Relevant Business News from Ghana

Inflation rate for August 2017 increased to 12.3 percent from 11.9 percent recorded in July, 2017, according to the latest figures released by the Ghana Statistical Service. According to the Ghana Statistical Service, the increase in the rate was as a result of a base drift effect, (an abnormality in calculating inflation), the introduction of flat VAT rate scheme and fuel price adjustments. “The flat VAT rate imposed by government affected a lot of items particularly imported items”, Acting Government Statistician, Baah Wadieh told JoyBusiness. The Food and Non-Food Inflation components recorded 7.4% and 14.7% respectively for the month of August as compared to 7.2% and 14.7% for the month of July, 2017.  The Upper West region recorded the highest inflation rate with 13.4% (18.1% for Non-Food and 4.1% for Food). Greater Accra region had the next highest inflation with 13.1% and Upper East recorded a rate of 11.0% which is the lowest amongst the regio...

 Hon. Catherine Afeku –Minister For Tourism, Arts &Culture The hospitality sector in Africa’s emerging markets looks set to profit from foreign investment and an influx of foreign travelers. The emerging markets are set to post faster growth in revenue than their counterparts in developed countries, making them integral to the expansion strategies of some of the world’s leading hotel developers. Hospitality & Gaming Industry leader for PwC Southern Africa, Pietro Calicchio said “The growth potential of Africa is high mainly because of the rapid economic growth in some economies, a growing middle class and an increase in visits from foreign visitors. “The emerging markets are a sought after destination for foreign investors – it is in these markets where there is continued economic growth and a need for additional infrastructure. In addition, governments and policy makers are introducing a range of tax incentives and other inc...

The proposed merger between Airtel and Tigo is expected to linger until such a time that the two companies complete the necessary regulatory processes with the National Communications Authority (NCA). The two entities officially announced the decision to merge in  March 2017. But latest information from the NCA indicates that the process is yet to be completed, six months after the announcement. In a response to an email request from Citi Business News, the NCA confirmed that it has received a joint application for a merger between Airtel Ghana Limited and Millicom Ghana Limited operators of Tigo. The NCA also says it has since reviewed the joint application. The regulator however says the two networks are in the process of furnishing it with some further details on the requirements for the merger. It is unclear what requirements the regulator is seeking that the companies abide by but the NCA is expected to give its approval for the merger after a final review of t...

Pricewaterhouse Coopers (PwC) has commenced issuing letters to staff of former UT and Capital Banks. PwC is undertaking this exercise in its capacity as the receiver of the purchase and assumption agreement between GCB Bank and the two defunct banks. Information available to Citi Business News indicates that the letters are being served to all employees of the two affected banks. This is expected to affect about one thousand workers both of former UT and Capital banks. According to PwC, any claim of the workers in terms of salary arrears, wages, leave, severance pay and other entitlement will be dealt with in accordance with the provisions of the Labour Act, 2003 (Act 651) and the Banks and Specialized Deposit Taking Institutions Act, 2016 (Act 930). “Your contract of employment with UT has been terminated as a result of the receivership effective 14 August 2017. Any claim you have against UT such as arrears of salaries, wages, leave, severance pay and other entit...

The rise in the minimum paid up capital for commercial banks will further restrict lending to the private sector at least within the short to medium term. The development should be expected due to the operations of commercial banks which have limited the amount of credit offered businesses. The caution comes on the back of the increase in banks’ minimum capital from 120 million cedis to 400 million cedis. Commenting on the issue, a Credit Consultant, Emmanuel Akrong also indicated that banks risks reducing their income streams with this plan. In his view, the restriction in credit to businesses is also likely to adversely affect the larger economy. “At the moment, if you look at how banks are their deposits, they are putting more into government’s bonds and treasury bills than lending…so lending is not going to be low because of this new capital requirement but because of certain fundamentals which we need to fasten our seat belt about,” Mr. Akrong stated. The latest ban...

The Bank of Ghana (BoG) will on Monday announce a new capital requirement of 400 million cedis for banks in the country, an official at the central bank has confirmed to Citi Business News. This represents an increase of 233.3 percent from the previous 120 million cedis.By this, banks in the country will be required to set aside 400 million cedis in capital to be supervised by the central bank. The Governor of BoG, Dr Ernest Addison, announced the figure to Chief Executives of banks today, Friday, September 8, 2017.Citi Business News has gathered that banks will be given until December 2018 to meet the new requirement. The Governor of the Bank of Ghana, Dr. Ernest Addison Ghana’s banking sector recently suffered a setback after assets and deposits of UT Bank and Capital were taken over by GCB Bank. The takeover confirmed reports of some 8 banks which were under distress. Some financial observers have called for an increase in the capital requirement to force banks t...

Ghana is set to generate US$10 billion from Non-Traditional Exports (NTEs) in the next four years. Madam Gifty Klenam, the Chief Executive Officer of the Ghana Export Promotion Authority (GEPA), disclosed on Wednesday. To achieve the target, she said, the Authority was developing and promoting exports vigorously, by identifying additional products with significant export potentials in the various districts in the country. Ms. Gifty Klenam  The Export and Import Act, 1995 (Act 503) defines Non-Traditional Exports (NTEs) to include all export products with the exception of cocoa beans, lumber and logs, unprocessed gold and other minerals, and electricity. Madam Klenam said this in a speech read on her behalf, at a meeting on the implementation of the National Export Strategy, vis-à-vis the One - District-One-Exportable-Product in Sunyani. It was organized by GEPA and attended by District Chief Executives, Coordinating Directors and other stakeholders in the export sector...

