THE Constitution Review Commission (CRC) has recommended that presidential and parliamentary elections be conducted in November in subsequent election years after 2012 to facilitate smooth transitional processes.
The commission further proposed the expunging of the indemnity clauses of the 1992 Constitution which provide coup makers immunity from prosecution.
The recommendations are contained in the final report of the CRC after two years of consultations on the amendment of the 1992 Constitution.
The 1,000-page report is expected to be presented to the President, Professor John Evans Atta Mills, on December 12, 2011.
According to a source close to the CRC, after the document had been presented to the President, there would be the possibility of a referendum to amend some of the entrenched clauses in the 1992 Constitution.
Among other key recommendations are the removal of the death penalty from the country’s statutes and the establishment of the National Development Planning Commission on non-partisan basis.
Criminalising homosexuality ( gay activities and lesbianism), which received an overwhelming endorsement during the consultative process, is also part of the proposals of the final report.
After 20 years of operating the 1992 Constitution, President Mills set in motion the process to review the strengths and weakenesses of the Fourth Republican Constitution to reflect the current demands of governance.
The commission, inaugurated in January, 2010, was mandated to collate views of Ghanaians and articulate the concerns of the people on amendments that might be required for a comprehensive review.
The commission was expected to make recommendations to the government for consideration and provide a draft bill for possible amendments to the Constitution.
In that effect, the National Constitution Conference was held in April, this year, to deliberate on 12 thematic areas, including executive and legislative powers, judiciary and legal sector, and lands and natural resources.
The source indicated that the probability of a referendum being conducted to amend such entrenched positions in the 1992 Constitution was about 95 per cent.
It said another key recommendation was that the position of Metropolitan, District and Municipal Chief Executives (M/DCEs) should be an elected one on partisan lines to curtail political influence, thereby deepening the decentralisation process and reducing corruption across the board.
SOURCE: Della Russel Ocloo, Daily Graphic, Tue Nov 29, 2011.
Tuesday, November 29, 2011
Thursday, November 24, 2011
TWO HUNDRED EMPLOYEES OF BANK OF AFRICA TO BE LAID OFF
About two hundred employees of Bank of Africa, BoA Ghana are to be laid-off by March next year.
The process which is already underway would however not necessarily affect only Junior staff.
That’s according to management which adds the move is aimed at streamlining the bank’s operations for enhanced service-delivery to customers.
Chief Executive, Kobby Andah told Joy Business, the retrenchment exercise has been necessitated by the bank’s operational model also following the acquisition of Amal Bank earlier this year.
SOURCE: Joy Business (myjoyonline.com)
The process which is already underway would however not necessarily affect only Junior staff.
That’s according to management which adds the move is aimed at streamlining the bank’s operations for enhanced service-delivery to customers.
Chief Executive, Kobby Andah told Joy Business, the retrenchment exercise has been necessitated by the bank’s operational model also following the acquisition of Amal Bank earlier this year.
SOURCE: Joy Business (myjoyonline.com)
PETROLEUM COMMISION BOARD INAUGURATED
A SEVEN-MEMBER governing board of the Petroleum Commission (PC) mandated to promote sustainable and cost-efficient petroleum activities locally was inaugurated in Accra yesterday.
The board chaired by a retired Vice Chancellor of the University of Ghana, Professor Ivan Addae-Mensah, has a former Deputy Energy Minister, Dr Kwabena Donkor, who has since assumed post as the Chief Executive Officer (CEO) of the Petroleum Commission, as a member.
Others include Professor David Atta Peters, a lecturer at the University of Ghana; Mr Bishop Akologo, a representative of the civil society group; Mr Kwame Pianim, an economist; Ms Victoria Emefa Headcastle, a legal practitioner; and Mr Daniel Amlalo, acting Director of the Environmental Protection Agency (EPA).
Administering the oath of secrecy, the Minister of Energy, Dr Joe Oteng-Adjei, said the establishment of the commission was in response to Article 269 of the 1992 Constitution which required the establishment of the commission.
