Kofi Ahovi

World Bank has allocated US$ 45 million to Ghana in support of Micro, Small and Medium Enterprises but the government has not made use of the money. Fred Sarpong looks at the fund and what intended to achieved. The World Bank country office in Accra has come out to say that the international bank has allocated an amount of US$ 45 million to Ghana Government in support of the Micro, Small and Medium Enterprises (MSMEs) sector in the country. According to the bank office since 2000 that the money was given to Ghana only US$ 4 million has been spent within two and a half year period. The fund, which was channel through International Development Association (IDA), is available but the government has refused to access it to support MSMEs in the country. It therefore, called on the government to make use of the money before it starts reviewing it programme for the country come November 2008. If what the bank is saying is true then those in the sector may think the government did not do well

Mfund Annualised Yield 91-Day T'Bill Avg. Savings Rate 2004 18.77 17.29 8 2005 16.86 15.45 5 2006 14.47 10.24 5 2007 11.99 9.91 5 2008 15.2 24.62 6

COMPARATIVE INVESTMENT RETURNS - GHANA Type of Investment 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 91-Day Bill (Annual Average) 46.83% 47.86% 37.50% 28.12% 38.99% 40.87% 25.14% 28.37% 17.29% 15.45% 10.24% 9.91% 24.62% Cumulative (91-day) 46.83% 117.10% 198.52% 282.46% 431.58% 648.84% 837.09% 1102.95% 1310.94% 1528.93% 1695.73% 1873.69% 2359.61% 1-Year Note (Annual Average) 40.81% 41.92% 34.46% 19.66% 26.92% 31.57% 26.65% 29.85% 18.46% 17.69% 15.66% 12.42% 20.00% Cumulative (1-Year) 40.81% 99.84% 168.70% 221.53% 308.08% 436.92% 580.00% 782.98% 945.98% 1131.02% 1323.80% 1500.63% 1820.76% US$ (Appreciation against Cedi) 20.23% 29.31% 4.27% 49.23% 96.80% 5.31% 15.12% 5.45% 2.55% 0.65% 1.34% 4.22% 12.67% Cumulative (US$) 20.23% 55.48% 62.11% 141.92% 376.11% 401.39% 477.20% 508.65% 524.17% 528.23% 536.65% 563.52% 647.58% Headline Inflation (End-Period) 32.70% 20.80% 15.70% 13.80% 40.50% 21.30% 15.20% 23.6

Considering the strong growth in trade and investment flows between Ghana and South Africa over the past few years, the relaunch of the South Africa – Ghana Chamber of Commerce in April this year could not have been more timely. This is reflected by the enthusiasm with which enterprises that have ties to both countries have quickly signed up to be members of the Chamber. Within six months some 40 corporate entities have joined the Chamber and the number keeps growing. “We want to double our current membership to reach 80 corporates” says Trevoe Sproat, first Vice President of the Chamber and also CEO of Consumer Finance Company. He is part of an Executive Committee which is also led by Albert Brock who was elected as President of the Chamber last April, and Vlure Galtz, the incumbent Second Vice President. The Chamber’s membership now includes well known corporate names in Ghana such as Anglogold Ashanti, Accra Breweries, 3M, Aqua Vitens Rand, MTN, Broll Ghana, CAL Bank, Consumer Fin

CODE DIVISION MULTIPLE ACCESS (CDMA) Code Division Multiple Access (CDMA) is an American digital standard that was developed by a company named Qualcomm, based o\in California. It describes a communication channel access principle that employs spread. Spectrum technology and a special coding scheme (where each transmitter is assigned a code. CDMA was originally deployed as a battlefield communication system because it is very hard if not completely impossible to intercept CDMA transmissions. Its digital modulation scheme is titled interim Standard 95 (15 – 95). CDMA employs what is known as a wideband spread spectrum technology to carry digital voice and data transmissions. The CDMA conversation is assigned its own separate code. CDMA ARCHITECTURE AND OPERATIONS Each CDMA base station can use the same 1.25MHz carries at the same time. The only change b/w each block of 1.25MHz spectrum is the pseudorandom walsh noise code. There are a maximum of 64 allowable pseudorandom walsh nois

