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FOODSPAN CALLS FOR RESPONSIVE ACTION ON FOOD CRISIS
May 28 2008
Statement from the Food and Agriculture ministry that the country is insulated against the effects of global food crunch is far from the reality as the prize of maize has jumped from 35-40 Ghana cedis to 75 Ghana cedis a bag between January and April this year, while a bowl or olonka of local rice has risen from one Ghana cedi 20 pesewas to 2 cedis 50 ghana pesewas for same period.
For maize, this jump represented 114 percent price increase as against a global hike of 31 percent and globally while the percentage increase of price of rice moved up by 74 percent, Ghana recorded 108 percent for local rice and 118 percent shoot for imported rice.
However, Foodspan says these alarming waves on the food front should not induce government to adopt inimical solutions such as to resort to production and consumption of genetic modified food. Miss Anna Antwi is the coordinator of Food Span.
According to her, government’s intervention of removal of food import tariff should not go beyond 3 months otherwise local farmers would suffer and lead to more hunger and malnourishment.
Credit: anextra agency news (AA)
TWO LOCAL COMPANIES WIN WORLDSTAR AWARDS
May 22 2008
Two Ghanaian companies were among 166 organisations that Wednesday received the 2007 WorldStar Awards for excellence in packaging. Polycraft Ghana Limited was awarded for Vitamalt Plus carton while Unilever’s Blue Band Good Start Margarine carton box was also honored.
31 countries worldwide took part in the competitive awards including four African countries namely, South Africa, Ghana, Zimbabwe and Tunisia. The top awards went to Japan and United States winning 14 awards each, followed by 13 awards to Germany, South Africa and Brazil 12 each, and China 11. For the African nations, Tunisia had one prize while Zimbabwe took home two awards.
The world star award for packaging was instituted by the World packaging organization, WPO, to acknowledge the innovations and contribution of packaging to trade and consumerism.
Speaking at the award ceremony in Accra, the president of the WPO, Mr Keith Pearson said the WorldStar competition is one of the major events of the WPO as an initiative to motivate packagers and packaging converters to improve their productions.
He noted that African packaging industries need to do upscale their packaging industries to enable Africa chalk more revenue in global trade.
The number of African countries at the final awards is a reflection of the continent’s standing in international trade as the volume of manufactured goods constitutes only 20 percent of Africa’s total exports.
At the national level, 21 oragnisations also received the Ghana Star Awards.
Ironically, no government official was at the award ceremony, though the organisers, Institute of Packaging Ghana (IOPG) sent four invitations to the sector Ministry of Trade, Industry, PSI and Private Sector Development.
IOPG top executives, including its President Kofi Essuman expressed unhappiness that no representative of the ministry could attend such an important event though the sector minister, Joe Baidoo-Ansah, delivered the keynote address during the opening of the African Packaging Summit Conference & Exhibition as well as the launch of the 40th anniversary of the WPO. What saddened the IOPG officials the more was that this event would only come again to Ghana after 20 years.
CREDIT: AAN
PACKAGING INDUSTRY TO HELP AFRICA
May 21 2008
Poor packaging is one of the greatest set backs to international trade for Ghana and the rest of Africa as the volume of manufactured goods constitute only 20 percent of the continent’s total exports.
However, packaging experts in Africa and the world over think that this sorry state of affairs can be reversed and are therefore holding an African Packaging Summit Conference & Exhibition in Accra.
The event, being attended by over 30 global packagers, is organized by the Institute of Packaging Ghana and the World Packaging Organisation, WPO. The summit seeks to raise awareness on changing global trends in the packaging industry, and to provide solutions to the major constraints hindering effective development of the packaging sector in Africa.
The president of the Institute of Packaging Ghana, Mr Kofi Essuman observed that unless the Ghanaian packaging industry builds and consolidates its capacity to become cost competitive it may lose its market to other countries. In that direction, Mr Essuman advocates that the first point of change should be in the chocolate sector.
He said the country has competitive advantage in the chocolate industry however, effective packaging is required to bring in the needed returns, which would be far more profitable than the export of cocoa beans.
For his part, the Minister for Trade and Industry, PSI and Private Sector Development, Joe Baidoo-Ansah said government would take advantage of the summit to strengthen the local packaging industry.
He noted that the success stories of the countries of the Far East and South Africa have been due to not only to the application of scientific and technological research but also to superb packaging that enhances the product appeal as well as shelf life.
The minister also lamented that losses arising from poor packaging are too colossal and the country cannot continue to suffer this situation.
He said it is as result of this that government would complement the efforts of the Danish Technical Institute and DANIDA in establishing packaging and Distribution Resource Centre in the country which would be a regional centre of excellence to provide packaging design and development, services, training and research to packaging converters in Ghana and West Africa.
He appealed to IOPG to use its influence and connections as a private sector-led body to galvanise packaging manufacturers, user industries, designers, packaging materials suppliers, academicians and regulatory agencies to facilitate the growth of the packaging industry in Ghana.
CREDIT: AAN
MONETARY POLICY COMMITTEE OF BANK OF GHANA_PRESS RELEASE
May 20 2008
1. Good Morning Ladies and Gentlemen, and welcome to this MPC press briefing.
2. We are meeting here today at a time when on the global scene primary commodity prices remain quite firm providing impetus to growth in developing countries but record high and rising crude oil prices and a surge in food inflation are posing a threat of resurgence of global inflation with inflation rising above targets in most economies. And, there are still lingering effects of the credit crunch and sub-prime problem and turmoil in the financial markets, which has led most developed economies to revise downwards growth projections for 2008, and continuing re-alignment of the major currencies.
3. Available information on the economy show a fairly resilient and robust economic performance with regard to output and demand growth and external trade and payments position in the face of shocks in the policy environment based on strong economic fundamentals.
4. Latest data indicate that the level of economic activity continued to be strong into the first quarter of 2008. The Bank’s Composite Index of Economic Activity rose by 3.0 percent, some easing in the growth rate but at 28.5 percent in year-on-year terms, is above the trend growth of 21.3 percent at the end of March 2008. This compares with 21.4 percent recorded in the same period of 2007. All the major sub-components showed strong growth.
5. Additional information for tracking real sector performance, such as social security payments, job vacancies, and retail sales also point to robust economic activity. Registered number of firms on the SSNIT scheme increased by 20.8 percent over the 17,684 registered firms recorded in the first quarter of 2007. For the first quarter of 2008, total social security contributions increased by 10.4 to GH¢19.3 million, compared with GH¢14.8 million recorded for the same period in 2007, and GH¢17.4 million for December 2007.
· Cement production increased by 23.4 percent to 609,424 metric tons during the first quarter of 2008, compared to 493,879 metric tons recorded for the same period in 2007.
· The index for general retail sales suggests strong consumer demand growth in the first quarter of 2008.
· Advertised job vacancies recorded for the first four months of 2008 was 5,147, a sharp increase over the 2,243 recorded in 2007, with most of the vacancies in the services sector. This translates into an average monthly job vacancies advertised of 1,286 for the first four months of 2008 compared with 560 for the same period in 2007.
6. The Bank’s survey of Business and Consumer confidence indicate that confidence has softened over the first quarter of 2008, amid uncertainty about oil prices and rising inflation, while both business and consumer expectations about economic prospects for the rest of the year remain generally positive.
7. Credit to the private sector and public institutions continued its strong growth into the first quarter of 2008. Credit to the private sector and public institutions increased by GH¢1,615.8 million, or at an annual rate of 57.3 percent compared with GH¢846.0 million (50.4 percent) recorded for the same period in 2007. The private sector accounted for 81 percent (GH¢1,308.2 million) of the increase in credit.
· Distribution of the credit flow to the private sector continues to be broad-based. Services accounted for 33.9 percent, commerce and finance 17.9 percent, miscellaneous 16.1 percent, construction 9.3 percent, manufacturing 5.6 percent and transportation, storage & communication 5.4 percent. The remaining sectors recorded increases of between 1.0 percent and 4.9 percent.
· Distribution of the credit flow by user similarly remains broad-based with households gaining increased significance in the loan portfolios. Enterprises absorbed 69.9 percent of credit extended to the private sector over 12-month period to March 2008, down from 82.8 percent for the same period in 2007. The share of households rose to 27.4 percent from 15.0 percent over the same period. On year on year basis, credit to households increased by 85 percent to GH¢779.1 million at the end of March 2008, up from 41 percent in March 2007 when such credit stood at GH¢420.6 million.
8. The asset portfolio of the banking system continued to expand through to the first quarter of 2008. Total assets of the banking system grew by 43.7 percent to stand at GH¢8,085.9 million at the end of the first quarter of 2008, compared with 41.6 percent for the same period in 2007. At the same time, deposits grew by about 45 percent, compared with 42 percent for the same period in 2007. Generally, the banking industry remains strong, profitable and fairly liquid.
9. The quality of the loan book of the banking industry continued to remain strong in the first quarter of 2008, even though the Non-Performing Loans (NPL) ratio and the NPL net of provision edged up from 6.4 percent and 4.5 percent respectively at the end of the fourth quarter 2007 to 8.7 percent and 14.0 percent at the end of the first quarter of 2008 respectively. Similarly, loan loss provision to gross loans ratio also edged up from 5.5 percent to 5.9 percent over the same period.
10. Evidence from the Bank’s survey of credit conditions continues to point to increased access to credit by both enterprises and households but some tightening of long term loan conditions because of balance sheet constraints at the end of the first quarter of 2008. The easing of credit conditions was broad-based with Small and Medium Enterprises (SMEs) gaining improved access to credit.
11. Provisional data show that broad money (M2+) increased by 3.3 percent in the first quarter of 2008 compared with an increase of 1.2 percent for the same period in 2007, seasonally down from 19.4 percent recorded in the fourth quarter of 2007. Annual M2+ growth in March 2008 was 39.2 percent, up from 35.9 percent recorded for the same period in 2007.
12. Strong growth in liquidity of the banking system has been supported by significant increases in deposit mobilization with the opening of more bank branches and introduction of new products to attract deposits. Total deposits increased by 42 percent in year on year terms to GH¢4,828.9 million at the end of the first quarter of 2008, compared with 40 percent for the same period in 2007. Savings & Time deposits grew by 38 percent to GH¢1,920.3 million at the end of the first quarter of 2008, compared with 56 percent for the same period in 2007. Foreign currency deposits also grew by 41 percent to the equivalent of GH¢1,212.6 million at the end of the first quarter of 2008, at a much faster pace than the 25.1 percent for the same period in 2007.
13. Preliminary banking data of the fiscal position for the first quarter of 2008 continues to show buoyant revenue growth matched by sharp expenditure growth. Total revenue and grants for the first quarter of 2008 amounted to GH¢1,121.45 million (6.9 percent of GDP) compared with GH¢1,017.62 million (7.3 percent of GDP) for the corresponding period in 2007. Total revenue and grants increased further by GH¢383.84 million in the month of April to bring the cumulative amount for the year to April to GH¢1,505.28 million (9.2 percent of GDP), compared with GH¢1,436.71 million (10.3 percent of GDP) for 2007.
14. Total expenditure (excluding foreign financed capital expenditure) for first quarter of 2008 amounted to GH¢1,384.73 million (8.5 percent of GDP) compared with GH¢1,156.53 million (8.3 percent of GDP) for the same period in 2007. Additional spending of GH¢579.46 million was made in April to bring the cumulative expenditure for the first four months of 2008 to GH¢1,964.19 million (12.1 percent of GDP) including an estimated GH¢200.8 million outlays on the energy infrastructure financed by sovereign bond proceeds, compared with GH¢1,536.4 million (11 percent of GDP) recorded for 2007 and a budget target of GH¢5,109.3 million for the year.
15. The narrow budget deficit (defined to exclude foreign financed capital expenditure) but including expenditure financed by capital market borrowing for the first quarter of 2008 was GH¢479.54 million (2.9 percent of GDP), compared with GH¢125.97 million (0.9 percent of GDP) for the same period in 2007. The deficit in addition to a foreign loan repayment of GH¢207.86 million, were financed from the domestic economy.
16. The stock of domestic debt (gross) at the end of 2007 was 26.5 percent of GDP. This ratio declined to 24.2 percent by the end of the first quarter of 2008. The stock of external debt also ended 2007 at 24.6 percent of GDP, and reduced further to 22.5 percent at the end of the first quarter of 2008. This brings total public debt stock to US$7,607.0 million (46.7 percent of GDP) at end of the first quarter of 2008 compared with US$7,146.5 million (51.1 percent of GDP) at the end of 2007.
17. Developments in interest rates on the money market during the first quarter of 2008 have been shaped by rising inflation, and apparent shift in preferences towards shorter dated securities on the money market, and yields rising notably along the maturities range. The total share of short-dated securities increased by 1.5 percentage points during the quarter.
During the period from January to mid May 2008:
· overnight interbank rates firmed-up by 61 basis points to 12.65 percent.
· The 91-day and 182-day Treasury bill rates firmed-up by 234 and 282 basis points respectively to 12.96 percent and 13.62 percent respectively.
· The 1-year-note and the 2-year fixed rate note similarly inched up by 170 and 120 basis points respectively to 14.0 percent each.
· The rate on the 3-year fixed bond rose to 16.0 percent from 14 percent over the same period.
· Average base rate quotations of the banks were revised marginally upward by 26 basis points in April (on top of the 92 basis points revision at the end of March 2008) in the range 18.0 – 21.45 percent.
· Average lending rates were similarly revised upward by 19 basis points in April 2008 within the range of 14.8 – 33.9 per cent.
18. On the external front the average price of cocoa beans exports which was US$1,942.2 per tonne at the end of December 2007 increased by 7.7 percent to US$2,091.8 per tonne at the end of March 2008. Gold prices broke through the US$1000 mark in March 2008, resulting in an average export price of US$916.6 per ounce at the end of the first quarter of 2008, representing 17.8 percent over the level at the end of December 2007, and 42.4 percent rise in year on year terms.
19. The average weekly price per barrel of the benchmark Brent crude closed April at US$115.28, representing 22.5 percent increase over the end December 2007 level, and about 70 percent in year on year terms. It however reached a fresh record of US$124 per barrel on Thursday May 8, 2008.
20. Total merchandised exports for the first quarter of 2008 amounted to US$1,334.6 million, compared with US$1,041.5 million for the same period in 2007 (a growth of 28.1 percent), and US$1,098.3 million for the fourth quarter of 2007.
· Exports of Cocoa beans and products amounted to US$401.5 million, higher than US$382.27 million recorded for the same period in 2007 and US$221.9 million for the fourth quarter of 2007. However, cumulative cocoa purchases through the end of the first quarter totalled some 552,312 tonnes, against a target of 634,000 tonnes for the crop season, and 510,609 tonnes for the corresponding period of the 2006/2007 crop season.
· Gold exports totalled US$608.9 million as against US$395.0 million recorded for the same period in 2007 and US$486.4 million for the fourth quarter of 2007.