According to him, the board would be responsible for setting up the commission’s operational programmes and targets in line with the overall objectives of government policy directives.
“I am confident the governing board would not fail in its responsibility of assisting government in turning the fortunes of the country around using oil and gas resources,” Dr Oteng Adjei said.
He charged the board not to restrict itself to issuing broad policy guidelines, approving operational targets and ensuring efficient management of resources to achieve targets.
The minister also challenged them to be conversant with the government’s guidelines and circulars defining relationship among the boards, management and the government, and expressed the hope that the rich background of members would adequately ensure a fulfilment of the government’s mandate to the people.
The chairman of the board, Professor Addae-Mensah, on behalf of the board indicated that the discovery of oil had raised the expectations with the people wanting to see revenues from their natural resources manifesting in their lives and the general development of the country.
According to him, managing the petroleum industry the world over has remained a daunting task, hence the need to ensure decisions reflect the tenets of laid down regulations.
While expressing appreciation to President Mills for the opportunity offered them to serve the country, Professor Addae-Mensah gave an assurance that the board would take decision in the best interest of the people.
Present at the ceremony were a Deputy Information Minister, Mr Samuel Okudjeto-Ablakwa, the Chief Executive of the Ghana National Petroleum Corporation, Nana Boakye Asafu-Adjaye, and Mr Kofi Armah-Buah, a Deputy Minister of Energy.
SOURCE: Della Russel Ocloo, Daily Graphic, Thur Nov 23, 2011
The board chaired by a retired Vice Chancellor of the University of Ghana, Professor Ivan Addae-Mensah, has a former Deputy Energy Minister, Dr Kwabena Donkor, who has since assumed post as the Chief Executive Officer (CEO) of the Petroleum Commission, as a member.
Others include Professor David Atta Peters, a lecturer at the University of Ghana; Mr Bishop Akologo, a representative of the civil society group; Mr Kwame Pianim, an economist; Ms Victoria Emefa Headcastle, a legal practitioner; and Mr Daniel Amlalo, acting Director of the Environmental Protection Agency (EPA).
Administering the oath of secrecy, the Minister of Energy, Dr Joe Oteng-Adjei, said the establishment of the commission was in response to Article 269 of the 1992 Constitution which required the establishment of the commission.
According to him, the board would be responsible for setting up the commission’s operational programmes and targets in line with the overall objectives of government policy directives.
“I am confident the governing board would not fail in its responsibility of assisting government in turning the fortunes of the country around using oil and gas resources,” Dr Oteng Adjei said.
He charged the board not to restrict itself to issuing broad policy guidelines, approving operational targets and ensuring efficient management of resources to achieve targets.
The minister also challenged them to be conversant with the government’s guidelines and circulars defining relationship among the boards, management and the government, and expressed the hope that the rich background of members would adequately ensure a fulfilment of the government’s mandate to the people.
The chairman of the board, Professor Addae-Mensah, on behalf of the board indicated that the discovery of oil had raised the expectations with the people wanting to see revenues from their natural resources manifesting in their lives and the general development of the country.
According to him, managing the petroleum industry the world over has remained a daunting task, hence the need to ensure decisions reflect the tenets of laid down regulations.
While expressing appreciation to President Mills for the opportunity offered them to serve the country, Professor Addae-Mensah gave an assurance that the board would take decision in the best interest of the people.
Present at the ceremony were a Deputy Information Minister, Mr Samuel Okudjeto-Ablakwa, the Chief Executive of the Ghana National Petroleum Corporation, Nana Boakye Asafu-Adjaye, and Mr Kofi Armah-Buah, a Deputy Minister of Energy.
SOURCE: Della Russel Ocloo, Daily Graphic, Thur Nov 23, 2011
YELLOW FEVER IMMUNISATION BEGINS IN 43 DISTRICTS
MASS immunisation against yellow fever began yesterday in 43 metropolitan, municipal and district assemblies across the country described as high-risk zones.