The Northern Region Office of Ministry of Trade and Industry (MoTI) is to organize the Northern Trade Fair 2017 to showcase emerging opportunities in the region for business to take advantage of. The event, scheduled for October 10 to October 14, 2017 is expected to bring together over 500 entrepreneurs, craftsmen, manufacturers, producers, service providers amongst other stakeholders to market their wares. It is being organized by MoTI in partnership with Universal Marketing Consultancy Limited and Dansyn Ghana Limited on the theme: “Harnessing the Emerging Business Opportunities in the North for Economic Development through Trade and Commerce.” Alhaji Alhassan Issahaku, Northern Regional Coordinating Director, who launched the event in Tamale on Wednesday, said “the region has a lot of potentials which businesses can exploit and we are positioning the private sector to take advantage and grow their business.” He said the fair formed part of efforts to repositi...

Ghana may soon lose its fishing stock if nothing is done to overturn issues confronting the country’s fishing sector. Ghana which consumes over 950,000 metric tons of fish annually currently imports over 60 percent of its fish. Ghana in 2016 imported $135 million worth of fish because of the reduction in the country’s fish stock. According to the Minister for Fisheries and Aquaculture, Elizabeth Afoley Quaye, the huge imports could be blamed on the steady depletion of Ghana’s fish stock. Elizabeth Afoley Quaye, Minister of Fisheries and Aquaculture Development “We have a deficit of over 60% of production of fish in Ghana. So we import over 600,000 metric tonnes of fish and we produce less than 400,000. At the moment we have our stocks depleting steadily and we really have to do something quickly about it else we lose our stocks entirely,” she told Bernard Avle on the  Citi Breakfast Show  on Thursday. Afoley Quaye, however, added that her outfit is d...

Fifty-seven oil marketing companies (OMCs) have been sanctioned by the Ghana Standards Authority (GSA) for engaging in various infractions detrimental to the interest of consumers. All the affected OMCs are in the Greater Accra Region. They were fined a total of GH¢261,000 for serving customers with lower volumes of fuel, using non-approved GSA seals and breaking GSA seals meant to stop cheating at the pumps. The acting Director-General of the GSA, Prof. Alex Dodoo, told the Daily Graphic in an interview in Accra on Wednesday that the companies were sanctioned within a 12-month period. He said the GSA undertook periodic checks on the operations of all OMCs across the country twice a year to ensure that they conformed to GSA standards. Breakdown Prof. Dodoo disclosed that 45 OMCs served their customers less fuel than the customers purchased and were accordingly fined GH¢5,000 each. Ten other OMCs, he noted, used pumps not verified by the GSA, for which reason they w...

Businesses that pay 25% of their profits in corporate taxes should expect to pay less from next year (2018). The corporate tax is expected to be reduced to twenty percent eventually. It follows what the Finance Minister; Ken Ofori Atta says is the consideration of reducing the tax in the 2018 budget. This is also part of the tax cuts which was key among the numerous promises by the New Patriotic Party (NPP) ahead of the 2016 general elections. Mr. Ken Ofori Atta maintains that diversifying tax revenue streams should   prevent the overconcentration   on Corporate Income Taxes (CIT). “How do you then tap enough people to contribute so that you do not need to focus on corporate income tax as a main source of revenue…We are considering reduction in a number of taxes and the Corporate Income Tax is one of them,” he explained. Upon assuming office, the NPP government has   reviewed about fifteen (15) taxes . In the government’s first budget, eleven ...

The International Monetary Fund (IMF) has extended Ghana’s program with the Fund. The extension will see Ghana end the program in April 2019 instead of April 2018. President Akufo-Addo during his maiden encounter with senior journalists at the Flagstaff House recently stated that government will not extend the programme after it ends on December 2018. However discussions between government officials and that of the fund in Washington yesterday led to an approval for an extension which was requested for by Ghana. The disbursement of 94.2 million dollars was also approved making it the fourth disbursement under the extended credit facility program.   A total disbursement under the arrangement is about US$565.2 million with the remainder to be disbursed after other reviews. The Board of the Fund also approved Ghana’s request for waivers of non-observance of performance criteria, and modification of one performance criterion; and the extension of the arrangement by one ...

Newmont Ghana Gold Limited has escaped sanctions from the Bank of Ghana (BoG) over its failure to surrender 30 per cent of its export receipts to the Central Bank in 2016.This was due to miscommunication amount the Minerals Commission, the BoG and Newmont. As a result, the Parliamentary Select Committee of Finance has directed the BoG not to apply any sanctions to the company, but should, however, apply the sanctions should Newmont fail to surrender the receipts for this year as well. This was contained in the committee’s report on the investigation to ascertain whether Newmont Ghana and Ghana Bauxite Company have had their mining agreements ratified by Parliament and whether the two companies were VAT compliant. Out of the deliberations of the report of the Public Accounts Committee on foreign exchange receipts and payments for the year 2015, it came to light that Newmont Ghana had been exempted from surrendering its foreign exchange earnings to the BoG as part of its minin...