Business24 Newspaper 19th October, 2020 by Business24 Online

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MONDAY OCTOBER 19, 2020

NO. B24 / 115 | NEWS FOR BUSINESS LEADERS

MONDAY OCTOBER 19, 2020

Corrupt public officers could face 25 years in jail under new law • Corruption classified as a felony

Some MFIs, RCBs defaulting on credit reporting By Joshua Worlasi Amlanu macjosh1922@gmail.com

ot withst anding improvements to Ghana’s credit referencing system, the central bank has indicated that some financial institutions have refused to subscribe to credit bureau services, contrary to the Credit Reporting Act 2007 (Act 726). Cont’d on page 3

PZ Cussons delists from GSE today By Joshua Worlasi Amlanu macjosh1922@gmail.com

Attorney General, Gloria Akuffo moved for the motion of the bill in parliament

By Eugene Davis ugendavis@gmail.com

ublic officers who are found guilty of corruption under the amended Criminal Offences law could face up to 25 years in jail. Section 260 of the

memorandum that accompanied the bill stipulates that a public officer who fails a set of accountability requirements could be jailed between 12 to 25 years. The amended law, which was passed last week, is awaiting presidential assent to become effective.

ECONOMIC INDICATORS EXCHANGE RATE (INT. RATE)

The new law also amends the Criminal Offences Act, 1960 (Act 29) to categorise the offence of corruption as a felony and provide a stiff penalty for a person who commits the offence of corruption and other related offences.

BRENT CRUDE $/BARREL

POLICY RATE

14.5%

NATURAL GAS $/MILLION BTUS

GHANA REFERENCE RATE

15.12%

GOLD $/TROY OUNCE

OVERALL FISCAL DEFICIT

11.4% OF GDP

PROJECTED GDP GROWTH RATE AVERAGE PETROL & DIESEL PRICE:

0.9% GHC 5.13

Cont’d on page 3

Cont’d on page 2 INTERNATIONAL MARKET

USD$1 =GHC 5.7027

ollowing the end of the tender offer and successful settlement of all tendering shareholders, PZ Cussons Ghana Limited has announced that the company will de-list from the Ghana Stock Exchange (GSE) effective today.

CORN $/BUSHEL COCOA $/METRIC TON COFFEE $/POUND:

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NEWS/EDITORIAL Editorial / News

MONDAY SEPTEMBER 142020 2020 MONDAY OCTOBER 19,

EDITORIAL Editorial

Pay before boarding order needs a rethink Ease of restrictions on conferences good news

Wash your hands 2

Cover your cough 3

The new directive for all passengers to pay their resident Nanafor Addo COVID-19 test online before their Dankwa Akufo-Addo arrival at Kotoka International yesterday Airport has been announced meet with resentment by restriction airlines and the lifting of the on passengers. the number of persons that can At a time when passengers are attend conferences, seminars still coming to terms with the and other� GHC gatherings subject to US$150 900� mandatory the adherence of the COVID-19 payment for COVID-19 test upon arrival at KIA, the new directive protocols. has generated more debate. The President in his Passengers travelling to Ghana 18th Address to the nation will from Tuesday, September 15 on measures toto make deal online with be required payments for the mandatory the pandemic made the C OV I D -1 9 te s t at Ko to k a announcement that should International Airport prior to spell goodof news for thea boarding their flight, d i r e c t i v e b y F r o n t has ier hospitality industry which HealthCare� the company already bore full brunt of some contracted to carry out the of the test restrictions on airlines their antigen at KIA--to all on Friday has revealed. operations. B y the t h e aftermath n e w d i r eofc t ithe ve, In “Passengers are required to show outbreak, conferences and proof of payment to airlines as a seminars were completely prohibited. But in subsequent measures, the President announced a cap of 100 persons

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country� s COVID-19 testing regime. not give rise to flagrant abuse ofThe the protocols. If for nothing CPA� s Chief Executive Officer, Kofi Kapito, said in as at all, we have the resurgence much as the government want to of cases in Europe curb imported cases ofasthea yardstick todisease, reminditusmust of what respiratory not burden the passenger but charge our recklessness could lead to. what is enough to cover their While theprofit President cost and not to from the maintained that private burials passenger. must notaround be attended by you not “Look Africa and see that what is paid in Ghana for more 100 people, the situation the test is the highest. Why on the ground is otherwise. should that be� ” Indeed quite apart from He also raised questions about funerals, are why the political Noguchi rallies Memorial Institute Medical of attendedforby moreResearch than 100 the University of Ghana, was not people which flies in the face made to handle the testing for a of the President reasonable fee responsibility. but rather a contract given a foreign Knowing howto devastating company to do what Noguchi this virus can be, we owe it first could adequately handle. to ourselves to keep ourselves Business24 would like to urge as well as our relatives. asafe flexible approach that allows passengers eithertopay online There’s to a limit how the or cash on arrival. state can police adherence to Covid protocols. the protocols but if we all make The fact that businesses are it a point to stick to them, this eager to ramp up sales should virus will no longer be thread.

COVID-19: Banks deferred GH¢3bn in loan repayments CONTINUED FROM COVER

Wear a mask

condition for boarding of flights to KIA.” to attend such gatherings. In address, T h e nSunday’s e w d i re c t ive , has however, been described by however, the ceiling was lifted airlines as detrimental to the paving way fortoother large renewedtheefforts stimulate conferences and conventions demand for air travel, given that– cash payments remains the key driver of revenues for hotels predominant mode of payment and other alliedtravelers. hospitality for most Ghanaian agencies – to be held. An airline operator who The to President maintained wishes remain anonymous, told Business24 that “The of costthe is that the gradual easing already too high and now this restrictions is part of measures new policy is also going to be to i m pensure l e m e n that t e d . the T h eeconomy re are hundreds of Ghanaian traders returns to its pre-pandemic who travel to buy goods to retail levels although he was quick to in the country. caution that the protocols must “Most of them don� t carry any not be compromised. electronic payment cards to be able to paper pay online. Theythat should This believes the have the flexibility to pay cash move is in the right direction when they arrive.” if the hoteliers are to recover The Consumer Protection some theirhas eroded Agencyof� CPA� also gains. raised critical about the Just like questions the President stated, relatively high cost of the priority must be given to the

that the desired outcomes are outbreak had transformed their team structures to the new way of achieved and the economy operations, the bank chiefs working in order to maximise brought back on track.” responded that the immediate efficiencies of digital banking, Mr. Awuah� s remarks were response was to enforce remote and ensure less-paper operations reinforced by majority of the top working while realigning workers� and requirements for social distancing. In the long run, these bank executives who responded roles. measures may result in possible While the majority, 69 percent, to the survey. The respondents layoffs for some whose jobs of respondents indicated that advised the Bank of Ghana to increase stakeholder consultation remote working will become a become automated,” the report Continued in orderfrom to cover propose more permanent option going forward, said. Commenting on the findings of there was general consensus that beneficial policies. the survey, which was on the the new norm will ultimately lead It provides generally for the This, they said, will help to the shedding of workers whose theme “The new normal� banks� rules of punishment for offences estimate the timelines and extent response to COVID-19”, PwC� s described as a first degree jobs have become automated. to which the policies of the Country Senior Partner, Vish “ M o s t b a n k s i n t e n d t o felony, degreeavailable. felony regulatorsecond will remain Ashiagbor, cautioned that for permanently incorporate remote and S o mae misdemeanor. r e s p o n d e n tA s distinct s i m p l y working as an option available to workers that survive the digital category of offences under the thought that there was the need staff based on their roles. 12.5� of p ro g re s s i o n , t hey h ave to new law is the proposal for a term for detailed guidelines from the banks confirmed that they have upgrade their skills to remain of imprisonment not exceeding government and Bank of Ghana already begun and will continue relevant. twenty-five years for corruption on the implement ation of to realign the job roles and work which as measureswas put incategorised place to curb the impact of the pandemic. misdemeanours under the old law. In their view, clear guidance Themissing, amendedand lawthough reiterates was this thresholds serve as a yardstick to judicial officer or juror, corrupt existing offences under various c o u l d b e s h a r e d d u r i n g guide judges in the determination selection of juror and corruption, provisions the previous they law of the term of imprisonment to intimidation and personation in stakeholderof consultation, couldsubstitutes not fully embed the new impose. but the relevant respect of election. policies in operational strategy provisions by providing Other amendments comprise Corruption, undoubtedly, without a for detailed documented specifically stiffer penalties to false declaration for office or constraints the economic directive. bring them within the category of voting, false certificate by public growth of a country as it reduces a first-degree or second-degree officer, destruction ofADVERTISE WITH document revenue to US the state and distorts Post-pandemic banking felony. TEL: +233 212 2742 by a public officer, deceiving a 024 economic development by The amending provisions public officer, accepting or giving rewarding the dishonest rather When asked by the minimum audit firm bribe to influence a public also stipulate the www.thebusiness24online.net officer than the most competent, the about how the pandemic� and maximum thresholds. The s or juror, corrupt promise by report states.

