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Africa should create gas pricing index as demand rises – ministers

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  • Africa gas market tiny but growing fast
  • Electricity generation is main growth driver
  • Unified pricing system tough in undeveloped markets

Africa should develop a gas pricing index based on the cost of electricity set midway between existing global benchmarks to ensure fairer pricing in new export projects on the continent, two African ministers said.

The idea is being floated when the world’s poorest continent, where 600 million people are without electricity, is turning to liquefied natural gas (LNG) as a cheaper way to power up amid plentiful global supply.

Plans to boost African power generation by 30,000 megawatts by 2030 could translate into 42 million tonnes of additional LNG consumption a year, according to the U.S. Department of Energy.

“The pricing of the LNG coming into Africa is going to be more than 50 percent for electricity, so it will be fixed to the price of electricity,” Equatorial Guinea’s minister Gabriel Obiang Lima told Reuters during the Africa Oil Week conference.

“What we need to calculate is the pricing of the power to be able to have this index and that should be something between (the U.S. gas exchange) Henry Hub, which is very low, and the Asian index, so we are talking about a range of between $3-$7 dollars,” he said on the sidelines of the meeting in Cape Town.

Obiang Lima said trading firm Gunvor could peg some sales of LNG from its planned Fortuna facility in Equatorial Guinea, due to start in 2020, to the index.

Gunvor struck a deal to buy all of the plant’s output, but there is a provision allowing Equatorial Guinea and its partners to sell up to half the volumes within Africa.

Gunvor declined comment on the index issue.

Equatorial Guinea already exports LNG to countries that include South Korea and Argentina.

Angola and Nigeria are also major African LNG exporters, with Cameroon set to start this year. New LNG projects are planned in Senegal, Mozambique, Congo Republic and Tanzania.

Equatorial Guinea aims to export LNG to Africa for the first time, including to Mali, Burkina Faso and Ghana.

Africa’s natural gas consumption rose 20 percent from 2011 to 2014 from 3,909 billion cubic feet (bcf) to 4,689 bcf, according to the U.S. Energy Information Administration, still a tiny market but the world’s fastest growing.

In Nigeria, Seplat Petroleum expects demand to grow rapidly for use in energy, cement and fertiliser projects.

But the still small size of Africa’s gas market may make establishing an index difficult, industry experts said.

“It would be extremely difficult to find a unified pricing system in Africa at the source. If one day Africa is well-connected with pipelines and many different sources, then maybe an index,” said Mounir Bouaziz, Royal Dutch Shell’s vice president for new business development.

But Ghana’s energy minister, Boakye Agyarko, said an index could be developed as the continent’s gas projects grew.

“As all our resources come together from Senegal to Mozambique and Tanzania, we can aggregate all of this and begin to make an impact on the demand and supply equation and therefore we can build our own index,” the minister said

Credit: Reuters

Hold states accountable for Africa’s education shortfalls, says UNESCO

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Governments must be held accountable for African countries’ slow progress on global education goals since underperforming schools and teachers are usually victims of a dysfunctional system, the U.N.’s cultural agency UNESCO said last week Wednesday.

Sub-Saharan Africa falls behind other parts of the world by most education standards, with one in four young people unable to read and 33 million children out of primary school, more than half of all those in the world.

The problems largely stem from lack of government regulation, corruption, high school costs, and other factors that could be improved if states were held liable, UNESCO said in a new report.

While 70 percent of all countries have at least nine years of compulsory education, only 40 percent of countries in sub-Saharan Africa do, the report found.

“Accountability should start with the government,” UNESCO’s regional director Gwang-Chol Chang told the Thomson Reuters Foundation in Senegal, though he emphasized that families and communities also have a role to play.

One problem in West and Central Africa is that school curriculums are often European-inspired and not adapted to the local context, Chang said, making school feel irrelevant and leaving graduates ill-equipped for the job market.

The report found in many African countries, low-fee private schools catering to poor populations are popping up faster than governments can handle so they remain unregulated and often have unqualified teachers.

In Ghana and Niger, the percentage of trained primary school teachers has fallen since 2000, the report said.

