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Africa Focused News


By Dario Galluccio

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Ghana: Nkrankwanta Area Rural Bank posts growth for 2012

The Nkrankwanta Area Rural Bank in the Dormaa-West District of the BrongAhafo Region last year posted a strong performance despite macro-economic challenges coupled with sluggish growth in the cocoa industry, which is the main economic activity in the operational territories of the Bank. Total assets of the Bank went up from approximately GH¢1.6million in 2011 to about GH¢2.7million in 2012, representing an increase of 68%. The bank’s 2012 investments saw a 67% increase to GH¢1,420,000 from the GH¢850,000 of the previous year. Short-term lending to government investments, especially in Treasury bills, remains the major income source for the bank.

Edmond Joseph Akomian, Chairman of the Board of Directors who announced this during the 4th Annual General Meeting of shareholders, attributed the small growth of the Bank’s profit to the low rate of Treasury bills, increased computerisation of its agencies, and poor performance of the special Akuafo Cheque system.

Kenya: CFC Stanbic Bank partners Aeolus to build wind power plant

Kenya’s CFC Stanbic Bank has partnered Aeolus Kenya (AKL) – a member of the Power Africa initiative led by the United States President Barack Obama- to build a Sh12.9 billion ($150 million) wind power plant in Kinangop, Kenya. The proposed power plant will be the largest wind power generation project to be built in sub-Saharan Africa to date, outside of South Africa. It is expected to come on line in mid-2015.

The wind project has already been registered under the United Nations’ Clean Development Mechanism.

The Kinangop Wind Plant which will provide electricity to approximately 150,000 Kenyan households, will add a further 60MW to Kenya’s 1,672MW national power grid.

According to CfC Stanbic Bank’s East Africa Head of Debt Solutions and Infrastructure Finance, Kwame Parker, “The project is designed to provide a clean source of electricity to Kenya. It will not only contribute to the social and economic development of Kenya, but will also significantly help ease the energy supply deficit that the country is grappling with.”

Ghana: Number 1 priority remains Cocoa

Vice President Paa Kwesi Bekoe Amissah-Arthur says the cocoa sector is still a top priority in government’s medium- to long-term growth plans despite the fortunes of the crop facing difficult times.

Mr. Amissah-Arthur said government remains committed to implementing a broad number of policy measures to support the cocoa sub-sector. These measures, he added, will in the long-term ensure efficiency through streamlining of activities, interventions and programmes and contribute to growth of the sector.

The Vice-President, speaking at this year’s Ghana Cocoa Festival in Accra, said the measures will help consolidate gains the country has made in the sector. He said an increase in local cocoa consumption will serve as a further boost to the sector.

COCOBOD recently announced an agreement with the Netherlands Embassy and three other institutions to stem the huge revenue losses arising out of the black-pod menace. The initiative, which has the Ghana Cocoa Growing Research Association Limited, Mars Incorporated and Mondelez International as partners, will make available over US$400million toward the production of new varieties of cocoa that can withstand the disease.

The crop has been a top foreign exchange earner for the country, grossing some US$2.8billion in export earnings in 2012, making it the third-highest foreign exchange earner after oil and gold.

Ghana: Improved energy will push forward growth

Mr. Emmanuel Armah Kofi Buah, Minister of Energy has said that the vigorous expansion of various energy programmes is to increase power production as well as support the growth and expansion of all the weak sectors of the national economy. He said government is rolling-out the various programmes and projects, particularly in the Western Region, as part of the energy expansion drive — which is geared toward positioning the sector to play the critical role expected for directing Ghana’s effort toward industrialisation.

Speaking at the World Tourism Day at Nkroful in the Ellembelle District of the Western Region, he noted that the country’s oil and gas sector is currently underdeveloped. According to him, the discovery of oil and gas in commercial quantities on the Western Region culminated in an influx of people — the stage is set for integrated tourism development in the region, so that instead of a potential threat from oil and gas activity to our environment, oil and gas activities will be made conducive to our situation and be a blessing to our environment.

Ghana: EU to support agriculture production

The European Union (EU) is to support Ghana to revolutionalise its agricultural production.

Mr Dacian Ciolos, EU Commissioner for Agriculture and Rural Development, who made this known in Accra, said the support would be in the form of financial and technical interventions.

“Agriculture is not only an economic issue, but also a social issue and this calls for the support,” he said. Stressing that the EU would take Ghana’s agricultural development objectives into consideration.

Dr Yemi Akinbamijo, Manager of Forum for Agricultural Research in Africa (FARA) said the partnership between EU and Ghana, which is under negotiation would take place from 2014- 2020. He said, it is a period for the promotion of agriculture and security.

Dr Akinbamijo said : agriculture would provide greater help to reduce poverty if done properly; pointing out that production, trading, finance, as well as infrastructure, education, science and technology and regional integration; are the seven pillars of FARA, which would be used to develop Ghana.

Africa: Standard Bank, Platinum Circle partner to provide business support

Standard Bank DRC, a member of Standard Bank Group, has agreed a strategic partnership with Platinum Circle – a Singapore-based business group – that will place Africa on the agenda of corporations, governments and intergovernmental organizations involved in the Future Global 100 (FG100) Initiative.

Launched in 2011 by Platinum Circle, the Initiative is a global program that shapes the future of the global economy, national markets, business and industries through the collective input of leaders from business, governments and intergovernmental organizations, gathering over 700 all-encompassing leaders to chart the Future Global Agenda.

Standard Bank will be working closely with Platinum Circle to anchor the FG100 Initiative in Africa and spearhead the Inaugural Africa Meeting in 2014, bringing top African leaders together with members of Platinum Circle worldwide including those in Singapore.

The strategic partnership between Standard Bank and Platinum Circle will pave the way for implementing the FG100 Initiative into Africa, by serving as an important forward- looking reference for foreign business and government leaders regarding Africa’s economic outlook and operating environment.