· Non-traditional exports rose by 27.1 percent to US$258.8 million, compared with (US$203.6 million) for the corresponding period in 2007 and US$325.3 million for the fourth quarter of 2007, and US$207.4 million for the fourth quarter of 2006..
21. Imports growth was strong at 33 percent during the first quarter of 2008, compared with the first quarter of 2007, with all import categories registering higher growth. Total merchandise imports for the first quarter of 2008 amounted to US$2,273.9 million, compared with US$1,659.3 million for the same period in 2007 and US$2,343.4 for the fourth quarter of 2007.
· Oil imports amounted to US$526.8 million and accounted for some 23 percent of total imports compared with US$346.1 million (21 percent of total imports) recorded for the same period in 2007 and US$571.1 million (24 percent) for the fourth quarter of 2007. The increased oil bill for the first quarter resulted from price effects. The average realized price rose by 53.3 percent; the value of crude imports declined by 50,930 barrels (1.4 percent) to 3.48 million barrels. Imports of refined petroleum products amounted to US$183.9 million, indicating a growth of 15.8 percent on year on year basis.
· Non-oil imports amounted to US$1,747.1 million and accounted for about 77 percent of total imports in the first quarter of 2008, compared with US$1,313.3 million (79 percent) for the same period in 2007, and US$1,772.3 million (76 percent) for the fourth quarter of 2007.
22. The merchandise trade account recorded a deficit for the first quarter of 2008 that amounted to US$939.3 million, compared with a deficit of US$617.8 million for the same period in 2007, and US$571.1 million for the fourth quarter of 2007. Preliminary estimates are that the current account recorded a deficit of US$725.8 million, compared with a deficit of US$422.9 million for the same period in 2007, and US$652.7 million for quarter four of 2007.
· The increased current account deficit was on account of imports of capital equipments for oil exploration and mining financed by foreign direct investment (FDI) inflow of US$367.5 million in the first quarter of 2008.
23. The overall balance of payments deficit is estimated at US$528.4 million for the first quarter of 2008, compared with a deficit of US$335.1 million for the same period of 2007.
24. Gross International Reserves (GIR) at the end of April 2008 was US$2.19 billion, and translates on average into goods and services import cover of 2.7 months.
25. The foreign exchange market continued to deepen, recording a sharp increase in the volume of sales and payments transactions during the first quarter of 2008. Total Purchases and Sales in the foreign exchange market by banks and forex bureaux for the first quarter of 2008 amounted to US$2.45 billion, 27.5 percent higher than US$1.92 billion for the same period in 2007, and 11.2 percent above US$2.20 billion recorded in the last quarter of 2007. This increased further by US$802.1 million in April 2008 (US$654.3 million for April 2007) to bring the cumulative amount for the first four months to US$3.3 billion, compared with US$2.6 billion for 2007, and US$2.2 billion for 2006..
26. Private inward transfers – received by NGOs, embassies, service providers, individuals etc. - through the banks and finance companies for the first quarter of 2008 amounted to US$2,008.4 million, which represents 35.4 percent increase over the amount of US$1,483.6 million recorded for the corresponding period in 2007.
• Of the total transfers at the end of the first quarter of 2008, US$400.8 million (or 20 percent) accrued to individuals, compared with US$345.2 million (22.8 percent) for the first quarter in 2007.
27. The cedi depreciated against all the three major currencies during January to April 2008, moving within relatively low range vis-à-vis the US dollar and the Pound Sterling, with depreciations of 1.8 percent, and 0.3 percent respectively. The Euro appreciated against the cedi by 8.2 percent. In trade weighted terms, the cedi depreciated by 3.2 percent, compared with a depreciation of 1.9 percent for the same period in 2007.
28. The latest inflation numbers released by the Ghana Statistical Service (GSS) show that inflation has been rising significantly to 13.8 percent at the end of March 2008, and further to 15.3 percent in April 2008, after reaching a low of 10.2 percent in September 2007. This rising inflation rate has been driven to a considerable extent by crude oil prices and its effect on the domestic market. Food inflation which was 9.3 percent in September 2007 rose to 13 percent at the end of March 2008 and further to 13.2 percent in April 2008. Non-food prices also moved from a low of 10.9 percent in September 2007 to 14.4 percent in March 2008 and further to 16.9 percent in April 2008.
29. Also core inflation (defined to exclude energy and utility) which has been in single digits since June 2006 began to increase from a low of 8.6 percent in September 2007 to 10.2 percent in March 2008 and further to 11.4 percent in April 2008.
30. To summarize, the economy has been resilient in terms of output and demand growth with economic activity proceeding at a pace above trend and with relative stability in the exchange market.
31. Domestic demand growth has been underpinned by strong fiscal stimulus, and rapid build-up of sectorally diversified bank loan portfolio in a deepening and competitive financial sector.
32. Inflation and cost price pressures have increased amidst rising and volatile oil prices, and a surge in food prices. And, uncertainty about developing inflation has weighed down business and consumer confidence, while the general assessment of economic prospects remains strongly positive.
33. Inflation has risen sharply over the past three months. Both headline and core inflation are now significantly above the target set over the medium term.
34. The risks in the outlook for inflation is on the upside with uncertainty about oil price increases and volatility and the potential for inflation expectations to become embedded in pricing and wage cost structure.
35. In the circumstances, to strengthen the anchor for macro-stability, the Monetary Policy Committee has decided to increase the Bank of Ghana Prime Rate from 14.25 percent to 16 percent.
Thank you for your attention.
16 WIN WORLD BANK DEVELOPMENT MARKETPLACE COMPETITION
Posted May 12, 2008
The World Bank Group has selected 16 companies and organizations as winners of the Development Marketplace competition for their innovative products or services tailored to Sub-Saharan Africa’s off-grid lighting market. The winners will receive up to $200,000 to implement projects that offer affordable, clean, and safe off-grid lighting and that improve access to lighting for people living without electricity across the region.
The winners were selected from among 52 competitors, and their projects were judged using five criteria: innovation, measurability of outcomes, organizational and financial sustainability, growth potential, and realism. They will use the funds to implement their projects in several African countries, including Burkina Faso, Cameroon, Ghana, Kenya, Liberia, Namibia, Nigeria, Rwanda, and Tanzania.
The ideas and concepts presented during this competition were far beyond our expectations, and this level of innovation and creativity is exactly what Africa needs. We are looking forward to seeing the winners implement their projects, said Anil Cabraal, World Bank Lead Energy Specialist.
One of the winning projects will use cassava waste to produce biogas for lighting about 2,250 rural homes. Another project introduced a revolutionary type of energy efficient solar cell product for light emitting diodes that can also be used as a mobile phone and energy charger and a source of energy for radio. The people’s choice award went to a project that aims to use the Savings and Credit Cooperative Societies, a network of solar technicians in Tanzania, and reasonably priced solar systems to reach remote areas.
This has been one the most fruitful Development Marketplace competitions. All of the finalists were able to meet with businesses and NGOs that are relevant to their day-to-day activities. This will help broaden their reach and impact, said Monika Weber-Fahr, IFC Manager for the Sustainable Business Innovator.
The competition took place during Lighting Africa 2008, the first global business conference for off-grid lighting in Africa, held in Accra, Ghana, from May 6 to 8, 2008. The conference is part of the World Bank Groups Lighting Africa program, which aims to mobilize the private sector to provide modern off-grid lighting to more than 250 million people in Sub-Saharan Africa by the year 2030.
CREDIT: AAN
MONETARY POLICY COMMITTEE TO MEET
Posted May 12, 2008
The Monetary Policy Committee (MPC) of the Bank ofGhana will meet from Tuesday, May 13, 2008 to reviewdevelopments in the economy. The decision of the MPC, with respect to the Bank ofGhana Prime Rate, will be announced at a pressconference on Monday, May 19, 2008.
CREDIT: AAN
MCA ELIGIBLE AFRICAN COUNTRIES MEET IN ACCRA
June 11
African countries eligible for the millennium Challenge account of the united states of America are in Accra for a two-day on enhancing collaboration to reduce poverty in their respective countries.
Out of a total of 19 eligible African countries, only five, namely, Ghana, Madascar, Benin, Cape Verde and Mali have signed funding agreements with the Millenium Challenge Corporation, the washington-based body that is managing the MCA .
Speaking at the meeting, the ECOWAS commission president, Dr Mohammed Ibn Chambas said the MCA is welcomed in the subregion, considering that 12 of the 15 member states of ECOWAS are among the least Developed Countries in the world.
For his part, the chairman of the MCA country board, Dr Paa Kwasi Ndoum said the meeting would come out with reportsand resolutions that would be forwarded to the MCC, African Union and the respective eligible African governments.
BOG LADIES HIT ROAD WITH REDENOMINATION
June 5 2007
The fever of new money is rising among the populace as the whole nation prepares itself for the birth of the new Ghana cedi, bound to come into being less than four weeks from now. The new cedi is expected to start making the rounds as the new symbol of purchasing power from the first of July, with the hope that its use would catch-up fast with the public.
However, feedback from various groups such as market women, churches and other social groupings show that education to the public is not reaching far enough to the general fabric of society.
In that direction, the Bank of Ghana Ladies Association, BOGLA, has embarked on an extensive public education campaign to increase the understanding of social groups on the new cedi. They have visited Kasoa, Batsona and Tema markets as well as surrounding villages, where they educated market women and villagers on how to convert the new currency and how to identify security features.
The field educational campaign is certainly going down well with target groups judging by the sort of interest that listeners of "the gospel according to redenomination" show wherever the team has been to.
According to BOGLA, it is happy to be in a position of assisting the public, particularly women, to understand the change over to the new Ghana cedi.
Under the new cedi convention, ¢10,000 is equivalent to ¢1 or 100 pesewas, while the notes of the Ghana cedi come in five variations of ¢1, ¢5, ¢10, ¢20 and ¢50. The coins accompanying the notes are six types, beginning from one pesewa, 5 pesewas, 10 pesewas, 20 pesewas, 50 pesewas and ¢1. For instance, ¢100 today would be same as one pesewa, while ¢1000 now is equal to 10 peewas.
Speaking to Anextra Agency News (AAN), the president of BOGLA, Mrs Evelyn Kwatia, said the central bank ladies realize that places like churches and markets provide a large forum for education on the new cedi, more so in local dialect.
She stated that the association is aiming at getting very close to the public for one-on-one discussion to achieve greater understanding about the currency and its security features. BOLGA has therefore written to a lot of social organizations about readiness to provide free education to anyone who needs it.
On its church to church education, the team of educators has been communicating to many congregations including the Calvary Baptist Church Adenta branch, St Mary’s Anglican Church at Akoto Lantey and Freeman Methodist Church at Jamestown. One of the principal educators, Eleanor Laryea, a member of BOGLA, disclosed that the redenomination message was received tremendously by the church congregations especially as Ga, Ewe, and Akan are used for the education. "What motivates me about this campaign is seeing that the people are angry for information and I’m glad to be able to reach out to them in whatever language we can for them to appreciate what is happening because they are the integral part of the society and if they do not understand the whole process, then it would fail" she said. Another team member, Patience De-Graft Klo, who has been doing the rounds at Bubuashi and Kaneshie churches, such as Mount Ararat, expressed similar sentiment. "I was shocked to see church members eager to listen to us with some saying that they never knew the central bank has them too in the focus of the exercise." The work of BOGLA in the capital, particularly in the markets is expected to heat up as the ban on drumming is lifted. These efforts by the Bank of Ghana Ladies Association should allay the fears of the central bank governor, Dr Paul Acquah that staff may sabotage the success of the redenomination exercise. Pix
STRESS IS GOOD SAYS PROFESSOR
The former director-general of Ghana health service, Prof Agyeman Badu Akosa has acclaimed that stress is good for everybody as it imposes challenges on the human life.
That explains the numerous experiences of stress that people go through either at home, work place, behind the steer, or financial capabilities.
He said this in Accra at the second health seminar by Donewell Insurance Company on the theme stress, it effect on the body and its management.
Prof. Akosa said those who marry more than their income also face stress, adding that some drink and smoke to over come the stress but that is not the way to solve the situation.
He pointed out that the best way to overcome stress is to understand the stress and know how to solve by either meditating or relaxation.
Prof Akosa lamented that it is unfortunate that children give avoidable stress at home and school during their tender ages and adolescent ages.
He thereforeurge all parents and teachers to let children get their fare share of learning and playing, noting that playing is fundamental for the growing capabilities of every child.
JOE LARTEY TURNS 80 AND STILL STRONG
June 7
The celebrated public speaker and broadcaster, Joe Lartey is in his second day as an octogenarian.
The strong looking man, popularly known as Over To You, turned eighty years yesterday and as part of the day, the Accra Toastmaster Club honoured him with a plaque dubbing the acclaimed personality as the Doyen of Public Speaking in Ghana.
Gold news was at the event and asked Mr Joe Lartey, how it felt like chalking four score years and still going steady.
He replied that he is been taking very good care of his body and health for a very long time now, because he caanot afford to be a good public speaker and be looking sickly.
Joe Lartey, alias Over To You, is a celebrated public speaker and broadcaster, who who marked his 80th birthday yesterday.
Fathia Nkrumah Is Dead
May 31 2007
Madam Fathia Nkrumah, 75, the widow of the late President Nkrumah is dead.
Madam Nkrumah was suffering from stroke and died in a hospital in Cairo, Egypt.
One of the sons of Madam Fathia, Mr Sekou Nkrumah told Joy News ( www.myjoyonline.com )shortly after her death that although his mother’s death was sad to hear it was something the family expected due to the complicated nature of the illness.
"It is sad in a way but at least we should celebrate her life…I was expecting the worst. At her age I believe all kinds of things take place in her body," he said.
Mr Nkrumah said it was good President Kufuor took time off to visit his mother before her death. He said that should serve as a basis for all Ghanaians to shun political differences and live in unity.
"Good timing on the President’s part to visit her before her death. Ghanaians need to move beyond partisan politics and see ourselves as one," he said.
Madam Fathia was a very young wife and mother of three very young children when her husband was overthrown in Ghana’s first successful military coup on February 24 1966.
SOLDIER ABANDONS HIS ACCIDENT VICTIM
May 26 2007
The fate of an innocent mother of three hangs between death and life due to the recklessness and indiscipline of a soldier whose disregard for road signs has resulted in the hospitalization of this woman.
The woman, Madam Lucy Bosso, 32, was the victim of a head-on collision that occurred on the 14th of April 2007 around 4pm in front of flagstaff house. She was sitting in the passenger seat beside the driver when Corporal Nubi Baadah drove a Tata bus with registration number 33 GA 85 into the front part of the vehicle that madam Bosso was sitting in, a commercial minivan GR 9402 X.
The victim, who had left Aflao that day for Accra in that vehicle to purchase goods, was quickly rushed to the 37 military hospital with fatal injuries including a completely shattered right leg and a broken right arm.The news of the accident was telecasted by GTV in its news.