Although African governments are often hard-pressed for funds, this does not excuse many of the deficiencies in their education systems, said Teopista Birungi Mayanja, coordinator of the Africa Network Campaign on the Education for All movement committed to providing basic quality education for everyone.

“It’s only partly due to lack of resources,” she told the Thomson Reuters Foundation, adding that civil society groups, unions, and other actors need to have a greater role in education decision-making.

“Unless governments allow all these voices at the table, they will never come up with a credible plan.”

The UNESCO study was part of a series monitoring progress toward the U.N.’s global goals, or Sustainable Development Goals, which include achieving universal education by 2030

Credit: Reuters

Insurers push for Self-Regulation

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The Ghana Insurers Association (GIA), the umbrella Trade Association for all Insurance Companies doing business in the country, held its first National General Insurance Conference at the Labadi Beach Hotel in Accra recently.

The Conference was on the theme ‘Transforming the General Insurance Industry in Ghana through Self-Regulation, Financial Capacity and Business Innovation’. The event was attended by representatives of all insurance practitioners from about 55 insurance and re-insurance companies, and those doing insurance-related business. The attendance was about 400 participants.

Mr. Kwame Ofori, second Vice-President and Chairman of the General Insurance Council/Executive Director, Enterprise Insurance Company, welcoming participants said the maiden conference is the culmination of years of hard work by the General Insurance Council in pursuit of their dream – which is to tell how General Insurance impacts the lives and properties of individuals and the country as a whole.

According to him, this is most appropriate in view of its focus on the three thematic areas that have the potential of improving the General Insurance Industry.

“Self-regulation has become one of the most powerful tools for initiating discipline, promoting healthy competition, and avoiding stricter regulations in various industries worldwide.

“The insurance industry in Ghana cannot be an exception. The benefits of self-regulation are obvious. It can help us address a range of issues, from establishing industry standards through developing and applying codes of professional ethics, to ensuring consumer confidence,” Ofori pointed out.

He stressed that self-regulation, by its very nature, relies on the input of all stakeholders, so members buy-in is high – leading to better compliance and more positive overall results. In Canada, the maximum self-regulation prevails – rather than the imposition of more remote and often less flexible and less timely rules by governments.

He indicated that the various Trade Associations, such as Advocis, have usually been able to voluntarily implement revised trade practices to enhance consumers’ interest and protection; thereby, avoiding unwieldly or labourious legislation and government supervision.

He admitted that similar arrangements exist in countries such as South Africa.

Ms. Aretha Duku, President GIA and Managing Director Ghana Union Assurance, emphasised that the industry in the country cannot be an exception to the global development.

According to the GIA President, there are people with the mindset that the insurance industry is being over-regulated.

However, we say No to this assertion if you do not self-regulate.

Regulating by itself presents benefits to both consumers and insurance companies; and as the consumer is assured of fair terms, the insurance company is able to operate on a level-playing field efficiently.

thebftonline.com l Ghana

 

BEIGE wins two awards at the 2017 CFO Awards

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Mr. Mike Nyinaku

BEIGE has bagged two awards – Finance Team of the Year and Business Transformation Award at the 3rd CFO Awards held at the Movenpick Hotel.

The Chief Financial Officer (CFO) awards is a gathering of senior finance professionals. It brings together business/financial leaders so as to reward and recognise their experience, expertise and contributions to the finance sector of Ghana.

Mr. Mike Nyinaku, the Chief Executive Officer of BEIGE, won the Business Transformation Award for the year, while the finance department of BEIGE won the Finance Team of The Year.

Receiving the award on behalf of BEIGE, Mr. Dauda Hafisdeen – the Chief Finance Officer of The BEIGE Bank said: “We are glad that our little effort as a finance team is recognised. This award comes to further challenge us to work even harder, especially in a way that reflects on our deposits and financial management strategy as a company”.

Commenting on the Business Transformation award, Mr. Mike Nyinaku said: “This award serves as an encouragement to my dedicated team who are working hard to serve our clients and make good use of their monies. I must also say that l am proud of my management and staff whose collective efforts have turned BEIGE around”.

