John Peter Amewu hosts Denmark Ministers

Denmark Ministers for Development Cooperation and Taxation have jointly paid a working visit to the Minister of Lands and Natural Resources John Peter Amewu in Accra, to deepen the bilateral co-operation between the two countries that will be mutually beneficial to both countries.

Mr. Amewu receiving the two delegation from Denmark; Mr Kaister Laontzer, the Minister of Taxation, and Madam Ulla Tornos, the Minister of Development Co-operation said, Ghana had a long-standing bilateral co-operation with Denmark and would work to ensure the relationship mutually benefitted both countries.

Mr. Amewu said, government had decided to critically examine the value chain of the natural resource exploitation, especially the downstream linkages, and strategise the best option to reap the maximum benefit.

He added that government had rolled out the National Supply Development Programme, which was a conscious effort to addressing the concerns of all the suppliers along the downstream sections of the mining sector so that the country would reap the needed benefit.

“The programme is in collaboration with the African Mining Development Centre, which is an aspect of the African Mining Vision to ensure that African countries benefit from their natural resources.”

Mr Amewu said government had instituted measures to enter into downstream activities in the extractive sector that would fetch the country additional revenues.

He said it had also instituted measures to increase tax collection and add value to the natural resources so as to ramp up the required income for the nation.

“I think exporting the mineral resources in their raw state has not been a blessing to Ghana, considering the level of depletion of the resources in relation to the benefit accrued to the nation,” he said.

Madam Ulla Tornos, the Danish Minister of Development Co-operation, said Denmark, through the Danish International Development Agency,had implemented a number of development projects in Ghana.

She said the Danish Government was in the process of improving the co-operation from aid to trade, adding that Denmark would re-structure its payment of taxes to Ghana, especially in the area of natural resources. 

‘2018 revenue target challenging but achievable’

The Ghana Revenue Authority’s (GRA) revenue collection target of GH¢39.8bn is achievable with suitable revenue collection strategies and dedication of staff, Commissioner-General of the GRA, Mr. Emmanuel Kofi Nti, has said.
 

 “The target is achievable on the back of hard work and the rollout of innovative measures in the course of the year. Yes, the journey may be daunting, but we believe with the introduction of adequate strategies we can surmount the hurdles,” said Mr. Nti.

Speaking at a media Soiree in Accra to deepen the Authority’s relationship with the media, Mr. Nti explained that the Electronic Point of Sales Device and the Excise Tax Stamp policies, which could not be implemented last year, will commence in 2018 and are expected to increase tax revenues, reduce the incidence of Value Added Tax (VAT) and Excise Duty suppression, and monitoring of sales among others.

The Authority this year, will also implement the VAT Amendment Act, which requires the  appointment of withholding agents by the Commissioner-General to withhold payment to a VAT-registered supplier of seven percent of the supply’s taxable value and remit same directly to the Commissioner-General.

“Let me be quick to add that all these interventions are not new taxes but compliance measures to ensure that all VAT/NHIL due to government is paid,” he said.

Mr. Nti said the GRA will roll out the Total Revenue Integrated Processing System to the remaining 10 Domestic Tax Revenue Division offices during first quarter of the year.

He said the Authority will also improve the infrastructure to ensure officers work in a conducive environment while capacity-building programmes continue to enhance professional performance.

On tax initiatives for economic growth, Mr. Nti said Tax incentives for Young Entrepreneurs, which seek to grant tax holidays to entrepreneurs’ aged 35 years and below; and an income tax threshold to protect low-income earners will be implemented.

Mr. Nti said there are also plans to introduce Voluntary Disclosure Procedures in the Revenue Administration Act to waive penalties on voluntary disclosures and payment of unreported and understated taxes by taxpayers.

2017 revenue performance

In 2017, the Authority recorded a nominal growth rate of 22.3% over the 2016 collection figures.
GRA collected GH¢32.3billion (GH¢32,313.37billion), compared to the GH¢27billion of 2016.

In 2017, the GRA was tasked to collect GH¢33,434.20 billion. As of the end of the year, the provisional collection figure is GH¢32,313.37billion. This represents a shortfall of GH¢1.1billion (GH¢1,120.83million), a negative deviation of 3.4%.

In 2016 the GRA was charged to collect GH¢29 billion, but it was able to collect only GH¢27.8billion, recording a shortfall of GH¢1.2billion.

Even though the 2016 target was not achieved, the revenue performance represents a nominal growth of 25.4 percent. 

