Business24 Newspaper - August 24, 2020 by Business24 Online

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MONDAY AUGUST 24, 2020

Proceeds from Agyapa IPO to fund refineries, other projects Experts propose strategic, long-term approach to nat’l dev’t The country’s approach to development should be strategic with an eye on longterm deliverables rather than short-term ones, Dr. Felix Addo-Yobo, Director of Policy at the National Development Planning Commission (NDPC) has said. >>PAGE 3

By Patrick PAINTSIL

BY DOMINICK ANDOH

he upfront capital to be raised from listing of Agyapa Royalties Limited on the London Stock Exchange and Ghana Stock Exchange, as well as regular dividends thereafter will be invested in developing the country’s gold resources, building of gold refineries and world-class gold certification institution, Deputy Minister for Finance, Charles Adu Boahen, told Business24. “The funds raised during the listing and future profits will be re-invested in mining and the building of gold refineries and certification companies that will refine and certify gold produced locally and for other countries in the sub-region.

We have been mining for centuries and we don’t have many gold refineries and gold certification companies,” Mr. Adu Boahen said is response to the specific infrastructure projects that funds raised in the IPO and thereafter would be expended on. Government, under the Minerals Income Investment Fund Act has created a Special Purpose Vehicle (SPV), Agyapa Royalties Limited, to maximise the mineral royalties received by government from mining companies. In 2019, Ghana’s income from mineral royalties stood at about US$200m, according to Finance Ministry figures. At a time that the precious mineral is trading at >> MORE ON PAGE 2

Gov’t targets youthful hearts with Student Loan promise Vice President Dr. Mahamudu Bawumia says government will waive the requirement of a guarantor as a prerequisite to accessing student loans starting next year, should the incumbent win the upcoming December 7th presidential elections.

President commissions 15-million-dollar Ekumfi fruits processing factory

2019 GOIL financial performance impressive – Bartels

President Nana Addo Dankwa Akufo-Addo on Friday commissioned the 15-million-dollar Ekumfi Fruits and Juices Company Limited at a colourful ceremony at Ekumfi-Nanaben in the Central Region.

The 2019 financial performance of GOIL Company Limited was impressive as the group made a profit after tax of GH¢105. 5 million, up by 29 per cent compared to the year 2018.

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ECONOMIC INDICATORS *EXCHANGE RATE (INT. RATE)

USD$1 =GHC 5.6734*

*POLICY RATE

14.5%*

GHANA REFERENCE RATE

15.12%

OVERALL FISCAL DEFICIT

11.4 % OF GDP

PROJECTED GDP GROWTH RATE AVERAGE PETROL & DIESEL PRICE:

0.9% GHc 5.13*

INTERNATIONAL MARKET BRENT CRUDE $/BARREL NATURAL GAS $/MILLION BTUS GOLD $/TROY OUNCE CORN $/BUSHEL

43.22 1.79 1,842.40 329.50

COCOA $/METRIC TON

1,562.00

COFFEE $/POUND:

$109.65

COPPER USD/T OZ.

220.15

SILVER $/TROY OUNCE:

17.07

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NEWS/EDITORIAL

MONDAY AUGUST 24, 2020

EDITORIAL

Wash your hands 2

Cover your cough 3

National development policies must be inclusive A comprehensive national development plan that is inclusive and ensures equitable distribution of the country’s resources is crucial. The admonishing by Dr. Felix Addo-Yobo, Director of Policy at the National Development Planning Commission (NDPC) for a paradigm shift in addressing symptoms of problems to identifying and tackling the root cause of those problems in a more sustainable manner ought to be heeded. “We can’t flourish without inclusive and equitable development; national development is headed in the wrong direction if we were to maintain the status quo. We should create a future

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LIMITED Copyright @ 2019 Business24 Limited. All Rights Reserved. Editorial Team Dominic Andoh: Editor Eugene Kwabena Davis (Head of Parliamentary Business & Commodities) Benson Afful (Head of Energy & Education) Patrick Paintsil (Head of Maritime & Banking) Nii Annerquaye Abbey (Online Editor) Marketing Alexander Lartey Agyemang (Business Development Manager) Ruth Fosua Tetteh (Dept. Business Development Manager) Gifty Mensah (Marketing Manager) Irene Mottey (Sales Manager) Edna Eyram Swatson (Special Projects Manager ) Events Evelyn Kanyoke (Snr. Events Consultant) Finance/Administration Joseph Ackon Bissue (Accountant)

strive to maintain the stability of the nation. “Once the peace we are enjoying is bridged, it will be difficult to recover from the pain. It is only in a peaceful environment that we can hone skills that are essential ingredients for national development,” Mr. Addo-Yobo. Indeed, Business24 agrees with the suggestion that development decisions must be centered on comprehensive and workable policies that will fasttrack national socio-economic development.

Proceeds from Agyapa IPO to fund refineries, other projects CONTINUED FROM COVER

Wear a mask

and a world that we can all be proud of and the process of making that happen must start now,” he said. Aside the prudent policies and long-termed targets, there is also the need for strong civic values that will drive down the penchant for corrupt practices “We need to get our priorities right as a nation; and citizens must take their rightful places by taking interest in politics and related actions that affect their aspirations.” With the political temperature on the rise, the panelists highlighted the nexus between peace and development and urged both politicians and the general public to

a high of about US$2,000 per ounce, experts have argued that though gold is not a currency, it rivals the dollar as an international reserve asset and has thus benefited from the desire for diversification given the fall in real interest rates. The dollar’s depreciation from the end of the first quarter of this year against the euro and most other major currencies itself, is partly responsible for the increase in the dollar price of gold. Under an investment agreement between the Minerals Income Investment Fund and Agyapa Royalties Limited, the Fund has assigned its right to receive 75.6 percent of royalties from a portfolio of 12 producing mines and four development assets to Agyapa. In exchange, Agyapa will issue shares worth US$1bn to the fund. The planned Initial Public Offer (IPO) of Agyapa will offer some of the shares held by the fund to investors in order to raise about US$500m. At the end of the IPO, the Government of Ghana, through the MIIF, will continue to be the majority shareholder (51 percent) in Agyapa Royalties. The 12 producing mines from which royalties will be drawn include: Damang, Iduaprim, Bogoso, Wassa, Asanko, Tarkwa, Akyem, Ahafo,

Obuasi, Edikan and Chirano. Four development assets which hold significant gold deposits cited under the agreement are: Namdini, Enchi, Wa and Bibiani. This novel idea of maximising gold royalties means that the MIIF is expected to continue to receive dividends from Agyapa and will continue to receive the royalty revenue from other operating mines in Ghana that are not related to Agyapa Royalties. “It must be noted that Agyapa will have the right of first offer for future gold assets outside the 16 mentioned in this agreement,” Mr. Adu Boahen said.

UK registration and matters arising Agyapa Royalties is registered in Jersey, Channel Island, given the favourable tax regime that exist there. A local company, ARG, has also been duly registered to receive the royalties from MIIF for onward transmission to Agyapa Royalties as a means to satisfy the legal hurdle in the transaction. As a pblicly listed company on the LSE and GSE, all Agyapa’s large shareholders will need to disclose their position – when they buy or sell shares-. The company is expected to adhere to international corporate governance standards as to give its shareholders the needed assurance.

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Experts propose strategic, long-term approach to nat’l dev’t BY PATRICK PAINTSIL

To be able to achieve that, he suggested that policymakers and social actors may need to move away from addressing symptoms of problems to identifying and tackling the root cause of those problems in a more sustainable manner. “We can’t flourish without inclusive and equitable development; national development is headed in the wrong direction if we were to maintain the status quo. “We should create a future and a world that we can all be proud of and the process of making that happen must start now,” he said at a virtual discourse on peace and development organised by Abibiman Foundation, a non-governmental organisation. Supporting this proposition was socio-economic activist and Founder of the Abibiman Foundation, Kwabena Okai Ofosuhene, who further recommended the adoption of key standards that will get both public and private stakeholders to strive to propel the nation’s growth.

