GB&F MAY 2016 by Ghana Business & Finance

MAY 2016 / ISSUE 060 GH¢10.00

Is Bank of Ghana at forefront of mobile money revolutions?

Sales Speci&a50l Pp. 18, 42

Threats of terrorists attack retard business

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Airtel leads in data & digital innovation

THE FIRST BUSINESS READ IN GHANA

CONTENTS ISSUE 060 / MAY 2016

22 Insurance

Lack of openness reared its abhorrent head in the recent row between drivers, on one hand, and the Ghana Insurers Association, National Insurance Commission, and the Ministry of Transport, on the other hand, over the payment of premiums for 2016.

GB&F’s editor, had with Antonio Dixon, a seasoned international sales practitioner, reveals how to sell products and services effectively and profitably.

44 SMEs & Microfinance

24 Industry Front Cover: Jean Claude Domilongo Director of Airtel Data Business

Briefs

Summary of business and financial news that occurred in Ghana, Africa and the rest of the world in the last month.

14 Banking

Ghana has four mobile money transfer service providers, and mobile phone penetration has reached over 115 per cent. The mobile money services promise to promote financial inclusion in the country.

18 Corporate Progress

Sale after the sales includes activities that help maximise the customer’s satisfaction after the purchase has been made. Thus, many companies make after-sales support essential, enjoy J. M. Halm’s exposition.

20 Communications

The Africa launch of at smartphones with projectors in Accra will lead to a one-touch business hub in the palms of users. Also, phablet (combination of phone and tablet) is one of the novelties that this exclusive interview with the inventor and supplier reveals.

“I observed the tides as they surged and ebbed everyday. However, if an object is floating on the ocean, it appeared to stay roughly in one place, it is not pushed forward by the waves. This lingered on my mind for a long time. Why is the ocean never still?” writes columnist Dr Nana Ama Browne Klutse.

Airtel Ghana’s Jean Claude Domilongo, the Director of Airtel Data Business, is not new to the mobile digital terrain in Africa. Domilongo is leveraging his extensive experience to make Airtel lead in data and digital innovation.

One might have taken some consolation in the recent High Court judgement on the branding of the Bus Rapid Transit buses which upheld citizens’ right to access information, especially information in the public interest.

38 Agriculture

Despite the high quality of cocoa beans exported by Ghana, there is a negative incentive for producers to continue producing cocoa.

42 Word for word

This lively conversation that Ayuureyisiya Kapini Atafori,

Opinions expressed in this publication are entirely the writers,’ and do not represent those of the publishers. All information contained within this magazine is the property of Ghana Business & Finance and is not to be used without written authorisation from the publishers. Although every effort is made to ensure the correctness of information submitted for publication, the magazine may inadvertently contain technical inaccuracies or typographical errors. Ghana Business & Finance assumes no responsibility for errors or omissions in this publication or other documents that are referenced by or linked to this publication.

Shipping losses continued their long-term downward trend, with 85 total losses reported worldwide in 2015, according to Allianz Global Corporate & Specialty SE’s fourth annual Safety and Shipping Review 2016 which analysed reported shipping losses of over 100 gross tonnes.

50 Perspective

36 Information

“In view of the afore-narrative, I propose the establishment of the Ghana Institute of Cultural Research and Practice (GICRP). The idea for the GICRP will be to focus heavily on cultural integration and practice among the people of Ghana,” suggests columnist Yaw Asamoah.

48 Transport

32 Cover

Find us online at www.ghanabizfinance.com

MAY 2016

46 Business & Management

28 Science & Technology

10 Economy

Recent terrorists attacks in Nigeria, Mali, Burkina Faso and Cote d’Ivoire show that Ghana is a probable target. Threats of terrorist violence in Ghana are negatively affecting business.

Available research shows that technology companies are particularly prone to failure at commercialisation because the companies ignore the market and focus too much on the technology itself.

“[The microfinance] sub-sector seemed attractive a decade ago but has now witnessed a recent wave of closures and bad press. The expectation is that more will follow,” observes columnist Yaw Kyei Ohemeng.

Most product or service providers give what customers request without putting in any effort into creating unforgettable experiences for customers.

52 Events

Visit conferences organised around the world that may interest you and your business.

53 Stats & Indices

Figures speak louder than words for Ghana’s economy.

