Delegation of German Industry & Commerce in Ghana/ GGEA May 2011 Newsletter

EDITORIAL

Dear Members, Dear Clients,  

An event daubed “The Africa Roadshow” which seeks to give maximum publicity to four African countries; namely Ghana, Nigeria, Angola and South Africa to German companies and German investors, will take place in selected German cities during the latter part of May, 2011. The Africa Roadshow is an initiative of the Federal German Ministry of Economics and Technology together with the German State Minister Presidents and is part of the African Initiative of the German Government based upon the G8 summit of Heiligendam. The event will be supported by the Frankfurter Allegmeine Zeitung, a leading German newspaper and Investment agencies of the various German States.

The Africa Roadshow will be implemented in cooperation with the German Chamber of Industry and Commerce (DIHK) and the Delegate offices of German Chamber of Industry and Commerce in Ghana, Nigeria, Angola and South Africa. The Delegates will present their views about the economies of the four countries and advise German companies and German investors on doing business in those countries. Based on the number of companies and investors who have confirmed their participation at various locations including, Frankfurt, Kassel, Potsdam, Hannover, Berlin, Duesseldorf etc, one can say categorically that Germany is ready for Africa. The roadshow had previously been organized for the Middle East and North Africa (MENA) region as well as Asia. For the Ghanaian market, the Africa roadshow event represents a tremendous opportunity to attract new investments not only to the energy (particularly renewables) and mining sectors, but more importantly to the tourism, agriculture and agro-processing areas where the country is perceived to have competitive advantages. The second part of the Africa Roadshow will take place in October. Another major event which is often referred to as the Ghana Information day or “Wirtschaftstag Ghana”, an annual staple on the calendar of bilateral events between Ghana and Germany, takes place in Duesseldorf on 08.06.2011. This event is being hosted in North Rheine Westfalia, which is the first and only German State that has a partnership agreement with the Republic of Ghana. The Ghanaian Minister of Trade and Industry will deliver the keynote address on Ghana’s Industrial policy. The Ghana Information Day is a great platform to market Ghana to German investors especially in view of the sheer number of participants who normally patronize the event.

 

Stephen Antwi                   Patrick Martens

President of GGEA            Delegate of German Industry & Commerce in Ghana

 

 


New GGEA Executive Secretary

Mrs. Gudrun Mallet has been appointed as the Executive Secretary of the GGEA. Her appointment takes effect from 16th May 2011 She takes over from Mr. Patrick Martens who has been elevated to the position of the Delegate at the Delegation of German Chambers of Industry and Commerce in Ghana. 
Until this appointment, Mrs. Mallet worked as a bilingual secretary at the German Embassy in Accra where she dealt extensively in commercial and business issues. It is hoped that under her tenure the GGEA will grow from strength to strength.

 

 

 

 

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ACTIVITIES 2011 

JUNE
•    PURC & Town & Country Planning Issues With AMA (Forum)
(Novotel Accra)
•    Publishing of Business Guide
(Coconut Grove Regency Hotel)

JULY
•    Mining  or  Energy Forum
(Coconut Grove Regency)

SEPTEMBER- OCTOBER
•    GEREU 2011
(Accra International Conference Centre)
•    Publishing of Member Brochure

NOVEMBER
•    Annual General Meeting
(Alisa Hotel)
•    GGEA Member Dinner
(Alisa Hotel)

 


Dates for the Africa Roadshow in Germany:

Frankfurt - 19th May

Kassel -19th May

Potsdam - 20th May

Düsseldorf/ Neuss - 23rd May
 
Hannover/ Braunschweig - 24th May

Dresden - 25th June

Berlin DIHK Conference International; Wiesbaden -
30th May

Muenster - 31st June

DIHK Berlin - 1st June and

Ghana Information Day in Düsseldorf - 8th June

MEMBER NEWS

Papaya farmers get relief


Wienco Ghana, the leading agro-input distributor has launched a new bio-control named “Campaign” to tackle the spread of mealy-bugs affecting papaya crops in the country. A month ago, the Papaya and Mango Growers Association of Ghana raised the red-flag about the economic damage being done to their members by mealy-bugs attacks. Mealy-bugs attack papaya crops in hot, dry weather. Mr William Kotey of Wienco Ghana Ltd, told the Business & Financial Times that Campaign is effective in controlling papaya mealy-bugs as compared to synthetic chemicals. This is because it had a mixture of fungus naturally found in the soil and vegetable oil to make it better attached to the leaves and fruits of papaya crops. Mr Kotey noted that farmers sprayed synthetic chemicals which were mostly not effective and brought all the usual problems of pesticide-residues associated with generic chemicals. Campaign has an active ingredient found in nature rather than being formulated in a laboratory to kill pests on papaya trees. It is well-suited to insecticides and most fungicides, and therefore can be used in a conventional crop-protection programme. Campaign is, therefore, ideal for organic growers who are looking for an easy way to control mealy-bugs. The biological control of pest and insect on farms has been accepted worldwide. Campaign is no exception as it can be judged by its zero post-harvest intervals and zero re-entry periods,” Mr Kotey added. Business and Financial Times