Ghana: GIPC investment drive gets results

Ghana’s energy challenges will soon witness a massive improvement as United States Energy Company Symbion power commits to construct a 450 megawatts of power in Ghana.

A memorandum to that effect has already been signed between Ghana and Symbion power. The realization of this agreement came to light after months of negotiation between Symbion and the Ghana Investment Promotion Center, whose chief executive, Mawuena Trebah, led.

Under the letter of Intent signed by the energy minister, Emmanuel Kofi Buah, and the chief executive officer of Symbion Power, Paul Hinks; Symbion power proposed to finance the establishment of a 450 megawatts combined cycle energy facility to meet the need of an expanded energy facility in Ghana. The Volta River Authority on its part on behalf of Ghana is expected to give prompt and fair consideration to the Symbion proposal within the requirements of the country’s laws and policy.

Ghana: Oil production hits 115,000 barrels daily

Daily oil production hit 115,000 barrels per day in June 2013, significantly higher than the projected average for the year, the African Center for Energy Policy (ACEP) report on Government Compliance with the Oil Revenue Management Act in the 2013 budget has revealed. Total oil revenue of GH¢1.15 billion also far exceeded the projected target by GH¢362.3 million.

The report urged government to initiate discussions with Sabre Oil and Gas to recover the capital gains tax from the sale of its stake in offshore blocks.

It also indicted the 2013 budget for failing to capture capital gains tax as one of the revenue streams. It added “the Petroleum Income Tax Law should be harmonized with the Internal Revenue Act.”

Released by the Executive Director of ACEP Mohammed Amin Adam, the report also said the projected transfers to the Ghana Petroleum Holding Fund will be exceeded when the data on petroleum is released.

Ghana: Government commits GH¢350 million towards road sector

Government has since June released GH¢ 350 million for the road sub-sector out of the GH¢ 706 million allocated in the 2013 budget. Alhaji Amin Amidu Sulemani, Minister of Roads and Highways, said the Ministry has also improved upon revenue generation into the Road Fund for maintenance works. The total fund accrued from January to June was GH¢ 126 million, an increase of GH¢ 9 million over the amount recorded during the same period in 2012.

Alhaji Sulemani, who made this known during the inauguration of the Progressive Road Contractors Association (PROCA), urged members as well as the Association of Road Contractors to unite for the growth of the industry.

Mrs Joana Adjei, National President of PROCA promised to run an open door policy as well as an all inclusive administration to make the association stronger. She said the new administration would help revive the training programmes of the Association.

Mrs Adjei said majority of contractors are suffering as a result of delayed payment for work done. Mr Michael Aidoo, the outgoing President of PROCA advised the new executives to take criticism in good faith.

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Africa Focused News


by Dario Galluccio

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Ghana: Inflation at 11.5% in August

The average change in prices of goods and services in the country, measured by inflation, dropped to 11.5 per cent in August after registering a consistent rise since January, this year. The August figure was 0.02 per cent lower than the 11.8 per cent recorded in July this year.

The drop was generally influenced by both the food and non-food groups. Some of the items in the two groups recorded drops and that impacted the whole rate.

Year-on-year inflation, which compares the change in prices of goods and services in one month against the corresponding one in the previous, has been on the rise since January, after ending last year on a record low of 8.8 per cent.

From 10.1 per cent in January, the rate rose to 10.9 per cent in April, before peaking at 11.8 last month. That consistent rise was mainly influenced by corresponding increases in prices of goods and services which was then triggered by a weakening exchange rate regime and an upward adjustment of prices of petroleum products.

The decline in the rate for August comes at a time the cedi is regaining strength against some of its main foreign counterparts, with prices of goods and services stabilising, albeit slowly.

Ghana: Commercial production, export of oil yields $1.4 billion revenue

According to the Minister of Energy and Petroleum, Mr Emmanuel Armah Kofi Buah, Ghana earned $1.4 billion from the commercial production and export of oil from 2011 to June 2013.

He said 77 million barrels of oil had been produced as of September 10, out of which about 13 million barrels, representing Ghana’s share, went to the Ghana National Petroleum Corporation (GNPC). The government invested the revenue in infrastructural development and other agreed purposes.

Mr Buah said the country earned $444.12 million in 2011, $541.07 million in 2012, while $422.76 million had been accrued as of the end of June 2013.

The country’s oil output was set to further increase with the recent signing of a plan of development for the Tweneboah, Enyenra and Ntomme (TEN) project and ongoing negotiations for the finalisation and signing of a plan for the development of the Sankofa oil and gas fields.

South Africa: South African life insurer sets aside $100m for african expansion

MMI Holdings, South Africa’s 3rd largest life insurer, said it has reserved 1 billion rand ($100 million) to fast-track its expansion push across Africa. The JSE-listed firm also earmarked 500 million rand ($50 million) for its short term insurance business as it purchased 70 percent of insurer Mauritian Eagle.

It plans to spend the entire funds on acquisitions in 12 countries outside South Africa where MMI operates with talks for another purchase already in place, though nothing concrete has been established at the moment.

This revelation follows the release of its year-end financial results, which showed some positive figures. Its operating divisions’ profit witnessed a 19 percent rise, while its diluted headline earnings – also a profit measurer – rose 10 percent to 3.2 billion rand ($322.9 million). Also the Value of new business went up 19 percent to R711 million ($71.7 million).

Africa: IFC invests $63m in affordable housing

The International Finance Corporation (IFC), the largest global development institution, said it had invested more than $63m in a housing solutions fund for the support and development of affordable housing in sub-Saharan Africa.

The International Housing Solutions (IHS) Fund II aims to address the need for housing across the continent and the lack of affordable housing. The first IHS fund has already committed more than 200$ million to providing affordable housing in emerging markets.

