EU Alerts Ghana

- Less Aid In Future By Samuel Boadi Ghana should be preparing to single-handedly champion her development projects in the near future. This is because the level of development assistance it enjoys from European Union (EU) countries will soon begin to dwindle, the head of the EU Delegation to Ghana, Claude Maerten, has said. In an interview with BUSINESS GUIDE recently in Accra, Mr Maerten asserted that “the level of external assistance will decrease because the crisis is not one which affects just Europe but one that affects the growth rates of all countries of the world - the USA, South East Asia and all countries.” In order to counteract the effects of the current economic crisis unfolding in Europe, the head of delegation said Ghana should pursue more investment and trade. “Ghana’s growth rate projected for this year, compared with the growth rates of some countries in Europe, is very high. In some EU states, there is no growth rate at all while in some countries, there is a decline of the GDP. A few countries in Europe had positive GDP.” He revealed that EU countries have an agreement with the Government of Ghana that stipulates that from 2020, Ghana will be less aid dependent. “We know that Ghana has a lot of natural resources, mines and also oil, which will flow more and more. There is also the gas infrastructure which will develop the energy sector and bring jobs to the youth. “Ghana is very positive. So it is so clear that when we look at such situation in the world, we have to put in place a system of assistance for countries which badly need support. This being said, the relationship with Ghana will be quite high because Ghana is the most politically democratic country in the sub-region.” The foregoing not withstanding, Europe still remains a major trading partner of Ghana. But Ghana could also look at trading with countries in South-East Asia and Latin America. “It will affect external trade and exports but at the same time Ghana exports more raw materials with gold and aluminium. These products are in high demand and also the price of the products will be high in future. Ghana has been so much resilient in the competitiveness of these prices.” Additionally, Mr Maerten said there might also be an impact on the level of remittances because if there are less jobs in Europe or any part of the world where the Ghanaian reside, then it will be difficult for them to send money home. “That might also affect balance of payment of Ghana.” Asked when the crisis would end, he said: “Nobody knows how long it will take. Recently the economic and financial ministers met and launched the European Stability Mechanism to lend support to affected countries. This comes with an amount of 500 billion Euros seed money. Ghana-EU partnership has existed for about 35 years ago and has witnessed the investment of about GH¢3 billion in Ghana. Between 2008 and 2015, the EU has earmarked GH¢1.2 billion for development in Ghana. So far, 40 percent has been spent.

More Firms Go Into Housing

By Samuel Boadi An explosion is about to hit the country’s housing sector if some 90 companies which have applied to the Ministry of Water Resources, Works & Housing to build mortgage houses across the country are given the green light to do so. So far, four out of the 90 companies have been granted permission to do so and these include Ital Construct, which is expected to build 4,000 housing units, American Capital, which has partnered local companies to build 5,000 units, the Tema Development Corporation (TDC) and the Commonwealth Business Council. Their applications were approved in April, this year. Enoch Teye Mensah, Minister of Water Resources, Works & Housing, disclosed this to the media in Accra at the weekend. He added that the units would be completed before the conventional periods for building in Ghana since the companies would be employing new building technology. A seven-member committee, set up by the ministry, is investigating the backgrounds of the applicants to determine whether they have the means and integrity to execute their jobs. Others that are waiting to be approved include Amandy Company and a company from Brazil which has entered into agreement with Ghana Home Loans, among others. Also, SSNIT and Regimanuel Grey Limited are collaborating to build some 700 housing units at Klagon, near Nungua in Greater Accra. The minister noted that such housing units are specifically targeted at Ghanaians who are unable to own houses, adding that the houses would be affordable. Currently, Ghana’s housing deficit stands at 1,700,000 units per annum. Generally, a lot of people in Ghana, including workers, cannot feed themselves effectively a day, let alone save some money towards the construction of a house. To further dash their hopes of ever owning houses, their SSNIT contributions are being allegedly mismanaged and enjoyed by employees of entities that manage such funds. Ghana recently joined Shelter-Afrique, a pan-African financial institution to enable real estate developers gain access to funds at moderate interest rates to assist the provision of more housing units for Ghanaians. Ghana was admitted as the 43rd member of Shelter –Afrique, a company, headquartered in Nairobi Kenya in 2011. Habitat Ghana, a subsidiary of Habitat for Humanity (HFH), wants to build about 20,000 housing units for Ghana’s poor. Should all the applicant companies be offered permission to build houses, there would be more mortgage houses for grabs but an aspect to contend with is the affordability of such houses. South Africa’s foremost financial services company, FirstRand Limited has disclosed plans to invest proceeds of its $250 million fund raising exercise across major West and Southern African real estate markets, particularly Nigeria, Ghana and Angola.

VRA Guns For Shiroro Dam

By Samuel Boadi The Volta River Authority (VRA) would soon be operating Shiroro, one of Nigeria’s biggest dams with power generation capacity of 600 megawatts. This is expected to enhance VRA’s expansion drive since Nigeria was currently embarking on a massive privatization of its energy generation companies. The VRA, which has been invited to bid, has had to lose $50 million every month as a result of the lifting of crude oil from Nigeria to carry out its operations. This follows the shutdown of the West Africa Gas Pipeline since August, this year which has negatively impacted its operations. Kweku Awotwi, Chief Executive Officer (CEO) of VRA, who made this known, was delivering a speech at the biennial national congress of the VRA Senior Staff Association at Akosombo at the weekend. According to him, Ghana’s crude oil was not up to the specification needed by VRA in its operation. He added that despite the gas pipeline problem that had affected the VRA, it still made profits in 2011. The CEO said VRA posted a profit of about GH¢40 million in 2011, noting that it was an attainment which had not been recorded in many years. In order to bridge the power gap in the country’s energy supply due to the shutdown of the West Africa Gas Pipeline Company (WAGPCo), his outfit and the Social Security & National Insurance Trust (SSNIT) are collaborating to execute a project that will generate 300 megawatts of power by the end of 2012. He said despite the challenges, VRA was making strides to cooperate with its staff, indicating that his outfit would ensure that immediate measures were put in place to contain the situation.