Stanbic Bank makes strong gains


The Managing Director of Stanbic Bank Ghana Ltd, Mr Alhassan Andani, has predicted a further drop in interest rates to the region of 18 per cent and 20 per cent following a generally positive financial outturn reported by many banks for 2010 and as the industry’s investments in medium term securities mature. Last year’s substantial settlement of government debts owed contractors that had threatened the banks for the last three years, has quickly filtered through the industry, resulting in drastic reduction in impairment charges and non-performing loan (NPL) ratios that have now fed into the lowering of base rates by some banks. Speaking to a cross section of news men in Accra on a variety of issues, the experienced banker and economist said it was now opportune for economic actors particularly manufacturing, agricultural and agro-processing companies, to take advantage of the positive development and work with their banks to expand capacity. “We are expecting that as interest rates fall, the volumes of loans and advances will go up; we expect to see agricultural, agro-processing and manufacturing companies respond by taking advantage to develop and introduce new product lines and generally expand capacity so as to leave a positive impact on the economy,” Mr Andani stated. However, Stanbic Bank is ready to absorb the anticipated increase in the demand for credit as the bank slashes its base rate to 21.95 per cent per annum, effective April 6, 2011. Currently, the bank has already increased staff strength at its credit department from 15 to 40 people to manage and grow the loan portfolio to a diversified clientele, including the agricultural sector, mining, oil and gas, trade the small and medium-scale enterprises (SME) sub-sector and personal consumer loans. “We will go out there to grow our loans portfolio by working with our clients to expand their capacity, helping them to restructure their finances and coming out with innovations to take advantage of the new interest rate regime to access more credit,” Mr Andani said. Doing this successfully requires a large capital base and Stanbic Bank has already shored up its stated capital to over GH¢ 100 million, compared with the Bank of Ghana minimum requirement of GH¢ 60 million, in anticipation of improved business environment for this year and beyond. The bank’s profit before tax, which slumped to GH¢ 2.29 million in 2009 from GH¢ 20 million in 2008, picked up again to GH¢ 27.45 million in 2010, primarily due to the correction in impairment charges from GH¢ 31.55 million in 2009 to GH¢ 12 million in 2010. In spite of the ravaging financial storms of 2007/2008, which impacted the economy negatively until 2009, the bank kept pace with its interest income, which surged from GH¢ 52.57 million in 2008 to GH¢ 78.31 million in 2009 and GH¢ 99.59 million for 2010, one of the drivers that helped the bank to report a 14 per cent profit after tax. In the same vein, Mr Andani said, the bank continued to grow its loans and advances portfolio from GH¢ 241.23 million in 2008, GH¢ 261.37 million in 2009 to GH¢ 343.65 million in 2010; total assets from GH¢ 458.99 million in 2008 to GH¢ 714.12 million in 2009 and GH¢883.92 million in 2010, with deposits also surging from GH¢ 295.96 million in 2008, GH¢ 499.73 million in 2009 to GH¢ 624.15 million in 2010. From the difficult periods of 2009, which was characterised by high NPL ratios and the impact of the global economic crisis, Mr Andani said the Ghanaian economy held a lot of prospects for this and the years ahead, as cocoa and gold would continue to do well. The Stanbic MD said they would continue to leverage on one of its core strengths in Corporate and Investment Banking and bring experts to the country to offer high-end knowledge and advisory services to both the government and private sector firms. Daily Graphic
                                                                                         

Gold hits records, commodities firm as dollar wilts


Gold hit a record high on Friday, oil touched a 32- month peak and base metals surged, driven by a weaker dollar and improved demand prospects, while corn hovered at an all-time high ahead of a key U.S. farm report. Middle East unrest highlighted by a plunge in oil  exports from Libya, and macroeconomics shocks such as Portugal’s plea to the European Union for a bailout and the devastation caused by Japan’s March 11 earthquake, have not deterred the broad commodity rally. The dollar slid to a 15-month low against the euro-stoked by concerns that a budget impasse in the United States would lead to a government shutdown on Friday at midnight-helping gains in commodities priced in the currency. Gold, often viewed as a safer investment in time of risk, hit a record USD 1,472.96 an ounce, while silver rose to USD 40.28, its strongest since early 1980. “So far this year commodities are relatively unshaken by bad news on the macro front. The market is comfortable with the expectations on recovering global economy with an emphasis on the developed world rather than the developing world. Business & Financial Times


RECENT EVENTS

West African Finance Conference 2011

 

The DEG, GGEA, AHK Ghana, AHK Nigeria and the NGBA jointly organised the West African Finance Conference which took place on 18th April, 2011 at the African Regent Hotel, Accra with close to 50 companies based in Ghana and Nigeria.  This conference was to promote financial solutions for sustainable development of the private sector in West Africa.