Public officers could face 25-years in jail under new law

MONDAY OCTOBER 19, 2020

Some MFIs, RCBs defaulting on credit reporting Continued from cover This has been prevalent among the rural and community banks (RCBs) as well as microfinance institutions (MFIs). The Bank of Ghana (BoG) stated in its latest credit referencing report that the low usage of credit reports emanates from the lack of understanding among financial institutions of the usefulness of credit reports. Section 26 of the Credit Reporting Act mandates all financial institutions to obtain credit reports on all prospective borrowers prior to granting or refusing a credit facility application. “Some financial institutions, especially rural banks, conduct credit searches only on their commercial customers or firsttime borrowers, or once on regular customers,” the report said. Across the financial sector, credit enquiries for the purpose of credit application constituted 74 percent of total enquiries. Financial institutions’ use of credit bureau services for credit monitoring purposes increased by 12 percent in 2019 compared to the previous year. The central bank said

continuous use of credit reports for monitoring portfolios will enable lenders adequately foresee and mitigate potential adverse credit risks. In view of the challenge that is limiting the optimum performance of the credit referencing system, the BoG intimated that it will mitigate this challenge by administering

penalties for breaches through the Credit Reporting Regulations. Credit bureau usage As at December 2019, the total number of records in the database of credit bureaus stood at about 23 million. This included both credit and noncredit information, with about 22 million individual records

PZ Cussons delists from GSE today Continued from cover According to a statement issued by the company, the tender offer results and delisting have been approved by the GSE. The de-listing is in line with the company’s plans to achieve operational efficiency, by providing management of the company more time and resources to focus on running and expanding the business, its distribution network and reach, thereby ensuring consumer satisfaction. The completion of this process marks the sixth delisting of a company from the bourse over the past three

years—some voluntary, some enforced—and reduces the number of companies listed on the bourse to 31.

Offer results Out of a total of 2,079 shareholders represented in the register, 410 shareholders tendered a total of 8,830,143

and 716,736 corporate records. The non-credit information includes information in the public domain, ID information, and company data. There was a total of about five million unique borrowers in the credit bureau database, with individual borrowers accounting for 96 percent of total borrowers. shares valued at GH¢3.97m, representing 53.37 percent of the total number of shares under the offer. PZ Cussons (Holdings) Limited, the majority shareholder, therefore now holds more than 160 million shares, representing about 95.5 percent of the issued shares of PZ Cussons. The tendered shares have been transferred to the ownership of PZ Cussons (Holdings) Limited. The statement further noted that the company’s shares will no longer be traded on the GSE. However, shareholders who wish to trade their shares after the de-listing should contact UMB Registrars or IC Securities (Ghana) Limited.

MONDAY OCTOBER 19, 2020

News

MONDAY OCTOBER 19, 2020

Government settles prolonged inter utility legacy debt of US$203 million

he prolonged inter utility legacy debt of $203 million component of the power sector debt within the energy sector accrued by the end of 2016 has been finally set off. The debt, which involved both state owned corporations and Independent Power Producer, Sunon Asogli Power Ghana Limited affected the operational and financial performance of all parties involved within the power supply chain. A statement signed by Mr Elikplim Kwabla Apetorgbor, Sunon Asogli Manager of Energy Trading, Research and Regulatory Affairs pand copied to the Ghana News Agency in Accra said: “It became very difficult for the private sector organization to obtain financial support to sustain its business

operation, commitment to future investments and also affected their shareholders confidence.” It said as a result of collaboration among the Government of Ghana through the Ministries of Finance and Energy, The Electricity Company of Ghana Limited (ECG), Volta River Authority

within the sector had a sound and healthy financial status to sustain their operations. It said the settlement of the debt would contribute to the improvement of the credit rating of the various organization within the energy sector seeking for credit facilities from both domestic and international Banks. “It will further reduce the indebtedness of government, ECG, VRA, GNGC and Sunon Asogli Power Limited making (VRA), Ghana National Gas their books much better than Company Limited (GNGC) and before,” statement added. It said: “We will continue to Sunon Asogli Power (Ghana) Limited, the prolonged inter collaborate with all the parties utility legacy debt in respect of within the energy sector and gas invoices was finally settled. the Government in sustaining The statement said the and meeting the electric power support from government demand in Ghana.” through its agencies demonstrated its zeal to GNA ensure that all corporations

Government commended for fixing new cocoa price

he COCOBOD’s announcement of a new cocoa price of GH¢660.00 per bag of 64 kilo-grammes for the 2020/2021 cocoa crop season has been highly commended by farmers at Anum Apapam in the Ayensuano District of the Eastern Region. The price for the 2019/2020 crop season was GHc 514.00 of the same bag per same kilo-grammes. The Chief Farmer for Anum

Apapam and adjourning towns and villages, Nene Ashaley Adjabeng, speaking at a cocoa farmers meeting, amidst observation of COVID-19 protocol, said the new price increment would help farmers to expand their production and employ more hands. According to Nene Ashaley, the increment would ginger them to work hard to justify COCOBOD’s expectation of purchasing 900,000 metric

tonnes of the beans for this cocoa season, which was opened on October 2, this year. While the farmers commended the government and the authorities of the cocoa industry for what they termed as “slight upward adjustment”, he said, it was important that the problems they were confronted with were dealt with to ensure that the country’s projection of 900,000 metric tonnes of the production of the beans for the

year was not undermined. “The fact is that the contribution of the cocoa sector to the economy has far-reaching results”, he stated, adding, “we have no other option than to give the industry the support it deserves” and called on all cocoa farmers to get on board. In a related development, the Chief Farmer for Amanase and its environs, Nana Asamoah Ampofo appealed to COCOBOD to help restore the “Bonus” to cocoa farmers, the band adding, “Farmers need to enjoy the fruits of their labour. In another meeting with farmers at Akorabo in the Suhum Municipality, chaired by Enoch Agudze, a Purchasing Clerk (P/C) of the Produce Buying Company (PBC), the farmers pleaded with the Department of Feeder Roads and the municipal assembly to fix the stretch of feeder road from Kukua through Akorabo to Amanhyia which had been rendered deplorable to help the carting of cocoa beans from the area. GNA

MONDAY OCTOBER 19, 2020

News

MONDAY OCTOBER 19, 2020

GSS, UNDP engage journalists on data reporting

he Ghana Statistical Service (GSS) in collaboration with the United Nations Development Program (UNDP) has engaged journalist in a two-day training program on data interpretation and communication.

At the two-days training, Prof. Samuel K Annim, Government Statistician said, GSS and its partners often produce research reports on various aspects of development to inform policy decisions, however, journalists sometimes misinterpret and

misrepresent data out of context. The training is seeking to improve Journalists’ knowledge and understanding on how to effectively communicate the results of data analyses. This will enhance the participants understanding of basic statistical methods and terminologies, and interpretation of statistical data within context and dissemination

in the most effective ways, Prof. Annim stated. The Government Statistician further urged journalists to limit the use of statistical terminologies when reporting of statistics and data if possible, for the benefit of non-technical experts. The two-days training involved 25 selected journalists from Print, Online, Radio, and Television across Eastern, Volta, Central, Western, and Greater Accra Regions. The Head of Communication for UNDP, Praise Nutakor also indicated that, it has become important that journalists continue to improve their knowledge and understanding of statistics, particularly quantitative data to be able to interpret and present these in simple and straight forward terms to facilitate understanding especially among non-technical experts.