The aim of the exercise is to protect Ghanaians against the dreadful disease which currently does not have any treatment.
Communities in Tema, Ledzokuku, Krowor and parts of the Accra metropolis and the Upper West Region are to benefit from the exercise, which has targeted 1.9 million people.
The one-week exercise, being undertaken by officials of the Ghana Health Service (GHS), has become necessary following the discovery of three yellow fever cases in the Upper West Region recently.
The Deputy Director of Public Health at the Greater Accra Regional Health Administration, Dr Edward Antwi, said Ghanaians above 10 years in all the selected regions, except the Upper West Region, where immunisation is given to those from age one, qualified to go for the immunisation, which is free of charge during the one-week campaign period.
After the one week, however, it will cost GHc10 to get immunised.
“ Yellow fever is an acute viral haemorrhagic disease transmitted by infected mosquitoes to humans.
Up to 50 per cent of severely affected persons without treatment will die from yellow fever,” Dr Antwi stated, and explained that the disease did not have any treatment, as only supportive treatment, such as oral rehydration, rest, blood transfusion and dialysis for those who get kidney failure, was available.
“It’s a dreadful disease and every one in the selected areas must turn up for the immunisation,” Dr Antwi.
The Greater Accra Regional Disease Control Officer, Mr Daniel Ato Ashon, told the Daily Graphic that the exercise took off simultaneously in all four sub-metropolitan areas — La, Ayawaso, Osu Klottey and Ashiedu Keteku.
At the Adabraka Polyclinic, 152 people had been immunised as of 1:40 p.m. when the Daily Graphic team visited the facility.
Mr Ashon, who described attendance as impressive, explained that it would take 10 days for the vaccination to start working, while anybody who got vaccinated would be free from the disease for a period of 10 years.
He expressed optimism that the public would warm up to the exercise to ensure its success.
From Tamale, Nurudeen Salifu reports that the immunisation exercise took off in earnest in six districts in the Northern Region, with a target to reach over 430,000 people who are 10 years and above.
The districts are East Gonja, West Gonja, Central Gonja, Bole, West Mamprusi and Sawla-Tuna-Kalba.
In an interview, the West Gonja District Health Director, Dr Chrysantus Kubio, said immunisation was ongoing in all the 12 health centres in the district, including the West Gonja Hospital, and the various educational and training institutions.
He described patronage as very encouraging, adding that he was hopeful the targets would be reached by the end of the exercise.
The Deputy Northern Regional Health Director in charge of Public Health, Dr Jacob Mahama, told the Daily Graphic that 460,160 vaccines, needles and syringes had been allocated for the exercise in the region.
SOURCE: Naa Lamiley Bentil and Della Russel Ocloo, Daily Graphic, Thur Nov 23, 2011
The aim of the exercise is to protect Ghanaians against the dreadful disease which currently does not have any treatment.
Communities in Tema, Ledzokuku, Krowor and parts of the Accra metropolis and the Upper West Region are to benefit from the exercise, which has targeted 1.9 million people.
The one-week exercise, being undertaken by officials of the Ghana Health Service (GHS), has become necessary following the discovery of three yellow fever cases in the Upper West Region recently.
The Deputy Director of Public Health at the Greater Accra Regional Health Administration, Dr Edward Antwi, said Ghanaians above 10 years in all the selected regions, except the Upper West Region, where immunisation is given to those from age one, qualified to go for the immunisation, which is free of charge during the one-week campaign period.
After the one week, however, it will cost GHc10 to get immunised.
“ Yellow fever is an acute viral haemorrhagic disease transmitted by infected mosquitoes to humans.
Up to 50 per cent of severely affected persons without treatment will die from yellow fever,” Dr Antwi stated, and explained that the disease did not have any treatment, as only supportive treatment, such as oral rehydration, rest, blood transfusion and dialysis for those who get kidney failure, was available.
“It’s a dreadful disease and every one in the selected areas must turn up for the immunisation,” Dr Antwi.