It also provided participants a variety of financing opportunities from debt and capital markets to equity, mezzanine and long term debt. Presentations from financial institutions present enlightened companies on most viable financial options for the type or nature of business the companies are involved in.

Participating companies included Vicdoris Pharmaceuticals Ltd., Crocodile Machetes Gh. Ltd., Techno Crete Gh. Ltd., Hippo Ltd., Camelot Gh. Ltd., Tema Steel Company Ltd. Desimone Gh. Ltd. Tropical Natural Ltd., Nigeria to mention but a few. On the part of financiers we had DEG, Aureos Capital, and Fidelity Capital Partners, Black Star Advisors and Skye Bank from Nigeria.

This event was on a whole a successful event since participating companies that is financiers and financed had their needs met at the conference. 

 

 

TRADE MISSION TO GERMAN-AFRICAN ENERGY FORUM, HANNOVER MESSE AND USETEC 2011 IN GERMANY

A Delegation from Ghana attended the just ended German-African Energy Forum held in Hamburg, Germany as part of the events for the Ghanaian Trade Mission to Germany from 3 – 9th April 2011.

The Delegation was headed by Mr Stephen Antwi, President of the Ghanaian-German Economic Association and Mr Patrick Martens, Delegate of the German Industry and Commerce in Ghana. Participating Companies included Mr Thomas Asare-Baffour, Electrofax Engineering; Mr Emmanuel Adjei, Technocrete Limited; Mr Kevin Dadzie, Chase Petroleum; Mr Reindorf Sey, Tradeworks Limited and Mr Ebenezer Mensah-Attipoe, Knowledge tree Technologies Limited.

The Delegation attended the Energy Forum on 4-5th April and experts in all fields of energy including solar, oil and gas, wind and hydro gave presentations on the sustainability measures and how to improve capacities in developing the energy sector in Africa. The Forum was organized by the Afrika-Verein under the patronage of the Federal Ministry of Economics and Technology and the Chamber of Commerce in Hamburg.

As part of the forum activities, the delegation visited Hannover Messe (the World's Leading Showcase for Industrial Technology especially energy products and services) on an energy tour amidst individual business to business meetings.

The Delegation attended the USETEC 2011formerly RESALE (the No. 1 World Trade Fair for Used Technology).

 

Other meetings attended during the trade mission were with DEG/KfW Bakkengruppe and Lawyer Meyer in Cologne and BHF Bank in Frankfurt (members of the GGEA).

 

 


UPCOMING EVENTS

LIGNA: 30 May – 3 June 2011

World fair for the forestry and wood industries

The World Fair for the Forestry and Wood Industries LIGNA HANNOVER is the most international trade show of its kind worldwide.

Ticket Prices:                           

Day ticket (advance sale) EUR 18.50

Full-event ticket (advance sale)  EUR 31.50

Venue: Exhibition Grounds, 30521 Hannover, Germany

www.ligna.de

NATIONAL / ECONOMIC NEWS

Cocoa purchases up 45 per cent

Ghana’s cocoa output is running 45 per cent higher than last year, official figures from Ghana Cocoa Board (COCOBOD), has revealed. Declared purchases by private cocoa buyers to COCOBOD, reached 753,945 tonnes by March 31 since the start of the season in October. This is up by 45 per cent over the 518,304 tonnes registered in the same period last year, and ahead of the full-season record of 740,000 tonnes posted in 2005/2006 crop season. COCOBOD is targeting a record output of 850,000 tonnes of cocoa this crop year. Ghana, world number two grower, is seeking to ramp up production further to one million tonnes by the 2012/2012 season through enhanced farm husbandry, fertiliser application and farmer incentives. COCOBOD says it would start offering ‘hi-tech’ fertilisers to cocoa farmers for half-price starting May, in a move to improve yields. Reuters/The Ghanaian Times

 

BOST maps out plan for natural gas industry

In pursuit of its expanded mandate as a major player in the secondary gas sector, the Bulk Oil Storage and Transportation Company Ltd. (BOST) is acquiring over 300 acres of land near Takoradi to serve as a hub for the transportation of natural gas and liquefied petroleum gas (LPG) from Ghana’s oil fields to support a renewed gas-based industrialisation drive.  BOST is, therefore, completing feasibility studies to construct a modern gas transmission system to serve Ghana and neighbouring countries in support of its additional mandate to become the national transporter of natural gas. Ghana has a zero-gas flaring policy, which has compelled the Ghana National Petroleum Corporation (GNPC) to initiate the development of Jubilee gas processing plant towards the promotion of gas-based industrialisation. BOST has subsequently been given an expanded mandate to be the sole bulk purchaser of natural gas from the jubilee fields for transmission anywhere. To start with, the company says it would construct a gas terminal at Pumpuni, near Takoradi in the Western Region and also develop the first phase of what it calls the Western Corridor Transmission System, all estimated to cost USD 600 million to start this year and end in 2013. The government will solely fund the project through bilateral arrangements. According to BOST, its initial infrastructure will focus on transporting natural gas to some strategic projects to boost Ghana’s industrialisation drive.  Some of the projects date back to post-independence era but had to be abandoned for various reasons. The industries that can breathe a sigh of relief include the Abosso glass factory, the integrated alumina processing industry of which Sekondi would now be hub at, the Bokazo and Saltpond ceramics factories and the Nsuta manganese processing project. The Managing Director of BOST, Dr Yaw Akoto, told the GRAPHIC BUSINESS in an exclusive interview that BOST had moved swiftly with plans to build transmission infrastructure in the Western and Eastern corridors of Ghana due to its expanded mandate to facilitate the movement of natural gas and liquefied petroleum gas (LPG) across the country. Graphic Business