“Development decisions must be centered around comprehensive and workable policies that will fast-track national socio-economic development,” he added. Aside the prudent policies and long-termed targets, there is also the need for strong civic values that will drive down the penchant for corrupt practices, said another panelist, Ewald Quaye, who is a research fellow of the Centre for Democratic Development (CDD-Ghana). He also argued: “We need to get our priorities right as a nation; and citizens must take their rightful places by taking interest in politics and related actions that affect their aspirations.” With the political temperature on the rise, the panelists highlighted the nexus between peace and development and urged both politicians and the general public to strive to maintain the stability of the nation. “Once the peace we are enjoying is bridged, it will be difficult to recover from the pain. It is only in a peaceful environment that we can hone

Kwabena Okai Ofosuhene is the Founder/ Chairman of Abibiman Foundation

skills that are essential ingredients for national development,” said Dr. Addo-Yobo. To Mr. Ofosuhene, peace is a critical instrument that drives all aspects of socio-economic development. “Election is about putting people into positions of governance and not about getting people to lose their lives,” he advised. The virtual discourse was convened to relaunch Abibiman Foundation’s flagship project dubbed “Nkabom Journey for Peace

Dr. Felix Addo-Yobo, Director of Policy at the NDPC

and Development” on the theme “Shaping minds for the future— Addressing present needs”. The Nkabom project seeks to facilitate engagements with relevant stakeholders and policymakers in governmental and nongovernmental agencies in Ghana and other African countries to fast-track the implementation of the needed actions and solutions on selected sector-specific policies and programmes towards the achievement of SDGs.”

Gov’t targets youthful hearts with Student Loan promise BY BENSON AFFUL

Dr. Bawumia presenting the key highlights of the governing New Patriotic Party’s manifesto for the up-coming elections said all that will be required to access support from the Student Loan Trust Fund (SLTF) will be the National ID Card. “One of the problems for students in getting enrollment and access is affordability--whether it is the enrollment into the public or private universities. So, we have a major promise – a policy initiative which we say, all tertiary students except teacher and nurse trainees who will be on the allowance, will now be able to get the option to obtain a student loan without the requirement of the guarantor. “So, you don’t need a guarantor and all you need is your national ID card. That’s all and then you will be able to access your loan and once you complete your education, repayment will be deferred after your tertiary education, you’ll get a one-year grace period after your national service, then you start paying,” Dr. Bawumia explained at the launch of the NPP’s manifesto

in Cape Coast, Central Region. Currently, SLTF mandates applicants to provide one guarantor to qualify for the loan. Previously, under the Social Security and National Insurance Trust (SSNIT) Students Loan Scheme, each borrower was required to provide three guarantors who needed to be contributors to the SSNIT Pension Scheme. A guarantor is a person or agency

that gives an assurance that a loan will be paid. The guarantor agrees to pay someone else’s outstanding debt in the event of default. Many students, particularly the needy, found it difficult to get three guarantors to stand surety for the loans they were to contract for their tertiary education. Thus, when the SLTF took over the management of students’ loan, one of the first things it did was to reduce the guarantor requirements to one. But the

problem of getting even one guarantor still persists. Therefore, the SLTF in its bid to resolve the issue adopted a diversified guarantor system, where, in addition to the SSNIT pension contributor, a corporate body, nationallyrecognised religious body as well as Metropolitan, Municipal and District Assembly (MMDAs) can guarantee a loan application for a student who wishes to access a loan facility from the Fund.

MONDAY AUGUST 24, 2020

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President commissions 15-million-dollar Ekumfi fruits processing factory In August 2017 the President broke the grounds to commence the construction of the magnificent factory to begin the Government’s One District One Factory (IDIF) initiative as a means of igniting Ghana’s industrialisation and setting her on course for socioeconomic development. With a capacity to produce and package about 80 tonnes of fruits per day, the factory is expected to process a total of about 25,600 tonnes of fruit per year. It has begun commercial production of its main brand; “Eku juice” with 300 million packs of juice annually for local consumption and for export. With the more than 5000 direct out grower jobs within the community and its environs and 1,000 indirect jobs, the factory is projected to generate close to GH¢530 million in revenue annually. President Akufo-Addo, at a gathering of the chiefs and people of Ekumfi, expressed joy over the operationalisation of the biggest fruit processing factory in West Africa, saying it was a manifestation of his Administration to propel the industrialisation drive at the district level as well as drive linkages to agriculture and other natural resources of the country. He said the well-planned and well-thought through project had

the required raw materials for its successful operations and that would be sustained through an out-grower scheme put in place. He appealed for the unalloyed support of every Ghanaian as well as financial institutions to ensure the success of the project to better the lot of the people. The President pledged to work on the road infrastructure in the area and improve health facilities and security for the wellbeing of all. He thanked the traditional leaders for offering the needed support that facilitated the completion of the factory and asked them to do more. Mr John Alan Kojo Kyeremateng, the Minister of Trade and Industry, said the much-doubted factory was a clear commitment of the President to push industrialisation to a higher level, create employment and boost local economies. The Government, he said, encouraged local industries to use available raw materials to ease manufacturing and sustainably create import substitution industries. To show commitment to that effect, it had granted five-year tax holiday, waiver on import duties for machinery and flexible financing options provided by the Agricultural Development Bank and the Exim Bank.

Odaefo Nana Akyen VIII, Omanhen of Ekumfi Traditional Area, commended President Akufo-Addo for setting the pace for the rapid industrialisation of Ghana through policies like the Nation Builders Corps, Free Senior High School, and the One Village One Dam. He pleaded with the President to provide health facilities and speedy construction of roads in the area to improve the standard of living of the people. Mr Frederick Kobbyna Acquaah, the Chief Executive Officer of the Factory, express gratitude to

government and the traditional rulers for the massive support the company had received. As part of measures to sustain the raw material base of the factory, it had put in a well-planned scheme to increase the current out-growers capacity from 600 to 1,500, he said. Later, President Akufo-Addo cut the sod for the construction of landing beach at Mamford and inspected works at the Casa de Ropa Factory, which processes potatoes at Gomoa Bewadze in the Gomoa West District.

2019 GOIL financial performance impressive – Bartels Mr. Peter Kwamena Bartels, the GOIL Board Chairman, giving accounts at the 51st Annual General Meeting of shareholders in Accra, which was organised virtually, said GOIL’s earnings per share moved from GH¢0.209 to GH¢0.269. He said total asset increased from 1.345 billion cedis to approximately 1.716 billion cedis adding that the company had embarked on projects with the potential to yield higher gains in future. “For this reason, the Board has decided to retain a considerable amount of the earnings per share to help finance the projects. Recommendation for dividend per share is GH¢0.045 as against 0.042 in 2018,” he said. Mr Bartels said GOIL continued to be formidable, results-driven and adaptable, which “we believe are the needed characteristics for achieving sustainable growth.” “It’s a company that has seen transformation from being listed for divestiture to the biggest oil marketing company in Ghana.” Mr Bartels said it continued to emphasise on issues relating to health, safety, security and

environment. “In 2019 we increased momentum towards ensuring that our operations are carried out in a safe and environmentally friendly manner,” he said. He said those efforts were specifically geared towards the safety and well-being of employees, customers, and interested parties alike. “We abide by statutory, regulatory as well as other relevant legal requirements. We recognise that these requirements represent the minimum level to be achieved and to improve upon it, we adopt and implement internationally recognised best practices”. Mr Bartels said key to maintaining the confidence of its esteemed customers was the ability to continue to ensure that product offering was of the highest quality, hence the stepping up in fuel testing. “External testing laboratories were regularly engaged to ensure that incoming products were up to specifications. Regular and random testing of products within our ecosystem were, in addition, carried out,” he said.