Speaking at a press conference in Johannesburg, Saleem Karimjee, IFC senior manager for Southern Africa, said services such as access to quality housing were a priority in Africa.

The National Housing Finance Corporation is working with the IFC, and CEO Samson Moraba said the corporation was delighted with the investment as it would accelerate the delivery of housing. Its mandate is to broaden access to affordable housing finance for low- to middle-income South African households.

Nigeria: Austria partner to boost trade and investment

Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and Austrian Federal Economic Chamber (AFEC), the apex chamber of commerce in Nigeria and Austria, have signed a Memorandum of Understanding that will help boost business and economic activities between the two countries. The MoU which was signed at the first Austrian-Nigerian business forum, in Lagos, will provide opportunity for the commerce industries to explore other ways of mutually beneficial relationship.

NACCIMA President, Alhaji Badaru Abubakar, who was represented by the Second Deputy National President, NACCIMA, Iyalode Alaba Lawson, in his delivery speech titled : “Foreign Direct Investment – A Global Strategy,” said Nigerian economy is too large to be ignored for Foreign Direct Investment as it holds the eighth largest population in the world, 10th largest oil and gas reserves, fourth largest equity market in the MSCI Frontier Market index, and home to a stable of large, well capitalised banks and emerging world’s largest cement companies. He however noted that despite the impressive data presented, Nigeria’s business and investment environment, like that of any other developing economies in the world, has its peculiar challenges.

Meanwhile, Austrian Ambassador to Nigeria, Joachim Oppinger, noted that Nigeria-Austria bilateral business is actually improving, adding that bilateral trade between Nigeria and Austria is in the range of 100 million euros in export.

Austria is one of the richest countries in the world with thriving manufacturing sector and a renowned know-how in the fields of renewable energy and environmental technology. It was recently ranked the 10th happiest nation in the 2013 World Happiness report.

Africa now part of EOH strategy

IT solutions provider, EOH, said it is poised to make Africa part of its strategy and get down to business on the continent. Asher Bohbot, the head of EOH, told this followed a decision taken a couple of months back at the company’s executive committee meeting.

Bohbot said the company had formed a structure that will look at Africa and it has identified a number of people that will be dedicated to Africa. This structure and the people’s main objective would be to pay more attention to the African continent.

He did not name the countries that the company was preparing to enter in the short term. But this was a surprising announcement in that not long ago the company had told its shareholders that it would be very cautious about Africa and take their time when it came to investing in Africa.

Africa: African Union invites Indian investment

Africa is seeking India’s technical support and experience as it moves towards building a contemporary continent, a top African Union (AU) official has said, saying more Indians should visit Africa and invest in Africa.

“For us to look at our future with confidence we need to address our needs. India is supporting us in this. We are seeking technical support and share of experience and nothing else,” AU Commission Chief of Staff Jean Baptiste Natama told IANS during a visit here.

Capacity building and value development of skills to help Africans better organise themselves is one of the major areas in which India is collaborating with the 54-nation continent, said Natama, who was here for a meeting on adopting the Plan of Action of the Enhanced Framework for Cooperation for the India-Africa Forum Summit-II (IAFS). Natama described the Indian Technical & Economic Cooperation Programme (ITEC), under which African nations get scholarships in India to study across various sectors including agriculture, as an example of South-South cooperation.

He said India and Africa are bound by historical ties. He said both sides need to regularly consult each other and make sure “we are promoting the interests of the two sides”. “We are calling for Indians to visit Africa, to learn more about Africa and to invest in Arica. We want to assure them they will always be welcome in Africa,” said Natama.

Africa: New Multi-Manager Fund to invest for income

Momentum Global Investment Management has launched a multi-manager fund investing in Africa’s fixed income markets. Aimed at institutional investors, the Africa Fixed Income Fund is managed by David Lashbrook, head of Africa investment strategies at Momentum Global Investment Management.

Running the fund on a multi-manager basis enables us to benefit from local market specialists and actively manage risk,” Lashbrook says. He will manage the fund using a range of complimentary underlying investment specialists based in the UK and across Africa.

Lashbrook says until recently, African fixed income markets north of the Limpopo, South Africa’s northernmost region, have typically been extremely small and generally of short duration.

Issues were usually “swallowed up” by local pension funds and insurance companies, which bought and “locked them away until maturity”, he says. “This is changing,” he adds.

Momentum Global Investment Management is a wholly owned subsidiary of South Africa-based financial services group MMI Holdings.

Africa should develop its own democracy

Mr Frederik Willem de Klerk, former President of the Republic of South Africa, said African countries might need to evolve their own special forms of democracy to suit the special needs of their people. He said: “I have the greatest admiration for both the American and British democracies but the point I am making is that they should not be so quick to pontificate to Africa”.

Mr de Klerk said this in Accra during the Institute of Economic Affairs (IEA) post Supreme Court verdict lecture on the theme: “Fostering peace, national cohesion and reconciliation after the ruling of the Supreme Court of Ghana”.

Former President de Klerk commended Ghana for being one of the first African countries to adopt a robust multiparty democracy since 1992.

Ghana: To revive bilateral agreement with Italy

Government would revive the Bilateral Agreement on Migration to enable Ghanaian workers in the Agricultural Sector work in Italy. Nii Armah Ashietey, Minister of Employment and Labour Relations (MELR) disclosed this to the Ghana News Agency (GNA) in Accra, after the Italian Ambassador Laura Carpini paid a courtesy call on him. He said plans were advanced to finalize the said Bilateral Agreement, which would enable Ghanaians to work legally in Italy.

He said the two countries have also discussed the expansion of circular migration programme, which would enable more Ghanaians to work in the Agriculture sector in Italy.

The Minister said the government of Italy has continually supported Ghana in its strides to manage and organize Labour Migration, saying “major efforts have been made which could not be swept under the carpet.”