 

Ghana to get another oil refinery

 New Alpha Refinery- Ghana, a South African- initiated company, is to construct a second crude oil refinery in Ghana. The project comes with import/export facilities, a tank farm and a gas turbine. The refinery will have the capacity to process 200,000 barrels of crude oil per day. This would be more than quadruple the capacity of Ghana’s oil refinery, the Tema Oil Refinery (TOR), whose output is just about 45,000 barrels per day. The decision to locate New Alpha Refinery in the Western Region of Ghana has been lauded by industry experts as timely in the wake of the country’s discovery of oil in commercial quantities. Business & Financial Times gathered that the government through the Ministry of Energy and the National Petroleum Authority is providing every support necessary for the project to take off smoothly before the end of December. Officials of the company are tight-lipped on the cost of the project. New Alpha Refinery’s executive chairman Merlyn Julie said in addition to the refinery, terminal and tank farm, a power-generation plant would be constructed using gas turbines. She explained that the associated gas produced with the crude oil production will be harnessed to feed the plant for the purpose of powering not just the refinery itself, but also to generate surplus electricity to supplement the electricity requirements of the country. This is in line with the policy of government to maximise its electricity production capacity to serve not just the domestic market but also for export to neighbouring countries. Business and Financial Times

 

Ayensu Starch Factory assured of support

The government has given the firm assurance that it will provide the needed working capital to enable the Ayensu Starch Company (ASCo) to start production in earnest. Additionally, the company is to increase the capacities of its 1,000 nucleus farmers to produce more raw materials to feed the factory alongside 2,000 out growers. Situated at Bawjiase in the Central Region, the starch factory needs about 80,000 metric tonnes of cassava per annum to operate at full capacity. Disclosing this to the Times in Accra, the Deputy Trade and Industry Minister, Dr Joseph Annan, said the requirement “is generally not available” but the company was hoping to get about 50 per cent of the needed raw material to start operations in May. He said the company had undergone some rehabilitation, including a test run of its equipment, restoration of water supply and the construction of facilities for waste disposal. Dr Annan said once the company started production it would undergo an international certification exercise to ensure that it met international standards. ASCo was set up in 2004 under the President’s Special Initiatives to produce industrial starch for the local and export markets. The Ghanaian Times

 

Ghana issues 3-year bond

The Bank of Ghana will issue a three-year bond for GH¢ 320 million (USD 212 million) on April 27, to be opened to foreign investors, the central bank has announced. Ghana’s cedi strengthened to 1.5075/1.5100 to the dollar after the announcement, compared with the initial level of 1.5115/1.5140, as traders anticipated dollar inflows from foreign investors interested in the bond. “The underlying factors are that the central bank authorised the issue of a three-year fixed rate bond,” said Mr Jacob Brobbey of Barclays Ghana. “The the outlook will favour the cedi until the bond is over.” Dealers said the bond, the third three-year bond open to offshore investors since September 2010, could push the cedi to a near three-week high of 1.50 to the dollar in coming days. “The market will expect some offshore acquisition of cedis to purchase bonds. There will be huge offshore demand on the day of the issuance. We see it breaking into 1.49 levels,” said Chris Nettey from Stanbic. Biggles Amponsah from Access Bank said he expected “about USD 100 million in inflows” for the bond. Reuters/The Ghanaian Times

 

Cabinet Approves Renewable Energy Bill

Cabinet has approved the Renewable Energy Bill which seeks to integrate renewable energy security in the country. The bill provides for a feed-in tariff mechanism to encourage the adoption and use of renewable energy.
The Executive Secretary of the Energy Commission, Dr Alfred K. Ofosu Ahenkorah, told the Daily Graphic that the bill would be sent to Parliament for consideration and possible approval. He said when the bill is passed into law; it will create a platform for the trading of renewable energy and provide for a renewable energy purchase obligation for the utility services and bulk customers. Dr Ahenkorah said the law will provide for the integration of bio-fuel into petroleum so that those who produce biodiesel can have a market. The Ghana Renewable Energy Fund will be created under the law to support renewable energy. It will provide funds for renewable energy.  It will provide funds for renewable energy. It will provide funds for renewable energy promotion, research and other activities. Besides, the fund will supply seed money for renewable energy companies, depending on how much will be demanded by the companies. Meanwhile, Dr Ahenkorah said the Energy Commission has sponsored pilot projects on grid-connected solar system in five areas to promote the use of renewable energy. The beneficiaries are the Presbyterian Women’s Training Centre, Abokobi; the Valley View University, Oyibi; Pure Company, an agro-processing company at Benkrom in the Kintampo District, and two private residences in Accra. Daily Graphic