Mr. Mike Nyinaku emphasised the fact that the firm will not relent in its effort to satisfy clients through its broad range of services.

InstinctWave, organiser of the awards programme, is a marketing and business solution firm that pushes the boundaries in solving publishing, marketing and event management issues for clients.

thebftonline.com l Ghana

Sogakope observes UN Day at Raddy Infant School

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Mrs. Nayram Kyei-Mensah

Raddy Infant School, a private institute for child education in Sogakope, observed this year’s UN Day with a passionate call that stakeholders in child development should strive to promote and protect the rights of children.

Addressing parents, teachers and pupils at a function held at the school to mark the Day, Mr. Emmanuel Louis Agama – District Chief Executive of North Tongu, urged parents and teachers to work hard to safeguard the rights of children as enshrined in the UN Convention.

Mr. Agama said the child’s rights of survival, protection, participation and development are critical to the nurturing of children into responsible adults in society.

“As parents, guardians and teachers, we should affect the lives of children in a positive way, bearing in mind that children are influenced mostly by the activities of society – be they positive or negative; so we must do well to leave good examples for them to follow,” he said.

The UN Day is observed worldwide on October 24 and marks the anniversary of the coming into force in 1945 of the United Nations Charter. The day is devoted to making known to people of the world the aims, objectives and achievements of the world body.

The colourful ceremony at Raddy Infant School marked the first time the Volta Region town of Sogakope was observing the UN Day; and running under the theme ‘Impacting our Community and Beyond’, school authorities focused on showcasing the creative potentials of the wards and pupils of the school.

Little children, with ages ranging from 12 months to five years, thrilled an audience of parents, teachers, district officials and guests with performances which included a world costume parade, singing and choreographed dancing.

The Proprietress, Mrs. Nayram Kyei-Mensah, said the school – founded by the late Madam Ruby Dey, an indefatigable lover of children – is inspired by the strong conviction that the education of children necessarily has to transcend the usual and often perfunctory classroom routines and schedules.

“It is our conviction that education, especially of children, must not be limited to formal classroom work and academics, but should be managed in a rounded and holistic way with the child’s future in mind,” said Mrs. Kyei-Mensah, adding: “Educationists of today need to pay attention to the child’s physical, spiritual, social and emotional needs, as well as academic needs.”

The proprietress said if the right virtues and qualities are purposefully instilled in children at an early age, society can be sure of producing “well-rounded, confident, God-fearing, socially-sensitive and responsible adults” who will play a positive role in the development of their communities and society.

Dr. Momodou Cham, Medical Director at Sogakope’s St. Anne Clinic who chaired the function, said it was thoughtful of the school authorities to let children take centre-stage in the observance of UN Day.

“Yes, writing and reading are basic and necessary, but they must not be taught in a vacuum. They must be put within a certain social context, and the United Nations and what it represents in the world community today cannot be overemphasised,” he told newsmen after the function.

Referring to the children’s exceptional show of knowledge in current affairs at the function, Dr. Cham said: “It is simply a delight to see little children like these bring a sophisticated global institution to our doorstep here in Sogakope. I pray and urge the school authorities to endeavour to ensure that our town gets to experience the UN Day annually”.

thebftonline.com l Ghana

Our mobile money service is robust – Vodafone

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Mr. Carl Ashie

Vodafone Ghana has assured customers that its mobile money service is robust and provides no avenue for fraudulent activities on its network.

Media reports in recent weeks have highlighted alleged fraudulent activities on some mobile money platforms in the country. Whilst no comment has been made about Vodafone in relation to these issues, the company says it has the duty to assure current and potential customers that the Vodafone Cash service is robust and not susceptible to fraud. The company says the security measures and restrictive processes put in place make it impossible for successful exploitation either from actors within or without.

Mobile Financial Services Manager at Vodafone Ghana, Carl Ashie says:”We take our commitment to customers very seriously and recognise that they need safety and security when using our platform. We have therefore taken steps to make the service foolproof by ensuring that our agents have no direct access to customer records unless authorised by the customer.