AfDB second virtual business opportunities seminar of 2020, draws 250 global partners and suppliers

he African Development Bank hosted its second virtual business opportunities seminar in 2020 (BOS) on 13 and 14 October. The BOS offers a one-stop shop for individuals and consulting firms, civil contractors, manufacturers, suppliers, and diplomatic commercial attachés from the Bank Group’s regional and non-regional members seeking to provide goods and services to projects or to the Bank, or otherwise partner with it. During the seminars, participants are informed about the Bank’s strategy for supporting economic growth, its priority areas and rules and procedures for project and corporate procurement. This month’s edition was held over two days, to allow for participation from different time zones, with the added innovation of thematic breakout sessions replacing the business-to-business (B2B) sessions which took place during physical meetings before the onset of the COVID-19 pandemic. In an opening address, Valerie Dabady, a Manager in the Bank’s Resource Mobilization and Partnerships Department, welcomed

participants, highlighting the opportunities the seminar provides to external partners eager to know more about the Bank’s processes and procedures, as well as to strengthen virtual networks. “We believe there are opportunities for all of you…The important thing is to make the connections,” Dadaby said. The Resource Mobilization and Partnerships Department, organizes the BOS events to enable the Bank to grow a pool of high-quality providers to compete for its projects, boosting its own service delivery and achievement of the Bank’s overall development initiatives.

During the presentations, Bank staff laid out five key sectors that offer opportunities for partners and suppliers: climate change; human capital, youth and skills development; infrastructure, cities and urban development; financial sector development; and industrial and trade development. In one presentation, Bank partner, Clementine Umugwaneza, a project implementation unit coordinator and Director of Planning at the Rwanda Energy Group, spoke on the construction of the Gihira Water Treatment Plants Project, under the Rwanda Sustainable Water & Sanitation

Program. Chris Smith (https://bit.ly/37f56CQ), Vice President of Culligan (www.Culligan.com) Rwanda, an international water treatment company, shared his experience working with the Bank on a project to upgrade an existing water treatment plant and build a new one in Rwanda. The presentations were the opportunity for invaluable firsthand lessons, enrichening the experience for participants. “Thank you for the opportunity. I have a better understanding of the AfDB Group and how it works with its partners to bring about development in Africa,” said Judy Oduori, an individual consultant from Kenya. Since 2017 and until the advent of COVID-19, the Bank held two in-person business opportunity seminars each year – in Abidjan (headquarters) and in a regional member country. Tunisia, South Africa and Kenya have already hosted seminars which have drawn more than 1,500 participants from 55 member countries. In 2019, the African Development Bank Group supported 172 projects valued at close to $10 billion.

MONDAY OCTOBER 19, 2020

Feature

MONDAY OCTOBER 19, 2020

The ABC of business referral networking

usiness Referral Networking as a marketing tool is as easy as ABC. Don’t believe me? Follow these 3 principles religiously for 6 months and watch your client base – and profits – grow: A is for Attitude. Attitude is more important than ability. Let me prove it to you. If you were offered GH¢15 commission for every referral you got for your business, could you get 100 referrals this month? You might say yes, or no – depending on your desire and or (perceived ability). Now answer this question: If you were offered GH¢50,000 for getting all 100 referrals this month, could you get the lot? Of course you could. Enough said. With the right attitude, we can achieve far more than what we are right now. All we need to do is decide to improve our ability – then go out and accomplish this. It applies to

networking just as much as sales. B is for Be Patient. Business Referral Networking is certainly not for the quick fix merchants and not generally responsible for overnight success stories. Go in with your eyes open – do not expect to start making direct sales or even get referrals straight away. It takes time for others to trust you. C is for Commitment. Part of the trust issue is about showing up at every meeting. Once others see that you are committed to the group, it won’t just be you making all the effort to build relationships. People are not interested in excuses on why you can’t make a meeting as business referral networking is about giving business….not excuses. And make no mistake, it’s about more than just attendance. If you have employees you may have heard of ‘presenteeism’

– where someone shows up at work and goes through the motions without really achieving anything of note. Be careful that you don’t fall into this trap with your networking meetings. Who in your group can you help out this week? When was the last time you went and chatted to someone about their business without trying to sell them anything? Start thinking like this and before long you will start to reap the rewards. Authored by: Business Breakfast (BforB)

for

Business for Breakfast (BforB) is internationally recognised for creating successful networking meetings, events and training for referral marketing. Our global offices are in Australia, Germany, Czech Republic, Spain, Slovakia, Ghana and headquartered in UK. We create an environment where you can build quality

relationships within your group, backed up by an ongoing member support programme. BforB is committed to helping small to medium scale businesses expand. In our professional network, members meet regularly in business networks to develop relationships, support each other and to share and record referral business. We are here to help you get new business from quality business introductions and referrals made through our meetings. Contact us: 059 4 016 432 | info@bforbgh.com | Facebook & LinkedIn: @bforbghana | www. bforb.co.uk

Business for Breakfast (BforB)

MONDAY OCTOBER 19, 2020

Aviation

MONDAY OCTOBER 19, 2020

USAID & Ethiopian Airlines sign deal to source food locally for in-flight meals

thiopian Airlines and the United States announced a new partnership agreement that will enable the nation’s flagship carrier to source locally grown produce and ingredients for preparing in-flight meals for global passengers. Ethiopian Airlines Group CEO Mr. Tewolde GebreMariam and U.S. Ambassador, Michael Raynor, signed a memorandum of understanding in which the U.S. Agency for International Development (USAID) will provide Ethiopian farmers and food producers technical assistance and access to financing in order to ensure they are able to meet the airlines’ standards of quality and volume to serve its customers. “These new business linkages will help farmers and local agribusinesses reach a prominent new market and increase their revenue streams – with annual sales as high as US$10 million in

total – while providing Ethiopian Airlines farm-fresh ingredients sourced directly from Ethiopia, reducing the need for foreign suppliers’ processed foods for their catering services.” USAID support will help Ethiopian Airlines identify local suppliers for the list of catering materials the airline might potentially require, as well as provide support to farmer cooperative unions, youth groups, women groups and other local agriculture businesses to enable them to meet production

requirements. A U.S. government loan facility also will expand access to financing for local companies, farmer cooperative unions, and others to expand their operations as needed to meet the Ethiopian Airlines quality and supply demands. “We deeply value our relationship with USAID and extend our appreciation to USAID for all the support. The new partnership consolidates our effort to continue providing high-quality inflight meals

to global passengers while intensifying our effort in creating an enabling environment for local farmers across the value chain. We would like to maintain our partnership with USAID on a range of spheres,” added Mr. Tewolde GebreMariam. “The partnership we’re launching today demonstrates what’s achievable when prominent businesses like Ethiopian Airlines invest in other Ethiopian businesses and individuals, resulting in truly home-grown economic success that has the potential to be a model for other sectors,” said Ambassador Raynor. This partnership agreement will run through December 2022 and will help pave the way for Ethiopian Airlines and local producers and farmers groups to continue these supply linkages and partnerships into the future. ( Source: Ethiopian Airlines)

Research points to low risk for Covid-19 transmission inflight

he International Air Transport Association (IATA) has demonstrated the low incidence of inflight Covid-19 transmission with an updated tally of published cases. Since the start of 2020 there have been 44 cases of Covid-19 reported in which transmission is thought to have been associated with a flight journey (inclusive of confirmed, probable and potential cases). Over the same period some 1.2 billion passengers have travelled. “The risk of a passenger contracting Covid-19 while onboard appears very low. With only 44 identified potential cases of flight-related transmission among 1.2 billion travellers, that’s one case for every 27 million travellers. We recognise that this may be an underestimate but even if 90% of the cases were unreported, it would be one case for every 2.7 million travellers. We think these figures are extremely reassuring. Furthermore, the vast majority of published cases occurred before the wearing of face coverings inflight became widespread,” said Dr. David Powell, IATA’s medical advisor. New insight into why the numbers are so low has come from the joint publication by Airbus, Boeing and Embraer of separate computational fluid dynamics (CFD) research conducted by each manufacturer in their aircraft. While methodologies differed slightly, each detailed simulation confirmed that aircraft airflow systems do control the movement

of particles in the cabin, limiting the spread of viruses.

Layered approach of preventive measures

Data from the simulations yielded similar results:

Mask-wearing on board was recommended by IATA in June and is a common requirement on most airlines since the subsequent publication and implementation of the Takeoff Guidance by the International Civil Aviation Organization (ICAO). This guidance adds multiple layers of protection on top of the airflow systems which already ensure a safe cabin environment with very low risks of inflight transmission of disease. “ICAO’s comprehensive guidance for safe air travel amid the Covid-19 crisis relies on multiple layers of protection, which involve the airports as well as the aircraft. Mask-wearing is one of the most visible. But managed queuing, contactless processing, reduced movement in the cabin, and simplified onboard services are among the multiple measures the aviation industry is taking to keep flying safe. And this is on top of the fact that airflow systems are designed to avoid the spread of disease with high air flow rates and air exchange rates, and highly effective filtration of any recycled air,” said Powell.

