A

BUSINESS & FINANCE

JULY 2012 / ISSUE 017 GH10.00

Dollarisation of economy: Matters arising

(page 27)

Obamas new policy - Any good news for Ghana?

(page 38)

Glo Mobile causes stir in telecom market Whats secret?

(page 54)

Talal Fattal-a multi-talented business success

(page 18)
Follow us online at www.ghanabizmedia.com

USA........................$7.00 UK..........................5.00 EUROPE................. 5.00 AUSTRALIA.......... A$8.50

CFA ZONE....... CFA 2,500 NIGERIA..................N1000 SOUTH AFRICA..........R45 SOUTHERN AFRICA...R45

THE FIRST BUSINESS READ IN GHANA

Editor Felix Dela Klutse Deputy Editor Utche Okwuosah Senior Writer Effah Amponsah Contributors Daniel Nonor Justice Lee Adoboe General Manager Martino Kashif mkashif@ghanabizmedia.com Deputy Manager, Marketing Michel Kouassigan mkouassigan@ghanabizmedia.com Deputy Manager, Circulation & Subscriptions Josiah Spio-Garbrah jspio-garbrah@ghanabizmedia.com Editorial Committee Prof. Paul N. Buatsi Prof. Kwame Addo Ms. Johanna Awotwi Mr. Gaddy Laryea Mr. Ray de Bono Nana Robert Mensah Mr. Fredrick Alipui Ms. Dede-Esi Amanor-Wilks Nana Spio-Garbrah Office Location: Ghana Business & Finance African Business Media House No. 7, Lamb Street (Off Farrar Avenue) Adabraka, Accra Ghana Mailing Address: P.O. Box 0772, Osu, Accra, Ghana Tel: +233 302 240 786 Fax: +233 302 240 783 editor@ghanabizmedia.com adverts@ghanabizmedia.com subscriptions@ghanabizmedia.com info@ghanabizmedia.com

BUSINESS

& FINANCE
JULY 2012 / ISSUE 017 GH10.00

Dollarisation of economy:ing Matters aris

(page 27)

Obamas new d policy - Any goo news for Ghana?

(page 38)

ses stir Glo Mobile cau rket in telecom ma Whats secret?

(page 54)

Talal Fattal-a multi-talented s business succes 18)

(page
CFA 2,500 CFA ZONE....... 1000 NIGERIA..................N .....R45 SOUTH AFRICA..... 45 SOUTHERN AFRICA...R

7.00 USA........................$ 5.00 UK.......................... 5.00 EUROPE................. A$8.50 AUSTRALIA..........

A ESS READ IN GHAN THE FIRST BUSIN

om nabizmedia.c e at www.gha Follow us onlin

JULY 2012 / ISSUE 017

Front Cover: Talal Fattal, CEO of Metro TV -Ghana

Contents
5.....

Editors Suite
About a month ago, a local news reports emerged that the Kingdom of the Netherlands have announced their intention to withdraw their funding support for Ghanas budget after 2012. What is the reason? Read this piece to find out.

14.....

Trade
China is currently commanding great attention from the global economies due to its consistent increase in consumer spending.

18.....

Cover Story
The mention of Metro TV and Soccer Academy pops up one name - Talal Fattal, a multi-talented man whose contributions to the media and economy of Ghana are apparent. How much do you know him?

6.....

World Economy
Get to know the emerging dynamics characterising the developed and developing economies in the world.

8.....

News in Brief
Bring yourself up to speed on the business and business-related news in Ghana

Branding, Layout & Design of the Ghana Business & Finance magazine by Dmax Studios in Malta, EU. (www.dmax.tv) CEO & Art Director Ray de Bono ceo@dmax.tv Senior Designer-in-Charge of Publication Sasha Vella & Team Studio Support Executive (in charge of GB&F Online) Jonathan Galea & Team IT Strategy Director Uwe Schoenfeld

12.....

Manufacturing
GHACEM is now attempting to hold World Bank responsible for the latters statement on breaking duopoly of cement production. Is the move by GHACEM necessary? Barclays Libor controversy is on Page 57

Subscribe online at www.ghanabizmedia.com or please refer to page 53

Contents continue overleaf

All information contained within this magazine is the property of Ghana Business & Finance and is not to be used without written authorisation from the publishers. Although every effort is made to ensure the correctness of information submitted for publication, the magazine may inadvertently contain technical inaccuracies or typographical errors. Ghana Business & Finance assumes no responsibility for errors or omissions in this publication or other documents that are referenced by or linked to this publication.

JULY 2012

22.....

Banking and Finance

Having met its required minimum capital through the equity participation, UT Bank proposes to inject new vigour into its passion to remain trusted partners to SMEs. How would it do this?

36.....

Oil and Gas

Ghanaians are learning the hard way; conserving forest cover by subsidising consumption of LPG is proving extremely costly as free-riders demand overwhelms supply, and threatens to upend the programme.

44.....

Analysis
It is interesting to behold how the tables are turning in the favor of Africa regarding macroeconomic growth to the disadvantage of the developed economies. Africa is gradually soaring! Read this piece to learn more.

24.....

Diplomatic Relations
India is fast establishing itself as a new friend of Africa and particularly Ghana, when it comes to trade and economic relations. To what extent has both countries leveraged on the relationship?

38.....

Feature
After months of braving much criticism for its lack of attention on Africa, the Obama administration on 14 June launched an Africa strategy document that seeks to clarify his administrations specific focus for engagement with Africa. Read this article to find out the benefits of this strategy to Ghana and other African nations.

54.....

Special Report
The predictions of telecom watchers that the entrance of Glo Mobile would cause a stir on the telecom turf are coming to pass. How is the situation like?

27.....

Money Matters
Issues surrounding the dollarisation of the Ghanaian economy still rages on. Read this story to find out matters arising out of this.

57.....

Barclays Scandal
Barclays Libor controversy is on, how much do you know about it?

43.....

Executive Suite
Minister for Education Ambassador Lee Ocran is a man who does not pull punches. In an interview with GB&F, he says technology education remains the driving force behind Ghanas education sector. Read this piece to find out more.

30.....

Photo Gallery
The month of July was inundated with several business-related events in the Accra metropolis. See the photos.

32.....

ICT
This years electioneering campaign will surely take varied twists as politicians and political parties will have a wide range of digital publicity tools for their campaigns. Read this piece to find out more.

India is fast establishing itself as a new friend of Africa and particularly Ghana... Page 24

Minister for Education Ambassador Lee Ocran is a man who does not pull punches... Page 43

The Obama administration on 14 June launched an Africa strategy document... Page 38

Special Report: The predictions of telecom watchers... Page 54

JULY 2012

Controversy surrounding budgetary support

bout a month ago, a local news reports emerged that the Kingdom of the Netherlands have announced their intention to withdraw their funding support for Ghanas budget after 2012. According to Dr. Ton van der Zon, First Secretary and Environment and Water Advisor at the Embassy of the Kingdom of the Netherlands in Ghana, this decision was based on their dissatisfaction with the result they have been getting from their direct budget support over the years. He made this known to the media in Accra at the opening of the third annual civil society review of the natural resources and environment sector. Consequently, the Netherlands decided to opt for specific programme funding where they can easily assess the outcomes and work more with decentralized government systems instead of the central government, with the aim of ensuring development sustainability. The implication of this decision is that, in the coming year 2013, Ghana will lose more than 25 million it had always received as budget support from the government of the Netherlands. The total contribution of the Netherlands to Ghanas general budget support, since 2003, is estimated at 187.8 million. Multi-donor Budget Support (MDBS) is a common phenomenon in most parts of Africa. In Ghana, it began in 2003. At present Ghana receives such support annually from 11 donor countries and international agencies, some of these donors contribute through their various agencies. The countries and agencies are Germany (KfW), UK (DfID), France, Netherlands, Denmark, Switzerland, Japan (JICA), World Bank, African Development Bank, European Commission and Canada (CIDA). At a forum initiated by the European Union Delegation in Ghana about two months ago to rub minds with the government and people of Ghana on the way forward in Ghana-EU relations, the Head of the Delegation, Ambassador Claude Maerten was as candid as one could be in stating that the impact of the blistering Euro crisis may not be that far off as people would like to makebelief. He said With a world economic slowdown, there will be less international trade, there will be less demand for [Ghana]s products. The prices of oil, gas, cocoa, gold will go down, [the country]s balance of payments could be in deficit; and there will be less external assistance, eventually.

Ghana is now at the level of lower middle income country so; it is now time to look at higher impact aid and get more added value and value for money for each cedi spent. What the Ambassador meant was that, with the attainment of the middleincome status, it was time Ghana acts fully fledged and weaned itself off donor dependence. The credibility of this thought is further underscored by the current state of Ghanas economy, where macro-fundamentals are showing that they are not being built on a solid economic foundation. An economy that depends on donor support to meet as much as 40% of its fund requirement will always be vulnerable to all kinds of shock, more so when those budget supports are withdrawn in unplanned circumstances. By the way, just before going to press, the European Union (EU) announced that, for the year 2012, it has disbursed a total of 24 million to the Ghana government through the MultiDonor Budget Support (MDBS) framework, indicating that it has scaled down its own contribution by 2.4 million from its 26.4 million support in 2011. Perhaps to fully understand where the Netherlands decision is coming from, one needs take into account this New York Times report published May, 2012. The report unveils that of all the people rocked by the debt and austerity tumult rattling Europe, the famously prudent but prosperous Dutch were seldom on anybodys watch list; until now. It continues; This bastion of probity became a flash point of euro zone turmoil last week, when the government fell in a showdown over how to cut the budget to keep the nation from getting caught in Europes long-running debt crisis...It is the Netherlands toughest test of economic resolve since the nation became a founding member of the euro currency union in 1999. Last week, facing a crisis that could have tarnished the countrys sparkling credit rating, a caretaker government manoeuvred to pass a 14 billion euro ($18.5 billion) plan for spending cuts and tax increases. Political leaders acknowledge that the belt-tightening will further retard an economy already in recession. As Ghana is currently wrestling down the heady duo of flighty inflation and depreciating local currency, it is expedient that all solutions being sought be derived from efficiently addressing the fundamental need for building an aid independent economy, especially as another budget support withdrawal may not be too far away.

JULY 2012

EDITORS SUITE

WORLD ECONOMY

BRIEFS
Airbus to set up factory in US
Jacques Marraud des Grottes, Total's Senior Vice President for exploration and production in Africa, said in a statement on Wednesday that the deal matched the group's "strategy of building a strong presence in the new basins of East Africa offering highpotential plays for exploration." Total has been present in Kenya since 1955 through Total Kenya, with headquarters in Nairobi. Advances of Total within Kenya in terms of exploration and production began only in 2011. Source: BusinessDay

Airbus is close to finalising plans for its first aircraft factory in the US, a move that would dramatically ramp up its compe-tition with Boeing. The European aircraft maker is considering an expansion of its single aisle aircraft factories in France, Germany and China by setting up in Mobile, Alabama. The move could involve an investment of several hundred million dollars, and underline how Airbus is keen on improving its sales in Boeing's home market, where airlines are placing large aircraft orders to replace their ageing fleets. "We have long studied our options to increase our market presence [in the US]," said an Airbus spokesman. "We have no final decision yet." Fabrice Brgier, Airbus's new Chief Executive, recently visited Mobile with Tom Enders, Chief Executive of EADS, the aircraft maker's parent company. Mr Brgier, in a recent interview with the Financial Times, stressed the importance of the US market to Airbus, noting the regularity with which airlines there were renewing their fleets. He said he wanted to continue Mr Enders' strategy of enlarging Airbus's international operations, highlighting its narrow-body factory, which began operations in 2008 in Tianjin, China. Boeing has a strong lead over Airbus in the US, where the European manufacturer's estimated market share is below 20 per cent. Airbus hopes that the US will be the second most profitable market after China over the next 20 years. The company underlined its ambitions last year by securing an order from American Airlines, the third-largest carrier by revenue, for a 260 A320 narrow-body aircraft. The deal marked the first time that Airbus had broken into American's all-Boeing narrowbody fleet market. United-Continental Holdings, the largest US carrier by revenue, is preparing to place an order for at least a 100 single aisle aircraft. Airbus has an engineering centre in Mobile and the site could serve as the optimal location for the aircraft maker's fourth final assembly line for its production of A320 aircraft. Mobile would also have been the optimal location for the production of Airbus's A330 wide-body jets that EADS hoped to supply to the US military as aircraft refueling tankers. However last year, amid controversy, Boeing beat EADS to the $35billion contract with the US Air Force, and the A330 factory plans did not go ahead as planned. Making aircraft in the US would help reduce Airbus's currency risk by increasing its exposure to costs denominated in US dollars. Airbus's costs are principally in euros, but it sells aircraft overwhelmingly in dollars. When the euro strengthens against the dollar, EADS's earnings are reduced. The euro's weakness amid the Eurozone sovereign debt crisis should help EADS's earnings, although analysts said much would depend on its hedging strategy.

More file for bankruptcy in California

The Californian city of Stockton approved a special budget, paving the way for it to become the largest American city to declare bankruptcy. "Unfortunately, we have no comprehensive set of agreements with our creditors to offer you ... that would eliminate the $26 million budget deficit and avoid insolvency," City Manager, Bob Deis, said at a council meeting. Negotiations, however, continue with some creditors. "I think we're very close in announcing some possible deals with some creditors in the future," he said. "In fact, it could be as many as a third of the creditors ... that's not enough to balance the budget." The city Council approved the pendency plan on a 6-1 vote, meaning Stockton will file for protection under Chapter 9 federal bankruptcy laws before Sunday when the new fiscal year begins. The plan is essentially a new budget for the city of a population of about 291,000, spelling out day-to-day operations under bankruptcy. The city, which is about 80 miles east of San Francisco and about 50 miles south of Sacramento, says it will continue to pay employees, vendors and service providers, but curtail most other expenditures, such as debt service. Numerous governments across the country have filed for bankruptcy since the financial crisis of 2008. Last year, Jefferson County in Alabama, filed the biggest municipal bankruptcy in U.S history. In December, the county was $4.2 billion in debt. Before them, the largest municipal bankruptcy case was filed in 1994 by Orange County, California, which owed approximately $1.7 billion to creditors. Stockton Mayor, Ann Johnston, said: "In the 1990s, the city council approved labor contracts and retiree health insurance plans believing the hyper-growth the city was experiencing would continue forever. Then came the economic downturn of recent years, and debt-strapped California's raid on city finances." "Since 2009, Stockton has cut $90 million from its budget," Johnston said. "The city has reduced its police force by 25 per cent, its fire department by 30 per cent, and other city jobs by 40 per cent but has not been able to get itself financially stable." She continues: "And then, there was the housing bust." "The housing was the last straw that broke the camel's back," said Johnston. "We had this bubble in our economy here. We were booming in construction. We were building about 3,000 homes a year. It began to fall off sharply three and a half years ago," she explained. "This past year only 105 single-family construction permits were issued." Richard Acosta is a 75-yearold retiree in Stockton. Acosta said everywhere he looks there are "for-sale" signs. "You have two across from my house. There was like four on the other side, and there's about two or three more down on the next block," said Acosta. "I always thought the city of Stockton was really gonna go somewhere. But I don't really see any future in it for 5 to 10 years before something really is going to happen here." Source: BusinessDay

Total signs oil exploration contract in Kenya

France's Total said it signed a production sharing contract with the Kenyan government to explore for oil in 2,000-3,500 metre deep waters off the Lamu Archipelago.

JULY 2012

GHANA BRIEFS

NEWS
Harvard Marine to receive new vessels for operations
Harvard Marine International Ghana Limited has negotiated an agreement with Go Marine Group Australia, to act as their agent in the tender for marine contracts essential to the development of the Offshore Industry. The purpose of the agreement with Go Offshore Australia is to manage and operate offshore supply vessels on the West Coast of Africa based in Ghana. Moreover, the agreement provides not only for the crewing of the vessels by Ghanaians but also opens up avenues for employment in specialised fields such as ROV Operators, Divers, Logistic Managers, Surveyors and many other well sort after vocations in the petroleum and marine industries for graduates of Harvard Marine Petroleum Training Institute. Harvard Marine International Ghana Limited operates the Harvard Marine Petroleum Training Institute in Takoradi. It is an internationally accredited training facility specialised in training and certification for occupational health, safety and environment in the petroleum, mining, energy, construction and allied industries. General Budget Support is one of the three focal areas of cooperation between the European Union and Ghana. Contrary to a project approach, budget support involves the transfer of financial resources directly to the Government treasury to complement Governments own domestically generated revenues. This is to facilitate the implementation of the national budget and its associated public expenditure plans. In the year 2011, the EU disbursed a total of 26.4 million as budget support to the Government of Ghana. General budget support to Ghana is part of a broader EU aid portfolio of more than 420 million (about GHS 900 million) for the period 2008-2014. Other sectors of intervention include Transport and interconnectivity, governance, and non-focal areas such as trade facilitation, regional integration and support to the Economic Partnership Agreement. In addition, the aid will be used to support other sectors, including the natural resources management and migration, security and the Diaspora.

EU gives Ghana 24 million as budget support for 2012

The European Union (EU) has disbursed 24 million to the Government of Ghana through the Ghana's Multi-Donor Budget Support (MDBS)framework. This disbursement is in the context of the Millennium Development Goals Contract (MDG-Contract).

The agreement currently allows additional personnel to be accommodated on board of their vessels for training purposes. As part of the deal, Harvard Marine will receive a large fleet of state-of-the-art newly built sea vessels owned by Go Marine Group Australia. The agreement was sealed with a Memorandum of Understanding at the Ministry of Employment and Social Welfare in Accra, Ghana. The vessels will be operated by Harvard Marine in conjunction with Go Marine Group and crewed mainly by Ghanaians but will go under the high certifications and standards of the Australian company, one of the leading operators in the offshore oil fields. Captain Ronald McGrath, CEO of Harvard Marine International Ghana, signed for the Ghanaian company, whilst Mal Wardle, Executive Director of the Go Marine Group initialled for the Australian company. The ceremony was hosted by the. Deputy Minister of Employment and Social Welfare, Hon. Bosiako Sekyere and witnessed by the Deputy Minister of Energy, Hon. Emmanuel Armah Buah,, among other dignitaries.