We have deployed in Ghana, the same system that is used by our sister company, Safaricom in Kenya, which for the past ten years has revolutionised the payments sector in East Africa. Vodafone currently boasts of 33 million active mobile money customers across the continent. We assure our customers that they can securely transact using the Vodafone Cash platform, which boasts an uptime of 99.99 percent. We also advise customers to adhere to the processes meant to protect their funds such as loading their own wallet at the agent point.”

Vodafone’s mobile money service continues to experience a steady growth since its inception in Ghana a year-and-half ago. The service ensures strict compliance with effective customer security such as using first names to ensure customer privacy; tracking and dismissing non-compliant agents and ensuring that cash-out transactions are only initiated by the customer.

thebftonline.com l Ghana

 

Ria Money Transfer names GTBank as ‘Best Technology-Driven Bank Partner’ …also recognises it as ‘Best Ria Brand Champion’

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Guaranty Trust Bank (Ghana) Limited’s superiority in technology and electronic banking has been given further endorsement, as Ria Money Transfer – a subsidiary of Euronet Worldwide Inc. which specialises in money remittances – has named the bank ‘Best Technology-Driven Bank Partner’ in 2017.

The progressive global remittance services company has also recognised GTBank as the ‘Best Ria Brand Champion in 2017’.

These endorsements were made during Ria’s 30th anniversary awards and dinner night at the Labadi Beach Hotel, in Accra, last weekend.

A citation signed by Ria’s Operations Head, Africa, Mr. Robert Kotei, that accompanied the award for the ‘Best Technology Driven Bank Partner’ reads: “Ria is pleased to present to you this award for Best Technology Driven Bank Partner in 2017. Technology lies at the center of our service. Your expertise and resilience in this area is very impressive, and this enables us to offer a seamless service to our cherished customers. We appreciate you. Keep up the great work”.

For the ‘Best Ria Brand Champion’ award, the citation – also signed by Mr. Kotei – commends GTBank for its efforts in promoting the remittance service. It reads: “Ria is pleased to present to you this award for the ‘Best Ria Brand Champion in 2017’, for going the extra mile to promote our service inside and outside your branches. Thank you for continuously marketing Ria and helping us colour Ghana in orange”.

Reacting to these recognitions by Ria, Managing Director of Guaranty Trust Bank (Ghana) Limited, Mr. Lekan Sanusi said: “We are grateful to Ria for acknowledging our efforts. Our journey with RIA commenced in October 2013, and so far the relationship has been mutually beneficial. At GTBank we regard RIA as one of our best Money Transfer partners, and we can attest to the fact that they are responsive, cooperative and reliable, for which we applaud them”.

Mr. Sanusi also congratulated Ria on the celebration of its 30th anniversary. “30 years is short but long enough to have proven their strength and resilience in remittance business, and so on the occasion of their Pearl Anniversary we wish to urge Ria on to continue doing well; and we look forward to a more fruitful collaboration in our quest to delight our mutual customers,” he stated.

Ria is one of the largest global money transfer companies, established in 1987 with the purpose to provide a cost-effective, secure and fast option for sending money to families and loved ones worldwide. Serving 150 countries, Ria has emerged as a global leader in remittances and is a recognised brand in both quality and service.

Guaranty Trust Bank (Ghana) Limited, over the last eleven (11) years of operations in Ghana, has become a household name and trailblazer in the innovation of efficient electronic channels that enable its customers to carry out banking transactions from wherever they may be.

Barely a week ago, the Bank won five (5) awards at the 2017 Banker Africa–West Africa awards: namely the Most Innovative Bank, West Africa; Best Online Platform, Ghana; Best Commercial Bank, West Africa; Best Commercial Bank in Ghana and Best Corporate Bank, Ghana – all in recognition of its unique offering of tailor-made products and services to serve customers better.

In June this year, GTBank Ghana was for the fourth (4th) year running adjudged ‘Technology Advanced Bank of the Year’ at the Ghana Information Technology and Telecoms Awards; thereby cementing its undisputed lead in the use of technology to make banking easy and convenient for its customers and the general public.