• Aircraft airflow systems, High Efficiency Particulate Air (HEPA) filters, the natural barrier of the seatback, the downward flow of air, and high rates of air exchange efficiently reduce the risk of disease transmission on board in normal times. • The addition of mask-wearing amid pandemic concerns adds a further and significant extra layer of protection, which makes being seated in close proximity in an aircraft cabin safer than most other indoor environments. Data collection IATA’s data collection, and the results of the separate simulations, align with the low numbers reported in a recently published peer-reviewed study by Freedman and Wilder-Smith in the Journal of Travel Medicine. Although there is no way to establish an exact tally of possible flight-associated cases, IATA’s outreach to airlines and public health authorities combined with a thorough review of available literature has not yielded any indication that onboard transmission is in any way common or widespread. Further, the Freedman/Wilder-Smith study points to the efficacy of maskwearing in further reducing risk.

Aircraft design characteristics add a further layer of protection contributing to the low incidence of inflight transmission. These include: •

Limited

face-to-face

interactions as passengers face forward and move about very little • The effect of the seat-back acting as a physical barrier to air movement from one row to another • The minimisation of forwardaft flow of air, with a segmented flow design which is directed generally downward from ceiling to floor • The high rate of fresh air coming into the cabin. Air is exchanged 20-30 times per hour on board most aircraft, which compares very favorably with the average office space (average two to three times per hour) or schools (average 10-15 times per hour). • The use of HEPA filters which have more than 99.9% bacteria/ virus removal efficiency rate ensuring that the air supply entering the cabin is not a pathway for introducing microbes. Safety is always the top priority This research effort demonstrates the cooperation and dedication to safety of all involved in air transport and provides evidence that cabin air is safe. Aviation earns its reputation on safety with each and every flight. This is not different for flying in the time of Covid-19. A recent IATA study found that 86% of recent travellers felt that the industry’s Covid-19 measures were keeping them safe and were well-implemented.

MONDAY OCTOBER 19, 2020

Feature

MONDAY OCTOBER 19, 2020

The time bomb at the top of the world By Mario Molina, Durwood Zaelke

t is hard to imagine more devastating effects of climate change than the fires that have been raging in California, Oregon, and Washington, or the procession of hurricanes that have approached – and, at times, ravaged – the Gulf Coast. There have also been deadly heat waves in India, Pakistan, and Europe, and devastating flooding in Southeast Asia. But there is far worse ahead, with one risk, in particular, so great that it alone threatens humanity itself: the rapid depletion of Arctic sea ice. Recalling an Alfred Hitchcock movie, this climate “bomb” – which, at a certain point, could more than double the rate of global warming – has a timer that is being watched with growing anxiety. Each September, the extent of Arctic sea ice reaches its lowest level, before the lengthening darkness and falling temperatures cause it to begin to expand again. At this point, scientists compare its extent to previous years. The results should frighten us all. This year, measurements from the National Snow and Ice Data Center in Boulder, Colorado show that there is less ice in the middle of the Arctic than ever before, and just-published research shows that winter sea ice in the Arctic’s Bering Sea hit its lowest level in 5,500 years in 2018 and 2019. Over the entire Arctic, sea ice reached its second-lowest extent ever on September 15. Amounts vary from year to year, but the trend is inexorably downward: the 14 Septembers with the least sea ice have all been in the last 14 years. But sea ice is not only covering less area; it is also thinner than ever. The oldest sea ice (more than four years old), which is more resistant to melting, now comprises less than 1% of all sea ice cover. First-year ice now dominates, leaving the sea cover more fragile and quicker to melt. Scientists now expect the Arctic Ocean could be almost ice-free in late summer within a decade or two. The effects would be catastrophic. In the extreme scenario, which could happen within decades, loss of all ice during the entirety of the sunlit months would produce global

radiative heating equivalent to adding one trillion tons of carbon dioxide to the atmosphere. To put this in perspective, in the 270 years since the Industrial Revolution began, 2.4 trillion tons of CO2 have been added to the atmosphere. About 30% of the Arctic warming has already been added to the climate because of the ice lost between 1979 and 2016, and more warming follows quickly as more of the remaining ice is lost. This extreme scenario would drive climate change forward by 25 years, and it is hardly farfetched. Just last month, a block of ice about twice the size of Manhattan broke off from the largest remaining Arctic ice shelf, in Northeast Greenland, after record summer temperatures. Meanwhile, on land, the Greenland Ice Sheet is also in peril. With Arctic warming occurring at least twice as fast as average global warming, Greenland’s rate of melting has at least tripled over the last two decades. It is believed that this will become irreversible in a decade or less. Eventually, this melting will cause sea levels to rise by up to seven meters (23 feet), drowning coastal cities, though this peak will most likely not be reached for hundreds of years. Compounding the problem of accelerating Arctic warming is the self-reinforcing feedback risk of permafrost thawing. With about twice as much carbon locked away in permafrost as

is already in the atmosphere, releasing even some of it could be disastrous. Permafrost thawing would also release even more potent greenhouse gases: nitrous oxide and methane. As global temperatures rise, it also is possible that even more methane could be emitted from the East Siberian Arctic Shelf ’s shallow seabed. Clearly, urgent action is needed to mitigate these tremendous – even existential – risks. Rapidly reducing CO2 emissions is necessary, but not nearly sufficient. In fact, studies show that even rapid cuts in CO2 would mitigate only about 0.1-0.3°C of CO2 warming by 2050. That is why it is also vital to slash emissions of so-called short-lived climate pollutants: methane, black carbon, hydrofluorocarbons (HFCs), and tropospheric ozone. Such action could mitigate six times as much warming as reductions in CO2 emissions by 2050. Overall, eliminating emissions of these super pollutants would halve the rate of overall global warming, and reduce projected Arctic warming by two-thirds. Some progress is being made. Almost four years ago, in Kigali, Rwanda, 197 countries adopted an amendment to the Montreal Protocol focused on phasing out HFCs. (Already, the Montreal Protocol has facilitated the phaseout of nearly 100 chemicals that fuel global warming and endanger the ozone layer.)

Moreover, in the United States, the Senate reached a bipartisan deal last month to cut the production and importation of HFCs by 85% by 2036. California, for its part, has slashed black carbon emissions by 90% since the 1960s, and will halve the remainder by 2030. And the US Climate Alliance – a bipartisan group of 25 state governors – has set the goal of reducing methane emissions by 40-50% by 2030. These are laudable goals. But reaching them – let alone the more ambitious targets needed to stem the rise in global temperature – will require us to overcome strong headwinds, beginning with US President Donald Trump’s administration, which opposes emissions-reduction targets. Even if Trump loses next month’s election, the Arctic – and the entire planet – will be in grave danger unless the new administration radically strengthens efforts to cut emissions of both CO2 and shortlived climate pollutants. People all over the world are already losing their homes and livelihoods to deadly fires, floods, storms, and other disasters. Far worse could be yet to come. About the author Eric Posner, professor at the University of Chicago, is the author, most recently, of The Demagogue’s Playbook: The Battle for American Democracy from the Founders to Trump.