Emirates Breaks New Ground

Emirates Airline, one of the worlds fastest-growing international airlines, has responded to surging passenger demand by introducing the Airbus A340-500 onto the Accra-Dubai route. The introduction of the A340-500 offers customers a rewarding experience when travelling on the Accra-Dubai route.

The 2012 disbursement follows the satisfactory conclusions of the 2011 Multi Donor Budget Support (MDBS) annual review, conducted last May. Furthermore, it is to recognise the commitment shown by the Government of Ghana towards attaining macro-economic stability, implementing the Ghana Shared Growth and Development Agenda (GSGDA), and improving the country's public financial management. Under the Financing Agreement of the MDG-Contract, the EU is to provide 209 million as general budget support to Ghana over the years 2009-2014, with an overall objective of contributing to sustainable growth and poverty reduction for the country to attain middle-income status and achieve the MDGs.

First Class passengers can experience Emirates economically-designed private First Class suites, featuring privacy screens for maximum exclusivity and massageenabled seats which convert into flat beds, while Business Class customers will enjoy the comfort of angled lie-flat beds.

JULY 2012

Emirates now offers a new route-specific wine list, featuring some of the best champagnes, red and white wines and ports from across its route network. The new offerings include top-of-the range Grand Cru Classe Red Bordeaux, Premier Cru and premium quality wines from other regions of France, California, South Africa, Australia, New Zealand and Germany. Customers in all cabins can enjoy Emirates professionally selected wines, spirits and beverages, as well as fresh, locally-sourced dining options prepared by gourmet chefs and served by the airlines multi-national cabin crew. Passengers can also lose themselves in more than 600 channels of on-demand entertainment, including 50 new movie releases, more than 20 movie classics and 20 childrens films. In addition to interactive games, satellite telephone, sms and email, live BBC news headlines, an airshow moving map and external cameras for a birds eye view of the journey en route. Emirates serves Accra daily, offering 12 First Class Private Suites, 42 seats in Business Class and 204 Economy Class seats. There is also a total of 13 tonnes of cargo-carrying capacity. EK 788 departs Accra at 1735hrs and lands in Dubai at 0550hrs. EK787 leaves Dubai at 0740hrs and arrives in Accra at 1240hrs. First and Business Class travellers or Skywards Gold member can have access to world-class Emirates lounges at select destinations across the globe. Besides its three lounges in Dubai, Emirates lounges cover Auckland, Bangkok, Beijing, Birmingham, Brisbane, Colombo, Dusseldorf, Delhi, Frankfurt, Hong Kong, Hamburg, Istanbul, Johannesburg, Kuala Lumpur, London Gatwick, London Heathrow, Manchester, Melbourne, Mumbai, Munich, New York JFK, Paris Charles De Gaulle, Perth, San Francisco, Shanghai, Singapore, Sydney and Zurich.

The move is expected to enhance the chances of the Governing Council of GEPA to achieve its overarching goal of reaching US$5 billion for the NonTraditional Exports (NTEs) revenue by 2015, as directed by the Ministry of Trade and Industr y during its inauguration.

According to the GEPA boss, countries at the receiving end of exports are able to quantify how much is brought into their economy; meanwhile, Ghana does not even recognise such movements as exports. Because our data system is not able to capture the revenues from those services, we tend to ignore it in our non-traditional export statistics. Whereas we pride ourselves in making US$2.4 billion in 2011, when you go outside, the projections are that we earn three or four times more. It is all because of the way we capture our statistics. If somebody is able to put goods into their briefcase and sends it through the airport, it is not captured as part of our exports, yet he takes them abroad to sell. But because the receiving country sees it when it lands, they are able to capture the goods as imported items, while we in Ghana are not able to capture these as export, Dr. Owusu Agyemang told GB&F. The GEPA said his outfit has begun sensitising companies and institutions in the services sector to understand the need to release their statistics and aid the GEPA in collecting data to quantify Ghanas total exports. GSMA Speaks for Telcos on Tax Burdens The Global System for Mobile communication Association (GSMA), an organisation that represents the interest of mobile telecom operators worldwide, has called for the removal of specific mobile related taxes such as the Communications Service Tax (CST) and the import tax on SIM cards.

The Chief Executive Officer of GEPA, Dr. Kwadwo Owusu Agyemang, made this known at the 73rd National Exporters Forum in Accra. According to him, government intends to diversify its revenue streams to bring in more money from areas that are not under the coverage of the authority in terms of exports. There is an export component to the services sector, which we are not capturing at the moment. If you go to our cardiothoracic centre, the place is patronised by nonGhanaians who pay hard currency for admission and treatment. If you go to any of our polytechnics or universities, youll find out that there are a lot of foreigners who are coming here to enjoy the educational services provided. In a way, you can even say our footballers who are playing in other countries are providing services for which they are being paid. To the extent that they are repatriating their income into Ghana, it can be classified as service. So you can imagine how big the revenue from services could be, Dr. Owusu Agyemang told GB&F.

GEPA to include services sector in exports figures

The Ghana Export Promotion Authority (GEPA) has advanced plans to include the services sector in its export trade portfolio in the near future.

There is a 20 per cent import tax on SIM cards, and a six per cent direct tax on every call made from one network to the other.

JULY 2012

GHANA BRIEFS

NEWS

There is also a six per cent leverage on the interconnect fee that the originator network pays to the network on which the call is terminated. The Director of GSMA's Spectrum Policy for Africa and the Middle East, Peter Lyons, explained; The 20 per cent import tax on SIM cards must definitely be considered for removal and the six per cent CST at both the wholesale and retail levels should also be considered for potential removal because they both put a burden on consumers, He said the removal of both taxes would go a long way to encourage an increased use of mobile and broadband services, which would have a multiplier effect on the growth of the economy and on productivity, in ways that could generate even better revenue for government rather than from direct taxes. Mr. Lyons was speaking to journalists after a days workshop organised by GSMA and Ghana Chamber of Telecommunications on how to speed up expansion of quality broadband service in Ghana. T h e D i r e c t o r o f Re g u l a t o r y Administration at the National Communication Authority (NCA), Mr. Joshua Peprah, said telecom operators are within their rights to call for tax rebates, but taxation is a matter of sovereignty, and no external forces could determine the tax policies of any country. Meanwhile, the CEO of the Ghana Chamber of Telecommunications, Kwaku Sakyi-Addo, said what the telcos are asking for is not a complete removal of the CST (talk tax) but for governments removal of the additional six per cent on the interconnect fee. Source: myjoyonline BoG to Introduce New GH50 The Bank of Ghana has announced that it will soon introduce new 50 Cedis notes onto the market with a set of new features. The Central Bank said its intention was to prevent fraudsters from producing counterfeits of the currency.

According to him, GRA has arrangements, including the small taxpayer scheme, to rope majority of players in the informal sector into the tax net. With education, [an efficient] electronic system, and a tax identification number system, I think well be able to capture many people in the bracket at the end of the day to come and complement what public and private sector persons are paying, and courtesy the Pay-AsYou-Earn [PAYE] system. The seminar was an opportunity for GRA to sensitise taxpayers on the relevance of the integration of agencies into business and national revenue mobilisation. Source:myjoyonline Foreign Firms to Cede Businesses to Ghanaians Reports say foreign businesses coming into the country could soon be required to cede 30 per cent of their enterprise to Ghanaians. Established foreign businesses would also be required to give up part of their interest to locals over a period of time. These form part of proposals in the revised Investment Act currently being considered by Cabinet.

The announcement was made by the Governor of the Bank of Ghana, Kwesi Amissah-Arthur when he spoke to the media in Accra. According to the Central Bank, the new note will have a new set of features different from the existing one but the colour would practically be the same. The Governor said two people have been arrested by the Bureau of National Investigations (BNI) for attempting to produce counterfeit of the 50 Cedis notes. Reports said some foreign companies are behind the syndicate. Source:myjoyonline GRA Widens Tax Net The Ghana Revenue Authority (GRA) is fashioning out a Small Taxpayer Scheme to rope majority of players in the informal sector into the tax net. This was disclosed by officials at a forum in Kumasi to raise public awareness on some modernisation policies being implemented by the Ghana Revenue Authority. However some participants at the selfassessment seminar for GRA taxpayers in Kumasi expressed concerns at what they described as tax holiday for the informal sector. They also questioned the viability of a voluntary tax compliance drive by the Ghana Revenue Authority. But Robert Mensah, an official at the GRAs Public Affairs Department, is convinced that improved customer relations and ser vice deliver y will encourage voluntary filing of taxes.

The bill is part of a broad indigenisation policy being worked on by managers of the economy. It is also to ensure that indigenes can share in the profits foreign firms generate from their local operations. Sources: myjoyonline

JULY 2012

11

GHANA BRIEFS

NEWS

MANUFACTURING

Ghana cement crisis hits global stage

As GHACEM engages World Bank in needless tango

he recent cement crises that hit Ghana a couple of months ago, as a result of the temporary shutdown of the production plant of West African Cement (WACEM), producers of Diamond Cement, which shook the entire construction industry to its foundation seems to have taken an ugly twist, following what observers see as a needless attempt by Ghana Cement Company (GHACEM) to engage the World Bank.

A response, delivered by the Strategy and Corporate Affairs Director of GHACEM, Dr. George Dawson-Ahmoah, and captioned by the local media as, 'GHACEM Replies World Bank On Cement Production Monopoly Allegations' may not only be seen as rather confrontational but also in many ways, a demonstration of the insensitivity to the plight of the millions of Ghanaian consumers, who virtually went through 'hell' during the height of the crises. Thankfully, the situation is abating and things are expected to return to normal soon, but honestly the attempt to place records where they may not be necessary may not be the best for the future of the nation's fragile industry. While this piece is not an attempt to, in any way, hold brief for the global financial institution, the response by Dr. Dawson-Ahmoah, is likely to attract a series of other responses; a development that would not do GHACEM any good. It can be recalled that following the incident where the transformer of Diamond Cement Company was struck by lightning on April 26 this year the Aflao-based cement manufacturing company was forced to shut down production for close to about four weeks.

The temporary shortfall of some 3 million bags of cement over the period on the local market led to an overall retail price hike of 85 per cent from GH14 to GH25. In the heat of the crises, both the President of the Ghana Real Estate Developers Association (GREDA), Dr. Alex Tweneboah, and the Chairman of the Technical Committee of the Association of Building and Civil Engineering Contractors of Ghana (ABCECG), Mr. Rockson Dogbegah, expressed grave concerns, especially in the light of the fact that a number of construction companies were laying off workers as a result of the crisis. The leaderships of both associations were also quoted by the media as linking the unfortunate development to the monopoly in the cement industry and expressed similar misgivings on the matter. For its part, The World Bank, feeling uncomfortable with the continuous dominance of the two manufacturing companies, GHACEM and WACEM, in the production and sale of cement in the country, called for urgent steps that would liberalise the market to engender competition and drive down prices. In June 19, 2012 under the headline "Break Duopoly On Cement Production", a World Bank led economist, Mr. Sebastien Dassus, reportedly told financial journalists in Accra that the nearly 90% hold on the market by the two companies suppresses competition in the sector and has direct consequences on the supply and pricing of the product to the building and construction industry, describing it as 'nonsensical'. "I do not see any justification for a monopoly in the cement market in Ghana. It makes no economic sense," Mr. Dassus said. According to him, having a de-facto duopoly in the manufacturing and sale of an essential commodity like cement is not good for the country, especially given the rising housing and infrastructural deficit. He noted further in the publication that with Ghana's status, as a developing nation that is currently undertaking many infrastructural projects, 'liberalising the cement sector will help drive down prices and create more jobs for the teeming youth. The more there is competition in the sector,' he said, 'the better for consumers.' As if that was not enough, the ABCECG noted that the government needed to break the de-facto duopoly rather than leaving the nation's construction and building sector to the whims and caprices of the two companies. "We need a conscious effort to get other cement factories into the system because where you have only Diamond Cement and GHACEM controlling the market, it means that builders and contractors will continue to be at their whims and caprices," he stressed.

12

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He continued: "Currently, GHACEM comfortably controls close to 60 per cent of the market share. Diamond Cement, on the hand accounts for about 35 per cent of total cement sale and production bringing to over 90 per cent the stake of the two companies in the industry.

However, GHACEM's response erred when Dr. George DawsonAhmoah threatened: "GHACEM is not afraid of competition but will resist any unfair competition imposed on them." Even though it has not been GHACEM's making that for the past 45 years the market has been slanted in its favour. This in a way gives the company away, more so when Dr. Dawson-Ahmoah had "Fears are that the dominance of the two companies in the sector, earlier on, in the same story, admitted that back in 2010 both however accidental it may be, makes it possible for them to GHACEM and WACEM jointly raised a strong petition against 'technically' determine prices of the product nation-wide." the concessionary rate of five percent import duty, which they Then out of the blue came the 'bombshell' claimed was beneficial to a Nigerian-based from GHACEM posted on the Internet on cement importer, Greenview International June 26, 2012 with the caption "GHACEM Limited, for packaging 50kg bags and stood "I do not see any justification for their grounds till the Government of Ghana Replies World Bank on Cement a monopoly in the cement market amended its decision. Additionally, this does Production Monopoly Allegations." in Ghana. It makes no economic not sit well with many Ghanaian observers It read inter alia: "The Strategy and Corporate in the diaspora who see this as an attempt sense," Mr. Dassus said. Affairs Director of GHACEM, Dr. George to make mincemeat of the duopoly claim and Dawson-Ahmoah stated emphatically that the thereby insinuating that all is well with the company does not have total control in the building and production and marketing pattern of cement in Ghana. construction industry as portrayed. According to him, the monopoly of GHACEM was broken 12 years ago by the They argue that if, with its 30 per cent hold on the market, a fouremergence of other production companies like WACEM, week production shut down of WACEM could prompt an 85 producers of Diamond Cement who operate from Aflao in the per cent price hike, then one can only wonder at what would have Volta region." happened if the same circumstances were experienced by GHACEM which has over 60 per cent hold on the market. GHACEM does not enjoy monopoly in the cement industry; monopoly is a thing of the past now especially because there are Secondly, they wonder at how Dr. Dawson-Ahmoah would refuse other players in the cement market. to admit that the economic situation, where just two organisations control a particular raw material is monopoly or duopoly. There is the Greenview International Limited, operating in Tema community 2; Savanna Cement, operating from Buipe in the We should not forget that when we talk of monopoly, as was Northern Region; and the Fortress International, which imports done by the World Bank official, it doesn't mean there are no bagged cement among others," Dr. George Dawson-Ahmoah minor competitors in the system, otherwise where do we place noted. oligopoly? At any rate, assuming without admitting that Mr. Dassus erred in his monopoly claims, in what way does that Dr. Dawson-Ahmoah reiterated that Ghana has a trade liberalisation threaten GHACEM to the extent that the Strategy and Corporate policy, which allows business entities interested in importing any Affairs Director would have to 'respond' the way it did, captured product or establishing manufacturing units to do by the media? And by the way, who is not aware that for close so, provided they go through the right procedures. to half a century there had not been any meaningful competition in the sector? As much as the so-called ''response' is of little He said GHACEM is open to any fair and equal terms competition relevance to the consumer, as prices of cement are yet to reverse so far as the manufacturing and supply of cement in Ghana is to what they used to be before the crises, it is clear that it woefully concerned, adding that GHACEM is not interested in sabotaging failed to address the roots of the problem, if is not due to other competitors because their company will continue to work monopoly. Finally, increasing the production of GHACEM to hard to maintain its position as the leading manufacturer and meet demands, as was promised by Dr. Dawson-Ahmoah does supplier of cement in the country. not take away the question of monopoly.

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TRADE

China can no longer be ignored

hina is gradually becoming an important part of the global economy and no investor or business leader can ignore the increasing influence of its consumers. The tastes and preferences of China's market of 1.3 billion people have the potential to sway demand and shift the trajectory of global consumer spending. China's consumer spending is growing at an average annual rate of 18%, according to the National Bureau of Statistics, compared to 2.2 % gain for the United States. Getting through to China's consumer market is easier said than done and there have been some notable stumbles. Some consumer trends in China are well known, such as the increasing demand for luxury goods, but others may come as a surprise. In one edition of Ghana Business & Finance, we put together some major Chinese consumer trends. This list was based on studies and reports from international organisations such as the United Nations, the U.S. Department of Agriculture, and research firms including, Euromonitor International and McKinsey & Co. Foreign real estate investment China's government is cracking down on its domestic property market after a multiyear boom, and this is driving property investors abroad. Chinese buyers have thus been buying properties abroad in the U.S., Canada, Australia, the United Kingdom and in Ghana to name a few, , according to various reports from these countries. International real estate firms, such as CB Richard Ellis, have set up dedicated branches to help Asian buyers purchase homes overseas. In the last two years, China's biggest real estate website, Soufan Holdings, has been bringing Chinese property investors on tours of U.S. cities, including New York City, Los Angeles, Boston, and Las Vegas. This spate of overseas real estate deals is not limited to North America. According to real estate firm Knight Frank, Chinese buyers were the largest single block of investors buying investment properties in London, accounting for nearly 11 % of sales in 2010. The trend is worth noting, given that the Chinese government bars its citizens from buying more than $50,000 worth of foreign currency each year. However, Chinese property buyers have found ways around these restrictions, working with relatives to pool money together or sneaking money out of China.