“The Company does not only protect personnel and property against potential fires, but also from armed robberies, which have the tendency to hurt sales in so many ways including limiting the number of working hours”. He said in line with the Integrated Management System comprising quality and environmental management, GOIL followed the international best standards to ensure continuous improvement. Mr Kwame Osei-Prempeh, GOIL Group Chief Executive Officer, said the AGM received the 2019 Accounts and recommended the payment of

dividend of GH¢0.045 per share amounting to GH¢17,633,841.00 for the year ending December 31, 2019. In accordance with Regulation 88 of the Company’s Regulations, the following directors who are retiring by rotation but were eligible for reelection were re-elected as directors. They are Mr Robert Owusu Amankwah, Mr Thomas Kofi Manu, and Mr Stephen Abu Tengan. The remuneration of the auditors were fixed in accordance with Section 139 of the Companies Act 2019, Act 992, as Messrs Pannell Kerr Forster continues in Office as Auditors of the company. GNA

MONDAY AUGUST 24, 2020

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BUSINESS OUTLOOK SERIES

The Business Model Improvement and Innovation (PART 2) BY CDC CONSULT

n the last edition, we discussed the first 2 steps towards improving the business model. The first 2 steps can be summarized as follows: Step 1: Preliminary Activities (making the case and team formation) We indicated that it was necessary for the business owner and/or management to appreciate the challenges faced by the organization as far as its business model was concerned and come to the realization of the need to improve the business model. Following this, there was the need to constitute a core team charged with the responsibility of reviewing the business model. Step 2: Evaluating the Existing Business Model We indicated under this step that for each of the 9 building blocks of the business model, business owners and/or management had to identify success and shortcomings and describe the strengths, weaknesses, opportunities and threats associated with each of them. We went ahead to provide indicative questions to be used to evaluate each building block. In today’s edition, we will discuss the remaining steps for improving the business model. Stage 3: Generating Improvement and Innovative Ideas Having agreed on the SWOT analysis of the existing business model, the next stage is the development of the improvement and innovative ideas that will transform the business to survive and thrive even in this difficulty time. In other words, an improved business model will have to be designed on the basis that, the current strengths and success factors will have to be sustained; leveraging on opportunities the current and envisaged business environment presents; coming up with innovative ideas to transform the weaknesses into strengths; and mitigating the identified threats to the existing business model. The preferred approach to the generation of the improved and innovative ideas will be through workshop sessions. The presumption is that, the organization has adequate inhouse competence and ideas for improvements. Otherwise, industry experts and persons with experience in transforming businesses could be invited to be

part of the team for the session. The workshop should provide a creative environment that focuses on finding and generating ideas and to structure and present these ideas in coherent manner. There are two critical questions that should be addressed by the new/revised business model: The first one is ‘ do we know our market’- is there clarity of our market?; and secondly, is the new business model financially viable? With respect to the question of the market, it means the new business model has clearly established the market potential and growth prospect of the market the business will be serving; the extent of competition has been assessed; and the business competitive advantage established. It also means that all potential barriers have been identified (especially with new market) and mitigation strategies determined and finally, the business model has identified the distribution channels and customer relations channels, tools and techniques that utilize current technological applications are known. With respect to the financial viability, it is important that a comprehensive financial analysis is conducted to determine the model’s viability by estimating the future sales, cost of goods and overheads associated with service delivery to arrive at a reliable estimate of future cashflows. The financial viability should give a good indication of the profitability of the business model. Knowledge of the financial viability will help a business avoid a sense of false hope by merely looking at how good the ideas are which may not necessarily be financially beneficial to the firm. Stage 4: Estimating Resource Requirements It is inevitable that, implementing a revised business model will require some investments and therefore the need for capital injection. For instance, there may be the need to acquire new or improved technology to improve service delivery and customer relations management; acquisition of new and improved technology for production; acquisition of franchise; use of e-marketing tools and re-training of existing staff to build their capacity among others. It is therefore recommended to evaluate if any investments are needed in order to be able to fulfil the new business model and the amount of capital needed. If investments are needed, financial analysis should be conducted using methods such as payback

period and net present value to evaluate the investments. Stage 5: Action planning The next step of the business model improvement and innovation is undertaking action planning for the new business model. Action planning will involve determining the activities to be undertaken to implement the new business model, prioritization of activities based on the importance and resource requirements, determining the timelines for each activities and expected output and establishing responsibility for the achievement of deliverable. It is important to define which key deliverables indicate that an action of implementation has been reached and when the next action in the implementation plan may be initiated. Management could determine the periodic review period of implementing the new business model to establish what has worked, what has not worked and the lessons learned going forward. Stage 6: Communication and Management At this point, the firm, through the core team established at stage 1 has successfully improved the business model. What’s finally required is the buy-in of the wider team. The revised business model may cause major changes in work schedule, firm organization and resource allocation. The business owner and/or management must have good understanding of change management and apply those principles very well to ensure success. The revised business model and its implication should be clearly communicated to all staff. Team/departmental leaders should be made champions of the revised model and their respective team/departmental roles. The communication should focus on what would have been the adverse effects if the changes were not implemented and what the new

prospects are. It should further emphasize the responsibilities of the wider team members and how the success or failure depends on individual performance and affects individuals and the firm at large. Going forward, management should pay attention to the action plan and track performance. Where required, reviews should be conducted and it should be ensured that outcomes are better. It is important for business owners and management to understand that, business model improvement and innovation is an ongoing discipline throughout the business and that culture of continuous improvement must be embraced by all. “ …A time of turbulence is a dangerous time, but its greatest danger is a temptation to deny reality. But a time of turbulence is also one of great opportunity for those who can understand, accept and exploit the new reality..” ( Cleremont, California, 1993). Peter F. Drucker in his book ‘Managing in Turbulent Times’ stated that ‘’In turbulent times. Managers cannot assume that tomorrow will be an extension of today. On the contrary, they must manage for change, change alike as an opportunity and a threat’.

WATCH OUT FOR THE NEXT EDITION Remember to wash your hand under running water, wear your nose mask when going out and never forget to comply with the social distancing protocol. For more information and targeted services in financial management and investment advisory services, training and recruitment, market solutions and organizational development, and research, kindly contact CDC Consult Limited through info@cdcconsult.org, babilo@ cdcconsult.org. You can also call 055332030/0244683042