54 Commodities

Know the prices of agricultural produce in selected markets, as researched and compiled by Esoko.

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GHANA BUSINESS & FINANCE

Reality stares at workers, wages and ‘wasters’ General Manager Josiah Spio-Garbrah jspiogarbrah@ghanabizfinance.com +233 264 510 396 Editor Ayuureyisiya Kapini Atafori editor@ghanabizfinance.com Senior Staff Writer Kweku Darko Ankrah kdankrah@ghanabizfinance.com Columnists Jerry Halm Yaw Asamoah Dr Nana Ama Browne Klutse Yaw Ohemeng Kyei Contributors Martin Luther C. King Oppong Baah Anthony Sedzro Ebenezer T. Hanson Adnan Adams Mohammed Design & Production Manager Benjamin Tetteh btetteh@ghanabizfinance.com Circulation & Subscription Ernest Awo subscription@ghanabizfinance.com Editorial Committee Prof. Paul N. Buatsi Prof. Kwame Addo Ms Johanna Awotwi Mr Gaddy Laryea Mr Ray de Bono Mr Nana Robert Mensah Mr Frederick Alipui Ms Dede-Esi Amanor-Wilks Ms Nana Spio-Garbrah Office Location Ghana Business & Finance African Business Media House No. 7 Lamb Street (off Farrar Avenue) Adabraka, Accra, Ghana Mailing Address P. O. Box O 772, Osu, Accra, Ghana Tel: +233 302 240 786 Fax: +233 302 240 783 enquiries@ghanabizfinance.com Brand Advisor Dmax Studios in Malta, EU. (www.dmax.tv) Credits GNA Daily Graphic radioxyzonline.com Mergermarket Group ghanabusinessnews.com

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May Day has come and gone. The usual rituals were generously performed to celebrate workers. Despite the promises at the May Day events, many workers know that their salaries and wages cannot sustain them because the minimum wage is low, and the increasing number of the persons who we term ‘wasters’ - the unemployed – is alarming. Workers, wages and ‘wasters’ is a triad married to each other forever. Numerous public sector and private sector workers do not have the best of conditions of service in Ghana. Most middle-class workers in both sectors are strugglers whose wages and salaries are nothing to write home about (or send them home) in an economy in which interest rates are very high and the currency has been falling in value. Labour studies discover that private sector workers, mostly middle-level employees, get better pay packs than their counterparts in the public service. But thousands of private sector workers are denied the voluntary minimum wage because economic, financial and tax challenges bash employers. Or because of sheer greed, employers exploit employees. On the average, public servants enjoy better remuneration, with the implementation of the Single Spine Pay Policy (SSPP) in 2010. The National Tripartite Committee, comprising the government, Ghana Employers Association and organised labour led by the Trade Union Congress (TUC), agreed on GHS8 as the national daily minimum wage. In fact, it is often paradoxically joked that workers’ take-home pay cannot take them home. Indeed, an observer noted that in some countries public workers pretend to be working and the government too pretends to pay them. Low productivity is ironically associated with the better-paid public service, while the poorly-paid private sector staff performs better. Yet it is mainly public servants who have been embarking on strikes and protesting against the government’s policies and practices. Public sector workers’ sit-downs, strikes and protests erupted when the Single Spine Salary Structure (SSSS) came on board under the SSPP. Now, the Fair Wages and Salaries Commission (FWSC), the implementer of the SSPP, has migrated almost all public sector workers unto the pay scheme. Public service workers still express their grievances, now and then. One wonders whether there is an end to their complaints under the SSSS. The missing link in the SSPP juggernaut, to GB&F, is productivity-based compensation. Since the start of the SSPP, Presidents John Atta Mills and John Mahama, Employment Ministers and FWSC officials have mentioned linking productivity to wages and salaries. That linkage may help cut the about 75 per cent of money in the public purse paid to the workers; thereby ensuring value for money, which is now the bottomline. In the 2016 budget, Finance Minister Seth Terkper committed GHS14 billion to augment the public sector pay. The delay in matching input to reward is the Achilles feet of the government and the other social partners in the Public Services Joint Standing Negotiating Committee. A ray of hope: “That a National Productivity Forum should be organized to determine strategies for enhancing productivity in the public service; That a framework for developing public service productivity indicators be established; That a robust system be established to evaluate performance in the public service,” reads part of a communiqué which was adopted after the 2nd National Forum on SSPP on the theme ‘Sustaining the Single Spine Pay Policy’ held at Takoradi, Western Region, on May 7-9, 2015. When will the promised productivity forum be held? As for the ‘wasters,’ many Ghanaians, especially politicians, know that there is massive unemployment so they lure the youth with unfulfillable promises. Factually though, no one knows the unemployment rate. Not even the Ghana Statistical Service, the statutory body responsible for collecting, storing and disseminating data on all sectors of the economy. Despite no definitive data on the unemployment rate, it is not difficult to fathom that many young people are not gainfully employed. Some industrial specialists have long worried that the growing population of the unemployed is a time bomb. Graduate unemployment and under-employment seem legendary in Ghana. Currently, it is estimated that 200,000 unemployed graduates are in the country. This year, about 71,000 will be released into the job market from private and public tertiary institutions. And the prospects are no better. According to a report of the International Labour Organisation (ILO), ‘World Employment and Social Outlook - Trends 2015,’ unemployment will continue to rise in the coming years, as the global economy enters a new period of slower growth, widening inequalities and turbulence. “By 2019, more than 212 million people will be out of work, up from the current 201 million,” the ILO report states. Job creation is critical but the IMF-induced freeze on employment in the public sector saw nurses, extension officers, sanitary inspectors, mid-wives and teachers who are trained for the sector remain unemployed. The government must do something about the rising rate of unemployment in the country to prevent the time bomb from eventually exploding. In brief, GB&F wants wages to move hand in hand with work; and the promotion of workplace rights of employees that will result in decent work, and in higher productivity. All employers and employees are obliged to respect the labour laws.