MONDAY OCTOBER 19, 2020

Feature

MONDAY OCTOBER 19, 2020

Utilize Social Media NOW for your Business: 10 reasons why.

he POWER of Social Media is an easier sell to we the Generation Y business owners (1981-1996). We have a relatively healthy grasp of the before and the aftermath of the internet boom. This aforementioned power of social media is pretty obvious to Generation Z (1997-2012); that’s all they’ve known since they became “aware”. It’s the large number of Baby Boomers (1946-1964) and a lot of Generation X (1965-1980) that might be a bit stuck in their old ways and to them I respectfully say: FOLLOW THE NUMBERS! The math tells us that there are 3.96 BILLION active social media users as at three months ago. That word “active” means that many more accounts have been created and almost 4 billion of them are not dormant; they are regularly used. Considering that there are currently over 7.8 billion people in the world now, that’s half of the entire world population. I wish I could add the statistics for Ghana’s social media activity. I will take Selassy’s advice and write these articles earlier and on time but in the meantime, I could bet you one pesewa that your target market is on the internet, RIGHT NOW. The frequent question is, how do you reach them? That’s not what I’m addressing today. It should make for a good follow-up article next week. WHY YOU SHOULD REACH THEM is what we are deliberating. Here are 10 reasons why. ______________________________________ 1. The first one is obvious, MORE SALES. The principal aim of most businesses is to sell the goods or services that they’re set up for. Half of the world is on the internet actively engaging with other people and businesses. If you aim to reach more people and get more engagement with prospective customers, social media will play a vital role. The world is getting more and more digitally interconnected and social media is the present and future of marketing. 2. Social media engagement GENERATES REAL BUSINESS LEADS. These are real people. In a pandemic, the world has readily embraced the need to incorporate digital technology. The people that are liking and commenting on the content that businesses put on social media are as real as people standing right in front of a billboard. This is just a quick, easy and effortless way for potential customers to express interest in your product. 3. Most businesses have a

website with the full pitch, the full information about the product or services that will seal the deal with any interested and ready customer. The problem is, not everybody knows your company, or where to get the necessary info to make a decision. Social Media can INCREASE YOUR WEBSITE TRAFFIC when it’s designed to direct people to your website. There’s already a lot of traffic between social media user accounts. When you’re part of that traffic, any engagement with your social media handle can very easily direct people to your website. 4. Also, by indulging in all this social media engagement together with half of the world, you MAKE YOUR BRAND RECOGNISABLE. I don’t have the stats but I could bet you another pesewa that customers would choose brands they have interacted with on social media rather than totally strange ones. By staying on the minds of the public, you increase your chances of actually closing a sale when the opportunity presents itself or when a customer is ready to buy. You humanise your brand and make your company easily accessible and approachable. 5. By making yourself recognisable, you INCREASE BRAND AWARENESS. It’s true that 60% of Instagram users discover new brands on social media. Don’t lose out on that. Social media companies are mainly driven by their ability to display ads to a targeted audience. So, when you join the social media, you can promote your ads. It can be a picture with a simple message. Or a short video with whatever message you want to convey. It’s relatively inexpensive and very easy to get the assurance of a lot of eyes on your message at very little cost. 6. Also, you get to USE SOCIAL MEDIA INFLUENCERS. Just like on TV, there are some people that are popular and powerful on social media. Studies show that word of mouth has about 50% chance of swaying a purchasing customer. When someone is actually ready to buy a product or procure a service,

a good word from their favourite personality on social media can help. And it doesn’t have to be a big shot celebrity. There are equally long-reaching accounts on social media that are run by normal people that will charge you a fraction of what the big celebrities will. 7. Imagine GOING VIRAL. Just imagine it. Imagine being as viral as Big Shaq. He went viral because of content he made during a radio interview… RADIO! Yet, it wasn’t radio and TV that made him a household name. It was social media. YOU or your business stand a chance of going viral should your content resonate with the masses. When that happens, for however long it lasts, you will have Ghana’s attention… technically half of Ghana but that’s still a massive lot of people to introduce your business to. 8. It’s possibly never happened to you, and I hope it doesn’t, but if a crisis does befall you, then you don’t want to not have a strategy for SOCIAL MEDIA CRISIS MANAGEMENT. It is crucial because in the times we find ourselves, it is social media that disseminates information the quickest. If your company ever has a crisis and word needs to be put out fast and well, you will need a social media plan. To execute an effective social media plan, you have to have been active and engaging with your target audience on social media. 9. Regardless of crisis, smart companies frequently execute REPUTATION MANAGEMENT strategies. During all the interactions that happen on social media, one could influence how others think about and perceive your company. It’s better to get ahead of it. Your current and prospective clients are discussing your product. They’re looking at the good sides and the bad sides to choosing your company. If you follow very carefully, you can contribute to throwing more light on the positive and address the negative before it turns into a fullblown crisis. 10. Social media is accessible

to anyone with internet. It means you will see what your competitors do and have many other ways to MONITOR YOUR COMPETITORS. It means you’ll be able to tell when they put out important information, when they launch new products, and when they alter their way of doing things. Your competitors are your competitors because they’re doing something right and staying in business. Through social media, while you monitor opposition strategies, you can capitalise on what they’re doing wrong by offering a better experience to win over customers. ______________________________________ I remember a time when you’d have to get a flat-bed trailer truck, get some sound systems with some marketers dancing to popular music while the truck slowly drives through traffic to bring attention to your product, service or event. It’s called a float! It’s a FLOAT! I remembered the word late but I like the description I gave before so I’ll keep it in. Well, now, with just the internet and a resonating message, you can reach tens of millions of people in a jiffy as opposed to a street float reaching smaller than a very minuscule fraction of that. Look at the screenshot displayed here. That’s the social media analytics of the 3-day, less-than-a-week, intermittent, non-targeted buzz about the #GhanaEconomicForum on just Twitter. This is literally magic to the marketers of many decades ago! Get in on that. Hit me up on social media and let’s keep the conversation going! I read all the feedback you send me on LinkedIn, Twitter, Instagram and Facebook. Go to bit.ly/maxwrites to read all my previous articles. Have a lovely week! Maxwell Ampong is an AgroCommodities Trader and the CEO of Maxwell Investments Group, a Business Solutions Provider. He is also the Official Business Advisor to Ghana’s General Agricultural Workers Union of the Trade Union Congress (TUC). He writes about trending and relevant economic topics, and general perspective pieces. LinkedIn:/in/thisisthemax Instagram:@thisisthemax Twitter:@thisisthemax Facebook:@ thisisthemax Website: www. maxwellinvestmentsgroup. com Email: maxwell@ maxwellinvestmentsgroup.com Mobile: 0249993319

MONDAY OCTOBER 19, 2020

Feature

MONDAY OCTOBER 19, 2020

Who’s afraid of rules-based monetary policy?

By John B. Taylor

any of the world’s central banks have been formally reviewing their monetary-policy strategies in light of COVID-19 and the experience leading up to the pandemic. Unfortunately, they appear to be drawing the wrong lessons from the challenges they face. One of the first to complete this process was the US Federal Reserve System, which decided to move to a new “flexible form of average inflation targeting,” as Fed Chair Jerome Powell described it in a speech at the annual Jackson Hole monetary-policy conference in August. Similarly, European Central Bank President Christine Lagarde recently told the annual ECB and Its Watchers XXI conference that the ECB is in the middle of its own “monetary policy strategy review.” And according to Bank of Japan Governor Haruhiko Kuroda, there are ongoing discussions with the new government of Prime Minister Yoshihide Suga about how to deal with the pandemic and whether a new monetary-policy strategy is in order. In light of these discussions, it previously looked like there was a move underway to reform the entire international monetary system, with each country or region following a strategy similar to the Fed, though attuned to its own circumstances. But it no longer looks that way. “At the very least,” argues Otmar Issing, a former chief economist and member of the ECB Board who was largely responsible for charting the original course of ECB policymaking, “other central banks should not blindly follow the Fed’s new strategy.” Issing is not alone in seeing problems with the Fed’s new

approach. In early September, Robert Heller, a former Federal Reserve governor, argued in a letter to the Wall Street Journal that the Fed should “not target an average inflation rate of 2%.” Then, at a virtual conference convened by Stanford University’s Hoover Institution this month, Charles I. Plosser, a former president of the Federal Reserve Bank of Philadelphia, and Mickey D. Levy of Berenberg Capital Markets criticized the Fed for not being specific about the timespan over which average inflation will be measured. Is it one year or several years? Powell himself acknowledged this lack of specificity at the Jackson Hole conference in August. Noting that “we are not tying ourselves to a particular mathematical formula that defines the average,” he added that, “Our decisions about appropriate monetary policy … will not be dictated by any formula.” Then, in a press release the same day, the Fed’s Board of Governors explained that policy decisions would be based on “assessments of the shortfalls of employment from its maximum level” rather than by “deviations from its maximum level,” as had been previously stated. But whether the focus is on “deviations” or “shortfalls,” this new approach adds unnecessary uncertainty, because shortfalls are not defined. Moreover, there is no mention of how monetary policy will be used to generate higher inflation to make up for periods when inflation is less than 2%. Is the Fed considering additional changes in its procedures beyond the current mix of near-zero interest rates and large-scale asset purchases? In adopting this “flexible” approach, the Fed seems to have shifted away from the more