According to doctors, the leg cannot heal unless it is amputated, but even then the critical condition of the victim is hampering the operation, and so she is still lying in bed at the hospital immobile.
Surprisingly, Cpl. Baadah with identification serial number 188736, has abandoned the woman to her fate right from the moment that the incident occurred.
He never followed the victim to the hospital immediately following the accident, and has up till now never paid any visit to her to even ascertain her condition neither is he bearing the cost of her bills which is currently running into almost ¢10 million.
According to a brother of the victim, Holy Bosso, he has borne the cost of all the medical bills of his senior sister to date since the husband or any other family member lacks the means to take care of her.
He said they have reported the case to the cantonment police station but this has been to no avail. "And now the doctors at the hospital are suggestion that my sister's leg should be cut but since I don't have the money they are delaying while my sister suffers," he lamented.
Mr Bosso said although he received some donations from some individuals but it is not enough to take care of his sister and therefore pleaded with philanthropists to help him bring the sister out of pains.
He disclosed to that his sister was the bread winner for her family due to her husband being out of work for some years now and so the accident is having serious consequences on the family as the children and their father have been dispossessed of the breadwinner.
Mr Bosso said he is very much surprised at the behavior of the Corporal because he expected soldiers to be more disciplined than the character that Cpl Baadah has displayed.
He therefore appealed to the military authorities to help bring the culprit to book as well assist the victim get out of hospital.
PIX
Madam Lucy Bosso lying prostrate on bed at the 37 military hospital
CONSERVE WATER: MINISTER
Posted 24-05-07
Aqua Vitens Rand limited has estimated that illegal connections constitutes about 40 to 50 percent of unaccountable water and thus rendering the water company handicapped in supplying the required volume of water to consumers.
The company stated this at the launching of the save water education campaign in Accra.
Speaking at the launching ceremony, the minister of water resources, works and housing, Hackman Owusu-Agyemang said it is very essential for water to be conserved in order to complement governments efforts at providing portable water to all Ghanaians.
He said water is becoming increasingly scarce due to high population growth with its attendant increase in pollution coupled with growing economic activities, which is becoming a potential source of conflict in most African countries.
The minister pointed out that water conservation must include the protection and management of river bodies.
MASA TO BE HELD IN ABIDJAN
Posted May 24, 2004
African culture is one important contributing factor to the democracy that the continent is enjoying today. Therefore in restoration of peace and the consolidation of democracy in Cote d’Ivoire, a special edition of the Market For African Performing Arts, MASA is to held from July to August this year.
This unique edition of was re-launched in Accra after its four years break due to the Ivorian crises which brought the celebration of the festival to a halt.
The director general of MASA, Mr. Thomas Manou Yabalaih said MASA is the only Pan African artistic project which combines business opportunities, a forum for professionals and a festival.
The programme assists the African theatrical, dance and musical productions and artists to be better known by and help foster the circulation of their productions within Africa and the rest of the world.
Mr. Yabalaih disclosed that the special edition of the programme would be held in Abidjan and in four other cities in Cote d Ivore, namely Bouake, Korhogo, Man and Daloa.
World Migratory Bird Day, WMBD, a global initiative, will from 12-13 May 2007 celebrate the beauty of migratory birds and how to promote and conserve them through out the world. This year’s theme is “Migratory Birds in a changing climate”, which will focus attention on the plight of migratory birds as well as highlight the way they are being affected by climate change and living things. Briefing the media on activities put in place for the day, the Acting Executive Director of Ghana Wildlife Society, Mr. Erasmus Owusu said the theme for this year’s World Migratory Bird Day is appropriate because climatic change has a severe consequence on migratory birds, causes the loss of essential bird habitats, changes migration patterns and increases the competition for food between migrating birds and residents when they travel far to other lands. He said climatic change is one of the most critical global challenges of this time because recent events have demonstrated the growing vulnerability to climatic change, not only on migratory birds but would also affect agriculture and even endanger food security. The World Migratory Bird Day is being promoted worldwide by the African-Eurasian Migratory Water bird Agreement and the Convention on Migratory Species
MORE OF LOCAL RICE MUST BE EATEN
Imagine the number of mouths that relished the taste of one of the most delicious staple foods, rice, as Africans celebrated Africa Liberation Day on Friday May 25, 2007.
Sadly, whether in the continent’s most populous country, Nigeria or in small Eritrea, so would majority of Ghanaians also enjoy their rice, without regard to its source and that only a small percentage of the rice being eaten is produced in Ghana and that the consumption of the greater percentage makes poor local rice farmers poorer.
Rice is the most consumed staple food in this country after maize. In 2000, Ghanaians consumed 309,808.9 metric tons of rice with local production volume of 137,216 metric tons or 44.30 %, but in 2003 percentage of local rice in total consumption was 29.04 % at 155,353.6 metric tons out of 534,905.9 metric tons. Total national production of rice in 2004 was 169.45 metric tons.
The value of yearly commercial imports of rice in total consumption was 54.16 % in 2000, 62.37 % in 2001, 60.30 % in 2002 and almost 70 % in 2003.
Infact, for over a four-year period between 2000 to 2003, commercial rice imports averagely constituted about 61.52 % of total national consumption, while local rice comprised an average of 36.58% and food aid 1.90%. (Action Aid)
High volumes of rice imports with their low prices has made local rice production ever more less competitive and unappealing as the price of local rice has been increasing over the years. The net incomes of rice producers in Ghana has been in the negative from 2002 to date, and therefore raising the poverty levels of these farmers.
Reduction in incomes has led to the loss of investment capital of many rice farmers and consequently affecting their access to food particularly as about 70% of producer households use rice for food and crop for cash.
The incomes of national rice farmers have been falling steadily over the years, but these falls have quickened since 2002. In the Ejisu Juaben district, for instance 24 farmers recorded a positive net returns from rice production in 2002, but this number reduced to 20 in 2003. out of 190 rice farmers that cultivated the crop in 2004, only 65 had slight positive returns while 125 experienced negative returns.
Interestingly, this situation does not endanger only the food security of the rice farmers, but also the whole nation as the populace would easily be held to ransom if at any time food imports is used as a weapon against the country. That means the nation’s food security is insecure.
Furthermore, the current situation indicates that the nation would continually need more cash for rice imports and worsens the foreign exchange pressure. On the health front, the strength of citizens would be less than optimum as imported rice is far less healthy than the locally produced rice.
The World Bank in 1986. defined food security as the "access by all people at all times to enough food for an active and healthy life." This definition deals with food availability; equitable distribution; and consumption
In 1979 the World Food Programme Report conceptualized food security as being equal to an "assurance of supplies and a balanced supply-demand situation of stable foods in the international market”.
But this conception is not applicable to Ghana considering its food status, particularly with regard to rice production.
It is in the face of such disheartening picture of the rice industry in the country that the efforts of civil society organisations like Oxfam, General Agriculture Workers Union (GAWU) and Action Aid, among others should be appreciated.
These organisations concerned about the plight of local rice farmers, are doing the best through advocacy and interventionist programs to assist these affected farmers.
Such groups are giving support to the peasant rice farmer because food security is such an important component of the development module to the extent that any country that does not secure its food by its own hands but rather relies on the benevolence of others loses the key to growth and development.
The Project-Citizens’ Voice In Trade Policy project, sponsored by the Rights and Voice Initiative (RAVI) is one of the strategies adopted by GAWU to strengthen the capacity of farmers by enabling the farmers make a direct input into policy formulation for the enhancement of their sector. RAVI is the rights advocacy window of the Ghana Research and Advocacy Programme (G-RAP).
The Project-Citizens’ Voice In Trade Policy project is intended to strengthen the capacity of rice farmers and agricultural employees to engage with government on trade policy affecting food security with particularly reference to rice.
It seeks to ensure sustained citizen-government engagement on rice issues, as well as secure enhanced government responsiveness to citizens concerns on trade policy and food security.
GAWU’s intervention in the rice industry has shown that the impact of rice dumped by heavily subsidized sources threatens to destroy the livelihoods of thousands of farming families and prospects for rural development.
The state of the rice industry in Ghana is an indication of how World Trade Organisation (WTO) trade regulations are forcing many small scaled farmers out of business as low-cost imports of rice have flooded the local markets.
Because of the WTO, government is weak in implementing strategies to benefit the local rice producers, such as imposition of high import tariffs and strengthening the production capacity of poor farmers who have sustained this economy all over the years but whose livelihoods are now disregarded in the name of liberalization.
The rural poor who are a major producer of food crops live in extreme poverty as a result of unfair competition arising from the influx of artificially cheap imports.
Despite these stark truths, the nation, particularly government looks on apathetically with the argument that the country lacks ability to meet its rice consumption requirements that is why cheaper rice imports must be continued.
The more we consume foreign cheap rice, the worse the plight of local rice become as they continually deprived of the needed funds that would have enabled them produce more at lesser costs.
It is time we put in place strategies to increase the consumption of local rice so that the miserable farmers can have access to more markets if they cannot be helped with subsidy.
The rice imported is heavily subsidized, and come to break the market of local farmers.
Food security means availability of food in sufficient quantities all year-round with a national buffer stock located at right places at affordable prices.
In 2002, Agriculture Development Bank gave out a loan of ¢112million to 141 women in processors and by June 2,430 acres of rice had been planted. This was certainly a good gesture of how support can work.
For now, government through the Ministry of Agriculture should support local rice farmers to go into large scale production and processing under let’s say a special five-year project that would ensure that rice produced would be enough to meet the nations need by end of the project.
We must consume more local rice from now on as we observe 50 years of independence, more so when local rice is become tastier to the extent that is packaged with foreign labeled bags.
A rice farmer inspecting his farm
A group of rice farmers working on their cultivation
A rice farmer inspecting his farm
Officials of GAWU educating local rice farmers on their rights
MINING COMPANIES URGED TO BE MORE RESPONSIBLE
Mining companies have been advised to mine responsibly in order not to compromise the livelihoods of future generations.
Chief executive of the chamber of mines, Ms Joyce Aryee gave the advice during a media interaction in Accra.
She noted that the mining sector is very important as almost everything revolves around mine products, however, mining firms must be more accountable to the society.
Ms Aryee expressed joy that members of the chamber have lived up to their social responsibility by providing free medical care for workers and their dependants as well as host communities.
Apart from establishing hospitals, there is a multi – billion malaria control programme underway to reduce the high rate of malaria in mining communities.
The sector’s contribution to GDP increased from 2.3 percent in 1991 to 5.2 percent in 2005 as the third highest contributor to internal revenue, accounting for over 12 percent of IRS collections.
Miss Aryee stated that the mining sector contributed 2.199 trillion cedis in 2005 towards national development.
MPC REVIEW OF GHANA'S ECONOMy JAN-APRIL
Posted 22/5/07
Below is the full text of the economic review report of the Monetary Plicy Committee of the Bank of Ghana, which was dekivered by the Governor, Dr Paul Acquah:
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The components contributing to the growth in the index were employment, exports, commercial bank credit, imports and tourism; there were some declines in port activities, cement sales and electricity consumption.
Evidence from the Bank’s surveys of Business and Consumer Confidence show that both indices of business and consumer expectations dipped slightly at the end of the first quarter from the highly favourable levels recorded in preceding quarters. Non-financial corporate sector performance during the first quarter of 2007, was robust and broad based for listed companies. These companies posted good results in terms of turnover growth, net profits and cost of sales in various sectors, covering manufacturing, Distribution, Food and Beverages, Agriculture, and Information Technology.
Deposit Money Bank’s (DMBs) credit to the private sector and public institutions continued to show significant growth as it increased by 12 percent (¢3,021 billion or GH¢302.1 million) to ¢28,218.8 billion (GH¢2.82 billion) in the first quarter of 2007 and 11.9 percent during the last quarter of 2006. Over the twelve-month period to March 2007, DMBs credit to the private sector and public institutions rose by 50.4 percent (¢9,460 billion or GH¢946.0 million) compared with 42.1 percent (¢5,559 billion or GH¢555.9 million) recorded for the same period in 2006.
In real terms, credit to the private sector grew by 41.7 percent in March 2007 (highest in recent times), compared with the 28.7 percent recorded for December 2006 and the 19.4 percent for the corresponding period of 2006. The distribution of the annual credit flow was broad-based, but continued to be concentrated in the services (27.1 percent), commerce and finance (22.2 percent), manufacturing (12.6 percent) and construction (11.2 percent).
Total assets of the banking industry rose by 41.6 percent to ¢56,275.7 billion (equivalent to GH¢5.62 billion) over the year to March 2007, compared with 24 percent a year ago. Net loans and advances increased by 58.1 percent to reach ¢26,354.7 billion (or GH¢2.63 billion) in March 2007, compared with 41.8 percent for the preceding year.
The quality of the banking industry’s loan portfolio improved. Non-Performing Loans (NPL) ratio declined to 6.9 percent at the end of March 2007 from 7.9 percent in December 2006, compared to 12.9 percent recorded a year ago. Banks’ solvency remains strong as the industry Capital Adequacy ratio stood at 16.9 percent in March 2007 compared with 16 percent a year earlier. These developments are driven by the recent build up of bank’s loan books but also the clean up of balance sheets and write off of bad debts.
Broad money (M2+) rose by 1.2 percent during the first quarter of 2007, compared with the 17.4 percent recorded in the last quarter of 2006, and 3.6 percent in the corresponding period of 2006. On annual basis, M2+ grew by 35.9 percent, down from 39.1 percent at the end of December 2006 and compares with 19.6 percent recorded for the same period in 2006. Reserve money broadly declined at a somewhat more rapid pace in the first quarter of 2007. After peaking at 32.3 percent in December 2006, reserve money declined by 11.8 percent in the first quarter of 2007 compared with 8.2 percent seasonal drop over the same period in 2006.
Provisional data at the end of April 2007 show that on year-on-year basis, reserve money grew by 20.6 percent compared with 32.3 percent at the end of December 2006 and 18.5 percent at the end of April 2006. Interest rates eased downwards along the spectrum of maturities.
The benchmark 91-day Treasury bill rate fell by 9 basis points to 9.55 percent at end April 2007. The 182-day Treasury bill and 1-yr note also fell by 27 and 60 bases points respectively to 10.26 and 12.4 percent respectively. The 3-year fixed instrument moved to 13.5 percent in April 2007 from 14.0 percent in December 2006. Average base rate quotations of Deposit Money Banks moved downwards by 1.41 basis points in the first quarter of 2007 within the range of 18.00 and 21.45 in March 2007 from a range of 19.20 and 22.50 percent in December 2006.
However, average lending rates remained unchanged within the range of 15.0 percent and 33.5 percent at the end of March 2007.