Demand for corn China is the world's second largest consumer of corn, and demand continues to increase. It is also the world's second largest producer of corn behind the U.S., This is indeed surprising for a country whose main staple is rice. Indeed, most corn in China isn't consumed by humans at all-75% of its corn consumption is used for animal feed. Corn consumption has grown consistently, rising nearly 3% each year for the past decade. The country's corn imports were predicted to have reached a record 5 million metric tonnes by the end of 2011. According to the United Nations' Food and Agriculture Organisation, China's corn import is more than double the 2010 level of 2 million tonnes. That surge in demand has helped push corn prices on the Chicago Mercantile Exchange up 17% this year alone. Health food & nuts China's health food market is expected to grow to $70 billion by 2015 -more than tripling from $20 billion in 2010. The expanding appetite for healthier foods among the country's fast-growing middle class and aging population has boosted demand for imported fruits, nuts, and yoghurt. Global prices of nuts like cashews, walnuts, pecans, and almonds are at record levels, boosted by Chinese imports. Countries are eager to meet China's demand for health food, despite the government's policy of food self-sufficiency. Last month, Chile signed a deal to be the only direct exporter of fresh blueberries to China. This partnership was achieved after two years of negotiations. Mobile internet China's mobile internet industry is booming, growing much faster than rates seen in many developed countries around the world. China is set to surpass 1 billion mobile connections by July 2012, according to a report by Wireless Intelligence. About 22% of urban Chinese mobile phone users browsed the internet on their phones at least once a week in 2010 up from 15 percent in 2009. This is quite impressive for a mobile phone market that boasts 770 million total users and 318 million users with internet-enabled mobile phones. Furthermore, in exporting the surplus from their factories, Chinese phones have found their way to Ghana, where Ghanaians have developed a preference for them, especially at social functions where they display them to catch the fancy of loved ones.

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TRADE

Last year was the first in which veterinarians were required to pass an exam in order to obtain a license. In an effort to control the pet population, the government has introduced a one-dog rule in major cities, including Beijing and Guangzhou. Overseas education China has the world's largest number of students studying abroad, with about 1.27 million students attending foreign universities at the end of 2010. This represents an increase of 284,000 students or 24% from 2009. Many undergraduate students choose to study abroad to avoid China's highly competitive national college entrance exams. Britain's University of Cambridge, for example, had 1,000 Chinese students last year, comprising approximately 8.3% of the student body. Adding to the trend, more middleclass families are able to afford a foreign education for their children. Indeed, 93% of students studying abroad are funded by their families. Some Chinese parents, eager to expose their children to foreign culture, are willing to spend roughly $5,000 to send them to American summer camps, where they interact with citizens of different countries, and thus broaden their worldview. Luxury goods China's growing demand for luxury goods has been well publicised and global luxury retailers are flocking to the country to cash in. Luxury consumption in the country is predicted to grow 18% annually from 2010 to 2015, and reach $27 billion by 2015. If these projections prove to be correct, China would account for more than 20% of the world's luxury market by 2015. China is the fastest growing market for a number of luxury brands. Retailer sales in the country jumped 27% in the second quarter, compared to the same period the year before. China's demand for luxury products has continued unabated, despite the 2009 global recession, rising 16% that year. The world's priciest luxury brands have taken notice of this trend. Conclusion The world can no more sit idly and continue to think that the Chinese are confined behind walls built up by their Communist leaders. Governments are beginning to take notice, resulting in signing bi-lateral agreements with many African countries, where raw materials are traded in exchange for badly needed infrastructural development. Businesses all over the world are also beginning to take notice, focusing their marketing drives towards this huge market. Just like the proverbial elephant in the room, China cannot be ignored any longer. It is high time the world recognised this and put strategies in place to embrace this new player on the international scene.

Wine consumption China will overtake the U.S. to become the world's largest consumer of wine by 2015, says Euromonitor. About 126 million cases of wine were sold in China in 2009 only. The country is currently the world's fastest growing market for wine consumption, with annual growth rates of around 20% in each year of the last decade. Sales of imported wines are growing faster than domestic brands. Wine drinking is considered a healthier alternative to spirits and an increase in the number of Chinese women who drink alcohol has also boosted demand for wine. The Chinese government is looking into ways to make domestic wines more attractive to consumers. Earlier this month, government-controlled Bright Food Group said they would consider acquiring wine assets in Australia, France, Chile, and the U.S. International travel China is home to the world's fastest growing travel market. With 65 million outbound departures expected this year, the UN World Travel Organisation estimates that there will be 100 million Chinese outbound trips by 2020. Travel has become a top priority for the newly wealthy Chinese in a country where a few people used to travel outside its enormous borders. Chinese tourists are spending more money on their travels abroad-boosting tourism industries in countries around the world. National carriers from the Middle East to New Zealand are rushing to launch new direct flights to a number of cities in China. In 2010, more than 450,000 Chinese visitors spent $3 billion in Australia. This is 20% more than the year before. Hotels and tour companies around the world are gearing up to meet this demand. The iconic Burj Al Arab Hotel in Dubai, for example, has hired a number of Chinesespeaking staff; created brochures and programmes in Mandarin; and added Chinese cuisine to its menu to accommodate this growing trend. Pet ownership Increasing numbers of Chinese home owners are buying pets, as the country's attitude toward pet ownership has evolved. Onechild households and an aging population have created an environment in which pets have become an extension of the family. This new fashion is driven by increasing levels of disposable income. Consumers are now able to afford better care for their animals. The pet population grew a rapid 20% from 1999 to 2004, according to Euromonitor. Dogs are the most popular pets, with their numbers growing 10% a year, but the true number is likely higher, since this figure only includes registered pets. This comes as no big surprise, as dogs are viewed as a status symbol among wealthy Chinese. The increase in pet ownership has led to an increase in pet-focused websites and social networks, and dog treat stores. As a result, the country is attempting to regulate the pet industry.

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COVER STORY

Talal Fattal

A multi-talented man
Through his multiple talents, the Ghanaian economy has experienced immense benefits in various ways; these benefits include an enhanced image of Ghana, job creation, discovered talents, instilled nationalism and broadcasting the nation. Talal, as he is known by all, is not a Ghanaian by birth but he is a Ghanaian by heart! Effah Amponsah gives us more insight on Talal Fattal and his works.
The reward for grit, pursuit of personal and societal conviction is recognition. Talal Fattal poses for this memorial photo with his wife after annexing the Best Entrepreneur, Electronic Media at the Ghana Entrepreneurs Awards

ike a fairy tale, the life story of Talal Fattal is very interesting, exemplary and thought-provoking to any person who desires to succeed in life. With its many twists, his story has great lessons that can serve as a reference point to give impetus to many people who are facing great hindrances or impediments in their quests to be outstanding in their chosen fields of endeavour in life. The great respect that Talal enjoys from his contemporaries, both local and abroad is an ovation to his exceptional endowments, wits and feats, which he has amassed through his journey in life and career. When it comes to expats contributing to the transformation of the Ghanaian society, Talal Fattal, who is well-known for his flagship company Metropolitan Television (Metro TV), stands tall among his compatriots in this niche of business interest. His love and passion for the Ghanaian society has stimulated his heavy investments into the society and economy, maybe not as in what one considers as tangible traditional exports products but in unquantifiable, image-raising dimensions for Ghana. His companies, captured under one group, the Global Village Media Group with its subsidiaries including the popular Metropolitan Entertainment Television (Metro TV), Optimum Media Prime (OMP) and Soccer Academy, are a testimony of his optimism and entrenched belief in the Ghanaian and the Ghanaian community. Though not a citizen of Ghana by birth, the enigmatic Talal from all reference of deeds, has taken Ghana as his adopted home, and probably knows this country more than some Ghanaian citizens.

Music engineered my life The life of any successful person is normally driven by a particular conviction, interest, endowment or pursuit that usually defines him or her. Normally, a beautiful blend of fate, faith in fate and more importantly, the pursuit of fate is what sets the tone for successful life. For Talal, music was his lucky charm, which set him up on a pathway to the destination of his destiny. Music has been an integral part of my life and where weve reached today, in the sense that I went into music because of my love for writing, producing, arranging and singing songs, Talal Fattal told GB&F at the start of an exclusive conversation on his life. In music, he was the jack of all trades but a master of one. In the 1970s, when he began his music journey, Talal composed, sang and promoted his music, a combination that is highly capitalintensive, and hence, grimy to young musicians in Ghana. Talals music captures particular social issues, serving not only as music but also as a message to all. As a young person, it was not just a dream, but a passion that I wanted to share with people. Most of my songs portrayed messages that are social in feeling: Forgive and Forget, Better Place than Home and others. So there were social messages that I wanted to bring out and music was a means of communicating them. That was then, now if I ever would like to do music, itll be theme music for movies, instrumental music that can be used for TV and listening pleasure. So then, my music was a social message but now its for listening, Talal said with his face beaming with reminiscence.

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Metro TVs broadcast milestones in Ghana and beyond

Achievement First TV station to broadcast free-on-air 24 hours First TV station in Ghana to broadcast via satellite Business of the Year Award (Millennium Excellence Awards) First TV station in Ghana to launch on DSTV First TV station in Ghana to partner with Supersport and MNet Sports TV Station of the Year First private TV station to broadcast free-on-air nationwide Sports TV Station of the Year CIMG Media Organisation of the Year Sports TV Station of the Year GJA Best Journalist Award (Samuel Agyemang) Commonwealth Broadcast Award Year December, 2004 January, 2005 2005 March, 2006 February, 2007 2007 July, 2008 2008 2009 2009 2010 2011

The music career I would say is in the background, but still there. For example, as I speak to you, Im putting finishing touches to my huge music studio at the back [of my residence]. I intend to return to the music business but not to sing may be produce and write songs for other artistes. Ill probably resurface again, hopefully in the next year or the next two years, Talal hinted. The journey continued With his many gifts, Talal transitioned from music to media, using advertising as his means of transition. The entrance into the media landscape meant Talal was entering a whole new world but he was prepared for it. Part of the package earlier on in the 70s was that I had to promote my music, conduct radio interviews, produce jingles, TV videos and newspaper write-ups in order to get to know the media. That interaction with the TV, radio and the print media was what Ill say, later became the seed for entering into advertising, television and where we are now, he told GB&F. Very characteristic of him, Talal introduced novelty concepts when he first ventured the advertising business on television including TV Market, Smash TV and then Advertising Cycle. Then, local programmes were being produced by the state broadcaster, Ghana Broadcasting Corporation (GBC), and we were the first to break that jinx, Talal said with a sense of pride. The opportunity came later and we felt the need to establish a TV station. It was a joint venture with GBC to start Metro TV. It was an opportunity for all other firms, but some refused it, others could not take the challenge or meet the requirements, but I also believe there was an element of destiny in that. Accolades

But it never came without challenges Talal As Metro TV relishes its 15th milestone but highlighting the accolades at the expense of the challenges may not be a fair move, given the fact that testimonies of surmounting challenges normally stimulate others to forge ahead.

15 years! It looks easy, but when I look back, its 15 years not like a wink of an eye. The challenges have come from various spheres; technical, programming, salesmanship, technology but weve managed to cross over Talal.

Metro TV has evolved to become the fastest growing private television station in Ghana and a mustwatch for the Ghanaian television aficionados, across varied demographic segments of diverse broadcast tastes and inclinations. After achieving its target of urban and sub-urban profile via expanded broadcast platform, with more than 12 million viewers representing 20 per cent market share, Metro TV further introduced the premium quality family entertainment programming. Therefore, Metro TV purchased top notched TV programmes to match the taste of it and capture larger audiences on the local turf. To this end, Metro TV has become advertisers first port for business. You know it is the philosophy of trying to be the first, not because we think we are the first, but when you try to be the best along the line, and then it becomes a part of you. The philosophy of trying to be the first is part of our mission statement. Of course, its not only becoming first but staying at the top is more important.

15 years it looks easy, but when I look back, it is 15 years not like a wink of an eye. The challenges have come from various spheres: technical, programming, salesmanship and technology. The challenges have been quite overwhelming over the years, but weve managed to cross over, Talal expressed. When we brought the foreign content, it wasnt well accepted. It wasnt what I thought it should have been. The response was average. We started it all in the industry but now it is received better than then. Right now, I think the taste is more cosmopolitan especially in the urban areas. In 2012, the management of Metro TV is aiming at positioning its content quota to 30 per cent of news, 30 per cent of sports and 40 per cent of entertainment. Currently, Metro TV is dishing out more entertainment programmes to its viewers such as drama, game shows, sitcoms among others. At the mention of 30 per cent soccer content in programming, the interview with Talal took a somewhat pessimistic turn, despite the fact that Metro TV has been ingrained in the minds and hearts of many Ghanaian as the Home of Sports.

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COVER STORY

The likes of Forgive and Forget, Give and Get, Better Place than Home and the famous Black Stars song Straight to the Top are some of the hit songs from his albums that made tremendous waves in the music industry, subsequently becoming household lyrics in Ghana. However, talented Talal Fattals social messages seem to have halted.

COVER STORY

As much as GB&F persisted to know details of the upcoming programme, Talal was elusive on the subject, very characteristic of a businessman who wants to keep his secret as a secret! Its different, just different; completely out of the box. Just when you think youve seen all the reality show formats, this one will make a difference. Its a music reality show; not a music talent hunt! he only hinted, amidst smiles. Is Talals group of companies on sale? The Global Village Media Group is on 30 to 50 per cent shares offer. Ten years from now, Talal wants to sit back and offer more advisory services to the group. He wants to see the group enter into a dispensation of many owners. Of course, this will facilitate capitalisation and re-investment and make the group more or less, a public company. We are looking for more investors to buy into our group and take us to the next level, he mentioned. Under the company name, Optimum Media Prime (OMP), Talal is a shareholder of African Business Media, publishers of Ghana Business and Finance (GB&F) magazine.

Talal Fatal (left) in a discourse with Martino Kashif (General Manager of Ghana Business and Finance)

In 2005, we took it upon ourselves to carve a niche of sports. We succeeded but now, we are going back to quality family entertainment. Right now we have a more balanced formula. Though we have reduced sports content, were still strict on quality stuff but it does not have as much time coverage as it did before.

Talal understands very well that the new move and direction for the station is a daring one, nevertheless, he argues that television is a business and a service to the society, hence, other target audiences must receive a fair share of programming content for The other side of life personal and societal development. He is also mindful of the advertising revenue, Talal Fattal is a liberal Muslim, has a wife which he believes to be very crucial to and four children. As a liberal Muslim, he Metro TVs existence, sustenance and embraces all other faiths. He is an adherent The competition is on development. According to him, Metro and practitioner of principled living. He and we feel it. You cant TV wants to be the trailblazer in venturing believes in investing in people as against turn a blind eye or new television vistas with the aim of setting using people for material gains. George the new course of direction for the TV Orwell said in his famous book, Animal discount it, its there broadcasting industry in Ghana. Farm, that every person is a political animal, and to me, its vibrant... one way or the other. GB&F dared investigate Talals political inclinations. Talal Is there competition in the broadcast media turf? I can say my heart is somewhere and my head is somewhere else. Im very objective, The competition is on and we feel it. You cant turn a blind eye neutral. Im into the politics of positivity and playing politics with or discount it, its there and to me, its vibrant. lyrics and themes in songs, was Talals response to our tricky investigation as he smiled. Metro TV has played a role in the past to positively stimulate the industry and other players have yielded to that stimulation. Now, all the yardsticks and benchmarks have been raised. We are now What do you do when you are alone, Talal? aspiring with other networks and competing for quality, production values and news values. So the competition is there and it keeps I like watching TV and getting new ideas because, some of the everybody on their toes. ideas we borrow, we dont invent all the time. I like creative artworks like designs, logos, symbols, animation and graphics. I love this It is like localisation of industry in economics, as competition world of creativity, where you can escape the realities of this harsh increases a firm reduces its market share and the market volume world. We enter there, feel good and then come back after that. becomes bigger. This is how it is affecting us; we have a lesser market share but of a larger market, he admitted. Metro TV is I still love music but recently, I have drawn closer to health advancing plans to begin a soccer academy solely for ladies. activities in order to shed more weight. Last year, I was 150 kilos, According to the CEO, talks are ongoing with a headline sponsor, today Im 112 kilos. I have now developed the passion for exercising, who of course has to measure the benefits and value of the swimming, playing badminton, golf and using the gym, he phenomena on its corporate direction and goal. Talal is upbeat responded. Talal Fattal is a true communications business mogul that when the programme becomes a reality, the likes of Mercy whose exceptional contributions to the industry and the economy Myles, the Black Maidens captain, will be discovered of Ghana have not gone unnoticed. to bring development to womens football in Ghana. He has annexed several awards both in the country and This year, maybe, the Soccer Academy would take a break. We internationally. Ghana is yet to harness the endowment, acumen want to re-strategise; and we want to start a new music reality and strength of character in the likes of Talal Fattal. His life typifies show. the saying, the old soldier never dies!

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BANKING & FINANCE

UT Bank: Going the extra mile for SMEs

Having met its required minimum capital through the equity participation of the International Finance Corporation (IFC) and other big international investors, UT Bank proposes to inject new vigour into its passion to remain trusted partners to SMEs. GB&Fs Utche Okwuosah digs into the details.
Prince Kofi Amoabeng, Chief Executive Officer, UT Bank

ccording to the Registrar Generals Office, small, medium and micro enterprises (SMEs) have consistently formed between 90 and 92 percent of registered companies over the years. That this group of enterprises referred to as the informal sector also constitutes a significant backbone of most African nations economies is no longer a new economic fact. Rather, what remains elusive is the staying solution to their perennial lack of sustained funding. In a paper published in the International Research Journal of Finance and Economics by Joshua Abor, Department of Finance, University of Ghana Business School, Legon, and Peter Quartey of the Institute of Statistical, Social and Economic Research (ISSER), University of Ghana, Legon in 2010, they stated that SMEs in Ghana have been noted to provide about 85 percent of manufacturing employment of Ghana. They are also believed to contribute about 70 percent to Ghanas GDP and account for about 92 percent of businesses in Ghana. Now, this is how important this less understood and financially underserved informal sector is to Ghanas economy. Over the years, figuring out exactly how best to meet their needs to harness the growth and developmental potential they offer to both the private sector and the national economy has been a seemingly adamant problem. This is especially the case in Ghana, where locating an individual poses a herculean challenge, as street identifications are almost nonexistent. Consequently, as a result of their lack of structure, locatable addresses and at times, proper accounting, they can be a high risk to the banks. Thus, the sector perennially remains in lack of sufficient funding to perform at its best. Add to that the never-improving high cost of borrowing, and what you have is an informal sector that continues to crawl instead of leaping. But, what do you expect? queries Prince Kofi Amoabeng rhetorically from across the glass conference table in his Manet Towers office, Airport City, where he sat in an interview with the GB&F team.