MONDAY AUGUST 24, 2020

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University-Industry Relationship: Growth and sustainability of technology hubs in the Ghanaian entrepreneurial ecosystem BY KWABENA OBIRI YEBOAH, PHD

he influx of technology hubs across the country has significantly inspired the youth to seek selfemployment in the technology sector. The pursuit of new knowledge and the creation of innovative products have been the outcome so far. Technology hubs introduce the youth to both the technical and entrepreneurial aspects of venture creation. The entrepreneurs use the information acquired over the period to make strategic decisions in the venture creation process. The role of these technology hubs in the entrepreneurial ecosystem of Ghana cannot be underestimated. The hubs serve as a safe haven for ambitious youth who want to start or scale their businesses. They provide working spaces, opportunities, and support that many startups require to advance to the next stage of their venture creation. On the Ghana Hubs Network’s website, there are 30 hubs registered as members of the network across the country. It is worth noting that, there are other existing hubs in the country which are not members of the network. The kind of access that individuals have to hubs in Ghana has increased tremendously over the past years. The success stories are numerous, but much needs to be done to achieve the expected goals of these hubs and to make them sustainable. The business models of most of these hubs are mostly dependent on available funds from foreign donors. The dependency on donor funding can be a threat to growth and sustainability, so there is a need for local strategic partnerships. Most of these hubs take their inspiration from the Silicon Valley and European ecosystem business models. In discussing the success stories of the technology hubs in Ghana, one actor which is critical to the growth and sustainability of these hubs is, in most cases missing – the university. Universities have played crucial roles in the success of the Silicon Valley ecosystem in the USA, and the hubs will have to find a way to engage them in Ghana. University support The role of universities in the startup ecosystem must be given the necessary attention that it deserves to get the best out of the hubs. In the Silicon Valley

ecosystem, some inventions started from the university to industry and vice versa. Universities are made up of competent human resources that we can leverage to our advantage in the idea creation and business building processes of technology entrepreneurs in the hubs. The human resources managing the youth in the various hubs influence the output of the entrepreneurs. The kind of innovations and level of sophistication is as a result of the support entrepreneurs obtain from the hubs. Providing well-coordinated support will improve the venture creation process, which will result in the development of competitive products for both local and international markets. Universities are continually researching ways to improve and present sophisticated technologies to consumers and the development of new ones. These results can enhance the idea generation and product development of most entrepreneurs. Entrepreneurs in the hubs can be given access to research findings under a structured dispensation to strengthen and transform their innovations. Bridging the gap between the hubs and universities will significantly benefit this endeavour. Entrepreneurs providing indigenous solutions could be supported to improve their innovations. The support could be structured according to the focus areas of the universities. Universities that focus on education can support startups developing EdTech products; universities that focus on agriculture can help Agritech startups, and so on. The wellseasoned Professors at these

universities, who are at the same time consulting for national and multinational cooperations can introduce startups to strategic networks which will facilitate the growth of their businesses. Infrastructure usage Most universities have closed their doors to students during the COVID - 19 period; the laboratories are empty and not in use. During this period, startups can use the university laboratories to develop and test their prototypes with experts’ support. Most of our hubs cannot build and maintain wellequipped laboratories, so using that of the universities will be incredibly supportive. Beyond COVID -19, universities can institute measures that offer the startups access to the laboratory spaces. The university laboratories can be used in lean periods and weekends. Final products or prototypes can be significantly improved using well-equipped laboratories. Lab assistants and experts in the universities can support such endeavours. Commercialization of innovations The ICT departments of universities have a lot of research results that can be commercialized. Partnership with private technology hubs in the country can help facilitate this move. Brilliant students or graduates could be identified and put into teams to develop products from the research findings. It will be an opportunity for universities to test most of the research findings. The industry players can also contribute to this endeavour. The universities, through their Technology Transfer Offices, could proactively organize industry events where these innovations can be exhibited. The universities

can own the intellectual property, and the technology license given to spin-offs to use. This calls for a more holistic licensing regime. In some instances, the university can also invest in the spin-offs. Attractive incentive structure There must be an incentive structure that encourages university Professors and experts to participate in these engagements. There can be a system where mentoring startups or particular hubs could be part of a Professor’s duties in the semester and rewarded accordingly. The Professors will report the outcome of these engagements to the universities at the end of each semester. Experts from the universities will also have the first right to purchase shares or invest in the spin-offs. Proper investment in the growth of the technology sector is very crucial. Technology hubs and universities must be proactive since the collaboration will benefit them in the long term. Government institutions that support entrepreneurship must play their roles to make this collaboration work. The intention of this engagement should be to build a stronger indigenous “Silicon Valley” using the resources available to achieve the bigger goal of Ghana becoming the next big technology innovation destination in Africa.

The author is an Entrepreneurship and Innovation Management Expert | Member, Institute of ICT Professionals Ghana. For comments, contact koyeboah2@gmail.com , +233555293293

MONDAY AUGUST 24, 2020

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Women Entrepreneurs Finance Initiative invests in over 15,000 women-led businesses amidst COVID-19 crisis BYWE-FI

he Women Entrepreneurs Finance Initiative (We-Fi) has announced its third funding allocation comprising US$49.3million - expected to benefit over 15,000 women-led businesses and mobilize about US$350 million of additional public and private sector resources. We-Fi’s latest round of allocations addresses the needs of women entrepreneurs created by the COVID-19 crisis, and encourages innovation and digital development, partnership development and the use of resultsbased mechanisms to facilitate greater access to financing for women entrepreneurs. The third round allocates funding for programs to boost women’s entrepreneurship that will be implemented by four multilateral development banks; the European Bank for Reconstruction and Development for programs in Central Asia and the North Africa region, the InterAmerican Development Bank for projects in Latin America, the Islamic Development Bank for entrepreneurship activities in fragile contexts in West Africa, and the World Bank Group for projects in the Sahel region, MENA and global programs. Over 65 percent of the most recent allocations will benefit women entrepreneurs in low-income (IDA-eligible) countries and countries affected by fragility and conflict. As a result of three financing rounds which now total almost $300 million in allocations, programs backing women-led businesses will soon expand to 61 countries. Due to the COVID-19 crisis, women entrepreneurs around the world are suffering large setbacks. New data about the disproportionate effects of lockdown measures on women-led SMEs are emerging; in several Sub-Saharan countries, about 60% of women-led small businesses have lost their sources of income, three times more than men-led businesses. Globally, women-owned SMEs are about 6 percentage points more likely to close their business than maleowned businesses, according to recent World Bank-led research. “As we absorb the consequences of the COVID-19 pandemic around the world, we need to take strong actions to build back better. Many women-led SMEs are disproportionally affected by the economic disruptions of

the COVID crisis and many more women are losing their jobs. Entrepreneurship is central to the economic empowerment of women, especially in developing economies. Actions and support, such as by We-Fi’s recent round of financing, reaches women entrepreneurs in this time of need, and will help reestablish their roles as engines of inclusive economic growth”, says Mari Pangestu, Managing Director of Development Policy and Partnerships of the World Bank, which hosts the We-Fi Secretariat. “We-Fi’s third round of allocations could not have come at a more important time. I am very pleased to see our Implementing Partners preparing such strong proposals to support women-led SMEs. Projects to leverage digital technologies, support digital skills-building, and identify new business opportunities that may arise as a result of the pandemic will benefit so many womenled SMEs during this crucial time”, says Mathew Haarsager, Deputy Assistant Secretary for International Development Finance and Policy of the U.S. Department of the Treasury and chair of We-Fi’s Governing Committee. Under the third round of funding: The European Bank for Reconstruction and Development (EBRD) was granted US$7.36 million for its “Women of the Steppe” Women in Business Program which aims to rapidly respond to the disproportionate pressures WSMEs face in the context of the ongoing COVID-19 related crisis. The program will deploy innovative solutions for WSMEs that will contribute to (a) improving access to

markets through more inclusive supply chains; (b) enhancing competitiveness, growth potential, and access to finance by strengthening their ability to leverage digital technologies and (c) leveraging sex-disaggregated data to inform more effective public and private sector interventions. Program activities will be implemented in Kyrgyz Republic, Mongolia, Tajikistan, Uzbekistan, Egypt, and Morocco. The Inter-American Development Bank (IDB) received US$14.71 million for its program to support access to finance, markets, skills and networks for women-led businesses primarily in technology and science-supported sectors. The program will prioritize helping women entrepreneurs navigate the ongoing economic crisis, and also to identify new business opportunities that may arise as a result of the pandemic. The program will provide acceleration support as well as seed and venture capital to high-potential STEM women entrepreneurs. The program focuses on countries in Central America, Ecuador and Guyana. The Islamic Development Bank (IsDB) received US$11.25 million for its program which supports women in West Africa engaging in entrepreneurial activities in the rice value chain. While women are heavily engaged in the rice industry, the prohibitively high cost of borrowing, and the non-financial constraints which hinder access to resources, assets, and markets, prevent women entrepreneurs from improving their livelihoods. Accordingly, the program will aim to support upgrading and advancing women-owned SMEs within the rice value chain in West Africa though capacity development and grant matching, as well as increased access local