The Greater Accra Regional Disease Control Officer, Mr Daniel Ato Ashon, told the Daily Graphic that the exercise took off simultaneously in all four sub-metropolitan areas — La, Ayawaso, Osu Klottey and Ashiedu Keteku.
At the Adabraka Polyclinic, 152 people had been immunised as of 1:40 p.m. when the Daily Graphic team visited the facility.
Mr Ashon, who described attendance as impressive, explained that it would take 10 days for the vaccination to start working, while anybody who got vaccinated would be free from the disease for a period of 10 years.
He expressed optimism that the public would warm up to the exercise to ensure its success.
From Tamale, Nurudeen Salifu reports that the immunisation exercise took off in earnest in six districts in the Northern Region, with a target to reach over 430,000 people who are 10 years and above.
The districts are East Gonja, West Gonja, Central Gonja, Bole, West Mamprusi and Sawla-Tuna-Kalba.
In an interview, the West Gonja District Health Director, Dr Chrysantus Kubio, said immunisation was ongoing in all the 12 health centres in the district, including the West Gonja Hospital, and the various educational and training institutions.
He described patronage as very encouraging, adding that he was hopeful the targets would be reached by the end of the exercise.
The Deputy Northern Regional Health Director in charge of Public Health, Dr Jacob Mahama, told the Daily Graphic that 460,160 vaccines, needles and syringes had been allocated for the exercise in the region.
SOURCE: Naa Lamiley Bentil and Della Russel Ocloo, Daily Graphic, Thur Nov 23, 2011
Wednesday, November 23, 2011
GOVT URGED TO ADRESS CRUDE OIL PROBLEM
STAKEHOLDERS in the petroleum industry have called on the government to address the inconsistent supply of crude oil to the Tema Oil Refinery (TOR) to avoid the recurrence of severe shortage of Liquefied Petroleum Gas (LPG).
The appeal comes on the heels of the shutdown of the refinery’s two major plants, the Crude Distillation Unit (CDU) and the Residual Fluid Catalytic Cracker (RFCC) plants on November 5 and 9, respectively for non-availability of crude oil for production.
Subsequently, production has come to a halt as the refinery’s management engages a consortium of banks in negotiation for letters of credit (LCs) to enable officials to take delivery of some one million barrels of crude oil on board the company’s time chartered vessel, Nippon Princess, on anchorage at the Tema Harbour.
Similarly, TOR is unable to process some 150,000 barrels of crude oil being stored in its storage facilities as a result of its inability to raise the LCs for Sahara Oil, the consignee agency.
According to the General Secretary of the General Transport, Petroleum and Chemical Workers Union (GTPCWU), Mr Emmanuel Armstrong Mensah, the government’s attempts to recapitalise TOR must include the supply of crude from the Jubilee oil fields to keep it in business.
He told the Daily Graphic that TOR’s strategic role in the country’s economy could not be underestimated thus the need for the government take a serious look at the challenges since it could have dire consequences for the development of the petro-chemical industry.
He explained that the continual inactivity at the refinery’s plants created a big problem for the country, as there might be lack of basic by-products such as naptha for industries and the depressing effect would be there for all to see.
He said the government should be able to go beyond the lip service to action since the TOR was a 100 per cent state owned enterprise (SOE).
“If the refinery’s machinery remained grounded, its components become malfunctional and we may end up going the Nigeria way where they produce raw crude but go out to refine it”, he lamented.
Mr Mensah also expressed disappointment at the sluggish progress on the recommendations from many meetings held between the leadership of the union, the TOR and the government and urged the latter as a matter of urgency to help the refinery in the raising of LCs for crude oil procurement.
“Petroleum subsidies, which in the past plunged the TOR into huge fiscal crisis, were never the making of the refinery since those benefits went to the consuming public, and if those actions today are preventing the TOR from raising LCs, the government ought to come to its aid”, he stated.