 

INDUSTRY / BUSINESS NEWS

 

Stanchart Ghana chalks financial sector operating profit record

Standard Chartered Bank Ghana has announced a fifth successive year of record income, demonstrating the consistent and sustainable growth strategy of the bank in Ghana. The bank continues to invest selectively in the business, positioning itself to take advantage of the long term growth opportunities across the Ghanaian market, while maintaining a strong focus on the fundamentals of banking. A statement issued by the bank said its operating profit went up by 19 per cent, amounting to GH¢ 218 million, while operating profit shot up by 26 per cent, amounting to GH¢101 million. “The bank’s basic earnings per share climbed 2.5 per cent to GH¢ 3.75 and return on equity reached 37 per cent,” the statement said. The bank’s operating profit of GH¢101, according to the release, was a record in the financial sector in Ghana since this was the first time a bank in Ghana had crossed the GH¢ 100 million mark. Commenting on the performance, the Chief Executive of Stanchart, Mr Kwaku Bedu-Addo, said the bank had continued to provide support for its customers and corporate clients through a unique international footprint which enables the bank to facilitate the growth of international trade between the corridors of Ghana and the rest of the world. The Ghanaian Times


 

Companies raise red flags over environmental tax

The 20 per cent tax imposed on plastic materials, otherwise known as Environmental Tax, has taken effect but not without some uneasiness from major plastic consuming and producing companies in the country. Key plastic consuming and producing companies in the country are protesting the 20 per cent tax imposed on plastic materials. The 2011 Budget and Economic Policy Statement of the government through which the tax was introduced stated that the tax was meant “to protect the environment” and would be collected at “importation and any production or collection points” throughout the country. But the plastic manufacturing companies disagree; they are questioning the rational for railroading the 20 per cent charge on plastic material into the national tax policy. In separate interviews with the Graphic Business, sources within the Association of Ghana Industries (AGI) and other major plastic consuming and producing companies in the country have, however, challenged such an intent describing it as “misplaced” and “not meeting the tax target.” The Managing Director of Unilever Ghana, which now hosts the head office of Unilever’s West African operations, excluding Nigeria, Mr David Mureithi, told the Graphic Business that the tax was “purely a revenue collection measure” rather than an environment one as had been indicated in the budget. “Or is the government saying this environmental tax is a sin tax,” the MD asked. A sin tax is a form of punitive tax placed on products that are deemed unwanted by “society” and thereby aimed at discouraging or reducing consumption of the product. Graphic Business

 

New import declaration form introduced

The government says it has introduced an electronic Import Declaration Form to replace the manual forms currently in use. This, the government said, would help streamline import management processes and facilitate the speedy clearance of goods through customs, while at the same time improving record keeping. The Minister of Trade and Industry, Ms Hannah Tetteh, disclosed this at the 38th annual general meeting of the Ghana National Chamber of Commerce and Industry (GNCCI) in Accra. She added “the Ministry of Trade also completed the repositioning of the Destination Inspection Companies in the country after the review of the scheme. Giving an overview of her ministry’s activities over the past year, the minister indicated that the proposed Tariff Advisory Board was fully operational and was addressing inadequacies in the Tariff System. “The Board will ensure that tariff is set to promote the national economic development agenda and ensure equity and fairness vis-à-vis the competition between imported products and local production.” Ms Tetteh noted that the government had approved a new industrial policy for the country which focuses on Industrial Production and Distribution technology and innovation. The support programme would be operationalised to drive the implementation of the industrial policy. On regional integration, she said the implementation of the ECOWAS regional integration agenda had been below expectation as the progress made to date had been slow. Consequently, she said ECOWAS had outlined its goals to build a borderless region with the participation of non-state actors, such as the private sector. Daily Graphic

 

BUSAC to receive more assistance

The Danish International Development Agency (DANIDA) and the United States Agency for International Development (USAID) have signed a delegated cooperation agreement in which the USAID will contribute USD 400 million towards the implementation of the Business Sector Advocacy Challenge Fund (BUSAC), second phase. The DANIDA had earlier committed USD 800 million into the fund’s operations and is now promising to make good of the trust reposed in it by the USAID as the cooperation delegator in the successful execution of the agreement. It was the first of its kind between the two bodies on development cooperation levels. At a function to sign the agreement, the Head of Development Cooperation at DANIDA, Mr Jan Poulsen, said the agency was happy to see fruits from an effort it initiated three years ago. According to him, although the Danish government in 2008 sought ways of tightening cooperation with the new Obama Administration, DANIDA in Ghana was “interested in development cooperation with the new US administration through USAID. Mr Poulsen said although the USD 400 million comes to augment DANIDA’s own USD 800 million committed toward the successful operation of activities of the BUSAC fund, “there is still room for more funds.” He said in the coming months the agency would also sign financial cooperation agreement with the European Commission. Daily Graphic