and regional markets. Activities for this program will be carried out in Guinea, Niger, Senegal and Sierra Leone. The World Bank Group (World Bank and IFC) received US$16.01 million for a digitally enabled access to finance and markets program for women-led business in the Sahel region and globally, and an early-stage finance program supporting women entrepreneurs in several regions. The first program will foster market linkages between suppliers and buyers across the Sahel. It will provide services and training to womenled shea butter cooperatives on know-how, managerial capacity, networks, and marketing tools as well as support the digitization of payment systems. The second program seeks to create an inclusive entrepreneurial ecosystem, addresses financing gaps, and assists with skillsbuilding and mentoring of women entrepreneurs. Activities for these programs will be implemented in Burkina Faso, Mali, Mauritania, Jordan, Iraq, and globally.

About We-Fi: The Women Entrepreneurs Finance Initiative (We-Fi) is a multilateral partnership supporting women entrepreneurs with access to finance, markets, technology, mentoring, and other services, while working with governments and the private sector to improve the laws and policies inhibiting women’s businesses in developing countries. We-Fi is supported by the governments of Australia, Canada, China, Denmark, Germany, Japan, the Netherlands, Norway, the Russian Federation, the Kingdom of Saudi Arabia, the Republic of South Korea, the United Arab Emirates, the United Kingdom, and the United States. The We-Fi secretariat is housed by the World Bank and its programs are implemented by six Multilateral Development Banks

MONDAY AUGUST 24, 2020

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How the examples of sporting icons can work for your business BY BUSINESS FOR BREAKFAST (BFORB)

any of us marvel at the achievements of some of the world’s greatest sportsmen and women. Those who rise head and shoulders above their rivals don’t do it overnight: talent is given, greatness is earned, usually by hours and hours of toil and sweat. The world of business has many similarities to sport: preparation, competition, winning, losing, passion, hard work…sound familiar? There is no doubt that business leaders and entrepreneurs can draw much motivation from the world’s top sporting stars. If you are looking for business inspiration, then how about this, from the basketball legend Michael Jordan: “… obstacles don’t have to stop you; if you run into a wall, don’t turn around and give up; figure out how to climb it, go through it, or work around it.” Or this, from the tennis great Billie Jean King: “…champions keep playing until they get it right.” Both quotes are as relevant to running a successful business as they are to being a great champion in sport. And it is why business leaders, or anyone aspiring to be one, could do much worse to read the stories of the best sporting achievers, many of whom endured as many setbacks as plaudits on their way to the top. Take the late, great Sir Bobby Robson, for instance. His first job as a football manager ended in failure. He was sacked by Fulham, the team he had played for, after nine months, in 1968. He was then hired by Second Division Ipswich Town, and his first couple of seasons there was anything but a laugh-a-minute, with senior players pushing their luck and trying it on. But Robson had learned from the failure at Fulham, and helped by a Board of Directors who genuinely believed in him, turned it round, and by the time he left Ipswich, after 13 years, in 1982, he had built the club into one of the best, and most respected, in Europe. Those who played for Sir Bobby had the utmost respect for him, because he treated them like adults, dealt swiftly with mischief makers, knew how to motivate individual players; some needed an arm around the shoulder, others responded better to a

verbal ear bashing. He knew how to get the best, he knew when to make changes, and never shirked in doing so. He was the boss, and everyone was aware of it. As it should be. But he was responsible and sensitive when it was required. Another football knight was feared and loved in equal measure. Sir Alex Ferguson turned Manchester United from a team of mid-table under-achievers into the dominating force in British football for 20 years. Like Sir Bobby, Ferguson had to make some swift changes in personnel in his early days, and reputation counted for nothing: if you didn’t match is dedication and standards, he handed you a single ticket to any where other than Old Trafford. He surrounded himself with a talented backroom staff, and delegated with confidence, but when a big decision was made, the buck always stopped with him. That’s leadership. His roll of honour is unprecedented, but along the road to success he was blessed with good fortune too. In January 1990 there was talk of his imminent dismissal, but one result turned that season around, and the rest, as they say, is history. And for a third example, lets take the England Rugby World Cup

triumph of 2003, headed by coach Clive (now Sir Clive) Woodward. It took him six gruelling years to reach the Promised Land of sporting glory. If you are a business leader looking for inspiration, then this is it. It perfectly aligns the worlds of business and sport, and it is well worth a read. Any thriving entrepreneur will tell you that failure was part of the success story. Anyone taking their first steps into the unknown of running a business should be well aware that there will be tears before the cheers. Let us finish with the observations of two other sporting icons. As the golfing great Arnold Palmer once said: “…always make a total effort, even when the odds are against you.” In other words, however tough the going might be, whatever kind of day you have just endured, never give up. And the final word goes to the world’s greatest ever footballer, the brilliant Brazilian, Pele: “… the more difficult the victory, the greater the happiness in winning.” So true. Remember: talent is given, greatness is the reward of hard work, and lots of it. Take the advice of the best ever in world sport, and make it work for your business!

Business for Breakfast (BforB) is internationally recognized for creating successful networking meetings, events and training for referral marketing. 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

MONDAY AUGUST 24, 2020

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Banking in the next Decade: Four (4) strategies to thrive with contactless banking in the new normal BY EBENEZER ASUMANG (CGIA)

“Take a risk and keep testing, because what works today won`t work tomorrow, but what worked yesterday may work again.”—Amrita Sahasrabudhe, Vice President Marketing – FastMed

he COVID-19 pandemic has almost ravaged every fabric of society worldwide and the banking industry has had its first share of the turbulence. Banks worldwide are feeling the enormous pressure, this pandemic is mounting because of the impact on business operations specifically in relation to its clientele. It is therefore crucial that banks take full advantage of the new revolution of the digital world by adopting strategies that will help them weather the storm from the novel corona wave. 1. Leveraging Content Marketing to hook up Customers Content is king in digital marketing and vital to keeping people engaged, positioning your institution as a knowledgeable resource and provider of ongoing financial education. It also keeps your website fresh and interesting, a specialty search engine like Google would be proud of. One of the crucial strategies is blogging. Blogging - If you have a blog, plan your blog content strategically. With a little research, you can find out what people are searching for, what people are asking about in your branches, and what trends are hot. If you don’t have a blog, you should seriously consider investing in one. Don’t create a new, separate standalone site. Be sure that your blog is hosted on your domain to maximize its SEO value. And be sure to mix up the type of content you provide from articles and videos to infographics. Once your blog has great content, use channels like email and social media to drive traffic. 2. Greatly improve Customer Service by leveraging your Website The bank`s website is essentially a digital branch. It’s critical that this channel maximized to deliver customer service 24 hours a day for the entire year. Whether you love your current website or not, there are always opportunities to improve it. Focus on the things customers need the most e.g., help with online banking, finding your

routing number, accessing current rates, finding a nearby branch or ATM, or asking a general question. These can be done through: Investment in online chat Today’s digital consumer expects online chat. They’ve learned it can help them get their questions answered quickly and efficiently. Think about how your service reps always talk to one person at a time on the phone and compare with how they can be fielding inquiries simultaneously from multiple people through an online chat platform. Create of update FAQs - Many common questions that your members or customers ask can be addressed through a robust FAQ page. If you don’t have this on your site you should add it soon. Your customer service department is a great place to start to see how better information provided on your website can reduce unnecessary inquiries and streamline support operations. If you already have this information on your site, revisit the content to ensure it is accurate, comprehensive and up-to-date. Bonus points if you warehouse this information in a database and serve it up contextually next to relevant product pages. 3. Concentrate on Conversion Rate Optimization (CRO) This simply means focusing