SOURCE: Della Russel Ocloo, Daily Graphic, Wed Nov 23, 2011
The appeal comes on the heels of the shutdown of the refinery’s two major plants, the Crude Distillation Unit (CDU) and the Residual Fluid Catalytic Cracker (RFCC) plants on November 5 and 9, respectively for non-availability of crude oil for production.
Subsequently, production has come to a halt as the refinery’s management engages a consortium of banks in negotiation for letters of credit (LCs) to enable officials to take delivery of some one million barrels of crude oil on board the company’s time chartered vessel, Nippon Princess, on anchorage at the Tema Harbour.
Similarly, TOR is unable to process some 150,000 barrels of crude oil being stored in its storage facilities as a result of its inability to raise the LCs for Sahara Oil, the consignee agency.
According to the General Secretary of the General Transport, Petroleum and Chemical Workers Union (GTPCWU), Mr Emmanuel Armstrong Mensah, the government’s attempts to recapitalise TOR must include the supply of crude from the Jubilee oil fields to keep it in business.
He told the Daily Graphic that TOR’s strategic role in the country’s economy could not be underestimated thus the need for the government take a serious look at the challenges since it could have dire consequences for the development of the petro-chemical industry.
He explained that the continual inactivity at the refinery’s plants created a big problem for the country, as there might be lack of basic by-products such as naptha for industries and the depressing effect would be there for all to see.
He said the government should be able to go beyond the lip service to action since the TOR was a 100 per cent state owned enterprise (SOE).
“If the refinery’s machinery remained grounded, its components become malfunctional and we may end up going the Nigeria way where they produce raw crude but go out to refine it”, he lamented.
Mr Mensah also expressed disappointment at the sluggish progress on the recommendations from many meetings held between the leadership of the union, the TOR and the government and urged the latter as a matter of urgency to help the refinery in the raising of LCs for crude oil procurement.
“Petroleum subsidies, which in the past plunged the TOR into huge fiscal crisis, were never the making of the refinery since those benefits went to the consuming public, and if those actions today are preventing the TOR from raising LCs, the government ought to come to its aid”, he stated.
SOURCE: Della Russel Ocloo, Daily Graphic, Wed Nov 23, 2011
GALAMSEY AT AKYEM: OKYENHENE FINGERED
SOME members of the Asona Royal Family at Kyebi in the Akyem Abuakwa Traditional Area yesterday clashed with supporters of the Okyenhene, Osagyefo Amoatia Ofori Panin, over allegations of his involvement with galamsey operations in Kyebi in the Eastern Region.According to members of the Royal Family, the Okyenhene had oversight responsibility over events and activities within his jurisdiction and could, therefore, not say he was not aware of the illegal mining operations.
The Asona Royal Family, led by Odehyee Nana Kwame Adjei Boateng, who had earlier accused the Okyenhene of secretly funding illegal mining, similarly tasked the Akyem Abuakwa Traditional Council to challenge the Okyenhene to prove his innocence.
Illegal mining activities in the area pose serious challenges to the survival of the Birim River, which is the only source of water supply to the community and its environs, resulting in the pollution of the river to the extent that it had become dangerous for domestic use and drinking.
The Ghana Water Company Limited (GWCL) recently shut down its plant at Kyebi because of the uncontrolled activities of illegal miners in the river.
The Okyenhene has, however, denied the allegation, describing it as a smear campaign.
The accusation, however, stunned the entire community owing to the Okyenhene’s extensive campaign against illegal mining and environmental degradation. That whipped up people’s interest when Odehyee Boateng vowed to ensure that the Okyenhene swore an oath of innocence.
Subsequently, Odehyee Boateng, in the company of four others, stormed the Ofori Panin Fie yesterday morning in an attempt to coerce the Okyenhene to swear the oath of innocence publicly before the community deity, but the move was resisted by supporters of the Okyenhene, resulting in clashes between the two groups.
The clashes led to injury to some of the people on both sides.
According to eyewitnesses, armed guards on duty at the Okyenhene’s palace severely assaulted some members of the Asona Royal Family, while others fired gunshots to disperse the large number of people who had thronged the vicinity to witness the unfolding events.