It was also named the Digital Bank of the Year and Best Bank in Mobile Financial Service in recognition of the various platforms and channels deployed to enhance banking on the go.

These awards cemented an earlier international recognition of GTBank’s superiority in e-banking, when the U.K.-based Capital Finance International awarded it the Best Digital Banking – Ghana 2017 award in March this year.

thebftonline.coml Ghana

Maritime authority insists on raised safety and security charge • Shippers want to pass it on • Importers and exporters resist

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Mr. Kwame Owusu

The Ghana Maritime Authority (GMA) has said it will not succumb to any pressure, whatsoever, to reverse its decision to increase the maritime safety and security charge paid by shipping lines from US15cents to 50cents.

During a stakeholder engagement with representatives of shipping lines and other regulators in the shipping business, Director-General of the authority Kwame Owusu stated emphatically that “this issue about safety charge is over”.

He added: “For the GMA a charge is a charge. and we will enforce that position as stipulated by the laws of the land; as an authority, we will be proactive to protect the people of this country.

“We want to cure Ghana’s waters for shipping lines to operate and thrive within a conducive environment; we will do what we have to do to protect shipping lines and the waters.”

The authority, under a new leadership, has reviewed upward the safety and security charge for shipping lines from 15cents to 50cents.

The increase in the safety and security charge, occasioned by new leadership of the authority, means a vessel that used to pay about US$6,000 per month in security and safety charges will now have to pay between US$25,000 and US$30,000.

The safety and security charge increase is backed by the Authority’s regulations passed in 2012, which allows the imposition of maritime safety fees and charges on installations, ships, pipelines, cables and other assets employed in the maritime domain.

Shipping lines are asking the regulator to reconsider the increase – arguing that it will take a huge toll on their operations, given that third party costs are already eroding their actual freight.

If the decision won’t be reversed, the shipping lines argue that they should be allowed to recover the added cost from importers and exporters.

In response to that, the Director-General of the authority said: “The GMA is not saying that the charge cannot be recovered; but the mandate to pass on the charge to shippers lies with the Ghana Shippers’ Authority (GSA)”.

However, the shipping lines’ intention to transfer the cost to shippers was vehemently rebuffed by the Importers and Exporters Association of Ghana.

Executive Secretary of the association, Samson Asaki Awingobit, said at the meeting that his outfit will be forced to demonstrate against that decision.

He argued: “This is a charge to protect the country’s waters and make it conducive for the shipping lines to call at our ports.

“Were there to be any form of attacks or robberies in our waters, they would not come; they have to take up that responsibility and not pass it on.”

By Patrick Paintsil l thebftonline.com l Ghana

Wanted: 11 million professionals to save Africa from “disaster”

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Africa needs 11 million more doctors, nurses and teachers by 2030 to prevent a “social and economic disaster” that could propel millions to migrate, the United Nations said last week Thursday.

It said the 11 million were needed to help the continent cope with a booming population, with the number of children set to increase by 170 million to 750 million in the next 13 years.

“We are at the most critical juncture for Africa’s children,” Leila Pakkala of the United Nations Children’s Fund (UNICEF) said in a statement.

“Get it right, and we could … lift hundreds of millions out of extreme poverty, and contribute to enhanced prosperity, stability, and peace,” said Pakkala, who heads UNICEF operations in eastern and southern Africa.

The U.N.’s children agency attributed the boom in births to high fertility rates, a rising number of women of reproductive age and lower child mortality.

By the end of the century, one in two children worldwide will live in Africa, it said in a study.

If they reach working age both schooled and healthy, they could spur economic growth – but for that to happen, Pakkala said investment in education and health were badly needed.

More schools must be built, it said. And teachers, doctors, midwives and health workers must be trained and encouraged to stay in their community rather than move to cities or abroad.

The road is uphill.

More than one in five Africans aged 6 to 11 are not in school. Girls, in particular, are more likely never to see a classroom, waylayed by child marriage and teenage pregnancy.