Ayuureyisiya Kapini Atafori Editor (+233 024 2385374)

MAY 2016

Mail to the Editor

Send your articles, comments and letters to the editor at editor@ghanabizfinance.com

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EDITOR’S SUITE

After May Day Rituals

GHANA BRIEFS

Vodafone rated best in quality service The first telecom Quality of Service (QoS) report in this year by the National Communications Authority (NCA) indicated that Vodafone Ghana was the only operator which did not record any failures. The report, based on tests conducted in 14 communities of the Greater Accra Region in February, also showed that Vodafone was one of two telcos that scored highest on speech quality, the other was Glo. The report covered call congestion rate, call drop rate, call set up time, call completion, Standalone Dedicated Control Channel (SDCCH) Congestion Rate and voice quality rate. SDCCH congestion is defined as the probability of failure of accessing a stand-alone dedicated control channel during call set up. This should be less than or equal to one per cent. Call Setup Time (CST) is the period of time it takes for the receiver’s phone to ring after the sender had dialed the number and pressed send; it is supposed to be 10 seconds or less in 95 per cent of calls. Call Congestion Rate (CCR) is the probability of failure of accessing a traffic channel during call set up; the acceptable rate is one per cent. Voice Call Drop Rate (CDR) is the probability of a call terminating without any of the users’ will; only up to three per cent of calls are allowed to drop. Call Completion Rate is defined as the probability that a call has, after being successfully set up, be maintained during a period of time and ending normally. It is expected that at least 70 per cent of calls will run their full course.

Dr Asiama appointed Second Deputy BoG Governor President John Mahama has appointed Dr Johnson P. Asiama as the Second Deputy Governor of the Bank of Ghana (BoG). Dr Asiama’s appointment took effect from April 5. He replaces Dr Abdul-Nashiru Issahaku who has been appointed as the substantive BoG Governor following the early retirement of former Governor Dr Henry Kofi Wampah. A statement signed by Dr Edward Omane Boamah, Minister for Communications, confirmed the appointment of Dr Asiama. Until his elevation, Dr Asiama was the Assistant Director at the Economics Department of the BoG where he co-ordinated the work of the Monetary Policy Committee (MPC) and supported the work of the Governor directly. He holds a PHD (Economics) from the University of Southampton, UK, and an MPhil (Economics) from the University of Ghana, Legon. He has also previously served as Director of the Macro-economic Management Department at the West African Institute for Financial and Economic Management (WAIFEM) in Lagos, Nigeria.