The Chief Executive Officer of UT Bank painted a clearly contrasting sobering picture of a modern banking sector that is supposed to be the informal SMEs ultimate source of realising their entrepreneurial aspiration. Banks are formal and well-structured institutions which have developed as the advanced countries developed. The SMEs are mostly residing in the informal sector, especially in Africa. So, what you find is that there is a disconnect between the banks and the SMEs in the informal sector. Typically, a bank has a nice edifice, air-conditioned, people in suits and ties, with MBAs, and what-have-you, big English, and all that and, in addition to all of that, they are holding the money. Now, on the other hand, if you take the typical SME operator, he is quite the opposite probably not too much English, not structured, doesnt keep accounts, doesnt wear suits and this person is supposed to go and take money from those other well organised and quite formal people? Can you imagine that? And if he somehow finds the guts to approach them for the money, they want to tell him what to do because, obviously, they know more than he does and they have the money. How do you think such an encounter would always work out? It is that disconnect that we want to bridge because we know that the SME person knows his terrain and knows what he wants to do and that, we as a bank, if we want to be useful to him, must listen and even create the conducive environment for him to relax and establish trust between us. This is exactly what we are saying, that we know the SMEs; that UT Bank knows the SMEs more than any other bank because that is where we are coming from, so it is like walking a familiar path you know too well. We came as an SME to the banking business so going back is natural. Therefore, when we say we are for SMEs, we are not just talking. We are SMEs ourselves, except that we have become a bank. Recently, UT Bank entered into an equity relationship with the International Finance Corporation (IFC) in its bid to meet the GH60 million minimum capital requirement stipulated by the Bank of Ghana (BoG).

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He also said that the facility will also provide UT Bank access to a global network of banks that will help the bank to finance crossborder trade transactions of local companies. As a matter of fact, facilitating the SMEs was the founding goal of the banks mother company, Unique Trust Financial Services, about 15 years ago, and the passion seems not to have waned. According to Prince Amoabeng, one of the gratifying things about their decision to go to the IFC for the additional capital they needed was the aspect that made it possible for the bank to access loans. The loan will enable us do long and medium term business because until now we didnt have long term debts; we finance up to about two or three years and thats it. Now that we have long term loans we can finance about five to seven years, if we want. And then, the trade lines are to support our clients when it comes to establishment and confirmation of letters of credit (LCs) so that they dont have to come up with the money up front. We want to redefine banking. We started as an SME from micro, small, medium and then converted into being a bank just four people, and built our business up. So we understand the SMEs more than any other bank. Since its inception, UT Bank has continued to make indelible impressions on the terrain of its sub-sector, making it clear that it is here to stay. It has made sure that its paths are marked with performance acclamations in the form of awards, right from its first year, crowning it off with the Bank of the Year 2011 award. The banks recent relationship with the IFC has reinforced this belief that the bank is set for the big leagues. Being in bed with the IFC tells the whole world that you have come of age. So much so that our foreign investors, local investors, even our customers, staff and clients, are all happy about the IFC being a part of us. It means that you are a world-class bank, and that the IFC has faith in what you are doing and what you are going to generate for them in terms of return on investment. We are the only bank now that the IFC has shares in. And then they bring in all sorts of things like trade lines, some loans, technical assistance, which is all good. Here is the genesis of that significant relationship: You see, we started this business with fifteen to twenty thousand cedis and we have built it over the last 15 years to the position we are now, which is a far, far cry from the relatively meagre capital we took off with. For an indigenous company, we are still growing. However, because of the Bank of Ghana requirement to raise our minimum capital to $60 million we had to strategise and look to how we can raise the additional funds and stay in business to continue on our growth path. That was how come we had to go the IFC. Of all the investors that we could get, looking at our position, performance and the state of our shareholders, the IFC appeared to be the best option, despite their exhaustive due diligence processes.

CAPTION NEEDED

Yet, we considered it would be a test on ourselves if we should qualify to have them partner us. So, it took us almost a year and a half to get the IFC to come on board. With an equity injection of $15 million through IFCs subsidiary, Africa Capitalisation Fund Ltd (AFC) that is, aside the $15 million loan facility mentioned earlier the IFC has now bought up to about 19 percent of UT Bank. Also, other investors, like DEG for instance, are also buying about 13 percent, and this is coming from new issue of shares, says the Chief Executive. As at December 2011, the bank's total assets were valued at approximately GH712.9 million, with shareholders' equity of approximately GH61.23 million which, with the new capital injections, would have inched up quite significantly. At present the bank has about 26 branches and is still working at increasing that number, although the CEO thinks that with the modern technology offerings, physical presence of a bank would soon cease to be a priority. Now, if you ask me personally, I think that, because of technology, you dont have to have physical presence in most places. All we are trying to do is look at using a vehicle for reaching most places with the telephone as well. We are seriously looking at mobile banking. By this, I mean having a vehicle that could go to places on market days, because in most of these villages, after market days it seems business is dead until another market. So what we want to do is to be there when they need us. Then you can take deposits and disburse and keep moving. Actually, before the end of the year you are likely going to see the mobile banks in operation reaching the very people that need us most: the unbanked. You know, when we say the unique bank for real people we want to do things that meet the real need of people and not just doing it because other people are doing it. UT Bank has boldly taken steps to own an area of banking where other banks have been cautious. SMEs have found in them a partner that was once like them, and with whom their dreams and aspirations for growth will become reality.

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BANKING & FINANCE

With that relationship, also came an additional $15 million facility specifically secured for the funding of SMEs and for Senior Loan and Trade Finance. Speaking at the press briefing held when the documents for the facility were signed, Prince Amoabeng affirmed that the additional $15 million investment will, among other things, help increase access to medium-term capital for Small to Medium Enterprises.

DIPLOMATIC RELATIONS
Hon Hannah Tetteh, Minister for Trade and Industry with Mr Anand Sharma (left) Current Union Cabinet Minister in charge of Commerce and Industry and Textiles in the Government of India

At a time when the Eurozone is wading in sovereign financial crisis, local debts situation in the US and economic meltdown in China, India seems to be taking advantage of the extant situation and enhancing economic and trade partnerships with Africa, though with a flexible hand. Ghana, Indias friend in the sub-Saharan region, has also positioned itself strategically to benefit from this opportunity. Effah Amponsah writes.

Evolving India-Africa commerce relations: Ghanas lot

s a marketing slang for a national brand, India calls itself a land of limitless opportunities, summarising the endless prospects the nation has to offer its people and other partner-nations that engage in bilateral or multilateral cooperation. At the recent India Show held in Accra, India made its intentions clear to the rest of Africa including Ghana, that it plans to offer the continent an enhanced economic and commerce relations that has a competitive edge over other trade partnerships. The two-day event showed how entrenched India is in its bid to do business with Africa to position the latter as an indispensable trade partner in the world of commerce. Various sectoral discussions were held, including the area of food security and inclusive development, mostly. Modern agricultural practices, accessibility and affordable of healthcare and pharmaceuticals, mining and minerals, chemicals, automobile, infrastructure and construction, textile, power and energy were some of the topics raised during the event. The deftness and acumen exhibited by resource persons at these sectoral and roundtable discussions showed a glimmer of hope in the IndiaAfrica trade and economic relations. It is important for India to direct its foreign trade to Africa in these times of economy struggle for the Eurozone, US and China. Africa remains Indias top priority and we would look to energise the relationship through greater diversity and depth, Dr. Manmohan Singh, Prime Minister of the Government of India has said in recent times.

During the 8th edition of CII EXIM Bank meeting on IndiaAfrica Project Partnership, Anand Sharma, Indias Minister of Commerce, Industry and Textile, reiterated Indias objectives towards Africa. India and Africa are the driving forces of global economic recovery and the Indian government would fast-track the establishment of the specialised capacity building institutions on the continent. We are committed to fulfilling the developmental aspirations of Africa, Minister of State for External Affairs, Preneet Kaur also told African ministers and entrepreneurs at the opening of the meeting. This meeting was focused on how India-Africa partnership could be aligned further to create valuable possibilities towards building India-Africa partnership. From all intents and purposes, the Asian country has an opensecret to unseat the US and China as the world economic super power permanently in the near future. Against all odds, the nation has made tremendous strides when it comes to initiating win-win partnerships with other interest parties, especially in Africa. In the last decade, the trade relations between India and other African nations have reached a crescendo, thanks to the mutual understanding between the two sides, stemming from the spirit of South-South cooperation. Indias economic growth and Africas economic resurgence have created new possibilities for partnership for the two parties.

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BUSINESS & FINANCE

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DIPLOMATIC RELATIONS

Trade and economic partners like India will no doubt endeavor to maintain a balance of interest and mutual benefit in its dealings with Africa, if not soon, in the near future. Ghana is one of Indias friends in the sub-Saharan region benefiting tremendously from the South-South cooperation and bilateral relations with the Asian country. Economic and commercial relations between the two countries are on an upward trajectory. Official figures show that bilateral trade between India and Ghana in 2010/2011 stood at US$ 818 million, an increase of 52% over the previous year. For the year 2012, Rajinder Bhagat, the High Commissioner of India to Ghana say the bilateral trade between the two countries is projected to be US$1.2 billion. On GIPCs facts sheet, India currently lead the pack of countries that have invested heavily in diverse sectors in Ghanas economy. As at the close of 2011, India alone had established 548 projects amounting to US$ 550 million dollars of investments. Updated figures from the Indian High Commission for 2012 unveil a staggering US$ 540 million in investments in the Ghanaian economy. The Indian Government has to date extended US$ 228 million lines of credit to the government of Ghana.
Mr Anand Sharma, Current Union Cabinet Minister in charge of Commerce and Industry and Textiles in the Government of India

During the 2nd Africa-India Forum Summit (AIFS) in 2011 in Addis Ababa, Ethiopia, the most refreshing cooperation between the two parties emerged, as the Indian Prime Minister met African leaders to find ways to revitalise economic cooperation between his country and the region of Africa. This resulted in Indias announcement of US$ 5 billion for economic cooperation with Africa over three years. Since then, trade agreements have been signed with almost all West African nations.

African economy, mainly driven by relatively From all intents and purposes, strong commodity prices, substantial external Ghana is gradually albeit, on an increasing capital inflows and a continued expansion of rate positioning itself economically to stand the Asian country has an demand and investment from Asia, is rapidly on a pedestal of equal benefits from its trade opensecret to unseat the US improving. . Reports say among the continents and economic relations with India. and China as the world in the world, Africa has made the greatest stride economic super power in terms of percentage growths in recent times. Ghanas investment in the diversification of permanently in the near future This explains the current situation of Africa, the economy positions [the country] on a good which is seen as the safe haven for the pedestal to enjoy robust, sustainable economic industrialised economies, resulting in the influx growth in the future, Hannah Tetteh, Minister of MOUs, initiatives, partnerships, action plans and the like, between of Trade, Industry and Private Sector Development told a 200 many African countries and some developed economies. member Indian delegation, - the biggest ever to visit Africa from Foreign Direct Investments (FDIs) have surged in many African India when they participated in the just-ended maiden Indian nations in recent times, as the existence of untapped resources Show in Accra. for growth. Moreover the improving economic managerial skills have proved to Western and emerging Asian countries that Africa Ghanas macroeconomic performance is very impressive and is is a reliable business partner to deal with and a sure place where widely recognised as the current fastest growing economy in the to invest. I world. Its attainment of a staggering double-digit GDP figure of 14% gives it an upper hand over its contemporaries, at least in India has invested US$ 47 billion in Africa in recent the West African sub-region. No doubt Ghana has won the hearts times with 40% in West Africa and intends to shoot its investments of Western and now Asian countries, considering the strides it in the sub-region from US$ 20 billion to US$ 40 billion by 2015. is making as a middle income economy. The opportunities that Africa has to offer can be assessed from the fact that by 2020, Africas collective GDP is projected to touch US$ 2.6 trillion, with combined consumer spending amounting to US$ 1.4 trillion and a number of working age population estimated at 1.1 billion in 2040. With a promising future for African economies, external investors, economic and foreign trade partners, the world is assured of a rise in the scale to a balance level, where the benefits of relationships would not always be skewed to the benefit of one party. Ghana, like other African countries, offers myriads of natural resources for harnessing and exploitation. The nation also possesses a developing human resource asset that only needs training and expertise tutelage to be at par with human resources in developed economies. State-of-the-art technologies are also needed to harness and add value to the various products emerging from the sectors of the economy. It is imperative that the India-Ghana trade and economic relationship adopt a fresh paradigm and outlook to make their relations a more mutually beneficial one.

The credit has been used for the construction of the Flagstaff House, the expansion of the railway sector, agro-processing, fish processing, waste management, rural electrification, and the establishment of a sugar-processing plant. Not only has Ghana offered India a safe haven for investments, it has also proven to enjoy a healthy economic growth. This confirms that Ghana is able to meet the requirement of any economic partnership headto-head. A general prediction for the future is that most developed economies would be focusing on establishing trade and economic relations with countries whose economies are developing and can offer a competitive advantage with win-win partnerships.

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arisation Doll onomy: of ec ers arising Matt

n June 8, 2012 Ghanas central bank, Bank of Ghana (BOG) released a statement strongly refuting domestic media speculations that it was devising plans to close all privately held foreign currency bank accounts within the country as a means to halt the popular dollarisation culture. Nevertheless, the statement did not rule out the possibility that such a crude action could be adopted in the future. Moreover, it stated that in the future, such drastic measures may be taken if the current set of market-based policy tools fails to work. The Ghana Cedi has fallen by almost 15 per cent against the US dollar since the beginning of the year and consequently, major sectors of the local economy have effectively become dollarised. Rents and prices for private luxury homes, apartments, cars and professional services such as private school fees for instance are being quoted in US dollars.

Almost all major local Ghanaian businesses, even small-scale business owners, upper and middle-class families own US dollar savings accounts. Similarly, corporate invoices and pro formas are often quoted in US dollars rather than in Ghana Cedis. In April, the Bank of Ghana announced a number of market-based measures to stem the Cedi slid and reverse the ongoing dollarisation.

Ammisah Aurthur Bank of Ghana governor.

JULY 2012

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MONEY MATTERS

MONEY MATTERS

Tullow Oil, a major operator of Ghanas Jubilee oil fields, has recently confirmed that due to technical issues on-site, it is only producing 70, 000 bpd as opposed to the anticipated 120,000 bpd, 42 per cent below its earlier 2012 target. This shortfall has meant losses of about US$500 million to US$700 million of potential forex have been made. That said, the non-market based and crude tactic of seizing local forex accounts that may be considered in the future will be a major economic disaster for Ghana if it happens. In anticipation of such a move, despite the statement released by the central bank, a number of negative effects have occurred. Panicked businessmen and businesswomen are quietly closing their forex accounts and moving their savings and funds back to accounts in North America and Europe or withdrawing and keeping their forex in cash at home. Middle class savers are withdrawing monies out of local banks and putting them under their proverbial pillows and mattresses. This process if accelerated will lead to large asset-liability balance sheet mismatches for a majority of banks based in Ghana. Consequences of that include a tighter restriction on loans; credit lines will be cut down drastically and credit of the private sectors will be reduced to match their balance sheets with the withdrawn forex deposits. Furthermore, a massive withdrawal of forex from the banks by individuals and businesses in anticipation of a possible central bank seizure of accounts can also weaken the monetary policy transmission mechanism, increasing difficulties in controlling inflation. Finally, due to the large quota of importation of a number of ordinary household items, including imported food, any credible hint of a potential seizure of private forex accounts will also mean that businesses seeking to place orders for goods from abroad, may either order ahead of schedule and encounter storage problems or hoard until market signals are clear. These changes are likely to see sky rocketing prices of imported goods within the domestic markets even before the onset of the year-end shopping season. With importers fearing a loss of profits due to future currency translation losses, many will start increasing their retail prices to reap profits before such an anticipated fall in the value of the Ghanaian Cedi.

Dr. Kwabena Duffuor, Minister of Finance, Ghana

Some of the measures included increased interest rates, limited the net open positions of local banks in currency trading, introduced new 30, 60 and 270-day government bonds to mop liquidity, restricted local banks from holding nine per cent reserves against non-Ghana Cedi deposits in forex and instructed a 100 per cent local Ghana Cedi cover for all bank vostro accounts. Though, these markets measures may have temporarily halted the fall of the Ghana Cedi, they are not likely to reverse the trend. The central bank is therefore considering more measures. The current situation can be attributed to many causes, primarily the US recession and now the Eurozone crisis. Though the Eurozone is putting in measures for a major depreciation/ devaluation amidst a new recession, the US dollar has once again become the safe haven of choice for most saving accounts and investors globally, including Ghanas middle classes. However, on the domestic front, the likely cause of the depreciation of the Ghana Cedi is the major capital market disappointment that after a year of the discovery and commercial production of oil, Ghana is still 42 per cent behind its set daily production target rate of 120,000 barrels of oil per day. In late 2006, when the Cedi was redenominated into the Ghana Cedi, Ghanaian capital markets anticipated an oil-fuelled booming economy, the Bank of Ghana pegged the value of GH1 to US$1. However, over time markets have realised that the much-anticipated foreign exchange has not been generated; today, the Ghana Cedi is trading at almost GH2 to US$1.