The first quarter of 2007 saw a continued shift in the portfolio preferences of investors on the money market to the medium to long end of the market. This follows similar trends observed over the past 12 months. Shares of the 91-day and 182-day Treasury Bills declined further from 34 percent at the end of December 2006 to 27 percent at the end of April 2007 (from 56 percent at end of December 2005). The shares of the 2-year and 3-year fixed rate notes together with the 5-year GOG bond increased from 34 percent to 45 percent over the same period to April 2007. And, the share of 2-year and 3-year floating notes and bonds declined further from 7 percent to 4 percent at the end of April 2007.
The shift in portfolio preferences together with the issue of the 5-year bond resulted in lengthening of average maturity of government securities to 391 days from 322 days a year earlier.
Provisional data for the external sector during the first quarter of 2007 shows the trade balance improved by 7.6 percent from a deficit of US$842.25 million in the first quarter of 2006 to US$778.63 million at the end of the first quarter of 2007.
Total merchandise exports at the end of March 2007 amounted to US$1,044.08 million, an increase of 12 percent over fourth quarter 2006 position, and 13 percent compared with that of the first quarter of 2006. Total imports in the first quarter of 2007 amounted to US$1,822.71 million, a growth of 15.8 percent over that of first quarter of 2006, and 2.7 percent over the fourth quarter of 2006.
Crude oil imports amounted to US$415.43 million, about 24 percent above the US$379.79 million recorded in the first quarter of 2006, reflecting an increase in volume, as the average price declined by 6.7 percent.
Trade deficit however narrowed by 7.6 percent from US$842.25 million in the fourth quarter of 2006 to US$778.63 million for the first quarter of 2007. The external current account recorded a deficit of US$482.8 million compared to a deficit of US$181 million (before debt relief) recorded in the first quarter of 2006.
Private inward transfers – received by NGOs, embassies, service providers, individuals etc. through the banks and finance companies for the first quarter of 2007 amounted to US$1.52 billion, representing 17.1 percent increase over that recorded for the same quarter of 2006. Of the total transfers, US$346.56 million (22.8 percent) accrued to individuals, compared with 32.8 percent for the same period in 2006, when total transfers for the year amounted to US$5.80 billion.
The gross international reserves (GIR) stood at US$2.07 billion (2.5 months of goods and services imports). In April 2007, a decline of 8.8 percent from the end of 2006 level, but an increase of 8.4 percent in year-on-year terms.
On the foreign exchange market, total purchases and sales of foreign exchange by the banks and forex bureaux amounted to US$1.90 billion for the first quarter of 2007 (or an increase of 15.9 percent), compared with the fourth quarter of 2006. For the month of April 2007 alone, total purchases and sales increased by 20.2 percent to US$646.17 million, compared with US$537.14 million recorded in April 2006, raising the total purchases to US$2.55 billion (a 16.9 percent in year-on-year terms).
Developments in the nominal bilateral exchange rates of the cedi against the three core currencies – the US dollar, the pound sterling and the Euro – show that for the period from January to April 2007, the cedi depreciated, cumulatively, against all three core currencies by 0.5, 3.7 and 4.0 percent respectively. This compares with depreciation of 0.01 percent against the US dollar and depreciation of 0.2 and 4.1 and 7.8 percent respectively against these currencies over the same period in 2006. The result was a nominal depreciation of 1.9 percent in trade-weighted terms.
On the Budget, provisional banking sector data on the implementation of the 2007 budget indicates that total receipts for the first four months of 2007 amounted to ¢14,402.7 billion (GH¢1.44 billion), compared with ¢8,505.7 billion (GH¢850.6 million) for the same period in 2006. This represents some 23.5 percent of the annual budgeted target for 2007 and shows a growth of 69.3 percent over the outturn for the same period in 2006.
Total revenue and grants amounted to ¢10,758.9 billion (GH¢1.08 billion), some 45.9 percent above the outturn for the same period in 2006. Of this amount, programme grants received amounted to ¢1,440.24 billion (GH¢144.0 million), about 94.5 percent of programmed target for 2007.
Total payments for the first four months of 2007 amounted to ¢15,962.7 billion (GH¢1.60 billion), 55.9 percent over the same period in 2006, and constitutes some 35.9 percent of programmed expenditures for 2007.
These developments resulted in a deficit of ¢1,560.0 billion (GH¢156.0 million) compared with a deficit of ¢1,736.3 billion (GH¢174.0 million) for the same period in 2006. The resulting overall budget deficit was financed to the tune of ¢2,485.5 billion (GH¢248.6 million) through domestic borrowing mainly on the auction market.
Developments in the Consumer Price Index through the first quarter of 2007 showed a decline in the rate of inflation by 0.7 percentage points to 10.2 percent, driven by non-food prices. Food prices rose by almost a percentage point (to 8.4 percent) on an annual basis, while increases in non-food prices eased from 13.6 percent (at the end of December 2006) to 11.6 (at the end of March 2007).
In April 2007, CPI inflation showed an up tick to 10.5 percent. The increase in the Month of April 2007 was driven by unusual increases in food prices which have been attributed to supply conditions. The core measure of inflation which excludes energy and utility items from the consumer basket dropped by 0.3 percentage points from 9.4 percent at the end of December 2006 to 9.1 percent at the end of March 2007. It went up to 9.2 percent in April. Another core measure of inflation which excludes energy and utility and selected volatile food items followed a similar pattern.
To summarise economic activity has been robust through the first quarter of the year (with the uncertainty around the load management and energy supply a source of weakness in the outlook). Indications of performance in the composite index of economic activity is above its trend growth, corporate profitability and turnover are strong in both the non-financial corporate (listed companies) and the financial sector.
And, strong private sector deposit growth in the banking system is supporting rapid credit expansion that is becoming increasingly broad-based across sectors.
Data on the budget underlines the stimulus government spending is imparting to the economy. The lack of balanced synchronisation of spending with budgetary resources has enlarged the public sector borrowing requirement that will need unwinding later in the budget cycle.
Headline inflation showed an up-tick in April from the steady decline observed in the last quarter. However, inflation pressures remain relatively subdued and price volatility was driven by utility and energy over the past several months. Core CPI inflation excluding energy and utility continued to track inflation at below or close to the single digit threshold.
The downside risks in the outlook is associated with managing the output and cost pressures inherent in the load shedding and supply uncertainties in the energy sector, with the current round of wage settlements in the public sector is an added factor. The economic fundamentals are strong.
And, the external payments outlook remains favourable with commodity prices firm and inflows steady. To conclude I will like to announce for information of the public that the Bank of Ghana has formally adopted an inflation targeting framework and it will be using this core measure of inflation that I have just described as its principal variable for tracking underlying inflation in the economy.
The risks in the outlook are therefore well balanced and the Monetary Policy Committee has decided to keep the prime rate unchanged at 12.5%.
BOG ESTABLISHES GIPSS
Posted 10/05/07
The Bank of Ghana and the Ghana Association of Bankers have agreed to establish the Ghana Interbank Payments and Settlement System (GIPSS). GIPSS would be an independent entity responsible for the different components of Ghana’s payment and settlement system infrastructure. It would include National Switch (the Common Platform), Biometric Smart Card, Cheque Clearing, Codeline Cheque Truncation, Real Time Gross Settlement System (RTGS), and Automated Clearing House (ACH) A statement released today from the public affairs department of the Bank of Ghana said all banks would be members of GIPSS either directly or access the system through member banks. It is expected that the National Switch, biometric smartcard, codeline cheque truncation, and Automated Clearing House would be installed by the end of 2007 and this should provide Ghana with an efficient, robust and modern payment system infrastructure. The GIPSS would also significantly reduce the usage of cash for business transactions and move the economy towards electronic payments, with the National Switch allowing ATM interoperability between banks. The system would extend services to the unbanked and underbanked segments of the population. It would allow banks, savings and loans, and other financial and non-financial institutions (such as Government, Universities, Cocobod, SSNIT, NHIS, large enterprises, hospitals, public transport, etc) to deploy products for the banked and unbanked that they have thus far been unable to do. The biometric (finger print) smartcard, for example, is designed to function in location without electricity and telecommunication equipment and eliminates the need to have basic literacy and numeracy to operate a bank account, and it also offers protection against fraud. The cost of electronic transactions should also reduce as banks would be able to pass on the advantages of economies of scale to be derived from this cooperative effort.
NTEs EXPECTED TO HIT $ 1 BILLION
Posted 10/05/07
Revenue from the Non-Traditional Exports (NTE) sector is projected to hit the one billion-dollar mark this year as efforts to diversify the country’s export market is gradually paying off. The percentage share of NTE to overall exports for last year stands at $ 892,878 m, representing 26.14 percent of total exports of $3,415,700 m. Additionally, NTEs has been growing at an annual average rate of 14.3 percent since 1997. The Ghana Export Promotion Council (GEPC) revealed this at the first ever reception for sponsors of the GEA. The GEPC initiated the export awards to enhance NTEs and thereby lead to favourable foreign exchange earnings. The occasion was also used as an opportunity to present awards to some organisations that could not receive their awards last year, namely, Tongu Fruits, BOMAG Farms, Bio Plantlets and Export Development and Investment Fund (EDIF). Non-Traditional Exports is used to classify the export of all products apart from the traditional ones such as cocoa beans, timber logs and lumber, electricity and gold. There are over 383 different Non-Traditional Export products categorized into Agricultural, Processed / Semi Processed and Handicrafts. Launching the highlights for 2006 statistics of the NTE sector, a board member of the GEPC, Nana Asante Frimpong said processed/semi-processed products topped the list with a total of $ 710.89 m, followed by agriculture at $ 177.5 m and handicrafts $ 4.49 m. He noted that the contribution of NTE to the overall export sector has been very significant since the inception of the Ghana Exports Award (GEA) in 1989 to date. For his part, the general manager of GEPCMr Lawrence Prempeh stated that NTE earnings by markets for last year showed the European Union as the biggest with 47.03 % at $ 419,882,938 m , ECOWAS 27.18 % at $ 242,689,210 m, and Emerging Markets 11.9 % at $ 106,237,220 m. Markets for Other Developed Countries were 11.07 % at $ 98,857,773 m and Other African Countries 2.82 % at $ 25,210,576 m. Burkina Faso was the most African country that trade with Ghana, followed by Nigeria, while Liberia was the least in the sub-region that was traded with. GEPC is the National Export Trade Promotion Organisation that facilitates the Development and Promotion of Non-Traditional Exports. It was established in 1969 as an agency of the Ministry of Trade and Industry with the mandate to develop and promote Ghanaian exports. The Council’s focus has primarily been to diversify Ghana’s export base from the traditional export products of Gold and other minerals, Cocoa Beans, Timber Logs and Lumber, and Electricity. GEPC has a clientele base of over 3000 registered private sector exporting companies organized into 15 Product Associations, which she relates to both on individual corporate basis and as groups/associations. This year’s export awards, which is annually organised by the council with sponsorship from corporate entities, would be on the theme “Managing Ghana’s Export Trade For Economic Development”.
LEADING MARKETS FOR NTE IN ECOWAS
Performance of NTE relative to Total Exports 2004 to 2006
Ten Leading NTE Products
Ten Leading Processed/Semi Processed Products
Ten Leading Agriculture Produce
Ten Leading Handicrafts Products
PERCENTAGE SHARE OF NTE EARNINGS BY MARKETS MARKETS PERCENTAGE EUROPEAN UNION (EU) 47.03 % ECOWAS 27.18 % EMERGING ECONOMIES 11.90 % OTHER DEVELOPED COUNTRIES 11.07 % OTHER AFRICAN COUNTRIES 2.82 % TOTAL 100 % Performance of NTE Sector by Markets
Trends in Percentage Share of NTE Earnings by Destination Category
May 28 2008
Statement from the Food and Agriculture ministry that the country is insulated against the effects of global food crunch is far from the reality as the prize of maize has jumped from 35-40 Ghana cedis to 75 Ghana cedis a bag between January and April this year, while a bowl or olonka of local rice has risen from one Ghana cedi 20 pesewas to 2 cedis 50 ghana pesewas for same period.
For maize, this jump represented 114 percent price increase as against a global hike of 31 percent and globally while the percentage increase of price of rice moved up by 74 percent, Ghana recorded 108 percent for local rice and 118 percent shoot for imported rice.
However, Foodspan says these alarming waves on the food front should not induce government to adopt inimical solutions such as to resort to production and consumption of genetic modified food. Miss Anna Antwi is the coordinator of Food Span.
According to her, government’s intervention of removal of food import tariff should not go beyond 3 months otherwise local farmers would suffer and lead to more hunger and malnourishment.
Credit: anextra agency news (AA)
TWO LOCAL COMPANIES WIN WORLDSTAR AWARDS
May 22 2008
Two Ghanaian companies were among 166 organisations that Wednesday received the 2007 WorldStar Awards for excellence in packaging. Polycraft Ghana Limited was awarded for Vitamalt Plus carton while Unilever’s Blue Band Good Start Margarine carton box was also honored.
31 countries worldwide took part in the competitive awards including four African countries namely, South Africa, Ghana, Zimbabwe and Tunisia. The top awards went to Japan and United States winning 14 awards each, followed by 13 awards to Germany, South Africa and Brazil 12 each, and China 11. For the African nations, Tunisia had one prize while Zimbabwe took home two awards. The world star award for packaging was instituted by the World packaging organization, WPO, to acknowledge the innovations and contribution of packaging to trade and consumerism.
Speaking at the award ceremony in Accra, the president of the WPO, Mr Keith Pearson said the WorldStar competition is one of the major events of the WPO as an initiative to motivate packagers and packaging converters to improve their productions.
| GA MANTSE, NII TACKIE TAWIAH III IN A POSE WITH SOME WORLDSTAR AWARD WINNERS AT THE CEREMONY IN ACCRA |
He noted that African packaging industries need to do upscale their packaging industries to enable Africa chalk more revenue in global trade.
The number of African countries at the final awards is a reflection of the continent’s standing in international trade as the volume of manufactured goods constitutes only 20 percent of Africa’s total exports.
At the national level, 21 oragnisations also received the Ghana Star Awards.
Ironically, no government official was at the award ceremony, though the organisers, Institute of Packaging Ghana (IOPG) sent four invitations to the sector Ministry of Trade, Industry, PSI and Private Sector Development.
IOPG top executives, including its President Kofi Essuman expressed unhappiness that no representative of the ministry could attend such an important event though the sector minister, Joe Baidoo-Ansah, delivered the keynote address during the opening of the African Packaging Summit Conference & Exhibition as well as the launch of the 40th anniversary of the WPO. What saddened the IOPG officials the more was that this event would only come again to Ghana after 20 years.
CREDIT: AAN
PACKAGING INDUSTRY TO HELP AFRICA
May 21 2008
Poor packaging is one of the greatest set backs to international trade for Ghana and the rest of Africa as the volume of manufactured goods constitute only 20 percent of the continent’s total exports.
However, packaging experts in Africa and the world over think that this sorry state of affairs can be reversed and are therefore holding an African Packaging Summit Conference & Exhibition in Accra.