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Africa Focused News


by Dario Galluccio

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Africa: UBA Launches Project Alpha

United Bank for Africa Plc (UBA), a pan-African Nigeria-based bank with operations in 19 African countries and New York, London and Paris, has announced the launch of Project Alpha – a 3 year route map of key transformation initiatives, designed to consolidate the Group’s strategic positioning and fully capture the opportunities from Africa’s economic renaissance and the Group’s unique platform. It is focused on leveraging all aspects of the Group’s footprint, product offerings and operational capability, allowing a commitment to customer service transformation, market share growth, implementation of key e-banking initiatives across all segments, the growth of corporate and trade finance capabilities and significant investment in the human capital represented by the 25,000 UBA workforce.

United Bank for Africa Plc is one of Africa’s leading financial institutions, offering banking services to more than 7 million customers across over 700 branches in 19 African countries. With presence in New York, London and Paris, UBA is connecting people and businesses across Africa through retail, commercial and corporate banking, innovative cross border payments and trade finance.

Ghana: Export fund to support non-traditional sector

The government has committed itself to use the Export Development, Agricultural and Industrial Fund (EDAIF) to accelerate the growth of the non-traditional export sub-sector to enable it play a more meaningful role in the expansion of the economy. It is also intended to give the needed support to the manufacturing sector and expand the resource envelope.

The government, through the Ministry of Trade and Industry, has put together a technical committee to review the law in order to define and crystallise the policy and legislative changes needed to make the fund more responsive to the requirements of the private sector in general and the export sector in particular.

The final report from the committee will inform government on optimal capitalisation and utilisation of the fund especially to provide support for the growth of the non-traditional export sector. It is also to help enhance foreign exchange generation through exports; support the growth of identifiable manufacturing companies with growth potential for targeted, specialised incentives and support, as part of the industrialisation drive.

The Export Development and Agricultural Investment Fund (EDAIF), an agency of the Ministry of Trade and Industry was established to provide financial resources for the development and promotion of the export trade of Ghana. Operation of the fund, however, started in July 2001. For the purpose of achieving the object of the fund, monies from the fund are available for; development and promotion of products for export; capacity building, market research and development of infrastructure; development and promotion of other entrepreneurial activities and the export trade-oriented activities of institutions and bodies.

The proposed revised bill is expected to include the following among others: expand resource envelope of EDAIF to include equity financing, support manufacturing sector and start-ups; facilitate acquisition and adoption of appropriate technology and innovative practices to enhance productivity and promote industrial development.

Ghana: To sign $314m transportation Aid with Chinese firm

All is set for work to begin on the Volta Lake Transport Company Limited (VLTC) as the company has signed a Memorandum of Understanding (MOU) with the China Shipbuilding and Offshore International Company Limited (CSOC), the contractor. The four-year improved works on the Volta Lake would cost $314 million.

Mr Erik Kweku Yarboi, Managing Director, VLTC, who signed for his outfit, said the project which formed part of the Eastern Corridor Multi Modal Transport project was being funded by the China Development Bank (CBD) with government of Ghana contributing 15 percent.

Mrs Dzifa Attivor, Minister of Transport, said the projects would not only enhance safety and improve services provided by the Lake but would also create employment for the youth in the catchment areas. She also said the projects would enable farmers, who are not able to transport their products from the hinterlands, to do so due to the construction of roads which formed part of the contract.

South Africa: Bank of China and Nedbank partner to boost trade

One of China’s big four state-owned lenders, Bank of China (BoC) and South Africa’s fourth biggest lender, Nedbank Group, have partnered to lift business between the two countries.

The partnership will assist BoC clients that want to inject money in South Africa and the rest of the continent.

The alliance will include currency exchange between the two banks. It will also provide more backing services to Chinese firms with businesses in Africa through the banks’ networks. There will also be an increased collaboration when it comes to injecting capital in infrastructure projects in southern Africa.

Ghana: Finance Minister Says Plan to Halve Deficit Succeeding

Ghana’s plan to trim its budget deficit by half over three years by containing public-sector pay increases and raising taxes is showing initial signs of success, Finance Minister Seth Terkper said. The government is on track to achieve its deficit-reduction target of 9 percent of gross domestic production this year from 12.1 percent in 2012 when spending rose in the run-up to elections.

As the economy grows faster than the sub-Saharan African average [expansion in West Africa’s second-largest economy is forecast at 6.9 percent this year versus 4.8 percent for the continent south of Sahara] and the government “moderates” salary increases for public servants, the fiscal gap is forecast to narrow to 5 percent and 6 percent of GDP by 2015, he said.

The world’s second-largest cocoa exporter and an oil-producing nation since 2010 is implementing austerity measures including the reduction of fuel and utility subsidies, combined with higher revenue by adding at least four new taxes. The state wants to lower the wage bill to between 30 percent and 35 percent of tax income by 2015 from 72 percent last year.

India-Africa ties energised with oil and other products

India and Africa are coming closer to each other faster than most realize. In the last few years India has diversified its energy procurement to African countries. In 2005, India did not import any oil from African countries. Just eight years later, more than 20 per cent of India’s oil and gas imports are from Africa. While much is being traded, India has also begun investing in the energy sector in Africa.

State-run Oil and Natural Gas Corporation (ONGC) has just acquired a 10 per cent stake in an offshore gas field of Anadarko Petroleum Corp in Mozambique for $2.64 billion.It’s not just Mozambique. India has increased its purchase of oil and gas from a range of African countries. The biggest sellers of petroleum products to India from the continent are Nigeria, South Africa, Angola, Egypt, Algeria and Morocco.

Within Africa also, India’s overall economic relationship is changing. In 2001 Southern Africa accounted for nearly 60 per cent of exports to India while West Africa accounted for just above 16 per cent. Now West Africa is the largest supplier with a share of 40 per cent, while the share of Southern Africa is 24 per cent.