NIC asks insurers to merge to meet new capital requirement The National Insurance Commission (NIC) is pushing for mergers in the insurance industry to meet the current capital requirement. According to the NIC, many of the industry players are too small and could not operate efficiently, hence the need for mergers. The NIC reviewed the minimum capital of the insurance industry to GHS15 million on January 1, 2016 to ensure that operators have a strong capital base to operate. Reports revealed that some insurance firms are struggling to meet the new capital requirement, with a shut down imminent. Commissioner of the NIC, Lydia Lariba Bawa stressed that companies that did not meet the capital requirement must resort to mergers. “For a population of about 26 million, we have altogether about 50 insurance companies and some of them are very small, they don’t even have the capacity to retain big businesses. So once you capitalise they can participate in these big insurance businesses that come their way,” she said.

GHANA BUSINESS & FINANCE

Ghana-UK trade reaches over £1 billion Trade between Ghana and the United Kingdom (UK) has reached £1.3 billion, according to latest statistics. Ghana is currently the UK’s fifth largest trade partner in Sub-Saharan Africa. Speaking in Accra to mark the 90th birthday of Queen Elizabeth, Jon Benjamin, the British High Commissioner to Ghana, said British companies still have confidence in Ghana and continue to invest in the country. Benjamin added that the British companies continue to form partnerships with Ghanaian ones to create jobs, build local capacity and expertise in sectors such as education, health, agriculture, infrastructure, oil and gas and financial, legal and professional services. “I believe that the partnership between our two countries will only enhance our progress. Together we are better; together we are stronger; and only together can we create a more prosperous future for the UK/Ghana relationship,” Benjamin said. Dr Ekow Spio-Garbrah, Trade and Industry Minister, called on British firms to invest more in Ghana due to the relative economic stability being enjoyed as a result of the three-year International Monetary Fund (IMF) programme. Over the past year, the UK provided well over £100 million in bilateral and multilateral development assistance to Ghana, focusing on health, education, governance and economic development.

New drilling technology launched Contractors working on Cenpower Generation Company Ltd.’s 350 megawatt Kpone Independent Power Plant, Group Five, have introduced a new technology for drilling and tunnelling in Ghana. The Tunnel Boring Machine creates different sizes of tunnels underground without digging the top soil. This makes it environmentally friendly and shortens work duration. Group Five deployed the services of Coleman to construct a tunnel into the sea for water inflow and outflow. The sea water is required to serve as a cooling system for the combined cycle gas turbine power plant.

MAY 2016

BANKING

Mobile Money Revolution:

BoG at forefront of financial inclusion? BY SOSTHENES KONUTSEY

The 15-year United Nations’ (UN) 17 Sustainable Development Goals (SDGs) emphasise the attainment of universal financial inclusion by countries which need it. The Centre for Financial Inclusion, a Washington-based think tank, describes financial inclusion as “a state in which (1) everybody has access to a full suite of financial services including; credit, savings, insurance, and payments (2) Provided with quality; convenient, affordable, suitable, dignifying and client protection (3) To everyone who can use financial services; with special attention to rural people, people with disabilities, women, and other often-excluded groups (4) Through a diverse and competitive marketplace; a range of providers, robust financial infrastructure and clear regulatory framework.”

t present, Mobile Money (MM) technology promises to be the key anchor for attaining financial inclusion in the world. There were about 255 MM service providers in 89 countries worldwide, according to the GSMA 2014 report. Ghana has four MM service providers, as mobile phone 14

penetration reaches in excess of 115 per cent. The World Bank Findex data mentions Ghana as one of 13 markets with Mobile Financial Services (MFS) penetration above 10 per cent in 2014. BMI Research, in its June 2015 report, indicated that, according to the World Bank, “13% of adult Ghanaians report having access to a mobile account, as

GHANA BUSINESS & FINANCE

compared to the Sub Saharan Africa average of 11.5% in 2014.” According to the 2015 Financial Inclusion Insights survey executed by InterMedia, whilst access to banking increased only marginally from 34 per cent to 36 per cent of Ghanaian adults, access to MM increased from a near zero percentage point to 29 per MAY 2016

INDUSTRY

Addressing missing link between academia and private sector through technology commercialisation BY SHEILA FRIMPONG