The event, being attended by over 30 global packagers, is organized by the Institute of Packaging Ghana and the World Packaging Organisation, WPO. The summit seeks to raise awareness on changing global trends in the packaging industry, and to provide solutions to the major constraints hindering effective development of the packaging sector in Africa.
The president of the Institute of Packaging Ghana, Mr Kofi Essuman observed that unless the Ghanaian packaging industry builds and consolidates its capacity to become cost competitive it may lose its market to other countries. In that direction, Mr Essuman advocates that the first point of change should be in the chocolate sector.
He said the country has competitive advantage in the chocolate industry however, effective packaging is required to bring in the needed returns, which would be far more profitable than the export of cocoa beans.
For his part, the Minister for Trade and Industry, PSI and Private Sector Development, Joe Baidoo-Ansah said government would take advantage of the summit to strengthen the local packaging industry.
He noted that the success stories of the countries of the Far East and South Africa have been due to not only to the application of scientific and technological research but also to superb packaging that enhances the product appeal as well as shelf life.
The minister also lamented that losses arising from poor packaging are too colossal and the country cannot continue to suffer this situation.
He said it is as result of this that government would complement the efforts of the Danish Technical Institute and DANIDA in establishing packaging and Distribution Resource Centre in the country which would be a regional centre of excellence to provide packaging design and development, services, training and research to packaging converters in Ghana and West Africa.
He appealed to IOPG to use its influence and connections as a private sector-led body to galvanise packaging manufacturers, user industries, designers, packaging materials suppliers, academicians and regulatory agencies to facilitate the growth of the packaging industry in Ghana.
CREDIT: AAN
MONETARY POLICY COMMITTEE OF BANK OF GHANA_PRESS RELEASE
May 20 2008
1. Good Morning Ladies and Gentlemen, and welcome to this MPC press briefing.
2. We are meeting here today at a time when on the global scene primary commodity prices remain quite firm providing impetus to growth in developing countries but record high and rising crude oil prices and a surge in food inflation are posing a threat of resurgence of global inflation with inflation rising above targets in most economies. And, there are still lingering effects of the credit crunch and sub-prime problem and turmoil in the financial markets, which has led most developed economies to revise downwards growth projections for 2008, and continuing re-alignment of the major currencies.
3. Available information on the economy show a fairly resilient and robust economic performance with regard to output and demand growth and external trade and payments position in the face of shocks in the policy environment based on strong economic fundamentals.
4. Latest data indicate that the level of economic activity continued to be strong into the first quarter of 2008. The Bank’s Composite Index of Economic Activity rose by 3.0 percent, some easing in the growth rate but at 28.5 percent in year-on-year terms, is above the trend growth of 21.3 percent at the end of March 2008. This compares with 21.4 percent recorded in the same period of 2007. All the major sub-components showed strong growth.
5. Additional information for tracking real sector performance, such as social security payments, job vacancies, and retail sales also point to robust economic activity. Registered number of firms on the SSNIT scheme increased by 20.8 percent over the 17,684 registered firms recorded in the first quarter of 2007. For the first quarter of 2008, total social security contributions increased by 10.4 to GH¢19.3 million, compared with GH¢14.8 million recorded for the same period in 2007, and GH¢17.4 million for December 2007.
· Cement production increased by 23.4 percent to 609,424 metric tons during the first quarter of 2008, compared to 493,879 metric tons recorded for the same period in 2007.
· The index for general retail sales suggests strong consumer demand growth in the first quarter of 2008.
· Advertised job vacancies recorded for the first four months of 2008 was 5,147, a sharp increase over the 2,243 recorded in 2007, with most of the vacancies in the services sector. This translates into an average monthly job vacancies advertised of 1,286 for the first four months of 2008 compared with 560 for the same period in 2007.
6. The Bank’s survey of Business and Consumer confidence indicate that confidence has softened over the first quarter of 2008, amid uncertainty about oil prices and rising inflation, while both business and consumer expectations about economic prospects for the rest of the year remain generally positive.
7. Credit to the private sector and public institutions continued its strong growth into the first quarter of 2008. Credit to the private sector and public institutions increased by GH¢1,615.8 million, or at an annual rate of 57.3 percent compared with GH¢846.0 million (50.4 percent) recorded for the same period in 2007. The private sector accounted for 81 percent (GH¢1,308.2 million) of the increase in credit.
· Distribution of the credit flow to the private sector continues to be broad-based. Services accounted for 33.9 percent, commerce and finance 17.9 percent, miscellaneous 16.1 percent, construction 9.3 percent, manufacturing 5.6 percent and transportation, storage & communication 5.4 percent. The remaining sectors recorded increases of between 1.0 percent and 4.9 percent.
· Distribution of the credit flow by user similarly remains broad-based with households gaining increased significance in the loan portfolios. Enterprises absorbed 69.9 percent of credit extended to the private sector over 12-month period to March 2008, down from 82.8 percent for the same period in 2007. The share of households rose to 27.4 percent from 15.0 percent over the same period. On year on year basis, credit to households increased by 85 percent to GH¢779.1 million at the end of March 2008, up from 41 percent in March 2007 when such credit stood at GH¢420.6 million.
8. The asset portfolio of the banking system continued to expand through to the first quarter of 2008. Total assets of the banking system grew by 43.7 percent to stand at GH¢8,085.9 million at the end of the first quarter of 2008, compared with 41.6 percent for the same period in 2007. At the same time, deposits grew by about 45 percent, compared with 42 percent for the same period in 2007. Generally, the banking industry remains strong, profitable and fairly liquid.
9. The quality of the loan book of the banking industry continued to remain strong in the first quarter of 2008, even though the Non-Performing Loans (NPL) ratio and the NPL net of provision edged up from 6.4 percent and 4.5 percent respectively at the end of the fourth quarter 2007 to 8.7 percent and 14.0 percent at the end of the first quarter of 2008 respectively. Similarly, loan loss provision to gross loans ratio also edged up from 5.5 percent to 5.9 percent over the same period.
10. Evidence from the Bank’s survey of credit conditions continues to point to increased access to credit by both enterprises and households but some tightening of long term loan conditions because of balance sheet constraints at the end of the first quarter of 2008. The easing of credit conditions was broad-based with Small and Medium Enterprises (SMEs) gaining improved access to credit.
11. Provisional data show that broad money (M2+) increased by 3.3 percent in the first quarter of 2008 compared with an increase of 1.2 percent for the same period in 2007, seasonally down from 19.4 percent recorded in the fourth quarter of 2007. Annual M2+ growth in March 2008 was 39.2 percent, up from 35.9 percent recorded for the same period in 2007.
12. Strong growth in liquidity of the banking system has been supported by significant increases in deposit mobilization with the opening of more bank branches and introduction of new products to attract deposits. Total deposits increased by 42 percent in year on year terms to GH¢4,828.9 million at the end of the first quarter of 2008, compared with 40 percent for the same period in 2007. Savings & Time deposits grew by 38 percent to GH¢1,920.3 million at the end of the first quarter of 2008, compared with 56 percent for the same period in 2007. Foreign currency deposits also grew by 41 percent to the equivalent of GH¢1,212.6 million at the end of the first quarter of 2008, at a much faster pace than the 25.1 percent for the same period in 2007.
13. Preliminary banking data of the fiscal position for the first quarter of 2008 continues to show buoyant revenue growth matched by sharp expenditure growth. Total revenue and grants for the first quarter of 2008 amounted to GH¢1,121.45 million (6.9 percent of GDP) compared with GH¢1,017.62 million (7.3 percent of GDP) for the corresponding period in 2007. Total revenue and grants increased further by GH¢383.84 million in the month of April to bring the cumulative amount for the year to April to GH¢1,505.28 million (9.2 percent of GDP), compared with GH¢1,436.71 million (10.3 percent of GDP) for 2007.
14. Total expenditure (excluding foreign financed capital expenditure) for first quarter of 2008 amounted to GH¢1,384.73 million (8.5 percent of GDP) compared with GH¢1,156.53 million (8.3 percent of GDP) for the same period in 2007. Additional spending of GH¢579.46 million was made in April to bring the cumulative expenditure for the first four months of 2008 to GH¢1,964.19 million (12.1 percent of GDP) including an estimated GH¢200.8 million outlays on the energy infrastructure financed by sovereign bond proceeds, compared with GH¢1,536.4 million (11 percent of GDP) recorded for 2007 and a budget target of GH¢5,109.3 million for the year.
15. The narrow budget deficit (defined to exclude foreign financed capital expenditure) but including expenditure financed by capital market borrowing for the first quarter of 2008 was GH¢479.54 million (2.9 percent of GDP), compared with GH¢125.97 million (0.9 percent of GDP) for the same period in 2007. The deficit in addition to a foreign loan repayment of GH¢207.86 million, were financed from the domestic economy.
16. The stock of domestic debt (gross) at the end of 2007 was 26.5 percent of GDP. This ratio declined to 24.2 percent by the end of the first quarter of 2008. The stock of external debt also ended 2007 at 24.6 percent of GDP, and reduced further to 22.5 percent at the end of the first quarter of 2008. This brings total public debt stock to US$7,607.0 million (46.7 percent of GDP) at end of the first quarter of 2008 compared with US$7,146.5 million (51.1 percent of GDP) at the end of 2007.
17. Developments in interest rates on the money market during the first quarter of 2008 have been shaped by rising inflation, and apparent shift in preferences towards shorter dated securities on the money market, and yields rising notably along the maturities range. The total share of short-dated securities increased by 1.5 percentage points during the quarter.
During the period from January to mid May 2008:
· overnight interbank rates firmed-up by 61 basis points to 12.65 percent.
· The 91-day and 182-day Treasury bill rates firmed-up by 234 and 282 basis points respectively to 12.96 percent and 13.62 percent respectively.
· The 1-year-note and the 2-year fixed rate note similarly inched up by 170 and 120 basis points respectively to 14.0 percent each.
· The rate on the 3-year fixed bond rose to 16.0 percent from 14 percent over the same period.
· Average base rate quotations of the banks were revised marginally upward by 26 basis points in April (on top of the 92 basis points revision at the end of March 2008) in the range 18.0 – 21.45 percent.
· Average lending rates were similarly revised upward by 19 basis points in April 2008 within the range of 14.8 – 33.9 per cent.
18. On the external front the average price of cocoa beans exports which was US$1,942.2 per tonne at the end of December 2007 increased by 7.7 percent to US$2,091.8 per tonne at the end of March 2008. Gold prices broke through the US$1000 mark in March 2008, resulting in an average export price of US$916.6 per ounce at the end of the first quarter of 2008, representing 17.8 percent over the level at the end of December 2007, and 42.4 percent rise in year on year terms.
19. The average weekly price per barrel of the benchmark Brent crude closed April at US$115.28, representing 22.5 percent increase over the end December 2007 level, and about 70 percent in year on year terms. It however reached a fresh record of US$124 per barrel on Thursday May 8, 2008.
20. Total merchandised exports for the first quarter of 2008 amounted to US$1,334.6 million, compared with US$1,041.5 million for the same period in 2007 (a growth of 28.1 percent), and US$1,098.3 million for the fourth quarter of 2007.
· Exports of Cocoa beans and products amounted to US$401.5 million, higher than US$382.27 million recorded for the same period in 2007 and US$221.9 million for the fourth quarter of 2007. However, cumulative cocoa purchases through the end of the first quarter totalled some 552,312 tonnes, against a target of 634,000 tonnes for the crop season, and 510,609 tonnes for the corresponding period of the 2006/2007 crop season.
· Gold exports totalled US$608.9 million as against US$395.0 million recorded for the same period in 2007 and US$486.4 million for the fourth quarter of 2007.
· Non-traditional exports rose by 27.1 percent to US$258.8 million, compared with (US$203.6 million) for the corresponding period in 2007 and US$325.3 million for the fourth quarter of 2007, and US$207.4 million for the fourth quarter of 2006..
21. Imports growth was strong at 33 percent during the first quarter of 2008, compared with the first quarter of 2007, with all import categories registering higher growth. Total merchandise imports for the first quarter of 2008 amounted to US$2,273.9 million, compared with US$1,659.3 million for the same period in 2007 and US$2,343.4 for the fourth quarter of 2007.
· Oil imports amounted to US$526.8 million and accounted for some 23 percent of total imports compared with US$346.1 million (21 percent of total imports) recorded for the same period in 2007 and US$571.1 million (24 percent) for the fourth quarter of 2007. The increased oil bill for the first quarter resulted from price effects. The average realized price rose by 53.3 percent; the value of crude imports declined by 50,930 barrels (1.4 percent) to 3.48 million barrels. Imports of refined petroleum products amounted to US$183.9 million, indicating a growth of 15.8 percent on year on year basis.
· Non-oil imports amounted to US$1,747.1 million and accounted for about 77 percent of total imports in the first quarter of 2008, compared with US$1,313.3 million (79 percent) for the same period in 2007, and US$1,772.3 million (76 percent) for the fourth quarter of 2007.
22. The merchandise trade account recorded a deficit for the first quarter of 2008 that amounted to US$939.3 million, compared with a deficit of US$617.8 million for the same period in 2007, and US$571.1 million for the fourth quarter of 2007. Preliminary estimates are that the current account recorded a deficit of US$725.8 million, compared with a deficit of US$422.9 million for the same period in 2007, and US$652.7 million for quarter four of 2007.
· The increased current account deficit was on account of imports of capital equipments for oil exploration and mining financed by foreign direct investment (FDI) inflow of US$367.5 million in the first quarter of 2008.
23. The overall balance of payments deficit is estimated at US$528.4 million for the first quarter of 2008, compared with a deficit of US$335.1 million for the same period of 2007.
24. Gross International Reserves (GIR) at the end of April 2008 was US$2.19 billion, and translates on average into goods and services import cover of 2.7 months.
25. The foreign exchange market continued to deepen, recording a sharp increase in the volume of sales and payments transactions during the first quarter of 2008. Total Purchases and Sales in the foreign exchange market by banks and forex bureaux for the first quarter of 2008 amounted to US$2.45 billion, 27.5 percent higher than US$1.92 billion for the same period in 2007, and 11.2 percent above US$2.20 billion recorded in the last quarter of 2007. This increased further by US$802.1 million in April 2008 (US$654.3 million for April 2007) to bring the cumulative amount for the first four months to US$3.3 billion, compared with US$2.6 billion for 2007, and US$2.2 billion for 2006..
26. Private inward transfers – received by NGOs, embassies, service providers, individuals etc. - through the banks and finance companies for the first quarter of 2008 amounted to US$2,008.4 million, which represents 35.4 percent increase over the amount of US$1,483.6 million recorded for the corresponding period in 2007.
• Of the total transfers at the end of the first quarter of 2008, US$400.8 million (or 20 percent) accrued to individuals, compared with US$345.2 million (22.8 percent) for the first quarter in 2007.