EU Eyes Migration Pact With Ghana

By Samuel Boadi The European Union (EU) says it wants to establish a migration and stability programme with Ghana that will culminate in the development of Ghana and lead to higher growth in Europe. Claude Maerten, Head of Delegation of the European Union to Ghana, disclosed this in an interview with CITY & BUSINESS GUIDE Tuesday in Accra. “In Europe, we have situations in some economic sectors where we do not have enough manpower. We foresee that with the aging population in Europe, there would be the need to have manpower coming from other countries of the world. And so, we have considered some of this for Ghana. “It is very important that trained people living in Europe or the US, will have the opportunity to come back to Ghana if they want to work in Ghana or if they want to be part of the working force to make Ghana a middle-income country and society, be able to do that to save the lower end of the middle income. And I know that there are many Ghanaians there who might want to come. Migration is a tool for Europe and Ghana to share the benefits of mobility.” Commenting on Ghanaians who were not skilled but live in the Diaspora illegally, he noted: “People who are faced with illegal migration and travel to different parts of the world should not be treated with contempt. Maltreating them is against international human rights.” He noted: “On the relation between Europe and Africa, it is clearly one of the priorities of the EU to come up with a strong foreign policy. We have with Ghana and the rest of West Africa, a long standing relationship which is being governed by the Cotonou convention. We have for instance with Ghana a long-standing relationship that is multi-faceted. “We also have the EPA since 2007, more dialogue on migration and a new one which is being proposed by Europe which is called agenda on mobility and migration. We should soon start a working group to see what the working interests for Ghana and Europe are.” He said Ghana has been selected to continue enjoying external assistance from the EU between 2014 and 2020. He added that even though Ghana was working towards becoming a middle-income country, there would still be some sectors that need external assistance and therefore the reduction in development assistance will not register any significant difference. He said that investors in EU could nonetheless come over to Ghana to invest since foreign direct investment (FDI) was a private sector decision “so we have nothing to say to that. It is better to invest in any country of their choice.” The current situation in Europe will be the subject of a meeting among European leaders on 18th and 19th October, this year. It will start with the economic union compact for growth and job creation more importantly.

‘Pay Chirano Farmers, Sefwi Residents’ By Samuel Boadi Mike Hammah, Minister of Lands & Natural Resources, has given the Lands Valuation Board a two-week ultimatum to resolve issues regarding the payment of full compensation to some aggrieved farmers at Chirano and concerned citizens of Sefwi in the Western region. Mr. Hammah gave the directive yesterday in Accra when a group calling itself ‘Concerned Citizens of Sefwi’ and some affected farmers in the Chirano Gold Mines operational area, presented a protest note to him. Prince Eric Amoako Atta, spokesperson for the group, indicated that “the protest has become necessary because the frustration of farmers currently has reached bursting point.” According to him, the leadership of the affected farmers has come under immense pressure as a result of the long delay in getting the compensation paid. “The continuous building of the pressure threatens the existing process that aims at solving this impasse amicably with unpredictable but certainly disruptive consequences for the operations of the mining company.” The gold mines, Mr Amoako Atta noted, risks losing lands it took from farmers if the payment is not effected immediately in accordance with the recommendation of the Lands Valuation Division. On April 3, 2004, government granted Chirano Gold Mines Company Limited a mining lease after which it started gold production in 2005. Between 2004 and 2006, Chirano Gold Mines paid compensation to some farmers based on GH¢2.50 per matured cocoa tree after falsely presenting to the farmers who were mostly illiterate, a Government of Ghana approved compensation rate of GH¢2.30 per matured cocoa tree. But Government, in 2003, acting through the Lands Valuation Board, had approved a crop compensation rate of GH¢5.22. “We therefore took the matter which borders on fraudulent and deceitful actions by the company to the Sefwi Wiawso High Court in 2006. The company, knowing that it will lose the case requested for an out-of-court settlement. We peacefully agreed to the company’s request. “Unfortunately for us, the company did not stick to the process and deployed some delay mechanisms just to drag the process,” Mr Amoako Atta stated. In 2007, he said they had to send the issue to the Fast Track High Court in Accra. The case was pending before court in 2009 when the then Minister of Lands & Natural Resources intervened in the matter and initiated a process to get the matter settled out of court. The minister, in a letter dated May 17, 2012, advised Chirano Gold Mines to immediately pay all compensation assessed as provided in a payroll produced by the Lands Valuation Division taking due cognizance of earlier payments made in relation to the compensation claim. “But this advice has not been heeded by the company. Instead, it has, once more, reverted to its delay tactics and has been dragging its feet since then.” “We wrote the current minister on August 23, 2012 and urged him to take necessary actions which could include the withdrawal of the company’s licence to ensure immediate payment of the compensation-in- arrears. The situation has not changed much as our compensation-in-arrears continue to be in arrears while the company keeps digging gold.” The compensation-in-arrears seekers omitted 2010 because the company in September 2010 changed ownership from Red Back Mining Inc. to Kinross Gold Corporation, making data gathering from these companies extremely difficult.