It is widely recognised in the economic literature that the performance of a national economy in terms of innovation and productivity is not only the result of its basic research capabilities and inventions (Gay and Dousset, 2005). It is also strongly influenced by its ability to exploit these inventions commercially and develop them into products (Debackere and Veugelers, 2005).

nderstanding how scientific knowledge translates into commercially viable products in the marketplace is, therefore, an important research issue (Gans and Stern, 2003). It is common for inventors, policy makers and entrepreneurs not to underestimate the difficulty of commercialising science and technology (Bercovitz and Feldman, 2007). Available research shows that technology companies are particularly prone to failure at commercialisation because the companies ignore the market and focus too much on the technology itself. (www.glocalvantage.com). Thus, the marketing and commercialisation phase of the innovation process is seen as crucial for the success of any invention and innovation. This is because it is only when an invention is accepted on the market by consumers and users that it will begin to generate income which will compensate inventors, and eventually generate some profit. Commercialisation is defined

in different ways by various authors. Caurtois (2004) defines it as presenting or introducing a new product to market. Similarly, Nearly (2004) defines commercialisation as the processes by which research outcomes move towards practice and idea, and new findings develop in the form of new products. In another study (see Rosa and Rose, 2007), commercialisation is defined as a set of actions which conveys knowledge to product. These definitions suggest that for scientific innovations, the commercialisation acid test should be developed into products of use to the public. Indeed, most of the developing countries do not realise that their situations can only be rectified with the infusion of modern science and technology into their societies. Although some of the developing countries are aware of the importance of science and technology, this awareness does not necessarily make it easy to develop and popularise science. Inadequate scientific infrastructure is

GHANA BUSINESS & FINANCE

a critical factor which creates strong barriers to the path of advancement in the developing countries. Emphasis on education, S&T The social and economic growth of the developed countries is dependent on an essential emphasis on education, Science and Technology (S&T). The basic problems of developing countries are the weak educational and scientific infrastructure, and a lack of appreciation of the importance of science as an essential ingredient of economical and social development. The critical size of human resources and infrastructure, and the amount of investments in these areas, illustrates how S&T are of neglected importance in the developing countries. Industry and universities in Turkey face shortages of researchers - 10 for every 100,000 of the population compared with 280 in US, 240 in Japan, 150 in Germany, 140 in the United Kingdom (UK). In 1984, non-defence research expenditures in Turkey were 0.20 per cent of Gross

MAY 2016

PHOTO GALLERY

The 5th AGI Ghana Industry Awards, themed ‘Growing Local Industry for Export Development & Job Creation,’ was held in Labadi Beach Hotel, Accra, on April 12 (Left to Right) 1. Nora Bannerman, Chair, Awards Committee; Hon. Rashid Pelpuo, Minister for Private Sector; and James Asare Adjei, President of AGI 2. An attendee addressing the audience 3. Dignitaries at the High Table 4. Some of the participants 2

MAY 2016

GHANA BUSINESS & FINANCE

COVER

data usage shows that Airtel has moved from the 4th to the second position in terms of the number of customers using Facebook in Ghana. Facebook [being the most popular social media site in the world] is the mirror to see how customers are using data services and what we see currently is very positive and directly in line with our ambition.” Cheaper models of smartphones coming into the Ghanaian market are making it easier for more consumers to use data services. Aiming to tap into this and drive digital innovation, Airtel launched a ‘Free Facebook on Airtel’ product. He says it has worked. “We launched free Facebook and Internet.org last year to cater to the needs of our customers and we have seen a tremendous increase in the number of customers using this platform. Free Facebook on Airtel has indeed contributed significantly to growing our customer base for data. In addition to free Facebook, we provide free access to 40 different sites for education, health, news, job search and social media to ensure that our customers are truly digitally included. Enabling access to 40 zero rated sites in this country cannot be compared to anything the competition offers.” “When it comes to data usage, the growth in the industry is driven mostly by millennials. So we are there to support them learn, grow and develop themselves which is why we go beyond just social media platforms to provide free access to sites that truly enrich their lives.” Data will drive revenues According to the NCA figures for December 2015, whereas voice penetration rate is at a high of 127 per cent, data is only half way at 65 per cent. The future belongs to data and digital,

MAY 2016

GHANA BUSINESS & FINANCE

AGRICULTURE

Total liberalisation of cocoa trade imperative for production rise BY OPPONG BAAH