strategic, rules-based policy that it had been pursuing at least since 2017. As of this summer, its Monetary Policy Report no longer includes material on monetarypolicy rules, whereas the previous six reports going had featured a whole section in which different rules were presented and compared with actual scenarios. Among the rules considered were transparent settings for the Fed’s interest-rate policy, including the so-called Taylor rule, a price-level rule, and a modified Taylor rule to deal with the zero bound. It is understandable that Issing and others would be reluctant to go along with the Fed’s less strategic, discretionary approach, especially when there are alternatives that other central banks can pursue. Rather than casting about for something new or simply different from the Fed, they can embark on the same rules-based-policy path that the Fed itself was on before the pandemic struck. In fact, this would be easier done than said. When I first developed the Taylor rule, which has been widely discussed for three decades now, I based it on an average inflation rate. But, unlike the vague definition that the Fed has now adopted, I explicitly defined the “average” as “the rate of inflation over the previous four quarters.” In other words, the Fed could still switch to an average-inflation approach and yet be far more specific than it has decided to be. Moreover, the formal policy rules previously listed in the Monetary Policy Report all have variables to account for factors other than the inflation rate, such as the unemployment rate or the gap between real and potential GDP. These variables could be

included in the current strategy without neglecting the inflation target, as could policy rules to deal with asset purchases and their eventual unwinding. Developing such an approach would not be difficult for the Fed to do, especially if other central banks also chose to go in this direction. A decade ago, I wrote a paper with John C. Williams, now the president of the Federal Reserve Bank of New York, titled “Simple and Robust Rules for Monetary Policy,” in which we emphasized the importance of rules-based policymaking. And there are reams of additional studies showing the benefits of rulesbased monetary policy. That is why so many distinguished monetary scholars have endorsed this approach. It is promising that the ECB and other central banks often use the word “strategy” when describing their own monetary-policy reviews. A strategic approach is necessarily a rules-based approach, which is precisely how the international monetary system should be run. About the author

John B. Taylor, Under Secretary of the US Treasury from 2001 to 2005, is Professor of Economics at Stanford University and a senior fellow at the Hoover Institution. He is the author of Global Financial Warriors and (with George P. Shultz) Choose Economic Freedom.

MONDAY OCTOBER 19, 2020

News

MONDAY OCTOBER 19, 2020

World Bank/IMF Annual Meetings 2020: Development Committee Communiqué 1. The Development Committee met virtually today, October 16, 2020. 2. The COVID-19 pandemic continues to devastate countries, overwhelming health systems, disrupting productivity, threatening food security, multiplying job losses, and reducing incomes, particularly forthemostvulnerable.Wecommend and support the frontline workers who are fighting the pandemic and keeping economic activity and critical services open. The global crisis requires a comprehensive, robust global response from the development community. We therefore call on the World Bank Group (WBG) and the International Monetary Fund (IMF) to continue working with member countries, the public and private sectors, local and bilateral development partners, and international organizations, including the UN. The WBG should further the response while keeping a firm focus on the twin goals of ending extreme poverty and fostering shared prosperity in a sustainable manner, as well as on the IDA19 and capital commitments, while supporting progress toward the SDGs. 3. The pandemic has resulted in the largest global economic contraction of the last eight decades: it is impacting developing, emerging and developed economies; increasing the global poverty rate; exacerbating inequalities; and damaging long-term economic growth prospects. The associated lockdowns, restrictions and continued uncertainty have caused investments, trade, and remittance flows to plummet; eroded jobs and human capital; kept children out of school; and pressured food and medical supply chains. The humanitarian crisis can further exacerbate fragility, conflict, and violence as well as intensify risks, including in small island states. The economic crisis is threatening the lives and livelihoods of vulnerable populations, including women-led households, youth and the elderly, refugees and displaced people. It is also widening gender gaps and jeopardizing hard-won development gains and prospects for girls and children overall. 4. We commend the WBG for the speed and scale of its COVID-19 response across countries. The WBG has been at the forefront of multilateral efforts centering on relief, restructuring, and a resilient recovery. We welcome the focus on health, social, and economic responses, as well as policies, institutions, and investments that will be critical to resilient, inclusive, and sustainable recovery. 5. The WBG is supporting countries’ efforts to strengthen health systems and should continue to do so. We stress the importance of an effective COVID-19 vaccine and welcome the US$12 billion in financing recently approved for IDA and IBRD countries to support vaccine purchase and deployment. We encourage the WBG to assist with affordable and equitable

access to tests, treatments, and vaccines for developing countries. As the COVID-19 crisis continues to present wide-ranging health, economic, and social challenges over a prolonged period, we encourage intensified action to build robust health systems with universal coverage, thus increasing preparedness and resilience against future pandemics. In this context, digital technologies can secure vital medical consultations, maintain educational services, and allow businesses to survive. We thus welcome WBG operations that are expanding digital connectivity while safeguarding security and data privacy, broadening the reach of digital financial services and supporting digital transformation. These efforts help firms adapt to the crisis, be more competitive, maintain employment, and continue the delivery of critical services, including in education, health, social protection, and access to finance. 6. In the restructuring and recovery stages of the COVID-19 response, the WBG and IMF will need to help countries rebuild better, focusing on promoting the building blocks for an inclusive and sustainable recovery, ensuring affordable energy access and energy security, and addressing the challenges to economic and environmental vulnerabilities, including climate change. We look forward to the upcoming Climate Change Action Plan. To accelerate a resilient recovery centered on jobs and economic transformation, we ask the WBG to provide the knowledge, policy advice, and financial support to help countries strengthen social safety nets and facilitate the movement of capital and labor toward sectors that will be productive and sustainable in the post-pandemic context, while also providing the innovation needed to open up trade finance for SMEs and confront the challengesof informality. We urge the WBG to support the mobilization and crowding in of private capital and finance, with innovative products from IFC and MIGA, maintaining and building on the IFC 3.0 strategy to create markets and promote investments and quality infrastructure for a broad-based recovery and longterm development. Moreover, we stress the importance of increasing domestic resource mobilization in a manner that promotes fairness, equity, and inclusive growth, including by phasing out fuel subsidies and other distortive subsidies and taxes where feasible. We also note the importance of an immediate response in public

health, food security, and education; and we call on all countries to support the availability of medical and food supplies that developing countries depend on to avoid the risk of a wider health crisis, famine and hunger. We strongly welcome the work underway to address the risks to gender equality and impacts on biodiversity that are exacerbated by COVID-19. We underscore that the WBG plays a critical role in key global challenges, and it is only by rebuilding stronger and better that the twin goals and SDGs can be achieved. 7. We commend the WBG for its exceptional delivery in the final quarter of fiscal year 2020, with US$45 billion in commitments consisting of US$32 billion from IBRD/ IDA, US$11 billion from IFC, and US$2 billion from MIGA, including via their fast-track facilities, for operations in more than 100 countries. We welcome the second phase of IFC’s response, which will include the restructuring and recapitalizing of viable companies and financial institutions as well as support to health care value chains in emerging and developing economies. We also welcome the planned scaling up to US$35 billion of IDA19 resources in fiscal year 2021 to help countries address their long-term development needs. The WBG should continue its efforts to deliver a bold and decisive response of up to US$160 billion by June 2021. Considering the severity and likely long-term effects of the crisis, we encourage discussions on the WBG financial capacity beyond fiscal year 2021, to ensure that the WBG remains adequately capitalized to fulfill its mandate. In addition, we commend the IMF for its rapid and effective crisis response, which has provided some US$100 billion in assistance to over 80 countries during the pandemic, primarily through emergency financing facilities. We call on the IMF to continue to deploy all available tools and resources to help members achieve a durable exit from the crisis while building more resilient and inclusive economies. 8. We support the extension of the Debt Service Suspension Initiative (DSSI) by six months and to examine, by the time of the 2021 WBG and IMF Spring Meetings, if the economic and financial situation requires to extend further the DSSI by another six months, with targeted complements to the April 2020 DSSI Term Sheet. All official bilateral creditors should implement this initiative fully and in a transparent manner. We strongly encourage private creditors to participate on comparable