 

CPC converts debt to equity

Shareholders of Cocoa Processing Company (CPC) Ltd. have passed a resolution at the company’s annual general meeting to discuss the 2010 financial report to convert over USD 14 million which is part of its indebtedness to the Ghana Cocoa Board, to equity to recapitalise the company.  The move is expected to have a significant and positive impact on the liquidity of the company,” the Chairman of the CPC Board, Mr Jacob S. Arthur, said. Presenting the annual report, he said the balance of the debt of USD 32 million had been rescheduled to be repaid over a 10-year period at a concessionary interest rate. He noted that the year under review was a challenging one as a greater part of the year was devoted to completing the installation of complementary machinery at one of the company’s factories. The rehabilitation, he told shareholders, was necessary to bring the factory up to modern industry standards after more than 40 years of existence without any major rehabilitation. The company recorded a net loss of GH¢ 12.5 million as against GH¢ 17.83 million in 2009, while its turnover was GH¢ 84 million for 2010 as against GH¢ 45.54 million in 2009. The company’s total assets at the end of 2010 stood at GH¢ 187.65 million. He said to improve the fortunes of the company management had reviewed the company’s 10-year business and strategic plan. Daily Graphic

 

Financial stocks drive GSE

Financial stocks emerged the most active during the first quarter trading on the Ghana Stock Exchange (GSE), accounting for 57.13 per cent of total transactions within the period. The stocks, made up of nine banks and two insurers, also led the market in terms of the value of trade in the first quarter of this year with GH¢28.95 million, representing 51.53 per cent of the total trade value. This performance pushed the financial stocks’ index up by 5.39 per cent, and drove the exchange’s main index to a year-to-date gain of 7.15 per cent by the end of March. Ghana Commercial Bank saw the most transactions with 1,273 trades, consistent with its history, followed by CAL Bank Ltd with 912 transactions, without prejudice to the 1,025 transactions posted by Fan Milk Ltd. Share volumes traded were highest among food and beverage stocks, whose activeness was caused, particularly by the de-listing of Accra Brewery Ltd after an offer to minority shareholders of the company by SABMiller Africa, the South African brewer. Food and beverage stocks accounted for 54.26 per cent of total volume traded, while stocks of financial and distribution companies represented 27.79 per cent and 15.97 per cent respectively of the total volume of trade. March emerged the stock market’s busiest month of the first quarter amidst the igniting of investor interests as companies posted their 2010 financial results. Business and Financial Times

 

Kosmos raises IPO size to USD 621 million

Kosmos Energy filed with US regulators on April 14 to increase the size of its initial public offering (IPO) by a fourth to USD 621 million. The West Africa-focused oil company had previously filed for a USD 500 million IPO in January. Kosmos, backed by private equity firms Blackstone Group and Warburg Pincus, plans to use proceeds from the offering to help fund its capital spending. The Hamilton, Bermuda based company told the US Securities and Exchange Commission in a preliminary prospectus that Credit Suissie, Citigroup and Barclays Capital are underwriting the IPO. The filing did not reveal how many shares the company plans to sell or their expected price. The company intends to list its common stock on the New York Stock Exchange under the symbol “KOS”. Reuters/Business and Financial Times

 

Gold Fields to acquire more shares in Tarkwa, Damang mines

Gold Fields Ltd, a mining company in Ghana, has entered into a binding agreement with IAMGOLD Corporation to acquire its 18.9 per cent minority stake in the Tarkwa and Damang gold mines for a cash consideration of USD 667 million. Upon completion of the proposed acquisition, Gold Fields will have increased its interest in each of the Tarkwa and Damang gold mines from 71.1 per cent to 90 per cent, with the remaining 10 per cent interest being held by the government of Ghana. The completion of the proposed acquisition is subject to Gold Fields shareholders’ approval. When the transaction goes through, Gold Fields will acquire an additional 181,000 ounces of annual production at current cash costs of USD 540/oz and Notional Cash Expenditure of about USD 940/oz based on results for the six months ended December 31, 2011. There will also be an additional 2.14 million reserve ounces at a cost of about USD 300 per ounce; another 3.27 million resource ounces at approximately USD 198 per ounce, a significant resource and reserve upside potential in particular at the Damang mine and USD 20 million in working capital. Commenting on the transaction, Peter Turner of Gold Fields West Africa Region, said “this transaction confirms the confidence that Gold Fields has in the Ghanaian economy. We will continue to engage all stakeholders to grow shareholder value.” Daily Graphic

 

 