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PHOTO GALLERY

Dominion University

Archbishop and Members of the Governing Council of DUC interacting on the way forward

Dr. Ekwow Spio-Garbrah brainstorming with Ms. Fafa Kpodo before the DUC Governing Council meeting

Some members of the DUC & ACI Press Corps at the launch

The Launch of the Institute of International Negotiations

Mr. Adu Anane Antwi, D-G, Securities & Exchange Commission, Dr. Kwaku Addeah, CEO, Financial Law Inst. Hon. Justice S.K. Date-Bah, Judge of the Supreme Court and Nana S.K.B. Asante at the hightable Key members of the Institute and some guests pose for a group photograph to commemorate the historic occasion

Nana S.K.B. Asante, President of the Institute_ Angela Asante the Exec. Dir. of the Institute and Eva Mends, Head Budget Dev, Minstry Of Finance expressing their joy over the successful take-off Mr. K.B. Andah and Hon. Justice Date-Baah taking time off to catch up

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Stakeholders of Ghana's Mining Sector including Chiefs, Mining Companies, Mining Associations and Regulators participated at the forum

Minister of Lands and Natural Resources, Mike Hammah speaking at the maiden National Mining Forum held at the National Theatre, Accra

From left to right - Hon. Mike Hammah, Minister for Lands & Natural Resources, Mr. Ohene Kena, Chair of Minerals Commission, Mr. P.V. Obeng, Chair of NDPC, Hon. Victor Smith, Eastern Regional Minister.

Consultative Meeting

Minister for Finance & Economic Planning, Dr. Kwabena Duffuor delivering his speech at the meeting Members of the Budget Support Donors, Developmental Partners and International Blocs listening to proceedings at the Consultative Meeting

Managers of Ghana's Country in a chit-chat Dignitaries who graced the Consultative Meeting

JULY 2012

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PHOTO GALLERY

National Forum of Mining

ICT

Election 2012: Ghanaian politicians go high-tech

By Effah Amposah

he 2012 electioneering campaign is sure to elicit interesting twists as politicians and political parties will have at their disposal, a wide range of digital publicity tools for their campaigns. This became evident during a boot camp organised by Google Ghana, aimed at training election stakeholders on the effective utilisation of Google products and digital tools, purposely for the enhancement of activities before, during and after the Presidential and Parliamentary elections this December. Activists from various political ideologies, representatives of political parties within the country, journalists and business entrepreneurs gathered for a two-day program, which educated them on the various Google applications and software available and how these tools can enhance the marketing of their businesses.

CAPTION NEEDED

Politicians and campaign managers need to be aware of the power of the Internet and use products and tools available on the Internet to send their campaign messages across via the Internet, Estelle Akofio-Sowah, the Country Manager for Google Ghana told GB&F. This is a part of our efforts to support the 2012 elections in Ghana and to ensure that there are free, fair and successful elections, she added. During the program, Google Ghana officials lectured on a number of Google products including Google Alert, Google Docs, Google Plus, Google Fusion Tables and Google Maps.

Politicians and journalists were further enlightened on the usage of Google Apps, Google Data Visualisation, Google Ngram, Hashtags, Hangouts as well as Google Public Data Explorer. According to Madam Akofio-Sowah, Google Alert is really aimed at helping to bring together in one place, all the information one seeks to avoid long hours of searching. Simply set up an alert with all the keywords that you want to monitor. Whenever you prefer to monitor, either every morning or evening, you will receive an email that summarises and captures all the information on the Internet that is related to the keywords you selected when setting up. We are assisting citizens in getting quick information and responses to enable them make the right decisions or react in the right way.

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Google Docs, now known as Google Drive, is a free, Web-based office suite and data storage service. It allows users to create and edit documents online whilst collaborating in real-time with other users. Thus, it can allow both the electorate and political aspirants to simultaneously create and disburse propaganda materials. We know that the media, civil societies and Ghanaians in general are already using the Internet to get their messages across, therefore we are not introducing these products to novices but as a means to build the existing capacity of users in analysing information and decision making. Everyone agrees that social media add new arrows to the quivers of social activists. The social media we have discussed can be helpful in mobilising protesters rapidly undermining a regimes legitimacy and can increase national and international exposure to a regimes atrocities. The Arab Spring in Tunisia, Egypt and elsewhere in the MidEast for instance heavily relied on the Internet and social media it enhances such as Twitter, TwitPic, Facebook and YouTube in the early stages to accelerate social protest. In view of this, some people have expressed optimism at the introduction of these Google products, which seem to empower the electorate and gives them wider range of options in responding to national and political issues. Looking at what happened in the Middle East and North Africa; people achieved what they wanted in a way. We really need to understand the commitments that the political parties are making to citizens and hold them to their promise after the elections. So we wouldnt experience what has happened elsewhere to affect the decisions we make as Ghanaians, Estelle Akofio-Sowah explained extensively in an interview with GB&F. However, she also admitted that, some people may pursue their own goals aimed at inciting violence and we need to be aware of that. We have in place many organisations that are responsible for monitoring what people are saying and their implications. There are civil societies who would monitor methods employed by people in trying to incite trouble and quickly counter that by educating people on not responding to such information, she added. It is expected that Google Ghana would have gatekeeping measures firmly in place to prevent the prevalent situation in North Africa and the Middle East from brewing in Ghana, during the parliamentary and presidential elections in December 2012.

Google+, another tool, enhances user-specific interaction for the purposes of the receipt or dissemination of information. For instance, a Member of Parliament or a political aspirant can interact with a constituency by sharing and/or receiving information. Even though a politician might have used other social networking platforms like Facebook and Twitter to release poignant messages to the public, Google+ is more effective in amplifying his or her message to a targeted population critical in determining his or her triumph. The tool allows live, face-to-face video chats. It is as though people sitting in a room with you and they are raising their hands to ask questions, offered Justin Arinstein, a Google products training expert, as he lectured on the usage of Google+. Google Ngram is a tool within the Google books product, purported for displaying the occurrence of particular phrases over the years in books using a graph. In the same way, it can enable the electorate to make a quality decision as to who to vote for, by comparing and assessing a record of politicians publications found on Google books that discuss issues that matter to the electorate. Google Public Data Explorer provides users with the ease to track study and analyse a wide range of national issues that are of interest to them through visual representations. The products keep track a wide range issues such as of international treaties, pacts, memorandum of understanding and agreements between nations, regional blocs and international bodies to make these visualisations possible.

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ICT

ADVERTORIAL / MTN
Rahul De, Chief Marketing Officer supports with education on road safety tips with commercial drivers

MTN sensitises drivers on road safety during 21 days Yello Care Programme

taff Volunteers of MTN Ghana have undertaken a number of activities in all of MTN's three business districts in Ghana as part of this year's 21 Days of Y'ello Care Programme. The 21 Days of Yello Care Programme is an annual community enhancement programme that encourages MTN staff across all 21 operating countries to set aside 21 days in the month of June (from 1st . 21st) to volunteer and undertake community uplifting projects in the communities in which MTN operates. Each year, the Y'ello Care Programme is undertaken under a global theme and specific subthemes. The global theme for 2012 was Investing in Education, while the sub-theme for Ghana was Education . A Tool for Development. During the launch of the 21 days of Y'ello Care for 2012, the Chief Executive Officer of MTN Ghana, Mr. Michael Ikpoki, said, As a business, MTN is passionate about education and we recognise that education is the heartbeat of every country. It is a powerful driver of development and is one of the strongest instruments for reducing poverty, improving health, promoting gender equality, as well as peace and stability. It is in line with its passion for education that MTN is embarking on various sensitisation programmes aimed at educating different stakeholders about the different services that will enrich their lives and improve business opportunities.

As part of activities marking this years Yello Care, employees partnered with officials of the National Road Safety Commission and MTTU to educate commercial drivers on road safety issues. The road safety exercise took place at the Tema Lorry Station (Accra), Market Circle, (Takoradi) and Asafo Market (Kumasi). The group offered advice on the use of hands free driving kits. They also reminded the drivers to avoid drinking alcohol before driving and offered other safety tips. ASP Alexander Obeng, a representative from MTTU, in his remarks urged all road users to put safety first and drive cautiously. He encouraged drivers to take driving lessons seriously and also acquire a drivers license before driving on the roads. Mr. Reuben Adjetey, Assistant Planning Officer from the National Road Safety Commission, took the commercial drivers through various road safety tips such as wearing of seat belts while driving and using hands free kits where necessary to attend to urgent phone calls. He urged drivers who drive long distances as well as truck drivers to have enough rest before they embark on their journey and in between the journeys. Mr. Etse Ladjekpo, Executive Director of the National Drivers Academy who chaired the function reiterated the need for passengers to caution drivers who drive recklessly and if possible desist from continuing their journey in those vehicles. He also emphasised the need for drivers to have fire extinguishers, triangles, reflectors and other road safety items in their vehicle.

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(Main) MTN Volunteer distributes Road Safety Materials to Commercial Drivers (Inset Top) Education on The Mobile Phone, My Business with Market Women in Takoradi (Inset Bottom) MTN Staff shares Road Safety Tips with a commerical driver

MTN Staff also had one-on-one sessions with the drivers and educated them on safety signs and other precautionary measures to be observed on the road. Staff volunteers also distributed fliers to the drivers to serve as a guide and a reminder on the safety tips as they go about their daily routine.

The Chief Marketing Officer of MTN, Mr. Rahul De who participated in the road safety campaign, shares his experience. It is so refreshing to interact with the drivers. I never knew I would get this opportunity to share my driving experience with these commercial drivers. I am happy that 21 Days of Yello Care has made it possible for me to contribute to enriching the lives of these drivers with the knowledge I have. I believe with this sensitisation, a lot of lives would be saved as a result of more cautious driving on our roads. A group of MTN staff also interacted with the Conference of Heads of Assisted Secondary Schools (CHASS), Accountants and Bursars of Senior High Schools on the topic, How can Mobile Money transform the management of schools fees collection.

As a business, MTN is passionate about education and we recognise that education is the heartbeat of every country. It is a powerful driver of development Michael Ikpoki, MTN Ghana Boss

The interaction highlighted the efficient use of Mobile Money to operate a cashless, safe and convenient system regarding the collection of school fees. Some groups of Market Women and members of the Ghana Union of Traders Association (GUTA) were also engaged in a forum that sought to enlighten them on how they can use their mobile phones as a tool for enhancing their business. forum was under the theme: The Mobile Phone & My Business.

Recognising the need to educate stakeholders on the telecoms industry, a seminar on Telecommunications was organised for student journalists of the Ghana Institute of Journalism (GIJ) in Accra. The aim was to educate GIJ students on how mobile phone technology works and also to encourage young journalists to specialise in telecoms reporting. A career session was organised for female senior high school Students in Kumasi and Takoradi about the benefits of pursuing careers in Science and Maths, Telecoms and other Engineering fields.

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ADVERTORIAL / MTN

OIL & GAS

The LPG Subsidy saga

Ghanaians are learning the hard way; conserving forest cover by subsidising consumption of LPG is proving extremely costly as free-riders demand overwhelms supply, and threatens to upend the programme.

o suggest that Ghanas policy of subsidising the consumption of liquefied petroleum gas (LPG) should be scrapped was, not too long ago, simply uttering the unthinkable. In recent times, however, powerful voices have been pushing that agenda. Dr. Charles Wereko-Brobby, an energy expert, first broached the topic in 2010. He argued that there should be at least a partial ban on commercial vehicles usage of LPG rather than gasoline, which was undermining the effective supply of the product to domestic users, for whom the policy was instituted. Since the 1980s LPG, a by-product of the crude oil refining processes, has been promoted as a substitute for charcoal and fuel wood. The policy aims at conserving what is left of Ghanas alarmingly dwindling forest cover, which, at the turn of the 20th century, stood at 8.2 million hectares. Currently, this figure is below 1.6 million hectares and is estimated to be contracting by 65,000 hectares annually. The measure has become even more urgent for Ghana, since the northern fringes are increasingly threatened by the rapid southward spread of the Sahara Desert as a result of global climatic changes. Incidentally, the source of fuel in the northern parts of the country is mainly firewood, charcoal and cattle dung. Extensive grazing, a major economic preoccupation in those parts, compounds the already precarious ecological balance of the area. This has resulted in rapid worsening of the situation from excessive harvesting of wood for fuel. But though there are no exact numbers on the measures impact in reducing the rate of deforestation, some success can be inferred from figures obtained from the Energy Commission.

The data shows an appreciable rise in the usage of LPG as fuel in the residential sector, thereby helping to cut down on the use of the traditional sources of fuel. Most households use more than one form of fuel (a combination of charcoal, firewood and LPG) and the data shows that currently about 36 percent of the residential sector use LPG. This number continues to rise steadily, while about 79 percent use charcoal, and 40 percent use firewood. So while the use of LPG may be helping the situation, the country has since 2009 been intermittently rocked by acute shortages of LPG. Many domestic consumers, especially institutional kitchens such as in schools and hospitals, have been forced to revert more increasingly to the use of charcoal and firewood. Superficially, Dr. Wereko-Brobbys arguments sound plausible. Skyrocketing demand, caused by the increasing use of LPG by commercial vehicles, was creating persistent supply shortfalls. Domestic users bore the brunt of this shortage, as the country lacked both the refining and storage capacity to meet the growing demand. To put it in the right perspective, the National Petroleum Authority (NPA) revealed that within a short period, consumption of LPG had moved from a low consumption quantity of between 500 and 800 metric tonnes per week to over 1,800 metric tonnes. And with a price differential of more the 50Gp per kg in favour of LPG, increasing numbers of commercial vehicle owners were converting their vehicles from petrol engines to enable them run on LPG.

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The raw numbers seem to justify his position. From 2006 to date, LPG consumption has increased by over 537 per cent, from 21,116,059kg to 134,409,632kg in 2012. In a presentation at a forum in June organised by the Integrated Social Development Centre (ISODEC,) Dr. Wereko-Brobby said credible evidence suggests that more than 70 percent of LPG consumption is now as vehicular fuel and not for cooking as originally conceived and intended. But the debate about the wisdom, or otherwise, in maintaining subsidies on LPG consumption gets marred in the bigger picture of general fuel subsidisation. Mr. Mould notes that the cost to government is estimated to have grown to GH60 million a month with total cost in the first five months of 2012 alone exceeding GH 200 million. He said government spends over GH450 million on fuel subsidies annually, and with oil prices likely to remain elevated, fuel subsidies will continue to weigh on government budgets. The International Monetary Fund (IMF) had earlier waded into the fray, pressing government to remove all subsidies on petroleum products. Trade unionists were angered by this, and threatened a gargantuan demonstration should that happen. Government obviously had no interest in removing fuel subsidies; certainly not in an election year. Expectedly, civil society organisations, chief among them, ISODEC, who hold themselves as representing the interests of the people, welcomed governments decision to maintain fuel subsidies. On the other hand, proponents of fuel subsidy removal have a solid case. They argue that fuel subsidies pose huge financial burden on the government, disproportionately benefit the unintended income groups, encourage inefficiency and corruption, and divert scarce public resources away from investment in critical infrastructure. Interestingly however, Dr. Wereko-Brobby debunks the notion that government actually subsidises the consumption of fuel, noting that a plethora of taxes in the cost build-up of fuel outweigh the subsidy component in the price of petroleum products, arguing that actually, in recent years, 10 percent of government budgets are supported by such levies on petroleum products. Questioning whether the IMFs insistence on fuel subsidy removal is indeed a re-introduction of the Structural Adjustment Programme, (SAP) he punches the organisation and its allies to stop demonising subsidies and offer more constructive models. While saying no to subsidies as they exist in current form, he is all for subsidies that actually reduce the negative impacts of fuel price hikes and also make direct positive impact on the intended beneficiaries. That is where he suggests that subsidies on LPG consumption, which qualified for subsidisation for the sake of environmental considerations, needed better treatment if they are to serve their purpose. Caught in the debate of fuel subsidies, and more especially as commercial vehicular use of LPG as fuel is greatly undermining the primary purpose of LPG subsidisation, the price of LPG needs to be raised to achieve parity with gasoline, while contrarily instituting support measures such as lower taxes and subsidies on cookers, stoves, gas cylinders and other such household appliances used in cooking. This will ensure that there are no incentives for vehicle users to convert their engines to allow them take advantage of lowerpriced LPG as fuel. Concurrently, a return to the programme of conversion of institutional kitchens, which largely depend on charcoal and firewood for cooking, is imperative. Even more urgent now is the need to introduce more discipline in the LPG sector as the head of the Ghana National Gas Company (GNGC), Dr. George Sipa Yankey, disclosed at the recent launch of the Ghana Oil and Gas Yearbook. He stressed that upon the completion of the countrys gas processing plant that would utilise local natural gas, a lot of effort will go into making more gas available for domestic consumption. Obviously, if Ghanas dwindling forests must be conserved then subsidies must move away from fuels generally. The intended targets need to be supported exclusively, and as far as possible, the support must be enjoyed and must be seen to benefit directly those for whom it was intended. Ghana now has a great opportunity to effectively adapt to the adverse impacts of climate change. It all however depends on how well government succeeds at accurately targeting subsidies on LPG.

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OIL & GAS

That perhaps has prompted the Chief Executive Officer of the NPA, Mr. Alex Mould, to call for an outright ban on the use of the product by vehicles, among other recommendations. These included a price differential to ensure full cost recovery of LPG, which receives high subsidies from the government.

FEATURE

Obamas

new policy for Ghana & others Any good news?

By Sebastian Spio-Garbrah
Barack Obama, President of the U.S.

fter months of braving much criticism for its lack of attention on Africa, the Obama administration finally launched an Africa strategy document on June 14th, 2012. The document centres on clarifying the Obama administrations specific focus for engagement with Africa. The document is realistically minimalist as it seeks to anchor the administrations policies towards Africa around 4 main pillars: strengthening democratic institutions; spurring economic growth, trade, and investment; advancing peace and security; and promoting opportunity and development. While former President Bill Clinton prioritised trade and investment, and President George W. Bush made HIV-AIDS treatment a number one priority, President Barack Obama, current President of USA, has chosen to focus on strengthening democratic institutions as his highest priority for Africa. This focus, though laudable, is ironic, as evidence on the ground in Africa does not necessarily reflect a strong commitment by the Obama administration to democratisation. Despite the administrations past ambivalence concerning the current democratisation process in Egypt, it may be too early to tell their current position on the matter. It is still uncertain how the plan to move forward in US-Egypt relations and implement its strategy after the Muslim Brotherhoods candidate Mohammed Morsi, just won Egypts presidential runoff. However, the fact is for many - especially within the international community and to many African democracy activists - this priority for Africa by the Obama administration comes as a surprise.