By Kofi Ahovi The African Caribbean and Pacific (ACP) countries have instructed their Council of Ministers to create an ACP Free Trade Area (FTA) among themselves in a move to side step signing the proposed Economic Partnership Agreement (EPA) with the European Union. The decision, which was taken at the just ended 6th ACP Summit held in Accra last week, would enable the members of the group to freely trade between themselves while they await the EU to address critical concerns raised about the content of the EPA. Meanwhile the heads of the ACP states have unanimously declined to sign the final EPA, due to what they described as “undue pressure” being put on some ACP members by the EU. The ACP leaders, after several protests pressure groups in their home countries were convinced that their economies may not benefit much from trading with the EU through the controversial EPA. Several civil society organizations have mounted various protests to urge their governments against signing the

By Kofi AHOVI National Investment Bank Ltd has introduced a new product, Churchlink account, to its array of products and services. The churchlink account is a hybrid of a current and an investment account specifically designed to offer churches high interest, flexibility of a cheque book and loan facilities. It also provides higher interest on savings and free financial consultancy. The account also provides an unsecured loan amount of 40% of a church’s monthly credit turnover, invests idle funds into high interest bearing ventures to yield revenue for the church. Meanwhile, members of the church can access loan through Churchlink. The bank has also included in the package, a weekly mobile cash collection service to provide security to church funds.

By Toma IMIRHE Barclays Bank Ghana, the country’s biggest bank, has held its 2008 Barclays Microbanking Awards in Accra. The awards, which was the second in an annual series instituted last year as part of the bank’s 90th anniversary celebrations commemorate its partnership with microfinance customers, particularly with “susu” collectors, the Credit Union Associations and the Church Organizations who together comprise the bulk of this business activity. Barclays Bank launched its microbanking product three years ago and it has proved to be an outstanding success. Already, Barclays is now working with 732 “susu” collectors and has extended loans to them to the tune of GH¢1.5 million to assist them in providing financial solutions for their clients. On the average “susu” collectors access about GH¢3,000 from Barclays, but in some cases, as much as GH¢6,000. The bank has also been able to mobilize deposits to the tune of GH¢12.1 million from its micro banking partners. Barclays growing ex

The Global Executive opinion survey recently conducted by the Association of Ghana Industries {AGI} identified access to Finance as a major challenge to SMEs in Ghana. A suggestion has also been made for the establishment of an SME bank; Kofi AHOVI takes a look at how this could change the state of small businesses in the country. Opinions have been expressed by several economists about the need to financially support small businesses which have been identified as the engine of growth. These opinions were made on the grounds that small business in Ghana account for over 80% of the country’s manufacturing sector and employs 53% of persons engaged in the sector, as against the large scale businesses which employ 34% and constitute only 1% of manufacturing sector. Though some credit facilities have been provided to support small businesses in the past, they are woefully inadequate, and in cases where they are adequate those who qualify are unable to access them due to stringent requiremen

By Toma IMIRHE The inaugural West African Banking Awards have been launched in Accra. The awards which will be held next year, will be held under the auspices of the Business In Africa publishing group, which publishes the pan-African Business in Africa magazine as well as a prominent local bi-weekly business newspaper in Ghana, Business & Financial Times. The launch of this year’s awards was done at a gala dinner at La Palm royal Beach Hotel last week during the maiden two-day West African Banking Congress, also organized by the Business in Africa Group. Indeed the maiden awards will be held at the 2009 West African Banking Congress which the organizers have promised to make an annual event. The awards will recognize best banking practices across the sub-region. The inaugural West African Banking Congress attracted senior professional bankers, economists, IT experts and the likes from across Anglophone West Africa, particularly Nigeria and Ghana. Issues addressed by various presen

By Dickson Gborglor Many personal financial advisors recommend that investors maintain a diversified investment portfolio consisting of bonds, stocks and cash in varying percentages, depending upon individual circumstances and objectives. Because bonds typically have a predictable stream of payments and repayment of principal, many people invest in them to preserve and increase their capital or to receive dependable interest income. Whatever the purpose—saving for your children’s college education or a new home, increasing retirement income or any of a number of other financial goals—investing in bonds can help you achieve your objectives. That’s especially true for retirement planning. During the past decade, the traditional fixed-benefit retirement plans have increasingly been replaced by defined contribution programs. Because these plans offer greater individual freedom in selecting from a range of investment options, investors must be increasingly self-reliant in securing their r