No arrest has so far been made.
A Spokesperson for the aggrieved family, Nana Boakye Yiadom, who spoke on an Accra FM station, said the action of the Asona Family was to ensure total protection of Kyebi, which had become worried over the activities of galamsey operators.
He said although the Okyenhene professed to be a crusader against illegal mining in the area, he allegedly supported the operations on the blind side of the community.
Nana Yiadom said the Asona Royal Family would not relent in its quest to ensure the total protection of the Birim River.
Meanwhile, the Kyebi Divisional Police Commander confirmed the disturbances to the Daily Graphic when he was reached on phone by Nana Konadu,from Koforidua.
SOURCE: DELLA RUSSEL OCLOO, DAILY GRAPHIC, WED NOV 23, 2011
Tuesday, November 8, 2011
GHANA GETS B//B RATING FROM STANDARDS AND POORS
GHANA has been given ‘B/B’ rating of its long-term and short-term sovereign foreign and local currency by the Standard & Poors, an international credit ratings agency.
According to the agency, the country’s transfer and convertibility (T&C) assessment also remains at B+.
A release issued by Standard & Poors indicated that although Ghana continued to benefit from strong gross domestic product (GDP) growth, strengthening oil production volumes, and a track record of political stability, weak fiscal management highlighted by a widening of the fiscal deficit in 2010 and increased supplier arrears might persist in future.
The transfer and convertibility assessment measures the ease at which a country’s currency can be converted into gold or another currency while the sovereign foreign and local currency rating takes into account the economic and financial risk that may affect a country’s creditworthiness as well as the likelihood that a country would receive external support in the event of financial difficulties.
The ‘B’ rating given to Ghana’s long term sovereign currency means that the country’s capacity for timely fulfilment of its financial obligations is vulnerable to adverse changes in internal and external circumstances while the ‘B’ rating of the country’s short-term sovereign currency means that Ghana’s capacity for timely repayment could be affected by unexpected adversities.
According to the S&P, the ratings for Ghana were constrained by their view of the country's continued weak fiscal management, which has contributed to large fiscal deficits and supplier arrears.
Similarly, S&P believes the looming elections could further erode fiscal discipline with forthcoming oil revenues possibly used as an excuse to ramp up spending.
Accordingly, pressure on government spending, the release said, was likely to be heightened by intense popular demand to improve public services, and by spending pressures associated with the 2012 presidential elections.
The ratings are an assessment of a country’s competitiveness in accessing credit on the international market.
“In our view, the government's weak payment culture and fiscal discipline continues to be highlighted by the net new accumulation in 2010 of further arrears amounting to 1.9 per cent of GDP, raising the stock of arrears to an estimated 5.5 per cent GDP at end of 2010,” the report indicated.
That, it said, was in addition to the widened fiscal deficit to 7.4 per cent of GDP in 2010, from 6 per cent in 2009.
“Although improving, we continue to be concerned as to the extent of contingent liabilities that could crystallise from state-owned enterprises (SOEs) and the banking sector,” it said.
In spite of the factors mentioned above, the release stated that receipts from the oil sector should begin to improve fiscal flexibility in the medium term, provided that spending could be contained.
“And, despite accumulating new arrears on its own account, the government has paid off a substantial portion of arrears owed by the Tema Oil Refinery (TOR) to Ghana Commercial Bank (GCB), a key player in the domestic banking sector,” the report admired.
The rating agency also said that the Petroleum Revenue Management Bill, passed in 2011, had added clarity to government oil receipts.
According to S&P, the Multilateral Debt Relief Initiative (MDRI) contributed to a significant reduction in Ghana’s net external debt in 2006, but the public sector had been re-leveraging ever since; general government debt reached 38 per cent of GDP at year-end 2010.
S&P feared a bilateral loan from China might lead to a further ramp up in debt over the next few years as the debt ratio would have been even higher while the double-digit inflation had the potential to boost nominal GDP.