Early last year, during the largest wave of democratisation ever to occur on the African continent since 1975 when Africas Portuguese colonies gained their independence, the Arab Spring, there have been mixed views on the position of the USA. For many, the USA was behind much of the evolution process as in the case of Libya. For some, the USA remained a silent force until it was clear that the forces of democracy had been won. In Ghana, the quintessential poster child for good governance in Africa and a stop for Presidents from the last three US administrations have started showing signs of simmering ethnic violence ahead of the 2012 elections. Evidences of political corruption surmount as the immediate past Attorney General and Minister of Justice, Martin Amidu, widely known for rectitude, accuses the US-friendly President, John Atta-Mills, and several members of his cabinet of perpetuating gargantuan crimes. Once again, the US remains silent, as the Ghanaian public grows weary of their political class. Though the African Strategy Document does not clearly spell out tackling bribery and corruption as one of its objectives, it is clear that strengthening democratic institutions and spurring economic growth need to tackle with this poignant issue. Kenya, President Obamas homeland, has seen a rise in ethnicbased political parties and growing indications that late 2012 and early 2013 polls may become a repeat of the see a 2007 demonstrations. In spite of this, President Obama is yet to visit Kenya; similarly, he has barely mentioned Kenya in any major speech concerning economic development or elections.

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John Evans Atta-Mills President of Ghana

Evidences of political corruption surmount as the immediate past Attorney General and Minister of Justice, Martin Amidu, widely known for rectitude, accuses the US-friendly President, John Atta-Mills, and several members of his cabinet of perpetuating gargantuan crimes.

In Tunisia, France being a major ally of the US, supported the Ben Ali regime until its final hours in power, with the response of the US Secretary of State, Hilary Clinton, We cant take sides, speaking volumes, emphasising their muted stance. Later when the Egyptian revolution started, it was not until the day before former President Mubarak announced that he will step down from power with a new Vice President, Omar Suleiman named, that the Obama administration came out publicly in support of the democratic protests. In Libya, despite aiding the toppling of former leader Muarmar Gaddhafi, the US has taken no strong public steps to assist the new Libyan regime to re-establish order. It has done as much as granting diplomatic recognition to the National Transitional Council as the legitimate Libyan government and led efforts at the United Nations to allow unfrozen Libyan assets to be transferred to the interim government. However, nothing significant has been done with respect to the objectives of the African Strategic Document. Further south on the African map, the new Republic of South Sudan, an advent American administration of all ideological stripes supported for decades, lies in tatters. South Sudanese President, SalvaKir, since gaining independence in 2011, has launched an aggressive unsuccessful war against the north and has recently accused several ministers of siphoning several billion dollars from the government treasury. Yet again, the Obama administration has remained a silent giant on this democratic apostasy in South Sudan.

On the East of Africa, the US continues to supply military arms to Ethiopia, despite the many violent anti-democratic crackdowns that Prime Minister, MelesZinawi, has supervised during his 21year rule. In neighbouring Djibouti, the US maintains a military presence and has continued to support President Ismail Omar Guelleh, who has in recent years arrested opposition leaders, amended the constitution to run for a third term and disregarded many of the tenets, which the Obama pro-democracy Africa strategy advocates. For the civil society and pro-democracy forces in Djibouti, Obamas strategy to amplify and support voices calling for respect for human rights, rule of law will may come as a daydream. Somalia also experiences a literal absence of US with respect to the main political debates, except for a few drone attacks ordered on suspected terrorist bases. In Uganda, though, the Obama administration has posted 100 US troop in the country to help regional governments haunt down Joseph Kony and fight the Lords Resistance Army (LRA), the White House has been largely muted the ongoing destruction ordered of the opposition parties and physical abuses meted against the principal opposition leader KizzaBesigye by President Museveni. In Zimbabwe, the US still remains politically irrelevant to the debate over a post Mugabe era after a series of leaked US diplomatic cables unveiling the known weaknesses of the opposition leader and current Prime Minister, Morgan Tsvangirai.

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FEATURE

FEATURE

In Senegal, it was only a forceful populace that eventually pushed the octogenarian and former President, Abdoulaye Wade, out of office. The US voice in that drama was largely absent. In Mali, when the democratic government of President Amadou Toumani Toure was overthrown earlier this year, there was virtually no strong US response commensurate with the scale of constitutional violations. Indeed, the US has endorsed the Economic Community of West African States (ECOWAS) solution of forcibly retiring Toure and setting up a makeshift hybrid civilian-military Frankenstein government which has no popular legitimacy. As Ghana Business and Finance Magazine quick survey has shown, the Obama administration despite its public pronouncements of placing the strengthening of democratic institutions at the forefront of its Africa policy, this has yet to take root. Also lacking from the Africa Strategy is any discussion of Africas natural resources sector, especially the growing strategic importance of the Gulf of Guinea to US energy security, which the Cheney 2001 energy task force recognised.

President Atta Mills in conversation with Presidnt Obama

Despite the political progress made, by the two political parties, Zanu-PF and the opposition Movement for Democratic Change (MDC) to form a coalition, US policy towards Zimbabwe and the regime remains atavistic and unsupportive of the on-going improvements in that countrys political governance. Relations between South Africa and US remain tense. The Obama administration supported international military interventions in Libya and Cote dIvoire, whilst South Africas Jacob Zuma ultimately was opposed to both military operations. Today, South Africa refuses to recognise the interim government of Libya and vociferously opposed French-led (US supported) intervention in Abidjan, Cote dIvoire. In Angola, where according to Gallup polls, the government has the lowest support lever of any government in Africa, the US barely said a word about the convoluted political transition underway from President Eduardo dos Santo back to himself or to his close ally, Manuel Vincente with potentially hundreds of millions allegedly embezzled in the process. In Angola, signs point to an incipient youth revolution, an imminent shift in the countrys political structures and yet the Obama administrations position on the presidential transition is unclear and not categorically supportive of democratic change.

US continues to supply military arms to Ethiopia, despite the many violent antidemocratic crackdowns that Prime Minister, MelesZinawi, has supervised during his 21-year rule.

The management of resources, which the USA has taken a special interest in and a desire to counter the strong anti-competitive approaches taken by China to tie up large quantities of critical African mineral commodities is not discussed. The word oil appears only once in the entire document, and even there, On the East of Africa, the refers to non-oil exports to the US. Indeed, the word energy appears only twice in the document, once in reference to the financial management of energy resources and another in reference to clean energy.

In Gabon and Equatorial Guinea, the voice of the Obama administration has not been heard on the many allegations of democratic abuses that have occurred over the past few years. For an administration whose Africa policy is focused on strengthening democratic institutions, the most obvious candidates for reproach and reform have been largely left off the hook. In Cameroon, US policy favoring democratic change remains moribund and impotent as President Paul Biya entrenches himself in power after 37 years in office. Nigeria, is arguably the one country in Africa that the Obama administration has the most important bilateral relationship with and yet the US is missing in action on the most urgently pressing issues as to how to contain and defeat Islamist terrorist group, Boko Haram, and prevent a full scale escalation of a sectarian violence despite condemning its attacks and designating three leaders of the Boko Haram militant group as terrorists. On Cote dIvoire, Senegal and Mali, the views of the US remain tentative and obscure to discern. In Cote dIvoire, a victors justice seems to be underway, where only those associated with former President Laurent Gbagbo have either been hauled before the International Criminal Court at the Hague or jailed in his country, despite a UN teams findings on violence on both sides during the recent post-vote civil war. The US still remains silent.

It is very clear that the Obama administration, unlike the Clinton or the Bush II administrations, does not consider Africas oil and mineral resources of strategic importance to the US, and consequently, does not consider the role that major American energy companies such as Exxon Mobil are playing in Africa, beneficial to the US energy strategy. These companies are essentially on their own, whilst the Chinese, Koreans, Indians, Russians, Japanese and Thai energy firms receive strong diplomatic and political support from their home governments to snatch as many African oil leases and mining concessions as possible. As the botched acquisition of Kosmos Ghana assets by Exxon in 2010 showed, the strategic priorities of the US in Africa may not extend to giving strong support to major energy firms operating there.

Despite grandiose expectations by most Africans in 2008, when Barack Obama won the American presidency, that Africa will be a major thrust of his administration, his policy focus is naturally on domestic-economic issues, as his re-election in 2012 will be a referendum on his domestic competencies rather than his international popularity. Evidently, the tangible legacies Clinton and Bush have in Africa must serve as a painful reminder to many Obama supporters that merely having parents or grandparents hailing from the African continent does not guarantee that the continent will become a priority when one attains the American presidency.

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Help us reduce cancer impact in Africa

Our Mission
ACO is dedicated to reducing the impact of cancer in Africa through the provision of effective and feasible public awareness interventions aimed at reducing cancer incidence, suffering and mortality in Africa

Key Objectives
Cancer advocacy Education & awareness programmes Promoting volunteer services Supporting cancer research Encouraging cancer screening programmes Mobilise resources through fundraising activities Forging strong institutional partnerships

Cancer Awareness

ACO: Helping Improve

How can you help?

To donate, please send your cheques to 'African Cancer Organisation' or internet, in-branch or international payment using the following account details

african cancer organisation

House No. 7, Lamb Street (Off Farrar Avenue) Adabraka, Accra Ghana

Mailing Address: P.O. Box 0772, Osu, Accra, Ghana T: + 233 302 240 786 F: + 233 302 240 783

Thank you for your support!

www.africancancer.org

ACO is an International non-governmental organisation formed and dedicated to the control of cancer and its effects on the African Continent

UK Registered charity no: 1127740

Bank: Account Name: Account number: Sort code: IBAN: BIC:

HSBC African Cancer Organisation 71838776 40-06-21 GB72MIDL4006217183776 MIDLGB2107T

MOTORING

Meet Audi A6 Allroad

A
udi didnt invent the crossover segment, but it does field a pretty strong lineup of models. Things arguably started twelve years ago with the A6-based Allroad. Today, the company offers the Q3, Q5, and Q7utilities, as well as the A4 Allroad and A6 Allroad wagons. The Ghanaian market currently stocks the Q5, and Q7 while the A6 Allroad could, hopefully, join Ghanas lineup sometime in future. Well, the recipe remains unchanged from prior models: It is once again a dressed-up and jacked-up A6 Avant, without any true offroading aspirations. Okay, the A6 Allroad does offer a tilt-angle display and an electronic hill-descent-assist function. But these enhancements dont go very far in matching the chops of the first Allroad. So, the Allroad is mostly about aesthetics. In fact, many customers will choose it, not because they ever wish to leave the asphalt, but because they simply want the most upmarket A6. Ground clearance is increased slightly; the grille features specific vertical slats, the bumpers and fender flares are painted in a contrasting color. Overall, the new look isnt exactly rugged, but it makes the point that its owner is an outdoor type. In accordance with its place as the top-shelf A6 wagon, the Allroad is offered with the A6 lineup's better engines - there is one gasoline engine, the supercharged 3.0 TFSI V-6 with 310 hp, and three variations of the 3.0-litre V-6 TDI with 204 hp, 245 hp, and 313 hp. The Allroad is the first application of this engine to get increased torque output of 428 lb-ft, up from the previous 369 lb-ft. (Variations of this engine are sold in various Audi models, as well as the VW Touareg and the Porsche Cayenne.) As far as diesels go, this unit is just about perfect. It emits a quiet purr and very little vibration, and its powerful, with most of its torque available at low rpm. The seven-speed dual-clutch transmission makes for seamless shifts and, thanks to a short first gear, you dont miss torque multiplication when launching the car from a stop. The diesel fits the character of a crossover wagon better. Plus its very efficient. The A6 Allroad is an accomplished long-distance cruiser, but it also enjoys single-lane highways. The weight of its power-train is somewhat offset by body construction rife with aluminum, and the electromechanical power steering - one of the finer systems in this class - reacts loyally to driver input. Will the A6 Allroad be offered in the Ghanaian auto market? Indeed, one cant answer with great certainty because in markets as sophisticated and as liquid as the US market, the cutie was held back because Audi wanted to push its Q5 and Q7 models there. Just keep the faith and your eyes on the road! Source:caranddriver.com

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The Minister for Education, Ambassador Lee Ocran, is a man who does not pull punches. In this interview with GB&F, he says technology education remains the driving force behind Ghanas education sector. Below are excerpts of the interview.
Q: In the current technology-driven world, what are you doing to promoting science and technology education in Ghana? A: We are committed to promoting science and technology in education. This includes improving technical and vocational education, rehabilitation of science laboratories in senior high schools, and the development of appropriate curriculum to instill innovation and creativity in the application of scientific knowledge. We are also exploring all possible means to increase interests in the study of science and technology in order to ensure the attainment of governments policy to achieve the 60-40 ratio admission requirements at the tertiary level. Among the package of incentives earmarked for this purpose include specific targeting of support to science and technology-related courses as well as the provision of scholarships for the study of science. In addition, polytechnics with the capacity are now permitted to offer Bachelor of Technology (B.Tech) degrees in programmes but with special preference for science and technology related programmes. Q: What efforts are you making towards increasing computer-literacy in Ghanaian school children? A: As part of efforts to ensure that children in Basic Schools have access to computers, the Ministry in 2011 launched the Basic Schools Computerisation Project. Under the project, 60,000 laptops were purchased for distribution to Basic Schools throughout the country. To date, 15, 000 of these laptops have been distributed in the Upper East and Upper West and Northern regions. Plans are underway to cover the rest of the country before the end of the year. The Ministry has also drawn up plans to supply all Junior High School teachers throughout the country with laptops. Under the initiative, 65,000 teachers are expected to benefit from the package, which takes off before the end of the year. Q: Is GETFUND broke? A: To my knowledge as the one in charge, I am not aware that GETFUND is broke. The law setting up the fund mandates it to provide finances to supplement the governments budget for education at tertiary levels. The monies from the fund are to be expended in the provision of financial support to agencies and institutions under the Ministry of Education for the development and sustenance of essential academic facilities in tertiary institutions through the Ministry of Education. Q: Prospective beneficiaries of the Student Loans Scheme have complained about the stringent hurdles they have to scale before they can access the loan. How can you make the scheme more accessible? A: It is this governments intention that every student in an accredited tertiary institution in Ghana has access to loans from the Student Loan Trust Fund (SLTF).

Consequently, the government ensured the passage into law of the Student Loan Trust Fund Act (Act 820) in June 2011. Subsequent to this, we support the Student Loan Trust Fund to initiate activities geared towards easy Ambassador Lee Ocran Minister for Education, and adequate access to funding by Ghana tertiary-level students. To improve service-delivery to clients of the scheme, the SLTF has also introduced a guarantor diversification provision for the benefit of students. This facility enables non-SSNIT contributors to act as guarantors for students applying for a loan. Through this diversification, district assemblies, corporate bodies and individuals as well as SSNIT contributors will be able to provide guarantees for students. Q: How effectively do you implement the study-leavewith-pay facility for teachers? A: The NDC government is aware of its promise to teachers to create opportunities for easy access to study leave with pay. This promise was made with the full understanding of the challenges faced by the Ministry of Education and the Ghana Education Service, with regard to the GESs motivational support for teachers professional development. The Ghana Education Service has been directed and has accordingly streamlined the implementation of the study leave programme. The system now links study leave to teacher gaps in the delivery system. This study leave system serves the best interest of the child, the teacher and the education system as a whole. In terms of statistics on study leave approvals, the Ghana Education Service in 2010/2011 academic year granted study leave to 3, 000 teachers to further their education Q: The dearth of professionals in oil and gas to service Ghanas new oil economy has made room for many institutions claiming to offer training in oil and gas to advertise for students. What can you do to help ordinary Ghanaians sieve the real from the dubious ones? A: Of course when there is something new, some smart guys want to take advantage of the situation. When I was Ghanas High Commissioner to South Africa, we faced a similar problem from thieves in Ghana who placed adverts in South African newspapers for academic positions in non-existent oil and gas institutions in Ghana; institutions with funny names like University of Oil and Gas, Sekondi. Prospective candidates were asked to pay certain amounts and they concurred. When they did not get the employment, they run to the mission to complain. So definitely, there are people that will take advantage of the situation. My advice to those who want to study oil and gas is to be patient and diligent. Before committing money, ask yourself, What kind of oil and gas institution is that? Currently, there is an oil and gas training facility at Takoradi, for example.

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EXECUTIVE SUITE

Technology is crucial for educational sector - Education Minister

ANALYSIS

Africa is up & coming

By Angelina Lazar (International Management Consultant)

t is beyond fascinating, infinitely enigmatic, extremely precarious and highly ironic what is happening in macroeconomies across the globe today. Advanced, capitalist economies of a super-satiated developed world, as we know them, are plummeting head first, whereas underdeveloped third world and transitional economies are up and coming, rising like a phoenix from the ashes, and soaring upwards in flight at top speed like the loftiest. Never has the world been so topsey-turvey, veritably somersaulting as it is today; and we are only just beginning to witness this extravaganza play itself out, as it unveils itself mesmerisingly on the world stage, leaving polar peoples, unanimously gaping, watching with dropping jaws. Many are glaring, flabbergasted, spellbound, doubtful, shocked, and positively intoxicated over the implications these circumstances mean for them, their families and friends, nation and continent as a whole. Today, though, the change has already started to take over and is running at rampant speed, with no brakes to clutch, no flinching in heady cerebral intentions, no dovetailing, spinning or pit stops with junctions along the way.

The change is just moving at a veritable lightning speed, economies are virtually transmogrifying themselves into their antitheses simultaneously and vicariously. Billionaire George Soros puts it like this: "The world financial system is on the brink of collapse, with developed markets running at top speed toward disintegration[and] although developing countries are battling a slew of problems themselves, such as corruption and tattered infrastructure, they will most likely end up faring better than markets in the big, industrialised nations!" As if that were not enough, he goes on to say that, "the global financial system finds itself sliding down a slope of a selfreinforcing process of disintegration, and that investors must brace for the worst because the consequences could be disastrous! That was the bleak forecast Soros projected for the most developed countries in the Western world. We must not deceive ourselves, Soros is highly experienced in this field, therefore these are hardly projections, but are certainly warnings of what is to come and, indeed, is already here.