27. The cedi depreciated against all the three major currencies during January to April 2008, moving within relatively low range vis-à-vis the US dollar and the Pound Sterling, with depreciations of 1.8 percent, and 0.3 percent respectively. The Euro appreciated against the cedi by 8.2 percent. In trade weighted terms, the cedi depreciated by 3.2 percent, compared with a depreciation of 1.9 percent for the same period in 2007.
28. The latest inflation numbers released by the Ghana Statistical Service (GSS) show that inflation has been rising significantly to 13.8 percent at the end of March 2008, and further to 15.3 percent in April 2008, after reaching a low of 10.2 percent in September 2007. This rising inflation rate has been driven to a considerable extent by crude oil prices and its effect on the domestic market. Food inflation which was 9.3 percent in September 2007 rose to 13 percent at the end of March 2008 and further to 13.2 percent in April 2008. Non-food prices also moved from a low of 10.9 percent in September 2007 to 14.4 percent in March 2008 and further to 16.9 percent in April 2008.
29. Also core inflation (defined to exclude energy and utility) which has been in single digits since June 2006 began to increase from a low of 8.6 percent in September 2007 to 10.2 percent in March 2008 and further to 11.4 percent in April 2008.
30. To summarize, the economy has been resilient in terms of output and demand growth with economic activity proceeding at a pace above trend and with relative stability in the exchange market.
31. Domestic demand growth has been underpinned by strong fiscal stimulus, and rapid build-up of sectorally diversified bank loan portfolio in a deepening and competitive financial sector.
32. Inflation and cost price pressures have increased amidst rising and volatile oil prices, and a surge in food prices. And, uncertainty about developing inflation has weighed down business and consumer confidence, while the general assessment of economic prospects remains strongly positive.
33. Inflation has risen sharply over the past three months. Both headline and core inflation are now significantly above the target set over the medium term.
34. The risks in the outlook for inflation is on the upside with uncertainty about oil price increases and volatility and the potential for inflation expectations to become embedded in pricing and wage cost structure.
35. In the circumstances, to strengthen the anchor for macro-stability, the Monetary Policy Committee has decided to increase the Bank of Ghana Prime Rate from 14.25 percent to 16 percent.
Thank you for your attention.
16 WIN WORLD BANK DEVELOPMENT MARKETPLACE COMPETITION
Posted May 12, 2008
The World Bank Group has selected 16 companies and organizations as winners of the Development Marketplace competition for their innovative products or services tailored to Sub-Saharan Africa’s off-grid lighting market. The winners will receive up to $200,000 to implement projects that offer affordable, clean, and safe off-grid lighting and that improve access to lighting for people living without electricity across the region.
The winners were selected from among 52 competitors, and their projects were judged using five criteria: innovation, measurability of outcomes, organizational and financial sustainability, growth potential, and realism. They will use the funds to implement their projects in several African countries, including Burkina Faso, Cameroon, Ghana, Kenya, Liberia, Namibia, Nigeria, Rwanda, and Tanzania.
The ideas and concepts presented during this competition were far beyond our expectations, and this level of innovation and creativity is exactly what Africa needs. We are looking forward to seeing the winners implement their projects, said Anil Cabraal, World Bank Lead Energy Specialist.
One of the winning projects will use cassava waste to produce biogas for lighting about 2,250 rural homes. Another project introduced a revolutionary type of energy efficient solar cell product for light emitting diodes that can also be used as a mobile phone and energy charger and a source of energy for radio. The people’s choice award went to a project that aims to use the Savings and Credit Cooperative Societies, a network of solar technicians in Tanzania, and reasonably priced solar systems to reach remote areas.
This has been one the most fruitful Development Marketplace competitions. All of the finalists were able to meet with businesses and NGOs that are relevant to their day-to-day activities. This will help broaden their reach and impact, said Monika Weber-Fahr, IFC Manager for the Sustainable Business Innovator.
The competition took place during Lighting Africa 2008, the first global business conference for off-grid lighting in Africa, held in Accra, Ghana, from May 6 to 8, 2008. The conference is part of the World Bank Groups Lighting Africa program, which aims to mobilize the private sector to provide modern off-grid lighting to more than 250 million people in Sub-Saharan Africa by the year 2030.
CREDIT: AAN
MONETARY POLICY COMMITTEE TO MEET
Posted May 12, 2008
The Monetary Policy Committee (MPC) of the Bank ofGhana will meet from Tuesday, May 13, 2008 to reviewdevelopments in the economy. The decision of the MPC, with respect to the Bank ofGhana Prime Rate, will be announced at a pressconference on Monday, May 19, 2008.
CREDIT: AAN
MCA ELIGIBLE AFRICAN COUNTRIES MEET IN ACCRA
June 11
African countries eligible for the millennium Challenge account of the united states of America are in Accra for a two-day on enhancing collaboration to reduce poverty in their respective countries.
Out of a total of 19 eligible African countries, only five, namely, Ghana, Madascar, Benin, Cape Verde and Mali have signed funding agreements with the Millenium Challenge Corporation, the washington-based body that is managing the MCA .
Speaking at the meeting, the ECOWAS commission president, Dr Mohammed Ibn Chambas said the MCA is welcomed in the subregion, considering that 12 of the 15 member states of ECOWAS are among the least Developed Countries in the world.
For his part, the chairman of the MCA country board, Dr Paa Kwasi Ndoum said the meeting would come out with reportsand resolutions that would be forwarded to the MCC, African Union and the respective eligible African governments.
BOG LADIES HIT ROAD WITH REDENOMINATION
June 5 2007
The fever of new money is rising among the populace as the whole nation prepares itself for the birth of the new Ghana cedi, bound to come into being less than four weeks from now. The new cedi is expected to start making the rounds as the new symbol of purchasing power from the first of July, with the hope that its use would catch-up fast with the public.
However, feedback from various groups such as market women, churches and other social groupings show that education to the public is not reaching far enough to the general fabric of society.
In that direction, the Bank of Ghana Ladies Association, BOGLA, has embarked on an extensive public education campaign to increase the understanding of social groups on the new cedi. They have visited Kasoa, Batsona and Tema markets as well as surrounding villages, where they educated market women and villagers on how to convert the new currency and how to identify security features.
The field educational campaign is certainly going down well with target groups judging by the sort of interest that listeners of "the gospel according to redenomination" show wherever the team has been to.
According to BOGLA, it is happy to be in a position of assisting the public, particularly women, to understand the change over to the new Ghana cedi.
Under the new cedi convention, ¢10,000 is equivalent to ¢1 or 100 pesewas, while the notes of the Ghana cedi come in five variations of ¢1, ¢5, ¢10, ¢20 and ¢50. The coins accompanying the notes are six types, beginning from one pesewa, 5 pesewas, 10 pesewas, 20 pesewas, 50 pesewas and ¢1. For instance, ¢100 today would be same as one pesewa, while ¢1000 now is equal to 10 peewas.
Speaking to Anextra Agency News (AAN), the president of BOGLA, Mrs Evelyn Kwatia, said the central bank ladies realize that places like churches and markets provide a large forum for education on the new cedi, more so in local dialect.
She stated that the association is aiming at getting very close to the public for one-on-one discussion to achieve greater understanding about the currency and its security features. BOLGA has therefore written to a lot of social organizations about readiness to provide free education to anyone who needs it.
On its church to church education, the team of educators has been communicating to many congregations including the Calvary Baptist Church Adenta branch, St Mary’s Anglican Church at Akoto Lantey and Freeman Methodist Church at Jamestown. One of the principal educators, Eleanor Laryea, a member of BOGLA, disclosed that the redenomination message was received tremendously by the church congregations especially as Ga, Ewe, and Akan are used for the education. "What motivates me about this campaign is seeing that the people are angry for information and I’m glad to be able to reach out to them in whatever language we can for them to appreciate what is happening because they are the integral part of the society and if they do not understand the whole process, then it would fail" she said. Another team member, Patience De-Graft Klo, who has been doing the rounds at Bubuashi and Kaneshie churches, such as Mount Ararat, expressed similar sentiment. "I was shocked to see church members eager to listen to us with some saying that they never knew the central bank has them too in the focus of the exercise." The work of BOGLA in the capital, particularly in the markets is expected to heat up as the ban on drumming is lifted. These efforts by the Bank of Ghana Ladies Association should allay the fears of the central bank governor, Dr Paul Acquah that staff may sabotage the success of the redenomination exercise. Pix
STRESS IS GOOD SAYS PROFESSOR
The former director-general of Ghana health service, Prof Agyeman Badu Akosa has acclaimed that stress is good for everybody as it imposes challenges on the human life.
That explains the numerous experiences of stress that people go through either at home, work place, behind the steer, or financial capabilities.
He said this in Accra at the second health seminar by Donewell Insurance Company on the theme stress, it effect on the body and its management.
Prof. Akosa said those who marry more than their income also face stress, adding that some drink and smoke to over come the stress but that is not the way to solve the situation.
He pointed out that the best way to overcome stress is to understand the stress and know how to solve by either meditating or relaxation.
Prof Akosa lamented that it is unfortunate that children give avoidable stress at home and school during their tender ages and adolescent ages.
He thereforeurge all parents and teachers to let children get their fare share of learning and playing, noting that playing is fundamental for the growing capabilities of every child.
JOE LARTEY TURNS 80 AND STILL STRONG
June 7
The celebrated public speaker and broadcaster, Joe Lartey is in his second day as an octogenarian.
The strong looking man, popularly known as Over To You, turned eighty years yesterday and as part of the day, the Accra Toastmaster Club honoured him with a plaque dubbing the acclaimed personality as the Doyen of Public Speaking in Ghana.
Gold news was at the event and asked Mr Joe Lartey, how it felt like chalking four score years and still going steady.
He replied that he is been taking very good care of his body and health for a very long time now, because he caanot afford to be a good public speaker and be looking sickly.
Joe Lartey, alias Over To You, is a celebrated public speaker and broadcaster, who who marked his 80th birthday yesterday.
Fathia Nkrumah Is Dead
May 31 2007
Madam Fathia Nkrumah, 75, the widow of the late President Nkrumah is dead.
Madam Nkrumah was suffering from stroke and died in a hospital in Cairo, Egypt.
One of the sons of Madam Fathia, Mr Sekou Nkrumah told Joy News ( www.myjoyonline.com )shortly after her death that although his mother’s death was sad to hear it was something the family expected due to the complicated nature of the illness.
"It is sad in a way but at least we should celebrate her life…I was expecting the worst. At her age I believe all kinds of things take place in her body," he said.
Mr Nkrumah said it was good President Kufuor took time off to visit his mother before her death. He said that should serve as a basis for all Ghanaians to shun political differences and live in unity.
"Good timing on the President’s part to visit her before her death. Ghanaians need to move beyond partisan politics and see ourselves as one," he said.
Madam Fathia was a very young wife and mother of three very young children when her husband was overthrown in Ghana’s first successful military coup on February 24 1966.
SOLDIER ABANDONS HIS ACCIDENT VICTIM
May 26 2007
The fate of an innocent mother of three hangs between death and life due to the recklessness and indiscipline of a soldier whose disregard for road signs has resulted in the hospitalization of this woman.
The woman, Madam Lucy Bosso, 32, was the victim of a head-on collision that occurred on the 14th of April 2007 around 4pm in front of flagstaff house. She was sitting in the passenger seat beside the driver when Corporal Nubi Baadah drove a Tata bus with registration number 33 GA 85 into the front part of the vehicle that madam Bosso was sitting in, a commercial minivan GR 9402 X.
The victim, who had left Aflao that day for Accra in that vehicle to purchase goods, was quickly rushed to the 37 military hospital with fatal injuries including a completely shattered right leg and a broken right arm.The news of the accident was telecasted by GTV in its news.
According to doctors, the leg cannot heal unless it is amputated, but even then the critical condition of the victim is hampering the operation, and so she is still lying in bed at the hospital immobile.
Surprisingly, Cpl. Baadah with identification serial number 188736, has abandoned the woman to her fate right from the moment that the incident occurred.
He never followed the victim to the hospital immediately following the accident, and has up till now never paid any visit to her to even ascertain her condition neither is he bearing the cost of her bills which is currently running into almost ¢10 million.
According to a brother of the victim, Holy Bosso, he has borne the cost of all the medical bills of his senior sister to date since the husband or any other family member lacks the means to take care of her.
He said they have reported the case to the cantonment police station but this has been to no avail. "And now the doctors at the hospital are suggestion that my sister's leg should be cut but since I don't have the money they are delaying while my sister suffers," he lamented.
Mr Bosso said although he received some donations from some individuals but it is not enough to take care of his sister and therefore pleaded with philanthropists to help him bring the sister out of pains.
He disclosed to that his sister was the bread winner for her family due to her husband being out of work for some years now and so the accident is having serious consequences on the family as the children and their father have been dispossessed of the breadwinner.
Mr Bosso said he is very much surprised at the behavior of the Corporal because he expected soldiers to be more disciplined than the character that Cpl Baadah has displayed.
He therefore appealed to the military authorities to help bring the culprit to book as well assist the victim get out of hospital.
PIX
Madam Lucy Bosso lying prostrate on bed at the 37 military hospital
CONSERVE WATER: MINISTER
Posted 24-05-07
Aqua Vitens Rand limited has estimated that illegal connections constitutes about 40 to 50 percent of unaccountable water and thus rendering the water company handicapped in supplying the required volume of water to consumers.
The company stated this at the launching of the save water education campaign in Accra.
Speaking at the launching ceremony, the minister of water resources, works and housing, Hackman Owusu-Agyemang said it is very essential for water to be conserved in order to complement governments efforts at providing portable water to all Ghanaians.
He said water is becoming increasingly scarce due to high population growth with its attendant increase in pollution coupled with growing economic activities, which is becoming a potential source of conflict in most African countries.
The minister pointed out that water conservation must include the protection and management of river bodies.
MASA TO BE HELD IN ABIDJAN
Posted May 24, 2004
African culture is one important contributing factor to the democracy that the continent is enjoying today. Therefore in restoration of peace and the consolidation of democracy in Cote d’Ivoire, a special edition of the Market For African Performing Arts, MASA is to held from July to August this year.
This unique edition of was re-launched in Accra after its four years break due to the Ivorian crises which brought the celebration of the festival to a halt.
The director general of MASA, Mr. Thomas Manou Yabalaih said MASA is the only Pan African artistic project which combines business opportunities, a forum for professionals and a festival.
The programme assists the African theatrical, dance and musical productions and artists to be better known by and help foster the circulation of their productions within Africa and the rest of the world.