A recent report by Confederation of Indian Industry has an interesting nugget. Investment from Africa to India is growing. “Morocco and South Africa are the next largest investors in India with investments worth US$137 million and US$112 million, respectively.While the figures may not appear high, this is a beginning of an important development. The growing economic interdependence of India and African countries will add confidence to their dealings with the rest of the world.

Ghana: Will take advantage of Japan’s $32b for Africa

The Minister of Energy and Petroleum, Emmanuel Armah Kofi-Buah, has disclosed Ghana’s willingness to take advantage of the Japanese government’s proposed $32billion intended to support developing economies in Africa in areas of infrastructure development and energy to improve living standards in the region.

Hon Kofi-Buah who made the disclosure during a courtesy call on him by delegation from Sojitz Corporation, a Japanese company undertaking the $125 million seawater desalination project in Nungua, Accra to discuss progress of the project and other investments opportunities in the Energy sector, noted that Ghana’s excellent relationship with Japan could be further strengthened with increase investments.

The Teshie project, which will begin commercial operations in 2014, is expected to supply 60,000 m3 of drinking water to about 600,000 people in Teshie and surrounding communities. The desalinated water will be sold to Ghana Water Company Limited (GWCL) under a long term water sales contract of 25 years to ensure stable provision of drinking water on a long-term basis in the capital. The project is the first desalination project in sub-Saharan Africa, and also the first investment by a Japanese corporation in Africa.

South Africa: Africa’s biggest gold mining union begins strike

The National Union of Mineworkers, representing almost two-thirds of gold miners in South Africa, began a strike over a wage dispute. The companies had made a final offer to raise the pay of about 140,000 workers by 6 percent to 6.5 percent, whereas the NUM wants as much as a 60 percent increase in starting salaries.

Strikes may cost the industry about 349 million rand ($34 million) a day in revenue, with the total cost of the action including lost wages and taxes reaching 597 million rand a day.

Entry-level underground miners earn 5,000 rand a month before housing allowances and bonuses and the NUM is seeking a jump to 8,000 rand, the Association of Mineworkers and Construction Union, the second-biggest labor group representing gold miners, is demanding an increase to 12,500 rand a month, and Solidarity wants an 8.3 percent gain. UASA, a group that represents almost 7 percent of gold miners, is the only union that said it’s ready to take the employers’ offer.

Ghana: To consolidate its middle-income status with bonds

Ghana’s Finance Minister Seth Terkper says it is prudent to finance the capital component of the national budget with long-term bonds as the country consolidates its middle-income status. According to the Finance Minister, it is important for the country to develop its local capital market more especially to mobilize funds to finance the infrastructural gaps which constrains the development efforts of Ghana.

According to the African Development Bank‘s Financial Markets Initiative, Africa as a whole requires about $20 billion in infrastructure investment per year which can only be sustainably financed through long-term bonds. In Ghana alone, Mr Terkper says “our estimation is that the required financing gap is about $1.2 billion a year”.

Mr Terkper argues that a well-developed local bond market is critical in Government’s ability to mobilize the necessary funds to support capital expenditures. He added that such markets are necessary for enhanced financial stability and better integration in the global financial landscape.

Zimbabwe: SA firm plans investment bank

South Africa-based company JM Busha Investments plans to set up an investment bank in Zimbabwe in a bid to expand its business in the region. Group managing director Joseph Busha told New Ziana that the company would be engaging relevant authorities over the matter after the country’s new cabinet was appointed.

Busha said most Zimbabweans had money but were not investing in the country, opting to channel their capital elsewhere. JM Busha Investments currently has operations in South Africa and Zambia.

An investment bank is a financial institution that assists individuals, corporations, and governments in raising capital by underwriting and or acting as an agent in the issuance of securities.

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Ghana: US$1bn Eurobond listed on Ghana Stock Exchange

The government has successfully listed the US$1 billion Eurobond issued earlier this month on the Ghana Stock Exchange. This makes it the first Eurobond to be listed on the exchange of a country in sub-Saharan Africa (SSA). The bond is now being traded on the Irish Stock Exchange (ISE) at a rate of 8.17 per cent.

The Minister of Finance and Economic Planning, Mr Seth Terkper, symbolically listed the bond on the GSE, making it possible for foreign and domestic investors to buy and trade in the Eurobond on the Accra bourse. This is expected to help increase investor appetite on the local bourse while deepening capital market activities in the country in general.

Mr Terkper, who led a team of experts from the country to issue the bond on July 25, said the listing and subsequent trading of the bond on the GSE added to government’s commitment to develop the capital market. The country requires an estimated US$1.2 billion annually to fund its infrastructural needs, and the minister is confident a well-developed capital market would help mobilise the needed funds to support these capital expenditures.

Nigeria: Stakeholders demand listing of nigerian Telcos

Stakeholders in the Nigerian telecommunications industry are canvassing for telecoms firm to be listed on the Nigeria Stock Exchange (NSE). President of the National Association of Telecommunication Subscribers (NATCOMS), Deolu Ogunbanjo, told the News Agency of Nigeria (NAN) that it is imperative for telecoms company to be listed so that that they can service and enhance ownership base of the respective organisations.

Ogunbanjo believes quoting the companies on the stock exchange would broaden investment in the sector. “Nigerians will love to also invest their money in the success recorded by the telecoms firms in the last 13 years of the country’s telecoms revolution,” Ogunbanjo said.

He added that the move will enable Telecoms firms have access to public funds that can be used in expanding, consequently bringing an end to the lingering poor services.