on increasing the percentage of visitors that take the desired action on any given webpage. You’re putting a lot of time, effort and money into marketing tactics and you need to understand what’s working well and what’s not. This can be done in any of these ways: Landing Pages - A landing page is a dedicated page that specifically supports a specific desired action. This strips out all unnecessary elements, so that the visitor is entirely focused on your desired conversion. Every bank should have at least one landing page template as part of its website. 4. Integrate your Marketing With a lot of cooks in the kitchen, it’s easy to have disjointed messaging, or a single-channel campaign. The problem is that audiences are living in a surroundsound environment, where offline and online worlds continually collide and brand perception is often fragile. It’s better to do less, but integrate your marketing tactics, then spread yourself thin and confuse consumers. This can be carried out via: Multichannel campaigns Consider all of your channels when you have a promotion. If auto loans are a focus this period, plan backwards for success. Strategize your landing pages, then plot out your campaign tactics and

determine your success metrics. Relying on organic SEO and paid search, ATM ads, as well as social media and email marketing, your campaign should be integrated, consistent and memorable. Utilize the strengths of each platform - Integrating your marketing efforts does not mean doing the same thing across all platforms. Instead, play to the strengths of each platform, while you unify your message for more effectiveness and brand continuity.

Ebenezer ASUMANG (CGIA) worked extensively in mainstream Banking & NBFIs. He is a Chartered member of the CGIA Institute, USA, a Google Certified Digital Marketer and an Author. www.ebenezerasumang.com, info@ebenezerasumang.com, 0242339145.

MONDAY AUGUST 24, 2020

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Is the Almighty Dollar Slipping? NOURIEL ROUBINI

ar from signaling its imminent demise as the main global reserve currency, the greenback’s sharp depreciation is to be expected in the current macroeconomic context. The forces that could erode the dollar’s hegemony remain slower-moving and farther off. The recent sharp depreciation of the US dollar has led to concerns that it may lose its role as the main global reserve currency. After all, in addition to the US Federal Reserve’s aggressive monetary easing – which threatens to debase the world’s key fiat currency even further – gold prices and inflation expectations have also been rising. But, to paraphrase Mark Twain, reports of the dollar’s early demise are greatly exaggerated. The greenback’s recent weakness is driven by shorter-term cyclical factors. In the long run, the situation is more complicated: the dollar has both strengths and weaknesses that may or may not undermine its global position over time. Chief among the short-term negative factors is the Fed’s ultraloose monetary policy. With the United States monetizing ever-larger budget deficits, the Fed’s approach looks more accommodative than that of most other major central banks. The dollar tends to weaken during risk-on episodes, and vice versa. That is why its value peaked during the February-March panic over COVID-19, and then weakened from April onward as market sentiment recovered. Moreover, the Fed’s activation of currency swap lines with other central banks eased the dollar illiquidity that had been pushing the exchange rate higher earlier in the crisis. Now, a flood of global dollars is putting downward pressure on the greenback. Moreover, some developed countries (in Europe and elsewhere) and some emerging markets (such as China and others in Asia) are doing a much better job of containing COVID-19 than the United States is, implying that their economic recoveries may prove to be more resilient. The public-health failures and related economic vulnerabilities in the US are thus further contributing to the dollar’s weakness. It also bears repeating that before the pandemic, the dollar had appreciated by over 30% in nominal and real (inflationadjusted) terms since 2011. Given the yawning US external deficit, and because interest rates are not high enough to finance it

with capital inflows, a dollar depreciation was necessary to restore US trade competitiveness. And the US turn to protectionism signals that it prefers a weaker dollar to restore external competitiveness. Even in the short run the dollar could strengthen again if – as the latest global growth data suggest – a V-shaped recovery stalls into an anemic U-shaped recovery, let alone a double dip, if the first pandemic wave is not controlled and a second wave kills the recovery before effective vaccines are found. In the medium to long term, multiple factors could preserve the greenback’s global dominance. The dollar will continue to benefit from a broad-based system of flexible exchange rates, limited capital controls, and deep, liquid bond markets. More to the point, there simply is no clear alternative currency that could serve as a broad unit of account, means of payment, and stable store of value. Furthermore, despite its pandemic travails, the potential annual US growth rate, at around 2%, is higher than in most other advanced economies, where it is closer to 1%. The US economy also remains dynamic and competitive in many leading industries, such as technology, biotech, pharmaceuticals, health care, and advanced financial services, all of which will continue to attract capital inflows from abroad. Any country vying for the US position would have to ask itself if it really wants to end up with a strong currency and the associated large current-account deficits that come with meeting the global demand for safe assets (government bonds). This scenario seems rather unattractive

for Europe, Japan, or China, where strong exports are central to economic growth. Under the current circumstances, the US is likely to maintain its “exorbitant privilege” as the issuer of safe longterm debt that private and public investors want in their portfolios. The question, then, is what factors might undermine the dollar’s global position over time. First, if the US keeps monetizing large budget deficits, thereby fueling large external deficits, a surge of inflation eventually could debase the dollar and weaken its attractiveness as a reserve currency. Given the current mix of US economic policies, this is a growing risk. Another risk is the loss of US geopolitical hegemony, which is one of the main reasons why so many countries use the dollar in the first place. There is nothing new about the hegemon’s currency being the global reserve currency. This was the case with Spain in the sixteenth century, the Dutch in the seventeenth century, France in the eighteenth century, and Great Britain in the nineteenth century. If the coming decades bring what many have already called the “Chinese century,” the dollar may well fade as the renminbi rises. Weaponization of the dollar via trade, financial, and technology sanctions could hasten the transition. Even if American voters elect a new president in November, such policies are likely to continue, as the Cold War between the US and China is a long-term trend, and US strategic rivals (China and Russia) and allies alike are already diversifying away from dollar assets that can be sanctioned or seized. At the same time, China has been introducing more flexibility to

its own exchange rate, gradually relaxing some capital controls, and creating deeper debt markets. It has convinced more trade and investment partners to use the renminbi as a unit of account, means of payment, and store of value, including in foreign reserves. It is building an alternative to the Western-led Society for Worldwide Interbank Financial Telecommunication (SWIFT) system, and working on a digital renminbi that eventually could be internationalized. And its own tech giants are creating huge e-commerce and digital-payments platforms (Alipay and WeChat Pay) that other countries could adopt in their own local currency. So, while the dollar’s position is safe for now, it faces significant challenges in the years and decades ahead. True, neither China’s economic system (state capitalism with financial controls) nor its technocratic-authoritarian political regime has much appeal in the West. But the Chinese model has already become quite attractive to many emerging markets and less democratic countries. Over time, as China’s economic, financial, technological, and geopolitical power expands, its currency may make inroads in many more parts of the world.

Nouriel Roubini, Professor of Economics at New York University’s Stern School of Business and Chairman of Roubini Macro Associates, was Senior Economist for International Affairs in the White House’s Council of Economic Advisers during the Clinton Administration. He has worked for the International Monetary Fund, the US Federal Reserve, and the World Bank. His website is NourielRoubini.com, and he is the host of NourielToday.com. Copyright: project-syndicate.org.

