment and assist vulnerable communities to build resilience and resist criminal and violent activities, as well as strengthening cooperation between countries of the region and the regional organisations to enable them take necessary actions that mitigate the threats at sea and on land.

The strategy also recognises the need to protect both populations in the Gulf of Guinea region and European citizens from the threats emanating from the region -- including piracy, terrorism and trafficking of people, drugs and arms. 

He explained that the piracy, armed robbery at sea, organised crime and illegal, unreported and unregulated fishing in the Gulf of Guinea region pose serious challenges to human security, human rights, economic activity and trade both at sea and on land.

“Piracy in the Gulf of Guinea has become a global concern; the activities affect a number of countries in West Africa as well as the international community. It is often part of heavily-armed criminal enterprises which employ violent methods to steal oil cargo,” he said.

New board tasked to transform land administration

Minister of Lands and Natural Resources, Alhaji Inusah Fuseni has launched the national board of the Lands Commission with a call on members to devise policy guidance to transform its bad public image.
“The public image of the Lands Commission is not very good. As a members of the Land Commission at the apex level, you should be able to develop a cordial working relationship with the management to redeem the image as soon as practicable.

“There is a high level of mutual suspicion and lack of trust between customary land authorities and the Commission, most especially concerning the management of public and vesting lands. Your expertise would be required to restore confidence in this regard,” he said.

Alhaji Fuseni inaugurating the board in Accra observed that land administration in the country is bedeviled with too many problems.

He cited slow, bureaucratic and expensive systems for registering land transactions, in effect, are serious limitations, which deny opportunities to many people who have neither the time, nor contacts, to demand the services of four divisions of the Lands Commission.

 “The ‘business as usual attitude’ of some staff of the Lands Commission should, within your tenure of office, be seen as a thing of the past,” he said.

Alhaji Fuseni charged the board to have as top most priority the rapid pace of converting peri-urban lands into building plots for brick and mortal.

“We need to check the rapid horizontal development of our cities and implement more sustainable options.

“Our urban centres are gradually growing into big ‘villages’. I will personally follow with keen interest your ability to develop urban renewal strategies or projects to make our cities sustainably grow rather into megacities and not big “villages.”

Alhaji Bakari Sadiq, National Chairman of the Lands Commission, recognising the magnitude of the responsibility and challenges in the sector on behalf of members, assured government of executing their duty in accordance with the constitution.

“We wish to assure you of our unflinching commitment to provide the appropriate oversight responsibility over the operations of the Commission in a manner that will create the suitable environment for the execution of its functions.”

Alhaji Sadiq added: “ We are mindful of the desires of Ghanaians and indeed government, to eliminate the challenges arising from public land management such as encroachment’s and  attendant demolitions that could be avoided by better collaboration between the Commission and other stakeholders on the land scene and a higher citizen awareness of the need to protect state assets including land.”

He called for the need to provide guidance in the evaluation of policies that would respond to matters arising from rapid globalization, environmental degradation which calls for better use of land resources towards higher middle-income status.

“Matters that readily call from policy direction include those concerning the growing phenomenon of large scale land acquisitions for agriculture, rapid urbanization and the phenomenal growth of settlements.

“These are a few of the areas that the Commission would engage itself in advising government on the policy direction.

“Indeed one of our core functions of providing guidance on the development of lands by local authorities and traditional authorities will receive special attention during our tenure,” Alhaji Sadiq stated.