Mr. Yabalaih disclosed that the special edition of the programme would be held in Abidjan and in four other cities in Cote d Ivore, namely Bouake, Korhogo, Man and Daloa.
| World Migratory Bird Day |
World Migratory Bird Day, WMBD, a global initiative, will from 12-13 May 2007 celebrate the beauty of migratory birds and how to promote and conserve them through out the world. This year’s theme is “Migratory Birds in a changing climate”, which will focus attention on the plight of migratory birds as well as highlight the way they are being affected by climate change and living things. Briefing the media on activities put in place for the day, the Acting Executive Director of Ghana Wildlife Society, Mr. Erasmus Owusu said the theme for this year’s World Migratory Bird Day is appropriate because climatic change has a severe consequence on migratory birds, causes the loss of essential bird habitats, changes migration patterns and increases the competition for food between migrating birds and residents when they travel far to other lands. He said climatic change is one of the most critical global challenges of this time because recent events have demonstrated the growing vulnerability to climatic change, not only on migratory birds but would also affect agriculture and even endanger food security. The World Migratory Bird Day is being promoted worldwide by the African-Eurasian Migratory Water bird Agreement and the Convention on Migratory Species
MORE OF LOCAL RICE MUST BE EATEN
Imagine the number of mouths that relished the taste of one of the most delicious staple foods, rice, as Africans celebrated Africa Liberation Day on Friday May 25, 2007.
Sadly, whether in the continent’s most populous country, Nigeria or in small Eritrea, so would majority of Ghanaians also enjoy their rice, without regard to its source and that only a small percentage of the rice being eaten is produced in Ghana and that the consumption of the greater percentage makes poor local rice farmers poorer.
Rice is the most consumed staple food in this country after maize. In 2000, Ghanaians consumed 309,808.9 metric tons of rice with local production volume of 137,216 metric tons or 44.30 %, but in 2003 percentage of local rice in total consumption was 29.04 % at 155,353.6 metric tons out of 534,905.9 metric tons. Total national production of rice in 2004 was 169.45 metric tons.
The value of yearly commercial imports of rice in total consumption was 54.16 % in 2000, 62.37 % in 2001, 60.30 % in 2002 and almost 70 % in 2003.
Infact, for over a four-year period between 2000 to 2003, commercial rice imports averagely constituted about 61.52 % of total national consumption, while local rice comprised an average of 36.58% and food aid 1.90%. (Action Aid)
High volumes of rice imports with their low prices has made local rice production ever more less competitive and unappealing as the price of local rice has been increasing over the years. The net incomes of rice producers in Ghana has been in the negative from 2002 to date, and therefore raising the poverty levels of these farmers.
Reduction in incomes has led to the loss of investment capital of many rice farmers and consequently affecting their access to food particularly as about 70% of producer households use rice for food and crop for cash.
The incomes of national rice farmers have been falling steadily over the years, but these falls have quickened since 2002. In the Ejisu Juaben district, for instance 24 farmers recorded a positive net returns from rice production in 2002, but this number reduced to 20 in 2003. out of 190 rice farmers that cultivated the crop in 2004, only 65 had slight positive returns while 125 experienced negative returns.
Interestingly, this situation does not endanger only the food security of the rice farmers, but also the whole nation as the populace would easily be held to ransom if at any time food imports is used as a weapon against the country. That means the nation’s food security is insecure.
Furthermore, the current situation indicates that the nation would continually need more cash for rice imports and worsens the foreign exchange pressure. On the health front, the strength of citizens would be less than optimum as imported rice is far less healthy than the locally produced rice.
The World Bank in 1986. defined food security as the "access by all people at all times to enough food for an active and healthy life." This definition deals with food availability; equitable distribution; and consumption
In 1979 the World Food Programme Report conceptualized food security as being equal to an "assurance of supplies and a balanced supply-demand situation of stable foods in the international market”.
But this conception is not applicable to Ghana considering its food status, particularly with regard to rice production.
It is in the face of such disheartening picture of the rice industry in the country that the efforts of civil society organisations like Oxfam, General Agriculture Workers Union (GAWU) and Action Aid, among others should be appreciated.
These organisations concerned about the plight of local rice farmers, are doing the best through advocacy and interventionist programs to assist these affected farmers.
Such groups are giving support to the peasant rice farmer because food security is such an important component of the development module to the extent that any country that does not secure its food by its own hands but rather relies on the benevolence of others loses the key to growth and development.
The Project-Citizens’ Voice In Trade Policy project, sponsored by the Rights and Voice Initiative (RAVI) is one of the strategies adopted by GAWU to strengthen the capacity of farmers by enabling the farmers make a direct input into policy formulation for the enhancement of their sector. RAVI is the rights advocacy window of the Ghana Research and Advocacy Programme (G-RAP).
The Project-Citizens’ Voice In Trade Policy project is intended to strengthen the capacity of rice farmers and agricultural employees to engage with government on trade policy affecting food security with particularly reference to rice.
It seeks to ensure sustained citizen-government engagement on rice issues, as well as secure enhanced government responsiveness to citizens concerns on trade policy and food security.
GAWU’s intervention in the rice industry has shown that the impact of rice dumped by heavily subsidized sources threatens to destroy the livelihoods of thousands of farming families and prospects for rural development.
The state of the rice industry in Ghana is an indication of how World Trade Organisation (WTO) trade regulations are forcing many small scaled farmers out of business as low-cost imports of rice have flooded the local markets.
Because of the WTO, government is weak in implementing strategies to benefit the local rice producers, such as imposition of high import tariffs and strengthening the production capacity of poor farmers who have sustained this economy all over the years but whose livelihoods are now disregarded in the name of liberalization.
The rural poor who are a major producer of food crops live in extreme poverty as a result of unfair competition arising from the influx of artificially cheap imports.
Despite these stark truths, the nation, particularly government looks on apathetically with the argument that the country lacks ability to meet its rice consumption requirements that is why cheaper rice imports must be continued.
The more we consume foreign cheap rice, the worse the plight of local rice become as they continually deprived of the needed funds that would have enabled them produce more at lesser costs.
It is time we put in place strategies to increase the consumption of local rice so that the miserable farmers can have access to more markets if they cannot be helped with subsidy.
The rice imported is heavily subsidized, and come to break the market of local farmers.
Food security means availability of food in sufficient quantities all year-round with a national buffer stock located at right places at affordable prices.
In 2002, Agriculture Development Bank gave out a loan of ¢112million to 141 women in processors and by June 2,430 acres of rice had been planted. This was certainly a good gesture of how support can work.
For now, government through the Ministry of Agriculture should support local rice farmers to go into large scale production and processing under let’s say a special five-year project that would ensure that rice produced would be enough to meet the nations need by end of the project.
We must consume more local rice from now on as we observe 50 years of independence, more so when local rice is become tastier to the extent that is packaged with foreign labeled bags.
A rice farmer inspecting his farm
A group of rice farmers working on their cultivation
A rice farmer inspecting his farm
Officials of GAWU educating local rice farmers on their rights
MINING COMPANIES URGED TO BE MORE RESPONSIBLE
Mining companies have been advised to mine responsibly in order not to compromise the livelihoods of future generations.
Chief executive of the chamber of mines, Ms Joyce Aryee gave the advice during a media interaction in Accra.
She noted that the mining sector is very important as almost everything revolves around mine products, however, mining firms must be more accountable to the society.
Ms Aryee expressed joy that members of the chamber have lived up to their social responsibility by providing free medical care for workers and their dependants as well as host communities.
Apart from establishing hospitals, there is a multi – billion malaria control programme underway to reduce the high rate of malaria in mining communities.
The sector’s contribution to GDP increased from 2.3 percent in 1991 to 5.2 percent in 2005 as the third highest contributor to internal revenue, accounting for over 12 percent of IRS collections.
Miss Aryee stated that the mining sector contributed 2.199 trillion cedis in 2005 towards national development.
MPC REVIEW OF GHANA'S ECONOMy JAN-APRIL
Posted 22/5/07
Below is the full text of the economic review report of the Monetary Plicy Committee of the Bank of Ghana, which was dekivered by the Governor, Dr Paul Acquah:
READ ON:
Ladies and Gentlemen, it is always a privilege to welcome you to our MPC press briefing.
Available information on developments through the first quarter of 2007 show that economic activity continues to be robust, underpinned by significant growth in imports and exports and strong corporate performance with the continuing load management programme in the energy sector a source of weakness in the outlook. Headline inflation continued to be stable on its downward trend but showed an up-tick in April to 10.5 percent. The Bank of Ghana’s Composite Index of Economic Activity (CIEA) at the end of the first quarter was up by 5.2 points (1.8 percent) over the December 2006 level of 285.7, and 21.8 percent in year-on-year terms against a trend growth of 20.9 percent. The components contributing to the growth in the index were employment, exports, commercial bank credit, imports and tourism; there were some declines in port activities, cement sales and electricity consumption.
Evidence from the Bank’s surveys of Business and Consumer Confidence show that both indices of business and consumer expectations dipped slightly at the end of the first quarter from the highly favourable levels recorded in preceding quarters. Non-financial corporate sector performance during the first quarter of 2007, was robust and broad based for listed companies. These companies posted good results in terms of turnover growth, net profits and cost of sales in various sectors, covering manufacturing, Distribution, Food and Beverages, Agriculture, and Information Technology.
Deposit Money Bank’s (DMBs) credit to the private sector and public institutions continued to show significant growth as it increased by 12 percent (¢3,021 billion or GH¢302.1 million) to ¢28,218.8 billion (GH¢2.82 billion) in the first quarter of 2007 and 11.9 percent during the last quarter of 2006. Over the twelve-month period to March 2007, DMBs credit to the private sector and public institutions rose by 50.4 percent (¢9,460 billion or GH¢946.0 million) compared with 42.1 percent (¢5,559 billion or GH¢555.9 million) recorded for the same period in 2006.
In real terms, credit to the private sector grew by 41.7 percent in March 2007 (highest in recent times), compared with the 28.7 percent recorded for December 2006 and the 19.4 percent for the corresponding period of 2006. The distribution of the annual credit flow was broad-based, but continued to be concentrated in the services (27.1 percent), commerce and finance (22.2 percent), manufacturing (12.6 percent) and construction (11.2 percent).
Total assets of the banking industry rose by 41.6 percent to ¢56,275.7 billion (equivalent to GH¢5.62 billion) over the year to March 2007, compared with 24 percent a year ago. Net loans and advances increased by 58.1 percent to reach ¢26,354.7 billion (or GH¢2.63 billion) in March 2007, compared with 41.8 percent for the preceding year.
The quality of the banking industry’s loan portfolio improved. Non-Performing Loans (NPL) ratio declined to 6.9 percent at the end of March 2007 from 7.9 percent in December 2006, compared to 12.9 percent recorded a year ago. Banks’ solvency remains strong as the industry Capital Adequacy ratio stood at 16.9 percent in March 2007 compared with 16 percent a year earlier. These developments are driven by the recent build up of bank’s loan books but also the clean up of balance sheets and write off of bad debts.
Broad money (M2+) rose by 1.2 percent during the first quarter of 2007, compared with the 17.4 percent recorded in the last quarter of 2006, and 3.6 percent in the corresponding period of 2006. On annual basis, M2+ grew by 35.9 percent, down from 39.1 percent at the end of December 2006 and compares with 19.6 percent recorded for the same period in 2006. Reserve money broadly declined at a somewhat more rapid pace in the first quarter of 2007. After peaking at 32.3 percent in December 2006, reserve money declined by 11.8 percent in the first quarter of 2007 compared with 8.2 percent seasonal drop over the same period in 2006.
Provisional data at the end of April 2007 show that on year-on-year basis, reserve money grew by 20.6 percent compared with 32.3 percent at the end of December 2006 and 18.5 percent at the end of April 2006. Interest rates eased downwards along the spectrum of maturities.
The benchmark 91-day Treasury bill rate fell by 9 basis points to 9.55 percent at end April 2007. The 182-day Treasury bill and 1-yr note also fell by 27 and 60 bases points respectively to 10.26 and 12.4 percent respectively. The 3-year fixed instrument moved to 13.5 percent in April 2007 from 14.0 percent in December 2006. Average base rate quotations of Deposit Money Banks moved downwards by 1.41 basis points in the first quarter of 2007 within the range of 18.00 and 21.45 in March 2007 from a range of 19.20 and 22.50 percent in December 2006.
However, average lending rates remained unchanged within the range of 15.0 percent and 33.5 percent at the end of March 2007.
The first quarter of 2007 saw a continued shift in the portfolio preferences of investors on the money market to the medium to long end of the market. This follows similar trends observed over the past 12 months. Shares of the 91-day and 182-day Treasury Bills declined further from 34 percent at the end of December 2006 to 27 percent at the end of April 2007 (from 56 percent at end of December 2005). The shares of the 2-year and 3-year fixed rate notes together with the 5-year GOG bond increased from 34 percent to 45 percent over the same period to April 2007. And, the share of 2-year and 3-year floating notes and bonds declined further from 7 percent to 4 percent at the end of April 2007.
The shift in portfolio preferences together with the issue of the 5-year bond resulted in lengthening of average maturity of government securities to 391 days from 322 days a year earlier.
Provisional data for the external sector during the first quarter of 2007 shows the trade balance improved by 7.6 percent from a deficit of US$842.25 million in the first quarter of 2006 to US$778.63 million at the end of the first quarter of 2007.
Total merchandise exports at the end of March 2007 amounted to US$1,044.08 million, an increase of 12 percent over fourth quarter 2006 position, and 13 percent compared with that of the first quarter of 2006. Total imports in the first quarter of 2007 amounted to US$1,822.71 million, a growth of 15.8 percent over that of first quarter of 2006, and 2.7 percent over the fourth quarter of 2006.
Crude oil imports amounted to US$415.43 million, about 24 percent above the US$379.79 million recorded in the first quarter of 2006, reflecting an increase in volume, as the average price declined by 6.7 percent.
Trade deficit however narrowed by 7.6 percent from US$842.25 million in the fourth quarter of 2006 to US$778.63 million for the first quarter of 2007. The external current account recorded a deficit of US$482.8 million compared to a deficit of US$181 million (before debt relief) recorded in the first quarter of 2006.
Private inward transfers – received by NGOs, embassies, service providers, individuals etc. through the banks and finance companies for the first quarter of 2007 amounted to US$1.52 billion, representing 17.1 percent increase over that recorded for the same quarter of 2006. Of the total transfers, US$346.56 million (22.8 percent) accrued to individuals, compared with 32.8 percent for the same period in 2006, when total transfers for the year amounted to US$5.80 billion.
The gross international reserves (GIR) stood at US$2.07 billion (2.5 months of goods and services imports). In April 2007, a decline of 8.8 percent from the end of 2006 level, but an increase of 8.4 percent in year-on-year terms.
On the foreign exchange market, total purchases and sales of foreign exchange by the banks and forex bureaux amounted to US$1.90 billion for the first quarter of 2007 (or an increase of 15.9 percent), compared with the fourth quarter of 2006. For the month of April 2007 alone, total purchases and sales increased by 20.2 percent to US$646.17 million, compared with US$537.14 million recorded in April 2006, raising the total purchases to US$2.55 billion (a 16.9 percent in year-on-year terms).