Six in ten Africans lack access to basic sanitation and on average there are only 1.7 medical professionals per 1,000 inhabitants – well below the minimum international standard of 4.45 set by the World Health Organization.

To bridge the gap, 5.6 million health workers and 5.8 million teachers have to be trained by 2030.

ASIAN MODEL

If it fails to invest in its future, Africa risks a “demographic disaster, characterised by unemployment and instability,” UNICEF said.

It painted a picture where a lack of jobs, rapid urbanisation and climate change could force millions to flee the continent seeking a better life overseas.

Robert Yates, a health expert at the British think tank Chatham House, said 11 million teachers and medics was a challenging goal but not unfeasible, as shown by the rapid development of some Asian countries, such as Thailand and China.

But this required a strong political will to boost public spending on health and education – rare in sub-Saharan Africa.

Nigeria, which currently accounts for 20 percent of all Africa’s births, for example spends only 0.9 percent of its GDP on public health, one of the lowest rates in the world.

Exceptions in recent decades included Nelson Mandela’s South Africa, Rwanda and Ethiopia, Yates said.

“What is important is that other countries follow this lead,” he told the Thomson Reuters Foundation.

Credit: Reuters

Fifth IMF Review meeting positive – Dr. Assibey-Yeboah …as release of US$118m fifth tranche draws near

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Dr. Assibey-Yeboah

The country is nearing the receipt of a fifth bailout tranche payment of some US$118m, out of the US$918m IMF Extended Credit facility, following fruitful deliberations between the Briton woods institution and members of Parliament’s Finance Committee.

According to the chairman of the Finance Committee of Parliament, Dr. Mark Assibey-Yeboah, the staff of the Fund are primarily in the country to begin talks towards the fifth review and analyse performance of the government thus far in order that they can release the fifth tranche.

Mostly, when the IMF staff come into town, they meet with government officials – Ministry of Finance, Presidency, Bank of Ghana, Senior Minister as well as Parliament’s Finance Committee.

There are eight tranches in all, of which US$118m balance of payment support is expected soon, hence the visit of the IMF staff to begin talks for the release.

Furthermore, Dr. Assibey-Yeboah also explained that the IMF officials had enjoyed fruitful discussions with the Finance Committee in the past and were keen to meet up again this time round.

“Today’s meeting focused on the 2017 budget performance; they have data up till the end of August, how government’s revenues are performing, expenditure patterns, issues to do with the central bank when it comes to the currency, inflation and economic growth numbers.

They will be at speed with the data that government is using to inform its position on the 2018 budget, so that they can also have a foothold in the 2018 budget discussions, which are set to come in less than three weeks,” he told B&FT in an interview after the meeting on Thursday, October 26, 2017.

The country went to the IMF in 2015 for an External Credit Facility of about US$918 million under the John Mahama administration.

The IMF team is expected to meet with the government’s Economic Team to discuss how fiscal policies can be incorporated into requirements set by the Fund.

Ghana is awaiting the release of the fifth of eight tranches of balance of payment (b.o.p) from the IMF and prior to that the Fund would have to come to the country for a review, which is dependent on the performance of the terms of the agreement.

Dr. Assibey also indicated that the discussions covered all the issues, from monetary to fiscal, trade, energy bond, among others, and the IMF t and they got satisfactory responses from the officials of the Fund.

He expressed confidence about the country accessing the funds soon given strong macroeconomic performance, so far.

“So far, performance has been good; if you look at inflation, it has come down, the currency has stabilised, the deficit numbers are good, the debt stock is still high, there is some performance criteria, these benchmarks are set, so they go over, you don’t have to satisfy everything 100percent. If they give you a pass, releases will be made,” he added.

The IMF, recently, approved an extension of the Extended Credit Facility, initially worth $918 million, which will see the programme continue for an extra year beyond its original April 2018 end date.

Ghana, which exports cocoa, gold and oil, signed onto the programme in April 2015 hoping to restore fiscal balance to an economy dogged by budget deficits, rising public debt and inflation.

By Eugene Davis l thebftonline.com l Ghana

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