Ghana is the only cocoa producing country which has a controlled marketing system. The reform of the cocoa sub-sector, which started in the early 1990s, led to the liberalisation of internal marketing, privatisation of input market and renewed extension services. External marketing, however, is controlled by a state-owned entity.

ccording to a 2013 Food and Agriculture Organisation (FAO) report, despite the high quality of cocoa beans exported by Ghana, there is a negative incentive for producers to continue producing cocoa. The results from the analysis of incentives and disincentives for cocoa producers corroborate some of the conclusions reached by field surveys undertaken in the country that raised the issue of an increasing number of cocoa producers shifting from cocoa production to more profitable crops. Furthermore, the quality premium received by Ghana’s 38

cocoa on the international market does not seem to be transferred to the producers. The growing competition on the international market by countries with higher productivity and a sustained renewal of cocoa plantations calls for more pronounced interventions on the productivity and production aspects in Ghana. In terms of employment, the livelihood of a sizable chunk of the population depends on the cocoa sector. Despite exports of oil and minerals like gold and bauxite, cocoa is still the single most important commodity of

GHANA BUSINESS & FINANCE

the country. It is not clear, however, if the costs of maintaining the current organisational structure are really compensated by the benefits, at least, in terms of revenues generated at the producer level as it appears that the advantages of producing high quality cocoa is not enjoyed by the farmers. At Ghana’s independence in 1957, the country was the world’s largest cocoa producer. It was also a relatively prosperous state compared with the rest of Africa, largely because of its strong cocoa production and the relatively high world prices for cocoa (Woods 2004: 232–3; Frimpong-Ansah MAY 2016

WORD FOR WORD

SALES SPECIAL

“Every good salesperson is a good solutions provider” Antonio Dixon, CEO of Sun Powerd, a renewable energy company based in the United States, and an experienced international sales practitioner, speaks to GB&F’s editor, AYUUREYISIYA KAPINI ATAFORI, about how to sell products and services profitably. Dixon stresses that “Without sales, you have no business.” company – they benefit from your product and you benefit from the sales. GB&F: What are the key elements of good salesmanship? AD: Persistence, perseverance and determination. And the will to hustle. You know, Abraham Lincoln [Former US President] said “Good things come to those who wait but only left by those who hustle.” You see you can wait for things to happen to you but it’s only the leftovers from all the people who have hustled. You’ve got to work hard and be persistent, be determined and go after what you want by overcoming objections. You can’t afford to be scared.

GB&F: Why is the Sales Department important in an organisation, and what type of personnel should the department have? Antonio Dixon (AD): Well, without the Sales Department, you don’t have a business. You can make the best products in the world but without sales, they just remain products. I think every CEO needs to be the best salesperson. If you look at Steve Jobs, he is the best sales person for Apple. He demonstrates products when they are out. He is casual and he communicates with the customer. He is the best motivator of his sales people. He shows distributors how to sell the Apple products. In fact, sales is everything a business oragnisation requires. The company is mentioned in terms of revenue and that has to do with sales such as, for example, US$1,000,000 in sales. Without sales, you have no business. GB&F: How best can a sales person close deals for his or her company? AD: He or she has to figure out what the customer wants, what the customer needs and desires, and the efficiencies that his or her company can bring. I mean every good salesperson is a good solutions provider. Solutions providers with win-win for their clients and 42

GB&F: What are the worst things that a salesperson should never do in dealing with clients? AD: He or she shouldn’t just show up and tell a customer about all his or her products. He or she should understand what the customers needs are, and how his or her products can satisfy those needs, or solve their problems. One other thing that salespersons do wrong is over-promising and undelivered: Making empty promises. Saying that you can get the product to the customer by Friday but he or she doesn’t get the product in two weeks. I think that is a big issue. GB&F: And what are the best things that a sale person must do to succeed? AD: By making sure that his or her products have the solutions to the customers’ problems. He or she is to make sure that the customer is well taken care of. If you don’t follow up, I don’t believe you can be successful. I can give you a perfect example. I once sold a machine to a doctor for a US$120, 000, and he contacted people to fix it, and no one could fix. He contacted me and I called the President of the company and I said “Listen, can we give this guy a new machine? Can we give him a rebate for six months that his machine wasn’t working?” So I think at the end of the day, you have to