Vodafone launches business solutions unit

Vodafone Ghana has invested a total of USD 5 million in the last three years to upgrade its network and modernise the system. The company said the investments included modern internet technology that will help businesses and institutions to work efficiently and increase productivity. “We have invested in the 21st century internet and we will continue to invest to make the network very modern. This enables businesses to get new streams of revenue, increase productivity and volumes of business and also cut cost,” the Director of VBS, Mr Derek Appiah, said at the launch of a renewed business arm of Vodafone. The Vodafone Business Solutions (VBS), which used to be Enterprise Unit, has been restructured to drive sales and marketing for customers in the high-end of the market, mostly corporate bodies. The VBS will now provide tailor-made full range telecommunications solutions for large and small businesses and government agencies and institutions. Mr Appiah said the company’s network had been upgraded to the extent that it was now the leading provider of Wide Area Network (WAN) technology to big companies such as the mines, saying the new VBS arm was committed to innovative solutions to meet customer needs. To support the unit to achieve its objectives, Vodafone has set up new business development teams to penetrate the markets of Accra, Kumasi and Takoradi with others to come on stream later. “We can also assure our customers that response time to solving problems is now quicker as we have teams on stand-by to help our customers on any challenge the may face using our network,” Mr Appiah stated. Daily Graphic Graphic

 

Biotec centre for West Africa

A biotec centre for West Africa is to be established with headquarters in Ghana through a partnership between Return2Green, a Malaysian biotechnology firm, and Africa2Green International based in Ghana, together with other financing partners. This was made known at a stakeholders’ forum in Accra to discuss and seek investment for the Ghana Green Technology Park project, a joint initiative for the manufacture of biodegradable plastics and other packaging products to be marketed across West Africa. Under the project, biodegradable plastics and packaging products like cups and plates will be produced from agro waste materials such as sugar cane and cane husk. The Chief Executive Officer of Return2Green, Professor Ramaness Parasuraman, who invented the technology behind the project, said at the forum that aside creating a business and providing jobs for people, the venture seeks to rid cities and towns of plastic waste – whose management has proven difficult for authorities. He said his invention has passed regulatory tests in the United States and Europe, and emphasised the next stage is product commercialsiation from the invention with focus on Ghana and the rest of Africa to solve the challenge of plastic waste management. Business and Financial Times

 

MTN’s investment in submarine cables reaches new frontiers

MTN Groups USD 90 million investment in the West Africa Cable System (WACS) will reach an important milestone this month when the 14 kilometre-long submarine cable lands at Yzerfontein in the Western Cape. MTN’s investment in WACS forms part of a myriad of submarine cables that Africa’s leading telecommunications provider has invested in an attempt to bring much-needed broadband capacity to the continent, bolster Africa efforts to achieve the United Nations Millennium Development Goals to bridge the digital divide and provide millions of its subscribers in its footprint in Africa and the Middle East the capacity and ability to use smart solutions. As the single biggest investor in WACS, MTN will receive an initial capacity of 11 per cent when the cable becomes commercially available in the second quarter of this year. The Managing Director of MTN South Africa, Mr Karel Pienaar, said “WACS will provide millions of MTN subscriptions across Africa the much-needed bandwidth and will go a long way towards catapulting Africa into the digital age. Lack of bandwidth on the continent has arrested the development of Africa and has constrained the continent from achieving its full potential. MTN’s investment in WACS and a myriad of other submarine cables bear testimony to the company’s commitment toward the development of the continent and reaffirms our long-held confidence n the future of the continent.” The WACS submarine cable is an ultra high capacity fibre-optic submarine cable system which links Southern Africa and Europe, spanning the west coast of Africa and terminating in London, United Kingdom. This USD 650 million cable system is the biggest to ever land on the Africa continent. It has 15 terminal stations which anchor along the western coast of Africa, including countries where MTN Congo, Cameroon, Nigeria, Ghana and Ivory Coast. Business and Financial Times

 

ENI makes successful oil, gas appraisal in Ghana

Italy’s oil and gas company Eni has made a successful appraisal and testing of the Sankofa discovery offshore Ghana as part of its push to expand in Africa, the company has announced. The Sankofa-2 well was tested and delivered about 840,000 cubic metres of high quality gas and 1,000 barrels of oil equivalent per day of high quality 52 degree API condensate, Eni said in a statement. “Initial evaluations indicate that the appraisal well has significantly increased the preliminary estimate of gas in place at the discovery, confirming Sankofa’s potential to become the first development of non-associated gas from the Ghana offshore. The well in offshore Cape Three Points licence was drilled in 864 metres water depth, about 55 kilometres from the coast. The appraisal well confirmed the presence of 35 metres of net gas and condensate sands. Eni Ghana Exploration and Production Ltd is the operator of Sankafa-2 with 47.22 per cent stake. Vitol Upstream Ghana Ltd has 37.78 per cent stake while the Ghana National Petroleum Crporation (GNPC) owns 15 per cent with a back in option for another five per cent. Business and Financial Times

 