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High unemployment, lack of economic opportunity, low wages, widespread poverty, extreme concentration of wealth, unsustainable government debt, control of the government by international banks and transnational corporations, a weakening rule of law, disintegrating National Constitution, and counterproductive government policies are sure tell-tale signs; all of them are present and evident in the U.S. today and widespread throughout Europe as well. Other factors include poor public health, nutrition and education, as well as lack of infrastructure. These factors will rapidly deteriorate in a declining economy. In other word, we can expect to see these manifestations emerge in North America and across Europe, as unbelievable as they may seem to us today. However, people are not taking notice as they are believing the hype and propaganda of media giants - the fourth arm of shadow governments worldwide; hence, they are being programmed and brainwashed literally with their eyes wide shut. As for unemployment, this problem cannot be ameliorated, as it is a profound issue in the U.S. In fact, the problem of unemployment is due to the fundamental change in the modus operandii of the transnationalists based there and are attributed to a huge challenge to economic opportunity in the U.S.

ANALYSIS

On the other hand, Soros defines emerging markets such as Africa, the Arab World and China as "bright spots in an otherwise As a result, the labour market is in a serious downward trend with dim global economy". Other financial investment gurus claim corporate downsizing on the rise, an escalation of outsourcing that for those seeking yield and serious growth, Africa is the first jobs to Third World relative parties and offshoring of the place to target. This is highly encouraging for a manufacturing sector, as a whole. This is continent that was continually stigmatised as the globalisation at its worst and it is absolutely anti"Dark Continent", and which represented a place protectionist, causing veritable de-industrialisation The change is just where savvy investors avoided. Today, though, of the West. What a concept! it is foreseen as a safe haven , which they will moving at a veritable invariably flock to once they gain more appetite Now, I want to enlighten the savvy African reader lightning speed, for risk, as they see their options in the developed to please understand, prior to the Clinton world, namely Europe and the U.S., going up economies are virtually Administration, unemployment in America was in smoke and down the drain. measured properly, fairly and accurately. But transmogrifying Billy would willy-nilly calculate unemployment Conversely, the U.S. is increasingly becoming in a way that would hide the fact that the economy themselves into their more and more a post-industrialist neo-third was in huge disarray and outrightly disastrous. antitheses world, as Gerald Celente, the worlds most simultaneously and renowned futurist, likes to call it, and this will The actual fact is that unemployment in the U.S. become more and more visible to the naked eye, exceeds 22 per cent, just short of what it was vicariously. as it sends a shock wave to global citizens across during the Great Depression, when it was at 24.9 both sides of the equator and all income per cent. Now, we are beginning to see how spectrums inter-continentally. Thus, people may stable and opulent the U.S. really is when very well, in this quasi-virtual reality, consider putting their heads we look at the real numbers and not the fudged statistics we are on backwards to cope with the conundrum at hand in order to fed with from the proverbial silver spoon. keep moving forward. To put things further into perspective, so as to better understand The question however is: What constitutes third world status? this new reality and see the big picture, let me say that the U.S. trade deficit with China alone caused a loss of 2.8 million U.S. Well, let us consider this in order to truly grasp the hard cold jobs since 2001. But what about the number of jobs that were reality and facts at hand, as they smack one in the face so hard lost to North or South Korea, the Philippines, Thailand, Indonesia, that, it can only be likened to the Russian cold felt Vietnam and India? And the list goes on and on with no end in when one alights from a Moscow-based front sight. What, though, of increasing wages for those who are porch on a typical wintery 'po-russkii den.' employed? Isn't this, at least, a plus and not a negative, and can it not, somehow counter the negative numbers produced in the U.S.? Actually, the answer is no.; Real wages are actually falling as household incomes decrease precipitously. Those workers may be earning more dollars in fact, but what are they worth when wages, adjusted for inflation, have not kept up with the Consumer Price Index (CPI)? Hence, the cost of living is rising faster than the increase in wages, again rendering the net effect negative with higher wages null and inefficient, and more of a cover-up than anything else to programme people into thinking they are "making it" instead of 'breaking it'!

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1st
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ANALYSIS

And please note that the total wealth of society is reduced when wealth is highly concentrated. This is because there is a lower overall level of economic activity nationwide; hence, no matter which angle we shine the light from, the reality is grim, stark, devastating and destructive. We have not even discussed the unprecedented problem with the sub-prime mortgage crisis, which is rippling across the U.S. and beyond, as we have only seen the tip of the iceberg with upside down mortgages from coast to coast. And when we couple that with deteriorating jobs, it will mean an increasing number of home owners will not be able to make their monthly mortgage payments; as such resulting in the foreclosure of their homes, rendering them homeless, consequently, increasing the poverty rate, ushering in a post-industrial welfare state extraordinaire. Indeed, did I even mention the bank debentures and all the speculation and the fact that American citizens were fooled into subsidizing the very banks that put them in this mess with the bogus bail-our programmes? And did I also mention the hyperinflationary obligatory coming collapse of the U.S. dollar hardly anyone speaks of, and what that will do to an already plummeting U.S. economy? So, anyone thinking the Western world will perk up and find its way out of this hidden, disguised, procrastinating depression is Consequently, what does this mean and what is the conclusion? only a wishful thinker, and refusing to look at the hard, This means that there is an avid increase in poverty in America cold facts. They are in denial and paralysed with fear or totally today. According to the U.S. Census Bureau, the poverty rate in oblivious and ignorant of anything and everything around them, the United States rose to 15.7 per cent in 2011, with 47.8 million living in a virtual dream-world. And is there a way out? Yes! But Americans living in poverty which is 1 in 6 we will speak of that exclusively in our next people. The official poverty line, determined issue. Here, the point is being made by the U.S. Department of Health and Human surreptitiously that the wealth of the West is The actual fact is that Services, is $22,314 for a family of four; and disintegrating into nothingness, while the woes the number of families living in poverty has and ills of the Third World are being unemployment in the risen sharply since 2006 and continues to climb. transformed as the tide turns with yin and U.S. exceeds 22 per yangs interchanging roles, fates and natures. This is hardly the image America depicts of Preposterous or providential? Perhaps both, cent, just short of what itself and is far from the American dream; indeed.. it was during the Great instead, it is more like an American nightmare. Yet still, we are witnessing an increase in the Depression, when it concentration of wealth. Africa is up and coming. Africa is the was at 24.9 per cent. future Based on the grim outlook for employment Now, we are beginning and reality of actual and real wages however, Africa is unexpectedly, travailing in birth pangs, to see how stable and both poverty and reliance on government it is true, but the fruit it shall bear in the context opulent the U.S. assistance programmes will only continue to of these global economic wild card grow. But simultaneously, we are observing a manifestations will totally surprise the residents really is when we look phenomenon and contrary trend with the on this continent, as it will the rest of the at the real numbers household income and wealth of the wealthiest watching world abroad. Today, we can just one per cent of Americans increasing sharply, paddle over to the other side of that poverty and not the fudged despite the overall deterioration of the U.S. line, finally, experiencing a whole new statistics we are fed economy, according to the Congressional future of exciting possibilities. Budget Office. Quaint, isnt it? But let us qualify with from the this to better understand the growing disparity proverbial silver spoon. in income distribution in America. For the wealthiest one per cent of Americans, household income has veritably tripled between 1979 and 2007 and only continues to increase while household wealth in the United States has fallen by $7.7 trillion, according to Ron Hera of Hera Research. The Gini Coefficient measuring income disparity reveals that today, America is at parity with China and will soon overtake Mexico, a developing country.

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InvestGhana in a Beach Resort in

(And/or buy nearby residential plots)
A strategic investor and partner(s) is sought for a beach resort at one of Ghanas most sought-after beach resorts. Excellent location 40 kilometres from Accra, good access roads, power and water, telecoms, scenic town nearby. Great opportunity, high returns. World-class architects and developers from South Africa. Associated Opportunity exists for development of 30 beachside villas nearby, or for purchase of residential plots and self-development within a future gated community, with access to beach, hotel, restaurants, pools, spa, gymn, tennis and amusements.

Sunset Beach Resort Limited Enhancing the tourism supra-structure in Ghana.

10 Reasons To Invest in Ghana

a a a a a
Ghana is a multi-party democracy and is internationally recognized as one of Africas most politically stable countries Ghana has a stable, growing economy, averaging a growth of around 5-6% a year The Ghanaian government is pursuing a policy of economic deregulation. A fully privatised economy is the ultimate objective Ghana has large tracts of arable land that are attracting a growing number of agricultural projects. The government has launched numerous programs to support and develop various agricultural sectors Ghana has a well-developed production and service industry. Sectors include heavy industry, precision manufacturing, electronics, agro-processing, plastics, garments & textile, mining, and timber

a a a

a a

Ghana has an immense workforce, with an employable population of 10 million plus (out of a total of some 23 million) Wage costs are low, averaging just 1 dollar a day. Government programs are in place to consolidate Ghanas status as a low-cost, quality producer Ghana is strategically located, offering an excellent gateway to the Economic Community of West African States (ECOWAS), with its combined population of around 250 million. Thanks to its modern harbours, airports and communications systems, Ghana is fully equipped to handle international transport. English is the official language. This gives the country a head-start over its low-wage competitors in the international economic arena. Ghana is part of the G-8 debt relief program.

For further information, and a site visit, please call +233 (0)302 240 786 or +233 (0)206 433 663

Services sector to be captured in exports statistics GEPA

By Effah Amposah

NEWS EXTRA

he Ghana Export Promotion Authority (GEPA) has advanced plans to include the services sector in its export trade portfolio in the near future.

Currently, GEPA focuses on tangible commodities when it comes to export trade, promotion and marketing. These are divided into traditional exports and non-traditional exports. The authority intends to implement an age-long policy of including the services sector in the number of products that would be classified under exports with intentionto record the full range of earnings from all exports and also to rake in more revenue for the development of the country. The Chief Executive Officer of GEPA, Dr. Kwadwo Owusu Agyemang made this known at the 73rd National Exporters Forum in Accra. According to him, the authority intends to diversify its revenue streams to bring in more money from areas that are not under the coverage of the authority in terms of exports. The move is expected to enhance the chances of the Governing Council of GEPA to achieve its overarching goal of reaching US$5 billion for the Non-Traditional Exports (NTEs) revenue by 2015, as directed by the Ministry of Trade and Industry during its inauguration. Though exports earnings from the non-traditional exports (NTEs) sector exceeded targets for two consecutive years, experts say the services sector which is growing tremendously, currently growing by 8.7 per cent according to the Ghana Statistical Services (GSS), can boost the NTEs earnings. 2010 earnings exceeded target by 12.3 per cent rising from US$1.45 billion to US$1.629 billion. Again the 2011 export earnings exceeded set target by 33 per cent rising from US$ 1.8 billion to US$ 2.423 billion. It is likely that the GEPA would meet its target and even exceed, given the current stimulating factors are held constant or get better. It is believed that if the contributions of the services sector were quantified like the traditional and non-traditional exports, Ghana would haverecorded a colossal amount as the total exports earnings for the year under review. There is an export component to the services sector which we are not capturing at the moment. For instance, do we know how much foreign revenue we get from the University of Ghana? In all the polytechnics in the country, do we know how many foreign students are there and how much they are paying in foreign currencies? Dr. Owusu Agyemang asked in wonder in an interview with GB&F.

If you go to our cardiothoracic centre, the place is patronised by non-Ghanaians who pay hard currency for admission and treatment. If you go to any of our polytechnics or universities, youll find out that there are a lot of foreigners who are coming here to consume the educational services provided. In a way you can even say our footballers who are playing in other countries are providing services for which they are being paid. To the extent that they are repatriating their income into Ghana, it can be classified as service. So you can imagine how big the revenue from services could be, Dr. OwusuAgyemang told GB&F According to the GEPA boss, countries at the receiving end of exports are able to quantify how much is brought into their economy, meanwhile, Ghana does not even recognise such movements as exports. Because our data system is not able to capture the revenues from those services we tend to ignore it in our non-traditional export statistics. Whereas we pride ourselves in making US$2.4 billion in 2011, when you go outside, the projections are that we earn three or four times more. It is all because of the way we capture our statistics. If somebody is able to put goods into their briefcase and sends it through the airport, it is not captured as part of our exports, but he takes them abroad to sell. But because the receiving country sees it when it lands, they are able to capture as import, when we are not able to capture as export, Dr. OwusuAgyemang told GB&F. In the initial attempts to pursue statistics to quantify the services sector, GEPA has run into challenges. Unfortunately the difficulty has been that, when you are trying to get these statistics just to be able to quantify how much these institutions earn for export statistics purposes, they are afraid to give you the figures, because they think when you get to know, you are going to tax them, he said smiling. Meanwhile, awareness creation has begun in earnest in the tertiary institutions in southern Ghana on exports in Ghana in order to allay the fears that the statistics they release would be used as bases to tax the institutions. It is imperative that corporate bodies and other institutions in the services sector appreciate the essence of recording accurately, the total real export earnings for the country at the close of an economic year. The country cannot continue to plan its budgets with false figures, whether inflated or deflated. It is high time that decision and policy makers fully understand how much we earn as a country through the non-traditional exports including the services sector so that proper, realistic plans can be made to enhance the visibility and attract more export interest to the services sector.

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Work with US to solve problems of governance

As Ghana asserts itself within the African Continent as a country with an internationally respected track record in improved governance, the role of information and communications technologies (ICTs) as an enabler of good government and good governance is becoming increasingly appreciated. E-Governance enables the central government to network public institutions better at the capital city level, and also with regional, district and township level administrations to improve the governance process, using the electronic platforms of telecommunications, the Internet, information technology and broadcasting. Ce-G invites partners to execute research and consulting projects in typical e-Government issues, e.g. e-Parliament, e-Justice, e-Voting, and application of electronic platforms in solving Government to Government (G2B), Government to Citizen (G2G), Citizen to 2 Government and vice versa problems.
Contact: Office: Mailing Adress: Phone: Fax: E-mail: Website: House No. 7, Lamb Street (Off Farrar Avenue) Adabraka, Accra, Ghana P.O. Box 0772, Osu, Accra, Ghana + 233 302 240 786 + 233 302 240 783 info@ghanaceg.org http://www.ghanaceg.org

Ce-G

Esoko Commodity Market Prices Week ending July 20

WHOLESALE PRICES (GH/KG)
Accra Bawku Kumasi Tamale Techiman Takoradi Hohoe

MARKETS

Average
This week Last week

Groundnut (edible) Maize (white, grain) Cassava (Gari) Millet (sanio, grain) Soya Beans Rice (local) Rice (imported) Cowpea (White) Cassava(Fresh Tubers) Wheat (Grain) Tomato (cooking) Yam (Tuber)

3.84 0.91 0.90 1.12 1.46 1.50 1.92 2.29 0.50 2.70 3.84 1.28

3.65 0.55 0.80 0.67 0.75 1.43 1.90 1.23 0.80 1.90 2.00 0.78

2.92 1.05 1.91 0.96 1.00 1.50 2.80 1.37 0.32 2.20 2.30 1.00

3.41 0.56 1.03 0.75 0.70 1.40 2.40 1.20 0.67 1.14 1.35 0.50

3.54 0.77 0.74 1.00 0.80 1.60 2.00 1.60 0.26 2.10 2.70 0.70

2.60 0.95 1.40 1.00 1.80 1.80 2.50 1.80 0.80 3.00 2.80 1.80

3.54 0.77 0.75 1.28 1.46 1.50 2.00 2.12 0.28 3.40 3.80 1.20

3.36 0.79 1.08 0.97 1.14 1.53 2.22 1.66 0.52 2.35 2.68 1.04

3.31 0.80 1.04 0.99 1.12 1.43 2.25 1.67 0.49 2.41 2.65 0.99

RETAIL PRICES (GH/KG)

Accra Bawku Kumasi Tamale Techiman Takoradi Hohoe

Average
This week Last week

Groundnut (edible) Maize (white, grain) Cassava (Gari) Millet (sanio, grain) Soya Beans Rice (local) Rice (imported) Cowpea (White) Cassava (Fresh Tubers) Wheat (Grain) Tomato (cooking) Yam (Tuber)

3.91 1.08 1.00 1.25 1.60 1.60 2.40 2.40 0.56 3.00 4.00 1.40

3.95 0.60 0.88 0.73 0.81 1.48 2.00 1.28 0.95 2.00 2.02 0.80

3.23 1.23 2.40 1.23 1.30 1.85 3.20 1.62 0.43 2.60 2.94 1.19

3.42 0.57 1.04 0.76 0.71 1.42 2.41 1.24 0.68 1.15 1.36 0.68

3.80 1.00 0.90 1.23 1.00 1.60 2.20 2.00 0.30 2.40 3.33 1.00

3.00 1.00 1.60 1.50 2.00 2.00 3.00 2.50 1.00 3.50 3.50 2.00

3.75 0.85 0.83 1.40 1.54 1.60 2.40 2.31 0.37 3.40 5.00 1.45

3.58 0.90 1.24 1.16 1.28 1.65 2.52 1.91 0.61 2.58 3.16 1.22

3.54 0.93 1.20 1.16 1.30 1.59 2.52 1.86 0.62 2.58 3.08 1.18

NB: Prices are provided in standard measures (Kgs or Litres) as local measures tend to change for each market. * Accra market is Agbogbloshie

Maize prices drop in the Takoradi market Wholesale and retail prices of maize dipped over the week by 5 percent (gh 1.00 to gh 0.95) and 16 percent (gh 1.20 to gh 1.00

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SPECIAL REPORT

The arrival of Glo scene onto the telecom ns Emerging situatio on the turf
Two months into its operation, Glo Mobile Ghana is directly or indirectly causing a stir in the Ghanaian telecoms market, but to what extent? Effah Amponsah presents his analysis based on an indepth study of the new trends.

t is apparent that the liberalisation of the telecommunications industry in 1995 has launched Ghanas telecommunications sector into ever-increasing growth, serving the needs of the Ghanaian economy. Today, the mobile telecommunications industry is experiencing a golden age in business as the key players on the turf, buoyed by strong international backing, are unleashing innovative and value-added products to shore-up their subscriber base , thereby increasing revenue. The latest addition to the bandwagon of telcos is Glo Mobile Ghana, which launched its operations in April 29 of this year after the market had waited three long years, prompting a $200,000 fine by the National Communications Authority (NCA) in early April. With six players now competing for Ghanas relatively small market of 25 million people, the competition is growing keenly every day. The telecommunications opportunities and potential in Ghana are being explored vigorously by the six telcos in their quest for a strong return-on-investment (ROI). The countrys telecoms space has proven that it has capacity enough to accommodate six players despite the doubts of critics, especially those that were centered on the view that the market was too small for six operators. The regulators decision to add a sixth operator seems to have been vindicated as the healthy competition that has emerged as a result of Glos entrance is serving the best interests of Ghanaian subscribers. Telco executives in the country expressed various sentiments on the coming of the sixth operator onto the Ghanaian terrain.