GHANA BUSINESS & FINANCE

take care of the customer. If you take care of the customer that means you’re taking care of the company. If you take care of the company that means you’re taking of yourself. So there are many salespersons who are selfish and will say: “OK I want commission on the sales made. I don’t care about the customer of the company. But if you take care of the customer, that customer will always [for example] say: “Wow! Africa Business Media is a great, great company.” And if the CEO hears that people are saying that about the company because of you, then he will always make sure that you are taken good care of. GB&F: What is the difference between sales and marketing? AD: When marketing a product you need advertising and PR. Sales is actually meeting with the person and convincing the person to buy something. But marketers talk about the product. Salespeople talk about it as well but they actually convince the client to sign the deal. That is the difference. But I think if a salesperson has marketing skills or a marketing person has sales skills, these are much more valuable. There are some people who can do both. GB&F: You are a widely travelled sales practitioner. What is the future of salesmanship in the world? AD: Wow! [He smiles]. It’s a great question. The future of salesmanship in the world? I don’t think I have the answer to that … GB&F: We mean the future of sales in the wake of new technologies. AD: With technology, you will be able to identify customers easier. Through technology you know where customers are based to contact them. You can contact potential customers on Facebook now. You have Linkedin, you have Twitter. You have all kinds of social media ways to contact people. People are now more social. If you MAY 2016

TRANSPORT

Long-term decline in shipping losses continues … as economic pressures, cyber risk and super-storms challenge safety progress Shipping losses continued their longterm downward trend with 85 total losses reported worldwide in 2015, according to Allianz Global Corporate & Specialty SE’s (AGCS) fourth annual Safety and Shipping Review 2016 which analyses reported shipping losses of over 100 gross tonnes.

hough the number of losses remained stable year-onyear, declining by just three per cent compared with the previous year (88), 2015 was the safest year in shipping for a decade. Losses have declined by 45 per cent since 2006, driven by an increasingly robust safety environment and selfregulation. However, disparities by region and vessel-type remain. In 2015, the East and West African coasts saw losses of six ships, bringing the tally of vessels lost between 2006 and 2015 to 94.“Shipping safety and security remains a challenge on the continent due to historic underdevelopment of the maritime industry. AGCS Africa expects an increase in losses as the industry acquires more ships in line with the African Union’s Agenda 2063, which has prioritised the marine economy as a major contributor to growth within the continent. The insurance industry will continue to play a key role in protecting and growing marine insurance risks on the continent,” said Allianz Global Corporate &Specialty Africa Technical Underwriting Manager Mark Govender. South China, Indochina, Indonesia and the Philippines More than a quarter of all losses occurred 48

in the South China, Indochina, Indonesia and the Philippines region (22 ships). Losses increased year-onyear, unlike other major regions. Cargo and fishing vessels accounted for over 60 per cent of ships lost globally, with cargo losses up for the first time in three years. The most common cause of total losses is foundering (sinking), accounting for almost 75 per cent of losses, up 25 per cent, and often driven by bad weather. There were 2,687 reported shipping incidents (casualties, including total losses) globally during 2015, down four per cent. Activity is spread across all days of the week, although Thursday sees the most incidents and Saturday the fewest. The East Mediterranean and Black Sea (484) remains the top incident hotspot. Three vessels share the accolade of being the most incident-prone - a ro-ro in the Great Lakes region, a hydrofoil in the East Mediterranean and Black Sea and a ferry in the British Isles – with 19 incidents over the past decade. Economic pressures challenge safety While the long-term downward trend in shipping losses is encouraging, the continuing weak economic and market conditions, depressed commodity prices and an excess of ships are pressurising costs, raising safety

GHANA BUSINESS & FINANCE

concerns. AGCS has seen an increase in the frequency losses over the past year which can likely be attributed, to some extent, to this environment. “The economic downturn - and its impact on the shipping sector - is likely to have a negative impact on safety,” said Captain Rahul Khanna, Global Head of Marine Risk Consulting, AGCS. “Many sectors, such as general cargo, bulk and offshore, are already challenged and any drop in safety standards will be a serious case for concern,” Khanna stated. It is critical that economic pressures do not allow a “put it off until later” safety mentality to develop, AGCS

MAY 2016