Developments in the nominal bilateral exchange rates of the cedi against the three core currencies – the US dollar, the pound sterling and the Euro – show that for the period from January to April 2007, the cedi depreciated, cumulatively, against all three core currencies by 0.5, 3.7 and 4.0 percent respectively. This compares with depreciation of 0.01 percent against the US dollar and depreciation of 0.2 and 4.1 and 7.8 percent respectively against these currencies over the same period in 2006. The result was a nominal depreciation of 1.9 percent in trade-weighted terms.
On the Budget, provisional banking sector data on the implementation of the 2007 budget indicates that total receipts for the first four months of 2007 amounted to ¢14,402.7 billion (GH¢1.44 billion), compared with ¢8,505.7 billion (GH¢850.6 million) for the same period in 2006. This represents some 23.5 percent of the annual budgeted target for 2007 and shows a growth of 69.3 percent over the outturn for the same period in 2006.
Total revenue and grants amounted to ¢10,758.9 billion (GH¢1.08 billion), some 45.9 percent above the outturn for the same period in 2006. Of this amount, programme grants received amounted to ¢1,440.24 billion (GH¢144.0 million), about 94.5 percent of programmed target for 2007.
Total payments for the first four months of 2007 amounted to ¢15,962.7 billion (GH¢1.60 billion), 55.9 percent over the same period in 2006, and constitutes some 35.9 percent of programmed expenditures for 2007.
These developments resulted in a deficit of ¢1,560.0 billion (GH¢156.0 million) compared with a deficit of ¢1,736.3 billion (GH¢174.0 million) for the same period in 2006. The resulting overall budget deficit was financed to the tune of ¢2,485.5 billion (GH¢248.6 million) through domestic borrowing mainly on the auction market.
Developments in the Consumer Price Index through the first quarter of 2007 showed a decline in the rate of inflation by 0.7 percentage points to 10.2 percent, driven by non-food prices. Food prices rose by almost a percentage point (to 8.4 percent) on an annual basis, while increases in non-food prices eased from 13.6 percent (at the end of December 2006) to 11.6 (at the end of March 2007).
In April 2007, CPI inflation showed an up tick to 10.5 percent. The increase in the Month of April 2007 was driven by unusual increases in food prices which have been attributed to supply conditions. The core measure of inflation which excludes energy and utility items from the consumer basket dropped by 0.3 percentage points from 9.4 percent at the end of December 2006 to 9.1 percent at the end of March 2007. It went up to 9.2 percent in April. Another core measure of inflation which excludes energy and utility and selected volatile food items followed a similar pattern.
To summarise economic activity has been robust through the first quarter of the year (with the uncertainty around the load management and energy supply a source of weakness in the outlook). Indications of performance in the composite index of economic activity is above its trend growth, corporate profitability and turnover are strong in both the non-financial corporate (listed companies) and the financial sector.
And, strong private sector deposit growth in the banking system is supporting rapid credit expansion that is becoming increasingly broad-based across sectors.
Data on the budget underlines the stimulus government spending is imparting to the economy. The lack of balanced synchronisation of spending with budgetary resources has enlarged the public sector borrowing requirement that will need unwinding later in the budget cycle.
Headline inflation showed an up-tick in April from the steady decline observed in the last quarter. However, inflation pressures remain relatively subdued and price volatility was driven by utility and energy over the past several months. Core CPI inflation excluding energy and utility continued to track inflation at below or close to the single digit threshold.
The downside risks in the outlook is associated with managing the output and cost pressures inherent in the load shedding and supply uncertainties in the energy sector, with the current round of wage settlements in the public sector is an added factor. The economic fundamentals are strong.
And, the external payments outlook remains favourable with commodity prices firm and inflows steady. To conclude I will like to announce for information of the public that the Bank of Ghana has formally adopted an inflation targeting framework and it will be using this core measure of inflation that I have just described as its principal variable for tracking underlying inflation in the economy.
The risks in the outlook are therefore well balanced and the Monetary Policy Committee has decided to keep the prime rate unchanged at 12.5%.
BOG ESTABLISHES GIPSS
Posted 10/05/07
The Bank of Ghana and the Ghana Association of Bankers have agreed to establish the Ghana Interbank Payments and Settlement System (GIPSS). GIPSS would be an independent entity responsible for the different components of Ghana’s payment and settlement system infrastructure. It would include National Switch (the Common Platform), Biometric Smart Card, Cheque Clearing, Codeline Cheque Truncation, Real Time Gross Settlement System (RTGS), and Automated Clearing House (ACH) A statement released today from the public affairs department of the Bank of Ghana said all banks would be members of GIPSS either directly or access the system through member banks. It is expected that the National Switch, biometric smartcard, codeline cheque truncation, and Automated Clearing House would be installed by the end of 2007 and this should provide Ghana with an efficient, robust and modern payment system infrastructure. The GIPSS would also significantly reduce the usage of cash for business transactions and move the economy towards electronic payments, with the National Switch allowing ATM interoperability between banks. The system would extend services to the unbanked and underbanked segments of the population. It would allow banks, savings and loans, and other financial and non-financial institutions (such as Government, Universities, Cocobod, SSNIT, NHIS, large enterprises, hospitals, public transport, etc) to deploy products for the banked and unbanked that they have thus far been unable to do. The biometric (finger print) smartcard, for example, is designed to function in location without electricity and telecommunication equipment and eliminates the need to have basic literacy and numeracy to operate a bank account, and it also offers protection against fraud. The cost of electronic transactions should also reduce as banks would be able to pass on the advantages of economies of scale to be derived from this cooperative effort.
NTEs EXPECTED TO HIT $ 1 BILLION
Posted 10/05/07
Revenue from the Non-Traditional Exports (NTE) sector is projected to hit the one billion-dollar mark this year as efforts to diversify the country’s export market is gradually paying off. The percentage share of NTE to overall exports for last year stands at $ 892,878 m, representing 26.14 percent of total exports of $3,415,700 m. Additionally, NTEs has been growing at an annual average rate of 14.3 percent since 1997. The Ghana Export Promotion Council (GEPC) revealed this at the first ever reception for sponsors of the GEA. The GEPC initiated the export awards to enhance NTEs and thereby lead to favourable foreign exchange earnings. The occasion was also used as an opportunity to present awards to some organisations that could not receive their awards last year, namely, Tongu Fruits, BOMAG Farms, Bio Plantlets and Export Development and Investment Fund (EDIF). Non-Traditional Exports is used to classify the export of all products apart from the traditional ones such as cocoa beans, timber logs and lumber, electricity and gold. There are over 383 different Non-Traditional Export products categorized into Agricultural, Processed / Semi Processed and Handicrafts. Launching the highlights for 2006 statistics of the NTE sector, a board member of the GEPC, Nana Asante Frimpong said processed/semi-processed products topped the list with a total of $ 710.89 m, followed by agriculture at $ 177.5 m and handicrafts $ 4.49 m. He noted that the contribution of NTE to the overall export sector has been very significant since the inception of the Ghana Exports Award (GEA) in 1989 to date. For his part, the general manager of GEPCMr Lawrence Prempeh stated that NTE earnings by markets for last year showed the European Union as the biggest with 47.03 % at $ 419,882,938 m , ECOWAS 27.18 % at $ 242,689,210 m, and Emerging Markets 11.9 % at $ 106,237,220 m. Markets for Other Developed Countries were 11.07 % at $ 98,857,773 m and Other African Countries 2.82 % at $ 25,210,576 m. Burkina Faso was the most African country that trade with Ghana, followed by Nigeria, while Liberia was the least in the sub-region that was traded with. GEPC is the National Export Trade Promotion Organisation that facilitates the Development and Promotion of Non-Traditional Exports. It was established in 1969 as an agency of the Ministry of Trade and Industry with the mandate to develop and promote Ghanaian exports. The Council’s focus has primarily been to diversify Ghana’s export base from the traditional export products of Gold and other minerals, Cocoa Beans, Timber Logs and Lumber, and Electricity. GEPC has a clientele base of over 3000 registered private sector exporting companies organized into 15 Product Associations, which she relates to both on individual corporate basis and as groups/associations. This year’s export awards, which is annually organised by the council with sponsorship from corporate entities, would be on the theme “Managing Ghana’s Export Trade For Economic Development”.
TABLES Ten Leading Markets for NTEs
| COUNTRY | 2005 (US$Million) | 2006 (US$Million) | % Growth Rate | % Cont. to 2006 NTEs |
| UNITED KINGDOM | 113.4 | 108.2 | -4.58 | 12.12 |
| FRANCE | 58.1 | 82.1 | 41.36 | 9.20 |
| BURKINA FASO | 63.3 | 77.1 | 21.70 | 8.63 |
| NIGERIA | 54.1 | 67.6 | 24.96 | 7.57 |
| UNITED STATES | 50.0 | 55.0 | 9.89 | 6.16 |
| NETHERLANDS | 30.6 | 50.2 | 64.03 | 5.62 |
| INDIA | 14.8 | 47.5 | 221.38 | 5.32 |
| GERMANY | 21.4 | 45.7 | 113.16 | 5.12 |
| SPAIN | 36.6 | 43.2 | 17.78 | 4.83 |
| ITALY | 29.6 | 38.1 | 28.69 | 4.27 |
| TOTAL | 371.9 | 614.7 | 68.84 |
| COUNTRY | 2005 (US$) | 2006 (US$) | % Growth | |
| 1 | BURKINA FASO | 63,348,365 | 77,093,703 | 21.70 |
| 2 | NIGERIA | 54,119,399 | 67,625,854 | 24.96 |
| 3 | COTE D'IVOIRE | 18,583,507 | 31,782,748 | 71.03 |
| 4 | TOGO | 36,180,679 | 24,399,327 | (32.56) |
| 5 | NIGER | 19,210,495 | 10,701,010 | (44.30) |
| 6 | MALI | 19,546,213 | 8,310,346 | (57.48) |
| 7 | BENIN | 4,455,321 | 8,029,864 | 80.23 |
| 8 | SENEGAL | 5,981,704 | 6,767,921 | 13.14 |
| 9 | GUINEA | 1,400,816 | 1,897,292 | 35.44 |
| 10 | LIBERIA | 2,149,018 | 1,764,550 | (17.89) |
| 2004 US$’000 | 2005 US$’000 | 2006 US$’000 | |
| Total Export | 2,740,240 | 2,768,400 | 3,415,700 |
| NTEs | 705,429 | 777,593 | 892,878 |
| % Cont. of NTE to Total Exports | 25.74 | 28.09 | 26.14 |
| Product | US$ | % Cont. to NTE | |
| 1. | Cocoa Paste | 90,354,822 | 10.12 |
| 2. | Veneer Sheets | 56,030,284 | 6.28 |
| 3. | Prepared Tuna | 55,519,913 | 6.22 |
| 4. | Cocoa Butter | 53,058,590 | 5.94 |
| 5. | Frozen Tunas | 29,835,512 | 3.34 |
| 6. | Plywood | 27,350,979 | 3.06 |
| 7. | Shea Nuts | 27,248,779 | 3.05 |
| 8. | Cut Fresh Pineapples | 25,869,191 | 2.90 |
| 9. | Other Prepared | 24,487,115 | 2.74 |
| 10 | Other Frozen Fish | 20,088,060 | 2.25 |
| TOTAL | 409,843,245 | 45.9 |
| Product Description | 2005 (US$) | 2006 (US$) | % Growth Rate |
| Cocoa paste | 29,311,705 | 90,354,822 | 208 |
| Veneer sheets | 10,425,899 | 56,030,284 | 437 |
| Prepared Tuna | 54,849,916 | 55,519,913 | 1 |
| Cocoa butter | 33,468,122 | 53,058,590 | 59 |
| Plywood | 11,502,149 | 27,350,979 | 138 |
| Cut Fresh Pineapples | 13,429,736 | 25,869,191 | 93 |
| Prepared Fish | 22,869,768 | 24,487,115 | 7 |
| Tomato paste | 20,242,168 | 15,916,821 | (21) |
| Aluminum Coil | 16,544,780 | 15,412,863 | (7) |
| Natural rubber | 6,044,492 | 14,307,594 | 137 |
| Total | 227,179,689 | 379,440,094 | 67 |
| Product Description | 2005 (US$) | 2006 (US$) | % Growth Rate |
| Frozen tunas | 14,978,982 | 32,148,162 | 115 |
| Shea nuts | 28,968,495 | 27,248,779 | (6) |
| Other frozen Fish | 6,688,347 | 20,088,060 | 200 |
| Pineapples, fresh or dried | 12,784,322 | 19,086,134 | 49 |
| Yams | 10,951,355 | 14,156,905 | 29 |
| Cashew nuts, in shell | 5,235,834 | 11,794,820 | 125 |
| Banana, Fresh | 458,940 | 10,297,106 | 2,144 |
| Cotton linters | 4,053,066 | 4,427,006 | 9 |
| Cotton Seed | 1,761,748 | 3,187,066 | 81 |
| Vegetables | 1,592,515 | 2,089,071 | 31 |
| Total | 87,473,604 | 144,523,109 | 65 |
| Product Description | 2005 (US$) | 2006 (US$) | % Growth Rate |
| Statuettes of wood | 18,942,744 | 3,136,099 | (83.44) |
| Sculptures and statuary | 94,585 | 604,624 | 539.24 |
| Tanned or crust skins of sheep | 3937 | 337,142 | 8,462.99 |
| Articles of jewellery of base metal | 200 | 90,449 | 45,104.25 |
| Ceramic roofing tiles | 13,548 | 61,114 | 351.08 |
| Shells of molluscs | 39,840 | - | |
| Glazed ceramic flags and wall tiles | 4403 | 38,683 | 778.56 |
| Plaits and plaitings | 2520 | 37,825 | 1,400.98 |
| Paintings and drawings | 8,011 | 28,998 | 261.96 |
| Ceramic pot and jars | 12,281 | 26,112 | 112.63 |
| Total | 19,082,231 | 4,400,887 | (76.94) |
| MARKETS | 2005 | 2006 | % Growth |
| EUROPEAN UNION (EU) | 368,706,315 | 419,882,938 | 13.88 |
| ECOWAS | 243,953,543 | 242,689,210 | (0.52) |
| EMERGING ECONOMIES | 72,162,406 | 106,237,220 | 47.22 |
| OTHER DEVELOPED COUNTRIES | 74,024,165 | 98,857,773 | 33.55 |
| OTHER AFRICAN COUNTRIES | 18,746,191 | 25,210,576 | 34.48 |
Trends in Percentage Share of NTE Earnings by Destination Category
| DESTINATION CATEGORY | 2004 | 2005 | 2006 |
| EU | 53.76 | 47.42 | 47.03 |
| ECOWAS | 16.37 | 31.37 | 27.18 |
| OTHER AFRICAN C'TRIES | 3.8 | 2.41 | 2.82 |
| OTHER DEVELOPED COUNTRIES | 16.86 | 9.52 | 11.07 |
| EMERGING ECONOMIES | 9.21 | 9.28 | 11.9 |
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