It, however, expressed the hope that the emergence of the oil sector, along with good performance in Ghana's other key export sectors, would lead to strong real GDP per capita growth averaging five per cent from 2011-2014.
Standard & Poor's (S&P), a United States-based financial services company that publishes financial research and analysis on stocks and bonds.
As a credit-rating agency (CRA), the company issues credit ratings for the debt of public and private corporations.
SOURCE: DELLA RUSSEL OCLOO, DAILY GRAPHIC, SAT NOV 5, 2011
According to the agency, the country’s transfer and convertibility (T&C) assessment also remains at B+.
A release issued by Standard & Poors indicated that although Ghana continued to benefit from strong gross domestic product (GDP) growth, strengthening oil production volumes, and a track record of political stability, weak fiscal management highlighted by a widening of the fiscal deficit in 2010 and increased supplier arrears might persist in future.
The transfer and convertibility assessment measures the ease at which a country’s currency can be converted into gold or another currency while the sovereign foreign and local currency rating takes into account the economic and financial risk that may affect a country’s creditworthiness as well as the likelihood that a country would receive external support in the event of financial difficulties.
The ‘B’ rating given to Ghana’s long term sovereign currency means that the country’s capacity for timely fulfilment of its financial obligations is vulnerable to adverse changes in internal and external circumstances while the ‘B’ rating of the country’s short-term sovereign currency means that Ghana’s capacity for timely repayment could be affected by unexpected adversities.
According to the S&P, the ratings for Ghana were constrained by their view of the country's continued weak fiscal management, which has contributed to large fiscal deficits and supplier arrears.
Similarly, S&P believes the looming elections could further erode fiscal discipline with forthcoming oil revenues possibly used as an excuse to ramp up spending.
Accordingly, pressure on government spending, the release said, was likely to be heightened by intense popular demand to improve public services, and by spending pressures associated with the 2012 presidential elections.
The ratings are an assessment of a country’s competitiveness in accessing credit on the international market.
“In our view, the government's weak payment culture and fiscal discipline continues to be highlighted by the net new accumulation in 2010 of further arrears amounting to 1.9 per cent of GDP, raising the stock of arrears to an estimated 5.5 per cent GDP at end of 2010,” the report indicated.
That, it said, was in addition to the widened fiscal deficit to 7.4 per cent of GDP in 2010, from 6 per cent in 2009.
“Although improving, we continue to be concerned as to the extent of contingent liabilities that could crystallise from state-owned enterprises (SOEs) and the banking sector,” it said.
In spite of the factors mentioned above, the release stated that receipts from the oil sector should begin to improve fiscal flexibility in the medium term, provided that spending could be contained.
“And, despite accumulating new arrears on its own account, the government has paid off a substantial portion of arrears owed by the Tema Oil Refinery (TOR) to Ghana Commercial Bank (GCB), a key player in the domestic banking sector,” the report admired.
The rating agency also said that the Petroleum Revenue Management Bill, passed in 2011, had added clarity to government oil receipts.
According to S&P, the Multilateral Debt Relief Initiative (MDRI) contributed to a significant reduction in Ghana’s net external debt in 2006, but the public sector had been re-leveraging ever since; general government debt reached 38 per cent of GDP at year-end 2010.
S&P feared a bilateral loan from China might lead to a further ramp up in debt over the next few years as the debt ratio would have been even higher while the double-digit inflation had the potential to boost nominal GDP.
It, however, expressed the hope that the emergence of the oil sector, along with good performance in Ghana's other key export sectors, would lead to strong real GDP per capita growth averaging five per cent from 2011-2014.
Standard & Poor's (S&P), a United States-based financial services company that publishes financial research and analysis on stocks and bonds.
As a credit-rating agency (CRA), the company issues credit ratings for the debt of public and private corporations.
SOURCE: DELLA RUSSEL OCLOO, DAILY GRAPHIC, SAT NOV 5, 2011
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