MONDAY AUGUST 24, 2020

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Tourism Trauma and COVID-19

BY CYRIL REBILLARD

andemic-related lockdowns, flight cancellations, and border closures may be putting a crimp on summer vacation plans. However, the precipitous drop in tourism will have an outsized impact on countries that rely on foreign travelers—with potentially large-scale effects on their economies’ national accounts. Costa Rica, Greece, Morocco, Portugal, and Thailand could be among the hardest hit with losses in tourism proceeds exceeding 3 percent of GDP, according to the IMF’s recently released 2020 External Sector Report. The chart calculates direct tourism impacts on imports, exports, and current account balances under a scenario that envisions gradual reopenings in September but a drop of about 70 percent in tourism receipts and international tourism arrivals in 2020. A country’s current account balance is a measure of its total transactions—which includes but is not limited to trade in goods and services—with the rest of the world. For some economies, a drop in tourism (which is considered an

export) could have an impact on overall current account balances. For example, in Thailand, a decrease in tourism due to COVID-19 could bring the country’s overall exports down by 8 percentage points of GDP and have a direct net impact of about 6 percentage points of GDP on its current account balance in 2020. That could erode part of the 7 percent overall current account surplus the country had in 2019. The outlook for smaller, tourismdependent nations is even more stark. This chart and the External Sector Report focus on medium to large economies, but, under the same scenario, some smaller states especially reliant on tourism could see a dramatically larger direct impact on their trade and current account balances. Still, the overall effect a decline in tourism will have on current account balances may be less than these projected direct impacts foretell. Smaller, tourism dependent countries and even larger economies with a large tourism industry may see offsetting indirect effects. For example, smaller nations with less domestic resources often rely on more imports to support their tourism industries. A drop in tourism exports and the economic

activity that it drives, both directly and indirectly, will lead to a corresponding drop in imports— lessening the overall impact on the current account balance. Much is still unknown about the pace of tourism recovery in 2020.

Peoples’ desire and ability to travel abroad may continue to face headwinds going into 2021 due to the ongoing pandemic, leaving an uncertain outlook for tourism industries in economies both big and small.

MONDAY AUGUST 24, 2020

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The Dark Heart of Gold BY JEFFREY FRANKEL

he US Federal Reserve has rightly eased monetary policy aggressively since the onset of the coronavirus recession in March. But gold bugs would take the recent record-high price for the metal as a sign that the Fed should tighten monetary conditions sharply. The price of gold reached an all-time high of $2,000 per ounce in early August. And while mainstream economists have treated gold as a sideshow since the world abandoned the gold standard in 1971, this recent price spike is a significant signal. Three explanations for the elevated gold price – related to US monetary policy, risk, and investors’ growing desire for a safe-haven alternative to the dollar – have been offered. Each contains some truth. The US Federal Reserve has eased monetary policy aggressively since the onset of the coronavirus recession in March. True, there currently is little sign of inflation – for centuries a major motive for holding gold. But rising goods prices are not the only sign of easy money. Today’s low real interest rates, depreciated dollar, and high stock prices – not to mention the size of the Fed’s balance sheet – all reflect the Fed’s accommodative monetary-policy stance. A low real interest rate is often associated with a high real price of gold, both in theory and empirically. After all, the long-time argument that gold doesn’t pay interest is less persuasive when other assets are also yielding scant returns. The last decade confirms the correlation. The gold price was almost as high as it is now in 2011-12, during the Fed’s second and third rounds of quantitative easing (QE). It then fell to $1,200 per ounce during the “taper tantrum” that followed then-Fed Chair Ben Bernanke’s May 2013 announcement of plans to end QE. Another age-old reason to invest in gold is to hedge against risk, because the gold price, although highly variable, tends to correlate relatively weakly with prices of other securities. For obvious reasons, risk perceptions have been elevated since February, as reflected in policy uncertainty indices and the VIX (the so-called fear index). Gold is typically one of several safe-haven assets to which risk-averse investors flee. Although the dollar has long been the world’s leading safe-haven currency, the increasing eagerness of many investors’ to diversify

their holdings partly reflects US President Donald Trump’s weaponization of the greenback, using – or abusing – its status as the leading international reserve currency to enforce unilateral US sanctions extraterritorially. Another likely factor is widespread loss of confidence in the competence of US governance, with the most egregious example being Trump’s mismanagement of the COVID-19 pandemic. The end of the dollar’s preeminence has been prematurely declared many times, and no obvious challenger has yet emerged. The world’s second most important currency, the euro, lags far behind the dollar in measures of international use. Meanwhile, the Chinese renminbi, heralded as a potential challenger not long ago, is only fifth, seventh, or eighth in the rankings, depending on the criterion used. Gold is not a currency, but it rivals the dollar as an international reserve asset and has thus benefited from the desire for diversification. Moreover, the dollar’s depreciation since April against the euro and most other major currencies itself partly explains the increase in the dollar price of gold. The heyday of the international gold standard (under which most leading currencies were convertible into gold) ended in 1914, with the advent of World War I. But the arrangement continued to play an important role until August 1971, when US President Richard Nixon surprised the world by abruptly ending the dollar’s convertibility into gold. Today, however, the gold

standard is of more than antiquarian interest. In January, Trump nominated Judy Shelton – who made her reputation as a dyed-in-the-wool proponent of the gold standard – to be one of the seven governors on the Federal Reserve Board. The Senate Banking Committee voted to approve her, along party lines, on July 21, and her appointment could come up for a final vote as early as September. Shelton’s views go beyond nostalgia. “Let’s go back to the gold standard,” she wrote in February 2009. She favors abolishing the fiat dollar as legal tender. But returning to a gold-based monetary system is a terrible idea. Even if low and stable inflation were the only objective, the gold standard did not deliver that. Between 1873 and 1896, for example, the general price level fell by 53% in the US and by 45% in the United Kingdom, owing to a dearth of new gold discoveries, which ended only with the 1896 Klondike gold rush. Moreover, economies do better when central banks, in addition to seeking price stability, pursue financial stability and act to stabilize income and employment. The Fed’s monetary stimulus in 2008-12, when unemployment reached 9%, was thus the right policy. Conversely, tightening was appropriate in 2016-18, when US unemployment fell below 4%. Had the Fed instead followed the gold market, it would have tightened monetary policy in 2010, prolonging the period of high unemployment, and loosened policy in 2018. Stimulus was again the right decision when

the coronavirus recession hit – but true believers in gold would take the recent record price as a sign that the Fed should tighten policy aggressively. Then there is Shelton’s ideological inconsistency. As soon as the prospect of attaining high office arose, she contradicted her longstanding philosophy in order to say what Trump wanted to hear – namely, that the Fed should loosen monetary policy even faster. Were Shelton to join the Fed board, neither the price of gold nor what is good for the economy would likely determine her vote. Should Democratic presidential nominee Joe Biden win in November, she would almost certainly reconnect with gold and rediscover the urgent need to tighten policy – even if the economy is still very weak. But if Trump is re-elected, she will probably vote to double down on the current monetary stimulus, even if inflation revives. We have become accustomed to toadyism and cronyism under Trump, from the Justice Department to the US Postal Service. Until now, the Fed has been blessedly free of these scourges – but perhaps not for much longer.