Nigeria’s Minister of Communications Technology, Omobola Johnson is also optimistic about listing telecoms firms on the bourse. She said it is appropriate that many more Nigerians should benefit from the success recorded by the Nigerian telecoms industry.According to her, the telecoms sector is the fastest growing sector of the Nigerian economy, and has been for the last five years, growing year on year at an average of 22- 23 percent and contributing 8.3 percent to Gross Domestic Product (GDP) as at second quarter 2013.

Ghana: 170 percent oversubscription of Ghana’s first 7 year bond

The Government of Ghana through the Ministry of Finance and Economic Planning sold its first seven-year bond and it was over-subscribed by 170%. Government received GH¢ 270 million Ghana cedi offers from local and foreign investors but took GH¢102 million cedis. It would be paying those who participated in the bids, an interest or a yield of 17.5%. Most of the bids that government is likely to accept are from local investors.

Proceeds from the bond, would be used to finance infrastructure projects and settle some maturing debts. Government is however expected to receive the money by next Monday.

Ghana: AFD says it will keeps to financing power projects in Ghana

Mr. Yves Boudot, Director of Agence Francaise de Development (AFD) for Africa, said his office would continue to finance power projects in Ghana. He said the AFD had a wide range of financing options to support government’s efforts at achieving its power sector objectives.

A statement made available to the Ghana News Agency in Accra, by the Ministry of Energy and Petroleum, said Mr. Boudot made the promise at a meeting with the sector Minister, Mr Emmanuel Armah-Kofi Buah. Mr. Boudot said the AFD had demonstrated that efficient public companies could have access to direct international financing without state guarantee.

AFD is financing the reinforcement and extension of the power grid in Northern Ghana and Burkina Faso, which would allow the Ghanaian national electricity transmission company, GRIDCO to scale up development in the region”, the statement said. It added that the extension of power grid in Northern Ghana would have substantial economic, political and environmental benefits for the West African sub-region.

The programme’s main objective is to make Ghana’s existing power grid more reliable, and to scale up its capacity by reducing the current imbalance between the North and South of the country and support the development of Northern Ghana”, it noted.

Mr Buah, the sector Minister, said the relationship between Ghana and France would continue to grow from strength to strength, recalling the visit by President John Mahama to France.

Nigeria: AFC co-arranges $215m financing for Ughelli Power

Africa Finance Corporation (AFC) in conjunction with some Nigerian banks has provided a USD 215 million debt financing facility for the acquisition of Ughelli Power Plc.

Ughelli Power Plc is a gas fired thermal power plant acquired by Transnational Corporation of Nigeria Plc (Transcorp) in the first round of the Federal Government of Nigeria’s privatisation of power generation assets formerly owned by the Power Holding Company of Nigeria (PHCN). Ughelli Power Plc was incorporated in 2005, is situated in Delta State and has an installed capacity of approximately 900MW.

AFC, a multilateral finance institution established in 2007, was created to address the infrastructure investment deficit and as an African private sector investment solution, to drive economic growth and industrial development in Africa.

Commenting on the deal, Andrew Alli, President & CEO of AFC, said “AFC’s long term vision is to help address Africa’s infrastructure deficit and ensure sustainable economic growth for the continent. Growth of the Nigerian economy cannot be fully realised without an efficient and functioning power sector. Power is one of AFC’s high priority sectors for investment, and arguably Africa’s most significant need.

Ghana: WB committed to strengthening partnership

The World Bank says it is committed to strengthening its partnership with Ghana. According to the Bank, the architectural work of its new office in Accra, underscores its determination to continue with its pursuit of openness and accountability in its dealings with Ghana.

These assurances were given by Yusupha Crookes, World Bank Resident Representative in Ghana, during the commissioning of the Bank’s new office, located off the Independence Avenue, Accra. “I see the new building as a partial materialization of the Bank’s commitment to work as one institution and as a strong statement of dedication to our partnership with Ghana. The transparent glass exterior should be seen as our invitation to our clients, government and the general public to expect not only more efficient, one-stop service, but also to expect a more open, frank and accountable World Bank Group.”

The IFC Vice President for Sub-Saharan Africa, Latin America and the Carribean, Jean-Phillipe Prosper observed that the World Bank had provided more than $8 billion in funding to help the Government of Ghana to deliver services and build institutions. Similarly, the IFC had provided private sector investment of more than $2 billion within the past two fiscal years.

South Africa: Murray & Roberts set to acquire Austrialian construction firm

JSE-listed construction firm, Murray & Roberts, said it had concluded the due diligence audit in Australia’s construction firm, Clough Limited. Among South Africa’s top three biggest construction firms, Murray & Roberts wants to increase its stake in Clough to more than 61.6 percent it currently owns in the company. It wants to acquire the remaining 38.4 percent in the company and could make a R4.3 billion (A$461.4 million) payment for the shareholding.

Murray & Roberts also said independent directors of the targeted company had asked shareholders to back up the proposed transaction. If the deal goes ahead, Murray & Roberts will own 100 percent of Clough.

The construction firm has offered to recompense minority investors in Clough A$1.46 cash a share.

Africa: China’s investment in Africa increases 20.5% annually

China has been striving to enhance the investment in and financial cooperation with African countries, to improve the quality and level of China-Africa cooperation. China’s direct investment in Africa increased from 1.44 billion U.S. dollars to 2.52 billion U.S. dollars, with an annual growth of 20.5 percent from 2009 to 2012, says the paper on Sino-Africa economic and trade cooperation published by the Information Office of the State Council.

Currently, over 2,000 Chinese enterprises have invested in more than 50 African countries and regions, covering the industries such as traditional agriculture, mining, construction, resource product processing, industrial manufacturing, finance, commercial logistics and real estate.

By the end of 2012, China had signed bilateral investment treaties (BIT) with 32 African countries, and established joint economic commission mechanisms with 45 African countries.