Glo-1 is here…. Glo Mobile is coming

Public anxiety over the arrival of Globacom’s mobile service, Glo Mobile, soared to the roof when Glo-1, the international submarine communication cable was fired into commercial operation at a spectacular launch ceremony at the Banquet Hall, State House, in Accra. Vice-President John Dramani Mahama, who was the guest of honour at the top of a high profile invitation list, declared Glo-1, a multi-million dollar submarine fibre-optic communications facility which connects Ghana and West Africa to Europe and North America, duly launched. Ghanaians anxiously waiting for the services of Glo Mobile have come to embrace the fact that Glo-1 is the technical backbone of Glo Mobile and, therefore, had to be operational to pave the way for the mobile service. The Vice President said the broadband infrastructure will go a long way to support the implementation of an ICT-led socio-economic development policy and a strategy plan for the government in its bid to establish Ghana as an ICT hub within the sub-region. “Globacom’s programme to roll-out a modern cellular network in Ghana promises to ignite the communications landscape in the coming months. We, therefore, look forward to a rewarding engagement in the development of broadband infrastructure in Ghana,” the vice president said. The Group Chief Operating Officer of Globacom, Mr Mohamed Jameel, extolled the multiple benefits likely to accrue to Ghanaians from the Glo-1 broadband capacity if the society could optimise the facility’s enormous capacity. He said the nationwide fibre-optic cable network in Ghana had been connected to Glo-1 to enable the company to provide reliable last mile services to its customers without going through a third part. The 9,800km-long Glo-1 submarine fibre-optic cable berthed on the Ice Company Beach at Osu in Accra some 18 months ago, ending an undersea journey that began in Bude in the United Kingdom. It also has 16 branching units connecting countries in Europe, North and West Africa with a dedicated extension to the United States of America. Glo- 1 is a privately owned entity and is the very first project of its kind and magnitude to have been executed by a single organisation. The practice has been for a consortium of companies or countries to team up to build such facilities. Business and Financial Times


MUNICH TO MARITIUS

 

IMF cautions Africa countries on spending

The International Monetary Fund (IMF) is cautioning African countries to watch their spending during a year paced with elections in the region where rising food and fuel prices already pose a big threat. This year is the biggest for the African political calendar since the end of the Cold War, with 17 presidential polls and even more parliamentary and local elections.  The hectic schedule is raising concerns that countries could throw fiscal caution aside to win votes and undermine years of economic progress, pumping up growth and possibly raising wages that would further fuel inflationary pressures. “There are some hard decisions that governments will need to take this year and those are even harder in a political season, but we want to encourage countries to pursue reforms as much as they can,” Antionette Sayeh, IMF Director for Africa, told Reuters during a week-end meetings of global finance chiefs. Djibouti, Chad, Seychelles, Cape Verde, Sao Tome and Principe, Uganda, Benin, Niger and Central African Republic are among African countries going to the polls in 2011. In 2009, overspending by Ghana’s former government in the run-up to elections forced the country to turn to the IMF for USD 1 billion loan. Ghana’s ruling party faces presidential primaries in July before a vote in December 2012. But the Vice-President John Mahama has given the assurance that the government would stay with its budget limits and that the only major challenge facing the country was the threat of rising oil pricesDaily Graphic

Sub-Sahara needs USD 480 billion

Africa needs USD 480 billion for infrastructural development over the next 10 years, President Jacob Zuma has reiterated. “Over the next 10 years, Africa will need USD 480 billion for infrastructural development which should interest the Brazil, Russia, India, China and South Africa (BRICS) business communities,” he said in an address delivered at the BRICS leaders meeting at Hainan Island in China. “Already Africa is projected as the third fastest growing economy in the world, while BRIC countries now constitute the largest trading partners of Africa and largest new investors. This economic relationship will be further strengthened as Africa forges ahead towards regional economic integration. This move will open up opportunities for more foreign direct investment and expanding trade relations with BRIC countries.iafrica.com/Graphic Business

 

Zambia’s 2010 export earnings up on copper

Zambia’s export earnings surged more than 67 per cent in 2010 as mining companies in Africa’s top copper producer expanded output as global prices surged, the trade minister has said. Mr Felix Mutati told Reuters that Zambia’s exports totalled USD 7.2 billion in 2010, up from USD 4.3 billion in 2009, mainly due to rising copper production and higher prices. Copper output in Zambia is expected to rise further this year to 900,000 tonnes, from 819,159 tonnes last year, as mining companies boost output. Mutati said export earnings were also boosted by a 50 per cent increase in exports of products such as flowers, maize and cement last year. Expanding market share in regions such as the Common Market for Eastern and Southern Africa (COMESA) and the Southern African Development Community (SADC) also helped, he said. “We expect our exports to exceed USD 7.2 billion in 2011 because both copper production and non-traditional exports are expected to grow,” Mr Mutati said. Copper prices which hit a record high of USD 10.90 in February are expected to keep rising this year, helped by fast-growing demand from emerging economies like China. Reuters/Business and Financial Times