Mr. Nti explained that when he assumed office last year, collection in terms of the US dollar was stagnant in the region of US$6.8–6.9billion. For 2017, he said, collection rose to US$7.6billion - representing a break from the trend.

Direct collection was GH¢13.3billion as against a target of GH¢12.8billion.

On the other hand, GH¢6.3billion of indirect taxes was collected, as against a target of GH¢6.7billion. The Customs Division was given a target of GH¢13.9billion, but was able to collect GH¢12.7billion.

“The Authority really put up a sterling performance - especially in the last six months, but still fell short of the target marginally,” Mr. Nti stated.

Cocobod eyes Chinese market

Ghana Cocoa Board (Cocobod) is vigorously exploring prospects in the Chinese market for the country’s premium cocoa products, for which reason meetings have been ongoing between the two sides. 

Cocobod also plans to make a good showing at the maiden China International Import Exposition to be held in Shanghai from November 5, 2018 to November 10, 2018.

“A team from the Cocobod has already met officials at the Chinese Embassy; we have, again, met in Accra and our officers have started putting things together and it is because Cocobod wants to enter and explore the huge Chinese market for the cocoa products,” Noah Kwesi Amenyah, Cocobod’s Public Affairs Manager, told the B&FT.

“We want to send into that market value added cocoa products and not just raw beans; it will be good for us to get the Chinese public to know that Ghana’s cocoa is the best and it has a lot of nutritional and health benefits and therefore they have to patronise it,” he said.

Although China’s individual chocolate consumption is considered still low, less than 5% of what major lovers munch in the west, market research firm Ebrun reports that the market for chocolate in China is expected to grow in value to 40 billion yuan (US$6.2 billion) by 2020.

Ghana’s main export destinations are the Netherlands, with a market share of 12.88%, France 11.6% and USA 10.9%. 

France and USA grew significantly during 2012-2016. Exports to France, especially, reached high growth rates. With an average annual growth of +23% over 2012-2016, the country became the second largest Ghanaian export destination.

Exports to Spain and Belgium remained quite stable during 2012-2016, with export values between US$5-40 million.

Total exports of cocoa products from Ghana amounted US$542 million in 2016.

Exports to the Dutch market dropped from US$205 million in 2012 to only US$70 million in 2016, a decrease of-24% on average per year.

Ghana’s exports to China, on the other hand, is dominated by traditional or primary exports, such as unprocessed cocoa, raw metals, wood products, and petroleum oils, which account for 96 per cent of exports to the Asian nation, statistics from the Ministry of Trade show.

China International Import Expo

The China International Exposition is expected to attract over 100 countries and regions with various products. It is also expected that thousands of enterprises from these countries will attend the event, bringing up to a million commodities and services to the Chinese market.

China is therefore inviting Ghanaian manufacturers to enter its vast market to exhibit their products and to take advantage of the opportunity.

At a joint media briefing, Mr. Chai Zhijing, Economic and Commercial Counselor at the Chinese Embassy, explained that the exhibition is an opportunity for local business owners to woo foreign investors into Ghana.

He said: “At the moment, as far as biological trade is concerned, Ghana is one of our top 10 trading partners in Africa.

But at the moment, Ghana’s trade with China is in a deficit. So, that means that Ghana buys more from China than it exports,” Mr.Zhijing said.

“So, I think this Import Expo will be a very good opportunity for Ghana to show its potential – what it can offer to the Chinese consumers,” he added.

Deputy Trades Minister, Carlos Ahenkorah, confirmed government’s commitment to supporting local manufacturers and business owners in this regard, adding that the ministry is considering a proposal to acquire a pavilion in China to aid Ghanaian exhibitors.

“We want to take advantage of the early bird offer and have a whole pavilion to ourselves outside the individual enterprises that are going to have their own,” he said.

“If our request is accepted; if our one-month moratorium is given, I can assure you that within the month of February we would be able to affirm our commitment to take a pavilion for Ghana in the expo,” he stated.

Over the past decade, China’s annual growth rate of retail sales have stayed above 10%. While Chinese consumers are now starting to value quality over price, imported goods are gaining popularity.

In the past, importing market was dominated by large overseas companies. Nowadays, small and medium-sized businesses are selling huge amounts of products into China via new channels, such as shopping agents, supermarkets, and E-commerce.

China’s food and agricultural imports keep growing in recent years. In 2016, total import of food reached US$50 billion, and import of agricultural products were more than $110 billion.