At the 4th FOCAC Ministerial Conference in 2009, China announced the establishment of a special loan for small and medium-sized African businesses, of which the contract loans totalled 1.03 billion U.S. dollars by the end of 2012, with 666 million already granted. As a key investment sector, China’s manufacturing enterprises had directly invested 1.33 billion U.S. dollars in the 2009-2012 period towards African countries, including Mali, Ethiopia and other countries lack in resources.

Meanwhile, African enterprises started increasing the investment in China as Africa’s economic growth strengthened recently. Africa’s direct investment in China stood at 14.24 billion U.S. dollars by the end of 2012, up 44 percent from 2009.

Ghana: India-Ghana trade hits record $1.2b

Trade between India and Ghana has crossed the $1 billion mark, reaching $1.2 billion at the end of 2012, an increase of over 63 percent over the previous year. India’s exports to Ghana stood at about $800 million against imports of about $404 million.

A statement from the Indian High Commission said, “For the first time, the total trade between the two countries has crossed $1 billion and there exists much more potential to take the India-Ghana commercial engagement further to mutual advantage”.

The statement said India’s export strategy is aimed at helping Ghana establish developmental projects with a combination of investments, grants and loans, complemented by projects and exports to provide inputs for these projects and not to dump cheap products. It said these projects are undertaken under proposals authored by the Ghana government, according to its own development priorities, adding, “Where technology and knowledge-based items such as pharmaceuticals are exported from India, these are meant to bring down the cost of life-saving drugs and equipment.

The statement said India has so far extended and approved $230 million in credit lines to support various projects in Ghana including the construction of the Flagstaff House Presidential Palace, establishment of a Foreign Policy Training Institute and financing a rural electrification project. Other projects, it said, are the supply of agricultural and irrigation equipment, a fish processing plant and supply of waste management equipment.

Nigeria: Nigerian billionaire Aliko Dangote to borrow $3.3 billion for refinery project

Dangote Group, the West African conglomerate founded by Africa’s richest man, Aliko Dangote, has announced plans to borrow an additional $3.3 billion to invest in a $9 billion oil refinery and petrochemical complex in Nigeria.

According to a company official, a consortium of local and foreign banks will finance the project. The Dangote Group and the consortium of financial institutions will officially sign the term loan agreements on Wednesday, September 4.

The refinery, which will be located at the Olokola Liquefied Natural Gas (OKLNG) Free Trade Zone in Nigeria’s southwest region, will be Nigeria’s first private and Africa’s largest petroleum refinery, with a projected daily production output of 400,000 barrels a day. The refinery is expected to decrease Nigeria’s dependence on oil imports and boost Aliko Dangote’s fortune significantly in the medium to long term.

The refinery is expected to be fully operational by 2016.

Ghana: John Mahama remains President, Supreme Court affirms

The Supreme Court has upheld the validity of President John Mahama’s election as President of the Republic of Ghana, a decision of the court pronounced moments ago has affirmed.

Justice William Atuguba, presiding, read the decision as the parties sat attentively in open court.

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Tanzania: TIC registers 106 projects in Kilimanjaro

Tanzania Investment Centre (TIC) has registered 106 projects in Kilimanjaro Region, between January 2008 and December last year, with a total value of 265.26 million US dollars, TIC Acting Northern Zonal Manager, Mr George Mukono revealed

He said that the projects created 8,646 jobs and he mentioned the sectors involved: agriculture (11), commercial buildings (4), human resources (9), manufacturing (28), tourism (47) and transportation (7). According to Mr Mukono, the manufacturing sector employed 2,439 people, followed by the following sectors: agriculture (2,427), tourism (2,315), human resources (887), transportation (417) and commercial buildings (161).

He mentioned lack of water for agricultural activities and difficulties involved in acquiring water rights and scarcity of land for agricultural purposes as some of the challenges facing potential investors in Kilimanjaro Region. Other challenges include lack of industrial sites as well as real estate development sites, power rationing, lack of investment and reliable market and transportation of vegetable crops and flowers as well as other crops.

Tanzania: Stanbic Bank records 30% income growth

Stanbic Bank Tanzania has recorded a 30 per cent increase in its total income growth as compared to the same period last year. According to a statement released by the bank, the financial performance of the bank for the second quarter of 2013 is considered good in terms of total income earned and cost management. The statement shows that the growth was mainly caused by the increase in the net interest income by 6 per cent despite the increased cost of funding that the banking industry is currently facing.

Ghana: “Innovate to survive” – Bank of Ghana urges banks

The First Deputy Governor of the Bank of Ghana, Mr Millison Narh, has charged financial institutions to continually re-engineer their operations in order to stay relevant in a competitive environment. He said the stiff competition in the financial services sector meant that institutions which must survive should introduce innovative strategies and products to attract, delight and retain customers. The deputy governor also advised financial institutions not to throw risk management to the dogs as they would increase their appetite for risk in response to pressures from the market, saying ‘the temptation to shift to relaxed financial and operational prudence behaviour has the potential to sow the seed for the demise of an institution.’

A deputy minister of Finance, Nana Ato Forson, for his part, affirmed the vast contribution financial institutions had made to the economic development of the country, especially in education, health, agricultural and the informal sector. He said recognising the high percentage of the informal sector much was expected to be done to support the sector as the economy grew from a lower middle income to the higher brackets of middle income status.

It was in that regard that the government was urging banks and non-bank financial institutions to partner other credit providers to pay more attention to the informal sector and make credit more affordable and accessible to that segment of the economy.

Ghana: For 2nd year running, Kuapa Kokoo sustains profit

For the second year running, Kuapa Kokoo Limited posted positive financial outlook, after turning its first profit last year. The only licensed cocoa buying company owned by Ghanaian farmers had been recording loses for five consecutive years, since 2006.

Executive Director, Emmanuel Arthur attributes the improved performance to farmers’ commitment to supply cocoa beans to meet needs of the company.