terms when requested by eligible countries. Thanks to the efforts of official bilateral creditors, the DSSI is creating much needed fiscal space and supporting the financing programs of the WBG and IMF for the poorest countries. While protecting their current ratings and low cost of funding, we encourage MDBs to go further in their collective efforts in supporting the DSSI, including through providing net positive flows to DSSI-eligible countries during the suspension period, including the extension period. We encourage the WBG to explore additional proposals for COVID-19 emergency financing for IDA countries in its discussions with IDA deputies. We ask the WBG and IMF to continue supporting DSSI implementation, including by providing further details on the net new resources they are providing to each eligible country. We ask the WBG and the IMF to continue their work to strengthen quality and consistency of debt data and improve debt disclosure. Amid high public debt levels, shrinking economies, and rising fiscal pressures, we recognize that debt treatments beyond the DSSI may be required on a case-by-case basis. In this context, we welcome the G20’s agreement in principle on a “Common Framework for Debt Treatments beyond the DSSI”, which is also agreed by the Paris Club. We look forward to the endorsement of the Common Framework by members, subject to their domestic approval procedures. 9. We encourage the WBG and IMF to continue to review the debt challenges of low-income countries and propose actions to address their fiscal and debt stress on a case-by-case basis. We also continue to encourage the WBG and IMF to review the debt challenges of middle-income countries and to explore customized solutions to their fiscal and debt stress on a case-by-case basis, including by providing additional resources in these challenging times, in line with the capital package commitments. 10. We welcome the 2020 Shareholding Review Report to Governors and thank Board members for their progress to date. We look forward to the completion of the review based on the guidance provided at this meeting. We also thank the Board for their work on the ongoing review of IDA voting rights and look forward to its completion by the next Annual Meetings in 2021. 11. We thank Mr. Ken-Ofori-Atta, Minister of Finance of Ghana, for his guidance and leadership as Chair of the Committee during the past two years, and Ms. Yvonne Tsikata for her invaluable service to the Development Committee over the past four years. We welcome Ms. Mia Amor Mottley, Prime Minister and Minister of Finance of Barbados, and Ms. Azucena Arbeleche, Minister of Economy and Finance of Uruguay, who have been selected as sequential Chairs for the periods of November 2020 to October 2021, and November 2021 to October 2022, respectively. We also welcome Ms. Diarietou Gaye as Executive Secretary to the Development Committee. 12. The next meeting of the Development Committee is scheduled for April 10, 2021, in Washington, DC.

MONDAY OCTOBER 19, 2020

Feature

MONDAY OCTOBER 19, 2020

Why Africa’s animation scene is booming Nigerian animator Ridwan Moshood was so determined to learn how to make cartoons, he spent hours in internet cafés in Lagos, watching YouTube lessons and taking notes.

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I would go to a cyber café, watch video tutorials and write down whatever I’d learnt,” he says. Today, the 26-year-old is a rising star in Africa’s blossoming animation scene. Two years ago, he was recognised by the Cartoon Network Africa Creative Lab for his animation Garbage Boy and Trash Can. In what must have felt like sweet revenge, his cartoon was inspired by a bad experience at high school, involving a rubbish bin and school bullies. “Garbage Boy is basically me,” he says. “I was bullied and called names. “I decided to create Garbage Boy as a beacon of hope and forgiveness. And to show others who had been bullied that those names don’t define who you are.” He has since formed a production company and he’s now hoping to have his latest idea, a cartoon set in Lagos, called In My Hood, commissioned into a series. Self-taught talent Surprisingly, Ridwan Moshood’s journey into animation, is not particularly unique. “All over the continent we hear these stories,” says Nick Wilson, the founder of the African Animation Network, who is based in Johannesburg. He reels off a list of countries where local animators are starting to make their mark: Nigeria, Ghana, Kenya, Uganda, Egypt, South Africa, Mozambique and Burkina Faso. “Wherever we’ve been able to scratch the surface and connect the community, we’ve found pretty exceptional talent and the majority of this talent is selftaught,” he says. But while stories of self-taught animators breaking into the industry are inspiring, more formal training opportunities do need to be developed, he says. Doh D Daiga is a Cameroonian animator who lives in Burkina Faso. He’s responsible for skills

and development at the African Animation Network. “My experience in this industry shows me there exists an immense pool of young, talented and creative minds that never get to the see the day,” he says. “The only problem keeping Africa behind is a lack of training.” Recently, partnerships have been announced with international animation studios Toonz Media Group and Baboon Animation. Both companies plan to establish animation academies in Africa, adding to the handful that exist already. Pan-African production Despite the scarcity of formal training opportunities, locallymade productions are already starting to take off. Chris Morgan of Fundi Films was able to draw on a panAfrican talent pool for his recent production, My Better World. The educational series aimed at African schoolchildren and young teenagers involved a team of creatives working remotely across the continent. “We had over 100 producers working in seven different countries, and this was preCovid,” he says, speaking from Mpumalanga, South Africa. The end result is a series made up of 55 short animated films that are available in English, Swahili, Hausa and Somali. In each episode, the characters navigate complex situations - such as negotiations about early marriage - but in a lively and accessible way. As well as a cartoon, each film features an interview with a real-life high achiever, such as Africa’s first female pilot. When it was broadcast in Kenya earlier this year, My Better World quickly became the top rating children’s TV show. It was also nominated for this year’s Annecy International Animation Film Festival, one of the world’s top animation competitions.

Difficult stories, easily told But not all African animation work is aimed at the young. Nairobi-based artist and animator Ng’endo Mukii uses the medium to tell stories that are challenging and at times, confronting. Her most famous film, Yellow Fever, tackles the use of whitening creams by African women. “I wanted to look at the way women are using skin bleaching products in Kenya, and what we believe is beautiful,” she says, adding she wants “to know why”. Other themes covered in her work include migration and people smuggling. For Ng’endo Mukii, animation is the ideal way to approach sensitive or hard-hitting issues, especially when case studies are involved. “Animation allows people to have an anonymity and a distance between what they say and how others perceive it,” she says. It also allows people to “not feel necessarily attacked by what you’re discussing, so they can maybe engage with it a bit better”. Her work has received numerous international awards including the Best Animated Short at the Chicago International Film Festival for Yellow Fever in 2013. Covid boosts demand As more African animators win professional acclaim, international studios are taking note of the continent’s grassroots industry. Last year Netflix acquired its first African animation, Mama K’s Team 4 - a cartoon about four teenage girls set in Lusaka, Zambia. At the same time, foreign companies such as Pixar are hiring Africa-based animators to carry out production services for their films. In fact, the global market for animated content is booming, according to Rob Salkowitz, a Hollywood and entertainment

reporter at Forbes. “There is an incredible demand for animated content right now. This was true even before the pandemic because the streaming networks are really hungry for new content; and animation is a great way to get viewers from all different audiences,” he says. Demand has increased during the pandemic, as live productions were shut down or limited to socially-distanced teams. “We are seeing a ripple effect,” he says. With advertisers and other video producers unable to film in the field, those who can afford it, are turning to animation to fill the gap. “That’s putting a lot of demand on the pipeline,” he says. “Because professional animation studios are suddenly getting offers they can’t refuse from other, nontraditional clients.” ‘On a precipice’ But while more animators are joining the profession in Africa, many are facing an obstacle to getting their content on local screens. It’s cheaper for broadcasters to import ready-made shows from abroad, than fund original productions. The African Animation Network hopes to launch its own TV channel soon The African Animation Network hopes to overcome that problem by launching its own TV network - if it can attract enough investment. “Broadcasters are not incentivised to invest in the local industry because they can turn a profit on really cheap [foreign] content,” he says. The channel is currently in a pilot phase and is set to launch in the next few months. “We’re on that precipice of being potentially a thriving and sustainable industry,” says Nick Wilson. BBC