Kyle Whitehill, CEO of Vodafone Ghana, asserted that a sixth operator was not necessarily a good idea, explaining that in most markets around the world excluding India, there were two to three operators, and experience had shown each operator eventually needed at least 25 per cent market share to survive and be profitable. According to him, a sixth operator would dilute the market share structure and revenue of existing operators, hence making it particularly difficult for the relatively smaller operators to earn profits and survive. Besides if you enter a market like Ghana, that already has five multinational players, how are you going to make money as a sixth operator? he questioned. Mr. Whitehill further emphasised his opinion by making reference to India,, where all the new entrants were falling out because, invariably, it was not easy to be profitable under those circumstances. However, Philip Sowah, CEO of Airtel Ghana, admitted that Glos entry would change the focus of the industry and also pose further challenges to the other operators with respect to the returns on their investment. What this does is that it makes it more difficult to recoup the investment you make in the market because then you are sharing the telecoms revenue with more operators than before, he said. If the contribution of the telecommunications industry to the economy is anything to go by, the advocate for more competitive players would win the argument of the day.

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JULY 2012

If the contribution of the telecommunications industry to the economy is anything to go by, the advocate for more competitive players would win the argument of the day. The benefits of telecommunications to a nations economy are quite obvious. According to Telecom Operators Annual Reports, mobile operators in Ghana currently employ more than 1.5 million people directly and indirectly, and with the commencement of Glos operations, the number is expected to significantly increase. This obviously brings some relief to the present government, given the high rate of unemployment plaguing the country today, especially among the youth. The Africa Economic Outlook 2012 Report estimated the unemployment rate among youth from ages 15 to 24 in Ghana at 25.6 per cent. This estimate is twice that of the Ghanaian population within the 25 44 age group and three times that of the 45 64 age group. Therefore, the telecoms industry has in a significant way relieved the government burden of creating more jobs for the youth. These reports also revealed that mobile operators contributed to about 10 per cent of the total national revenue, and have invested more than $5 billion dollars into the Ghanaian economy. The benefits of more operators can be observed in both tangible and intangible ways. Telecoms observers have started noticing some budding changes within the market with the conception of Glo Mobile Ghanas operations. It has been observed that operators are really stepping up their game when it comes to quality of service rendered to subscribers. Innovative and subscriber-tailored products have been inundating the airwaves and print media in unprecedented fashion. The Mobile Number Portability (MNP), which has been in place in Ghana for one year, gives each operator as well as new entrants an equal opportunity to increase their subscriber base. Though some telcos expressed pessimism at the introduction of the MNP, the initiative has proven ideal, signaled a wake-up call, and has raised the quality of service of various operators. Each one of the operators in Ghana has lost significant numbers of subscribers due to the poor network services they offer to subscribers.

We do not intend to limit ourselves to survival. It is our strategic objective to thrive in this market and grow by focusing our efforts on building a customer experience, which comes with a strong comparative urge, said George Andah. According to him, as a customer-focused telco, we believe and understand the market, so we will keep doing what the customer wants as far as voice, data and mobile commerce is concerned. More time on the phone, less payment by subscribers A few years ago, mobile network operators in Ghana were consolidating their profits, enjoying an average industry call charge of 13 pesewas per minute on calls within the same network (onnet) and 14 pesewas on calls to other local networks (off-net). Now telcos have implemented drastic cuts on their call charges in order to stay on the competitive edge. With the entrance of Glo Mobile Ghana, it is expected that the price wars will intensify as time goes on. Not long ago, the industry benchmark was 8Gp per minute. Today, Tigo has established itself as the operator with the lowest voice charge. Tigo initially offered its subscribers 7Gp per minute to call all Tigo numbers, but presently, it charges 3Gp per minute for all Tigo to Tigo calls upon subscription.

George Andah, Chief Operating Officer of Glo Mobile, Ghana

MTN Call Charges (GH) On Net (Sept, 2010) On Net (May, 2012) Other Local Networks (Sept.2010) Other Local Networks (May, 2012) SMS Charges (GH) On Net (Sept, 2010) On Net (May, 2012) Other Local Networks (Sept, 2010) Other Local Networks (May, 2012) * Formally owned by Zain 0.04 0.04 0.05 0.05 0.075 0.09 0.075 0.13

Tigo 0.15 0.03 0.162 0.084 0.0403 0.0403 0.0477 0.0477

Vodafone 0.08 0.144 0.08 0.144 0.04 0.04 0.0424 0.0424

Airtel 0.08* 0.084 0.08* 0.084 0.04* 0.04 0.04* 0.044

Expresso 0.0954** 0.0954 0.1494** 0.1494 0.0438** 0.0424 0.0438** 0.0438

Glo Mobile 0.08 0.09 0.04 0.04

** Formally owned by Kasapa

JULY 2012

55

SPECIAL REPORT

Carlos Caceres, CEO of Tigo Ghana, was of a different opinion. He believes that the market always has opportunities for companies that offer competitive service, adding that, in a dynamic industry like this one (telecommunications), new business opportunities are appearing daily. Caceres said competition was always good when it benefited consumers, adding that there was still room to grow in the Ghanaian market. According to him, the operators who would propose and offer the best value to consumers would emerge as winners.

Network operators, upon realising the dire consequences on their revenue of the poor network and customer services, started introducing promotions and products to compensate subscribers in the face of sanctions by the industrys regulator. Before Glo commenced operations in Ghana many, including the industrys regulator, wondered whether the company would be able to survive the heightened competition in the country as far as the telecoms market was concerned. According to the Chief Operating Officer of Glo Mobile Ghana, George Kojo Andah, the company was poised to achieve its set target irrespective of the fierce competition currently characterising the telecoms space in Ghana.

SPECIAL REPORT

This consequently makes Tigo the operator with the lowest per minute charged at a time when the industry average is GH0.872. The ongoing Vodafone 138 promotion offers calls at a rate of as low as 1Gp per minute, but only for weekends. Glo Mobile offers its customers the Sweet Number promotion where a customer could call a special number for only 2 Gp per minute. These price reductions imply that competition has become so intense that operators are willing to sacrifice their profit margins to poach subscribers from other networks, assuming subscribers will likely shop for the deals that ease pressure on their phone bills. However, pricing is not all that there is to keeping subscribers in this extremely competitive industry. Unique service niches are very important in attaining brand loyalty of subscribers. Interestingly, MTN Ghana CEO, Michael Ikpoki, stated clearly that the current price cuts as a result of the entrance of a sixth operator would be a nine day wonder. According to him, the impact of the sixth operator would not be substantial, adding that although in the short-term, the impact would lead to a reduction in call and data tariffs, the trend would be reversed in the long-term. Interesting market share twists As at May, the entrance of a sixth operator has slightly affected the market share of mobile operators and this may further affect that of June as well. First of all, the total cellular/mobile voice subscriber base in Ghana had surged from 21, 805, 590 in April to 22, 453, 907 in May this year, representing an increase of 2.8 per cent. At the end of May, the market leader, MTN had a marginal decrease in its market share despite an increase in its subscriber base of 10, 644, 804, representing 47 per cent of the total market share as against 10, 518, 581 subscribers representing 48 per cent in April. Vodafone, which toppled Tigo at the start of the year, had a subscriber base of 4,576, 384, representing 21 per cent of total market share in April, and had a marginal increase, giving it a subscriber base of 4, 671, 999, still representing 21 per cent of market share in May. Tigo again suffered a marginal decrease in its subscriber base, retaining only 3, 457, 427 for May, representing 15 per cent, as against 3, 568, 094 subscribers representing 16 per cent of the market in April. Airtel Ghana came fourth on the chart, closing the gap on Tigo as it increased its subscriber base from 2, 938, 108 in April to 3, 015, 499 representing 14 per cent of the total market share in May. Glo Mobile Ghana made the best start at the close of May, 2012 as it canvassed 468, 508 subscriber base representing two per cent market share after going commercial on April 29, 2012. Thus, they overtook the beleaguered Expresso, which experienced a decrease in its subscriber base earning only 195, 670 in April, representing only one per cent of the total market share. However, the management of Glo Mobile may be asking themselves some questions regarding the subscription numbers, considering the fact that out of the 1.8 million potential customers that reserved a number, only 468, 508 were on the Glo network as at the close of May. Nevertheless, Glo Mobile made history by being the first cellular mobile network in Ghana to capture approximately half a million subscribers within the first month of its commercial operations.

Glo Mobile made history by being the first cellular mobile network in Ghana to capture approximately half a million subscribers within the first month of its commercial operations Given Glos promise of mesmerising packages for the local subscriber community and the traditional desire to experience a new thing, the June report on mobile voice market share is expected to show many Ghanaians opting more for Glo World outlets than any other telco. Hence, this is likely to reduce the market share of MTN, Tigo and Expresso, whilst Vodafone and Airtel are expected to experience slight increases at the expense of the current market leader. The recent cuts in prices of Airtels modems and promotions by both Vodafone and Airtel are expected to turn to their favour and influence their benefits in the June market share. Data niches are there for the taking With the Average Revenue Per User (ARPU) still declining to the dismay of telcos, it is incumbent on operators, especially new entrants, to step-up their efforts at searching for other sources of revenue in lieu of focusing solely on the voice dimension of their business. This is why the race for data is intensifying among the operators, as it seems to be the leeway for operators, given the relatively low usage of data in Ghana. With the coming of the Glo 1 fiber-optic armored-cable on the shores of Ghana, joining SAT3, Main One and West Africa Computer Systems (WACS), the nations quest to leverage on ICT and telecommunications for developmental growth has been given great impetus. It will also consolidate its position as the country with the highest internet speed in Africa. With a capacity of up to 2.5 terabits per second, as well as 99.9% uptime reliability, Glo 1 introduces onto the telecoms scene a much faster, reliable and relatively cheaper data and internet service. Dr. Mike Adenugah, CEO of Globacom Ltd, has invested in state-of-the-art technology that currently provides subscribers with value for money data services and internet coverage anywhere in Ghana. This is really causing a stir in the market, prompting possible boardroom discussions by other operators as to how to undercut and outwit Glos strength in data services. Some telecom operators have, in this regard, reduced the prices of their modems to ensure an increase in usage. To consolidate their interest in pursuing revenues from data services, some operators in Ghana have franchised with some smartphone manufacturers to undertake promotional sales in Ghana, in their bid to shore up their data drive. The coming of a sixth operator onto the Ghanaian telecom turf is therefore a blessing to the sector and the economy as a whole. The mere thought of a new competitor stirs up competition, which means things have to be done right, if winning is the goal. Though there are concerns that the voice telecoms space in Ghana is nearing saturation, the discovery of data business opportunities renders that opinion irrelevant. There are also expectations of a looming consolidation between some telcos operating in the country. Though this decision cannot be taken internally, given the global nature of telcos operations, it looks like sooner or later, the new unfavorable trends characterising the industry may force some telcos to succumb to others, either by way of an acquisition or a merger.

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By Jeffrey E. Osei-Hwedieh (IT and Risk Intelligence Consultant)

Barclays Libor Scandal - How does it affect consumers?

If it goes down, some borrowers will enjoy lower interest rates, but mutual funds and pensions with investments in Libor-based securities will earn less in interest. Whats the controversy all about? U.K.-based investment bank Barclays Capital paid $453 million in a settlement with U.S. and U.K. regulators, admitting that it lied in its Libor submissions about its cost of borrowing. Between 2005 and 2008, Barclays traders repeatedly requested that colleagues in charge of the Libor process tailor the banks submissions to benefit their trading positions. Barclays staffers also colluded with counterparts from other banks to manipulate rates, according to the settlement. The logic is similar to that of an insider trade in the stock market - if you have advance knowledge of information that will affect a security, you can make trades to profit from it. In addition, between late 2007 and early 2009, Barclays made artificially low Libor submissions. This was during the height of the financial crisis, and the bank was afraid that if its submissions were too high, it would get punished in the markets as investors questioned its health. It's not just Barclays, however - suspicion has now fallen on all the banks that participate in the Libor process. Deutsche Bank, Royal Bank of Scotland, Credit Suisse, Citigroup and JPMorgan Chase are among the institutions that have acknowledged they are being investigated by regulators. UBS has revealed that it's providing information to U.S. and Swiss officials on possible Libor manipulation in exchange for leniency and conditional immunity, depending on the jurisdiction. While Barclay's is the first institution ensnared by U.S. regulators, it certainly won't be the last.

anking giant Barclays Capital has been rocked by revelations that it manipulated Libor, a key benchmark for interest rates worldwide, for its own benefit. CEO Bob Diamond and the scandal appears set to spread to other banks as well. But just what is Libor, and whats this whole controversy about? What is Libor? Libor is short for the London Interbank Offered Rate, a measure of the cost of borrowing between banks and a crucial benchmark for interest rates worldwide. Its actually a collection of rates generated for 10 currencies across 15 different time periods, ranging from one day to one year. Libor rates are set each business day through a process overseen by the British Bankers Association. Between seven and 18 large banks are asked what interest rate they would have to pay to borrow money for a certain period of time and in a certain currency. The responses are collected by Thomson Reuters, which removes a certain percentage of the highest and lowest figures before calculating the averages and creating the Libor quotes. Interbank rates are measured elsewhere in the world through similar processes. For example, theres also Japans Tokyo Interbank Offered Rate, or Tibor, and the Belgium-based Euro Interbank Offered Rate, or Euribor. How does it affect consumers? Libor is the worlds most important benchmark for interest rates. Roughly $10 trillion in loans - including credit card rates, car loans, student loans and adjustable-rate mortgages - as well as some $350 trillion in derivatives are tied to Libor. If Libor goes up, your monthly interest rate payments may go up with it.

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BARCLAYS SCANDAL

What's being done about it? Diamond is set to testify on Wednesday before British lawmakers investigating the scandal. Meanwhile, similar probes around the world are in progress. In the U.S., the Justice Department is conducting a criminal investigation, and officials in Switzerland and Canada are also looking into the issue. In Japan, regulators temporarily suspended some transactions by UBS and Citi last year after finding that traders at both banks had attempted to influence Libor rates and the related Tokyo Interbank Offered Rate. Regulators themselves, though, are also facing scrutiny. In a lengthy public statement released Tuesday, Barclays claimed it had alerted U.S. and U.K. authorities about suspicious Libor submissions by other banks in late 2008, and was disappointed that no effective action was taken. The British Bankers Association, meanwhile, says it's reviewing the process by which Libor is set. Other Complications - Impact Analysis - Libor (and its counterpart Euribor) are the starting points for setting the interest rate for, well, pretty much everything. To give you an idea of the size of the possible distortion, the FSA notes that the notional amount of financial instruments, derivatives and contracts which depend on Libor in the first half of 2011 has been estimated at 554 trillion US dollars. The Worlds GDP for the same period was roughly 35 trillion US dollars. The manipulation of this interest rate by a tiny one-tenth of a percent can result in a distortion the size of the entire Eurozone rescue fund.

Bob Diamond, former CEO of Barclays Bank

How big is the scandal? This dwarfs by orders of magnitude any financial scams in the history of markets, said Andrew Lo, a professor of finance at the Massachusetts Institute of Technology. Given Libor's vast reach and the number of global firms that may be involved in its manipulation, the scandal is prompting calls for resignations, criminal prosecutions, and stricter regulation of the financial sector. Barclays CEO Bob Diamond and chief operating officer Jerry delMissier announced their resignations on Tuesday, following chairman Marcus Agius's announcement a day prior. The bank has been hammered by politicians in the U.K. including Prime Minister David Cameron, who called its actions a scandal and extremely serious.

bank Barclays Capital paid $453 million in a settlement with U.S. and U.K. regulators, admitting that it lied in its Libor submissions about its cost of borrowing.

Here is a fallacy which has emerged some few weeks ago: there were winners and there were losers. When the rate was manipulated up borrowers lost out, but savers gained. When the rate was manipulated down, the converse happened. This is a perfect example of the simplistic masquerading as complex. It ignores the biggest and most dangerous impact. U.K.- based investment Interest rates are all about the assessment of risk. The discovery that the basic Libor rate on which most such assessments are based was arrived at by collusion and was essentially fictional makes it unreliable. This creates extra risk. No prizes for guessing who will absorb this extra risk.

Civil suits have been filed in recent months by a wide variety of plaintiffs - ranging from mutual funds to individual traders to the city of Baltimore - claiming they lost profits on Libor-based securities due to banks' artificial suppression of the rate. Defendants in the consolidated case include Bank of America, Citi, HSBC, JPMorgan and Credit Suisse. By surreptitiously bilking investors of their rightful rates of return, defendants reaped hundreds of millions, if not billions, of dollars in ill-gotten gains, one complaint says.

Next time any lender sets its variable mortgage rate, they will be adding a little bit of fat, in case the Libor rate has been massaged down. Next time the decision is made on what interest to award to a pension fund, it will be made a little meaner, in case the Libor rate has been artificially boosted. That is the real cost of the Libor Scandal. Rendering the Libor rate unreliable, is like removing the base pillars from an enormous financial tower. It is causing the entire construct to teeter and become more unstable at every level. Importantly, it makes it more susceptible to the next crisis. It may steady itself or it may collapse.

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