Ghana: ACEP calls for Breaking of Ghana Gas Company’s monopoly

The natural monopoly of the Ghana National Gas Company (GNGC) should be broken to allow for competition in the distribution and marketing of the country’s own natural gas, the Africa Centre for Energy Policy (ACEP) has said.

GNGC should not be responsible for buying and selling gas. Gas purchases should be opened to marketers, and producers should be free to enter into gas sales arrangements with marketers and bulk consumers. Thus, some bulk consumers can be connected directly to the transportation network.’

The suggestion is contained in a gas policy option paper ACEP has presented to the Energy Ministry to aid the development of a national gas policy.

As it stands now, the GNGC has been mandated to build and own pipelines; buy, transport and sell gas. The national gas company therefore has exclusive right across the supply chain.

Ghana: BoG increases minimum capital for new banks

The Bank of Ghana increases minimum capital for new banks:

  • Commercial Banks who want to start businesses in Ghana would soon be required to have a minimum capital of 120 million cedis;
  • Rural banks are also required to have a stated capital of 300 thousand cedis, an up from 150 thousand;
  • Non-bank financial institutions would also have to up their capital by as much as 100 percent – 15 million cedis.

The First Deputy Governor of the Bank Ghana, Millison Narh, announced this at Ghana Association of Bankers Business, explaining that the increments have been done to ensure a strong financial system to support the real sector of the economy.

He also added that these increases are necessary in order to provide the institutions with the muscle to undertake big-ticket deals to support the growth of the private sector and to further serve as a capital cushion for absorbing unexpected losses that may arise in the normal course of business.

Tanzania: Balance of Payment figures continue to improve

The overall balance of payments in the year ending June this year recorded a surplus of US$ 449.1 million (about 718.56bn/-) compared to US$ 209.1 million (334.56) of the corresponding period in 2012. The Bank of Tanzania (BoT) said in its monthly economic review for July that the outstanding performance emanated from the net inflows recorded in capital and financial accounts.

Consequently, the gross official reserves amounted to US$ 4,353.5 million (6.96tri/-) sufficient to cover 4.3 months of projected imports of goods and services excluding those financed by foreign direct investment, the bank said.

The value of traditional exports increased mainly on account of higher export volumes of coffee and cotton associated with good weather conditions in the growing areas coupled with good prices offered in the preceding years.

Also in the period under review, the value of non-traditional exports notably gold declined, following a decrease in export volume and average unit export price. The volume of gold exported was about 36 tonnes compared with about 40 tonnes recorded in the year ending June 2012, while average unit export price declined by 3.6 per cent to US$ 1,610.7 (2.57m/-) per troy ounce.

Nonetheless, gold and manufactured goods continued to account for the largest share in total non-traditional exports. The value of diamond exports rose following an increase in production associated with the completion of major rehabilitation of the Williamson Diamond Mine treatment plant.

Ethiopia: H&M will leverage on low cost clothing industry

World’s second biggest fashion retailer, Hennes & Mauritz (H&M), plans to make clothing in Ethiopia.

The company targeted Ethiopia because it would costs less to make clothing in the East African hub which is also one of the fastest-growing economies on the continent. The move was driven by an increasing number of clothing stores the company has to stock up with its brands as it starts operations in more countries.

H&M planned to set up shop in Johannesburg, South Africa, and it is currently present in over 40 countries.

South Africa: Rosatom promises over 15,000 jobs

Russian state-owned nuclear company, Rosatom, says it would create more than 15,000 jobs in association with stakeholders of the South African nuclear program.

Speaking at the annual industry convention of the Nuclear Industry Association of South Africa (NIASA) on Wednesday, Boris Arseev, the Vice-President of JSC Rusatom Overseas (a subsidiary of Rosatom), said, “Implementation of the South African nuclear generation development program together with Rosatom would allow to create 15,000 additional jobs in construction, service and operation of the new units, as well as several thousands of jobs in related industries.”

He also said the program will increase the income of South African enterprises by $15 billion and an additional $3.5 billion in budget revenue.

Africa’s largest economy is planning to expand its nuclear energy sector and Rosatom is bidding for the construction of six South African power units with a total installed capacity of 9.6 GW.

Ivory Cosat: MTN extends cloud services

African telecommunication multinational, MTN, has announced a bouquet of cloud services in Cote d’Ivoire, as it aims to establish itself as the frontrunner in the delivery of digital services to customers. The introduction follows successful launches in Nigeria and Ghana in April, with plans for further roll outs in three other countries including Uganda, Cameroon and South Africa, already gathering pace.

The service, which provides business automation tools to enterprises across professional services, micro-finance, health and small and medium enterprises (SMEs) sectors, aims to promote businesses by providing technical support for a sustainable growth and development.

The uptake in Ghana and Nigeria has been positive. We are optimistic that MTN Cloud will receive a similar response in Cote d’Ivoire, and in the other markets when it’s launched,” says Pieter Verkade, MTN Group Chief Commercial Officer.

Ghana: Chinese firm will invest in power sector

A Chinese electric company, Shandong Electric Power Construction Corporation (SEPCOIII), has promised to enter the Ghanaian market and assist the government to meet its power generation target. Zhang Huanxiang, Vice-President and Chief Engineer of the company, made this promise during a meeting with Ghana’s Minister for Energy and Petroleum, Emmanuel Armah-Kofi Buah.

The West African cocoa, gold and oil producer targets to expand its generating capacity to 5000 Mega Watts (MW) by 2016 through a mix of gas and steam-powered thermals, hydro-generation and renewable energy sources.

We chose Ghana because of its political stability and hospitality which is noted worldwide,” Zhang explained.

Welcoming the delegation, the energy minister expressed excitement about the choice of Ghana by the company as its investment destination, promising a congenial business environment. “Ghana is on course to achieve the targeted power generation capacity of 5000 megawatts by 2016,” Buah stated.