MONDAY OCTOBER 19, 2020

Feature

MONDAY OCTOBER 19, 2020

Why operational subsidies are key to reforming SA’s taxi industry By Benjamin H. Bradlow

hen South African Transport Minister Fikile Mbalula announced recently that the government was considering a R50 billion subsidy to the minibus taxi sector, it seemed a watershed moment. The sector transports 66.5% of commuters, and has been hit hard by the sharp economic contraction that was deepened by the Covid-19 lockdowns since March. Buses and train services receive operating subsidies from the government. These are critical for containing fare increases, which are regulated by government. They are also key to establishing an operating model that can withstand temporary, short term shifts in user behaviour. Despite many promises, taxi operators have only ever received capital subsidies to repair and replace old vehicles, beginning in 1999 with the “taxi recapitalisation programme”. The main goal was to ensure vehicles were safe; essentially providing a one-off payment to buy new vehicles. This did little to address the core, recurring costs that drive the sector’s economics. I argue that a new proposed government subsidy for minibus taxis, for which most of the details have yet to be announced, should focus on guaranteeing the viability of taxi operations. Some may be wary of securing the future of the taxi industry given its largely deserved reputation for poor labour relations, substandard service and violence. Precisely because of these seemingly intractable problems, an operational guarantee is likely a necessary condition for enabling meaningful reform, plucking the industry from its low-level equilibrium. In South Africa’s largest cities, such an approach could make possible a more centralised mode of fare collection by municipal authorities. This would enable an integrated fare across multiple legs of a trip, potentially saving users money for a service that accounts for more than one-fifth of most poor households’ average expenditure. I draw on my comparative research on the governance of urban public goods in Johannesburg and São Paulo, Brazil, to explain why this operational subsidy can kick start a broader programme of public transport reform. This research compares each city’s attempts to reform the governance of three types of public goods — housing,

sanitation, and transportation — after transitions to democracy. Research on the transport sector in cities of the Global South has tended to focus on possibilities for technological innovation. This research has focused much less on the institutional changes that are necessary to effectively implement transport policy reform. Minibus taxi economic model The economic model of South Africa’s minibus taxi sector has never been fully transparent. As the post-apartheid government began investing in black townships in the mid to late 1990s, the sector was stuck in a dangerous spiral of incentives that encouraged cutthroat competition. The consequences were often violent. There was no way to stop new entrants, other than a very thin licensing regime that focused on the quality of the vehicles. This regime served as a form of implicit deregulation: competing taxi cartels continued to expand their fleets in order to capture ever thinner slices of a captive market. The need for their service grew as new urban employment centres sprawled into former white suburbs. Black townships and informal settlements likewise mushroomed, with the fall of apartheid-era population controls. As the customer base grew rapidly, the supply of taxis grew even faster. Today, the sector remains cash-based and its employment relations often exist in a gray zone of formality. Most reliable estimates place operations — especially labour and fuel — at the centre of its cost structure. At the level of policy, the National Land Transport Act of 2009 gave cities a mandate to develop their own transport plans. It also legislated the provision of funds for the “recapitalisation” of the sector. In addition, some cities have

pursued a technology-led reform strategy. “Bus Rapid Transit” systems gave some taxi operators ownership shares. But most operators were excluded and exist in direct competition with the bus system. A decade after the first phase of Johannesburg’s bus transport system began, it accounts for only 0.6% of transport users, with minibus taxis at 45.7%, and private cars at 36%. As Rehana Moosajee, a city official who oversaw the bus project in its first six years, recently acknowledged. Subsidy debate The debate around subsidies for the taxi industry is all about underwriting the existing operational model of taxis. There is a separate debate about largely doing away with the minibus taxis in favour of new technology, like the bus system. Policymakers have paid little serious attention to the operational dilemmas at the heart of providing collective transport: access, reliability, and reliance on fares for cost recovery. For all of the time and money spent on introducing the bus system, minibus taxis still dominate. A strong operational subsidy can restructure the relationship between taxi operators and municipal governments, so that there is an integrated taxi service at the municipal level, and possibly of a single fare for multi-leg trips. This could enable further integration with other transport modes. The case of São Paulo is a useful comparison to show how guaranteed subsidies for operational costs can be an effective incentive for centralising fare collection at the city scale. This, in turn, enables a more integrated and functional service. Lessons from São Paulo In São Paulo, a system of minibus vans, known as peruas, increasingly cannibalised a

patchwork of bus services during the early 1990s. This was especially so in the poor peripheries of the Brazilian mega city. The system bore a strong resemblance to the role of minibus taxis in South Africa. This rapid growth in informal transport was a key stumbling block when the Workers Party mayoral administration of Marta Suplicy tried in 2001 to implement a “single fare” that would allow users to pay just once for a multi-leg journey. The goal was to make trips from the poorest, most distant peripheries of the city cheaper and quicker. These commuters generally had to pay at least two — and often three or four — fares to travel the far distances from their homes to work. After tense negotiations, the city was able to convince informal perua operators to join be the new system. It did so by effectively subsidising their operations through a centralised system of fare collection that guaranteed a minimum of operational revenues. The lesson for South Africa’s current predicament should be clear. Before the COVID-19 pandemic, the taxi sector already operated on razor sharp margins. Now, with passenger numbers dwindling, the sector’s operational model is in even deeper crisis. Thus, Minister Mbalula’s proposed subsidy should not be a once-off intervention. That would merely delay inevitable renewed conflict between taxi operators and government. Instead, it should form the basis for a sustained reform process to integrate taxis into municipal transport operations. The subsidy itself can be used to incentivise taxi operators to cooperate in city-wide operational networks. Opportunity Policymakers need to look beyond fancy new technologies to replace a sector that they have long seen as undesirable. Every day, clear majorities of South Africans speak with their feet in choosing to use minibus taxis. The role of government should be to improve and reorganise this sector to address the needs of users. The proposed national operational subsidy is an opportunity to do precisely that. About author Benjamin H. Bradlow, Postdoctoral Fellow, Weatherhead Centre For International Affairs, Harvard University

MONDAY OCTOBER 19, 2020

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MONDAY OCTOBER 19, 2020

The journey of an MBA student| Kyle Loff

yle Loff, who works for the City of Cape Town, is a current MBA student at the University of Stellenbosch Business School (USB). He completed his Postgraduate Diploma in Business Management and Administration (PGDip BMA) last year (2019) and also did a Project Management course at the business school in 2017. He completed his undergraduate studies in Chemical Engineering but says he always knew he was not going to pursue a long-term career in the engineering field. “I needed something that would complement my Engineering qualification. The business field was something I was always interested in. However, when I started dealing with clients and executives in my previous role, I knew that my work experience would only get me so far,” he says on is decision to pursue his business management degree. Key learnings He says that since joining the USB, making decision in complex environments is one of the areas that he has significantly grown in. “Juggling work (including changing jobs) part-time studies, a one-year-old

and renovations in 2019 taught me how to prioritise what is important and make decisions swiftly. I’ve challenged the status quo by asking questions about how things are done and how they can be improved. I look at problems and solutions from a strategic and not blinkered point of view,” he says. “One of the most important skills I have gained is to be more reflective. The different modules and how they all integrate has taught me always to observe and look back at how I have approached situations and how I can improve. This is one of the most exceptional leadership qualities that will continue to grow in my professional and personal life.”

highlight. Classes are recorded so when you miss a session, you are able to catch up. This worked well for me last year when my son was in the hospital.” He adds that he has been encouraging colleagues and friends to do the PGDip BMA, specifically in the Blended Learning format to manage their time better. “Studying parttime takes its toll on you when you have a demanding job, and that’s where time management comes in. The Blended Learning is convenient for those that want to build new skills and have minimal impact on their working and family life. I believe there’s more balance to it,” he says.

Blended Learning

Kyle is a firm believer of continuous learning. Why is it so important? “As I progressed in my career, I realised that we could find ourselves on hamster wheels in how we live our lives. I had become frustrated with ‘living for the weekend’. Life is not going to be comfortable, and no one is going to give you your big break. If you want something, you’re going to have to get out of your comfort zone and learn a new skill. Comfortable is the same as

He chose to do both his PGDip BMA and MBA in the Blended Learning format. “The Blended Learning option of study caught my eye immediately, and the benefits of limited time off from work appealed to me,” he says. “The great thing with the Blended Learning format is the option of attending class on campus or streaming from wherever you are in the world, which has been my most excellent

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outdated; you will be left behind. I was impressed with how all the modules integrated and the golden thread throughout the course is woven as you progress,” he says. “My best learning experience by far has been the PGDip BMA. The people I met and syndicate group I were part of was instrumental in opening my mind to changing the way I think and conduct myself. The course stretched me in many ways, and the growth I experienced is invaluable. One benefit is having modules exempted now for my MBA. The PGDip BMA has prepared me in so many ways for my MBA and given a choice, and I would still start with the PGDip BMA,” he says. Last word of advice? “Nothing great was ever accomplished by sitting on the couch and binge-watching your favourite show. Learn, stretch, grow and become the most responsible authentic leader this world and our country needs!” CONTACT DETAILS Dr Marietjie van der Merwe USB Representative Marie@globalnatives.com +230 606 2341 / +230 5 701 1362

MONDAY OCTOBER 19, 2020

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