Private equity investment from abroad has been on the rise in Africa. For dedicated investment forms, West Africa is becoming a favourate destination. Nearly every African country is looking up to foreign investment to provide their respective private sectors with the finance to step up economic activity and generate direly needed wealth. Now the liberalization of most African economies, and the achievement of relative political stability, by opening up lots of new investment opportunities are attracting private equity from abroad in drawers. Nowhere outside of South Africa, is this being done more enthusiastically than in West Africa, a region that is seeing a dramatic increase in funds being raised for investment. “We’re seeing quite a few new GPs emerge in the region and some long-standing ones raising new capital” says John Jawuli Ababio, chief executive of the African Venture Capital Association. “There are six or seven that have recently closed a fund or are seeking capital e

Kwame Gazo-Agbenyadzie, Chief Executive of Metropolitan Insurance Company is one of the most accomplished insurance industry practitioners in Ghana, with vast expertise and experience covering both life and general (non-life) insurance. At a time of profound change in Ghana’s insurance industry, through a major recapitalization exercise, the separation of life and non-life activities, which now have to be done through separate companies, and the imminent introduction of compulsory fire insurance, his insights are invaluable, for most the biggest change has been the separation of life and non-life insurance which has forced a major shake-up in the industry have had to establish different firms for each of the two areas. “The separation was necessitated because accounting for life insurance is different from that of general business” explains Gazo-Agbenyadzie. “Even though the previous law mandates companies to separately account for the businesses in their books, these was the tendenc

By Kofi Ahovi The Initial Public Offer (IPO) of Ecobank Transnational Incorporation (ETI), which started on August 25 and was supposed to have ended last Friday, has been extended to October 31st 2008. The extension affects all the other countries where the share is on offer. Speaking to Business week the Corporate Affairs Manager of Ecobank, Rammy Baite, explained that the offer was extended because of certain delays in other African countries where the sale is currently ongoing. According to him, Liberia only received its approval barely a week ago from its capital market regulators, adding that holidays in some of the offer countries may have hampering the sale of shares of the transnational bank as initially scheduled. Usually these extensions are due to low patronage and under-subscription of share offers, but Baite have denounced this assertion. ETI, a pan African bank aims at raising US$2.5 billion combined Rights Issue and Public Offer after the Board of Directors of the ban

By Elikem Mensah UT Financial Services, the biggest non-bank finance institution, which launched its Initial Public Offer(IPO) fort night ago, is likely to be over subscribed by the close of its offer period According financial analyst, the company is coming to the market with a price earnings ratio of 14.25, which is lower than all but one of the eight other financial stocks on the Ghana Stock Exchange . The average P/E ratio for financial stocks on the Accra bourse is 20 with the highest of the financial stocks reaching 30. This indicates that UT’s shares are being offered at rock-bottom price compared to other listed stocks, despite its strong credentials as an outstanding non-bank financial institution. In 2007, UT’s return on average invested capital was 247 per cent, significantly higher than that achieved by the banking sector last year. The company is envisaging a growth of 25 per cent for the next five years. This is bound to attract more individual and institutional invest

by Kofi Ahovi and Toma Imirhe • HFC Equity Trust • HFC Unit Trust • HFC real Estate Investment Trust HFC Investment Services Limited (HFC-ISL) manages three collective investment schemes, all of which are licensed unit trust schemes. This wholly owned subsidiary of HFC Bank has proved to be one of Ghana’s most professional investment banking institutions with an outstanding track record in asset management, where aside from managing collective investment schemes, it also provides prudent fund management, individual client investment service, fund management for groups and institutions, as well as endowment fund management. HFC-ISL alongside Databank leads in the number of unit trusts it manages at three apiece. However, with regards to the diversity of business markets it invests them in , HFC-ISL is peerless, it invests in the capital market through the HFC Equity Trust, in the money market through the HFC Unit Trust, and uniquely, in the real estate market through the HFC Real Estat