Jeffrey Frankel, Professor of Capital Formation and Growth at Harvard University, previously served as a member of President Bill Clinton’s Council of Economic Advisers. He is a research associate at the US National Bureau of Economic Research. Copyright: Project-syndicate.org

MONDAY AUGUST 24, 2020

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Key role for natural gas in supporting Ghana’s development Kevin Okyere, CEO, Springfield Group, tells Oxford Business Group

he far-reaching implications of finding, commercially viable quantities of oil and gas in deepwater drilling off Ghana was one of several topical issues explored by Kevin Okyere, CEO, Springfield Group, in an in-depth interview he gave recently to Oxford Business Group’s online broadcasting channel, Global Platform. Okyere told OBG that Springfield’s success last year had confidence in other regional oil companies, many of whom were initially cautious about deepwater projects. Springfield E&P, together with its partners GNPC and its exploration company EXPLORCO, doubled its discovered oil reserves to 1.5bn barrels in late 2019 after drilling in deepwater at the West Cape Three Points Block 2. The company estimates that the undiscovered potential of the block is over 3bn barrels of oil and gas in proven reservoir units. “A lot of people in Africa hold the belief that you don’t go into deepwater areas,” he said. “Now Springfield has become the first

homegrown African company to shoot seismic in deep water, other Ghanaians have started applying to get concessions for oil blocks in Ghana.” In the interview, Okyere, also highlighted the key role that he believes the supply of natural gas will play in supporting Ghana’s development, driving its industrialisation and meeting rising demand for energy, both at home and across the continent. “They are even looking at some landlocked countries which we may be able to supply gas to,” he noted. Okyere added that as a clean source of energy, natural gas has several advantages, which ensure it sits well with international and local efforts to tackle climate change and curb deforestation. “The various gas policies that government has in place enable liquefied petroleum gas to be accessible everywhere, which will then stop people from cutting down trees to burn them to charcoal for cooking purposes,” he explained. Marc-André de Blois, OBG’s

Director of PR and Video Content, said that while Ghana’s hydrocarbons industry is relatively young, the gas associated with its oil finds quickly began proving its use as an alternative feedstock for the country’s power generation system and industrial sector. “Ghana’s industrial expansion is at the heart of broader efforts to diversify the economy and will be crucial in driving post-pandemic growth,” he said. “Our interview with Kevin Okyere highlights the major role earmarked for Ghana’s oil and gas in not only meeting rising domestic demand, but also serving more of the continent, reaffirming the country’s position as an important regional hub.” Global Platform is Oxford Business Group’s on-demand digital broadcasting channel. One of several research tools in OBG’s portfolio, the online platform has carved a niche as a leading business intelligence provider in its own right, with data verified independently by Deloitte. Global Platform provides innovative video interviews with top-level decisionmakers giving key analysis and the latest updates from across

all sectors of the global business community. About Oxford Business Group Oxford Business Group (OBG) is a global research and advisory company with a presence in over 30 countries, from Africa, the Middle East and Asia to The Americas. A distinctive and respected provider of on-the-ground intelligence on the world’s fastest growing markets for sound investment opportunities and business decisions. Through its range of products – Economic News and Views; The OBG CEO Survey; OBG Events and Conferences; Global Platform, which hosts exclusive video interviews; The Report publications – and its Advisory division, OBG offers comprehensive and accurate analysis of macroeconomic and sectoral developments. OBG provides business intelligence to its subscribers through multiple platforms, including its own verified subscribers and the ones of Dow Jones Factiva, Bloomberg Terminal, Refinitiv’s Eikon (previously Thomson Reuters), Factset and more.

MONDAY AUGUST 24, 2020

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Emirates and Clark International s irport celebrate landmark one-off a380 service The iconic emirates a380 made a one-off service to clark international airport Friday, becoming the first commercial flight, utilizing the iconic aircraft, to operate to the luzon-based airport. The special a380 service from dubai to clark and operating as ek2520, took off from dubai international airport at 02:40 and landed in clark at 15:23 local time, and was greeted by a traditional water cannon salute upon arrival at the airport. more than 400 passengers, who were delighted to have experienced emirates’ flagship aircraft on a route not regularly served by the aircraft, in addition to emirates executives, were welcomed by the airport’s executive management team. vips, including secretary of department of transportation, mr. arthur tugade, as well as media were given a guided tour of the a380 by emirates cabin crew. Satish sethi, ountry manager for emirates-philippines said: “today we mark a special day in the history of our operations in the philippines, by becoming the first airline to operate the world’s largest commercial passenger aircraft to clark international airport and we are delighted to share this special occasion with the airport that we have been operating from since 2016. it also is a great honour to have delighted our customers by giving them the opportunity to experience this flagship aircraft on their journey to the philippines.

“we have been serving our customers in the philippines for 30 years and, since we introduced this iconic aircraft to our fleet in 2008, filipino fans have always planned trips to destinations that are served by the emirates a380, by connecting in dubai, to enjoy its spaciousness, comfort and best-in-class features and amenities. this time, we wanted to give our customers the oneoff opportunity to have the same experience on the Dubai-clark route.” the popular emirates a380 aircraft has resumed operations to five destinations so far, including london heathrow, paris, cairo, guangzhou and toronto. “we would like to thank the authorities in the philippines for their continuous support that has been crucial to our success since we began our operations here. our most sincere gratitude also goes to them for making this exceptional flight possible, allowing us to take advantage of efficiencies and greater capacity on a route where flights remain in high demand. the last time our a380 aircraft made an appearance in the philippines was in 2014 in manila, and we hope to see it soon as a regular scheduled service to the country,” continued sethi. emirates has been serving the philippines since 1990 and inaugurated its first service to clark in 2016. in 2014, the emirates a380 made a one-off trip to manila,

marking its first arrival in the philippines. emirates resumed its flights to manila on 11 june, with daily flights, and clark on 1 august with six weekly fights. on 20 august, emirates will resume its operations to cebu, restoring scheduled services to all three gateways in the country. with safety as a priority, emirates is gradually expanding its passenger services to 75 cities in september, allowing travellers to connect safely and conveniently to the americas, europe, africa, middle east, and asia pacific via dubai. customers from emirates’ network can stop over or travel to dubai as the city has reopened for international business and leisure visitors. covid-19 pcr tests are mandatory for all inbound and transit passengers arriving to dubai (and the uae), including uae citizens, residents and tourists, irrespective of the country they are coming from. destination dubai: from sun-soaked beaches and heritage activities to world class hospitality and leisure facilities, dubai is one of the most popular global destinations. in 2019, the city welcomed 16.7 million visitors and hosted over hundreds of global meetings and exhibitions, as well as sports and entertainment events. dubai was one of the world’s first cities to obtain safe travels stamp from the world travel and tourism council (wttc) – which endorses dubai’s comprehensive and effective measures to ensure guest health

and safety. free, global cover for covid-19 related costs: customers can now travel with confidence, as emirates has committed to cover covid-19 related medical expenses, free of cost, should they be diagnosed with covid-19 during their travel while they are away from home. this cover is immediately effective for customers flying on emirates until 31 october 2020 (first flight to be completed on or before 31 october 2020), and is valid for 31 days from the moment they fly the first sector of their journey. this means emirates customers can continue to benefit from the added assurance of this cover, even if they travel onwards to another city after arriving at their emirates destination. for more details: www.emirates.com/ covid19assistance. health and safety: emirates has implemented a comprehensive set of measures at every step of the customer journey to ensure the safety of its customers and employees on the ground and in the air, including the distribution of complimentary hygiene kits containing masks, gloves, hand sanitiser and antibacterial wipes to all customers. for more information on these measures and the services available on each flight, visit: www. emirates.com/yoursafety. (source: emirates)

EU commission gives the green light for brussels airlines’ stabilisation package on july 24th, brussels airlines announced that it had reached an agreement with the belgian federal government and lufthansa to secure the future of belgium’s home carrier and herewith the long-term development of the airline through a stabilization package. on august 17, the package was approved by the german economic stabilization fund (wsf ). the eu commission has also given its approval. the stabilization package of €460 million- €290 million from the belgian federal government and €170 million from lufthansa covers in part the losses incurred by brussels airlines due to the crisis and secures at the same time tens of thousands of direct and indirect jobs that are linked to the activities of brussels airlines. thanks to the package, the airline can finance its turnaround plan and herewith create a long-term

and structurally profitable future. dieter vranckx, ceo of brussels airlines said: “with this news, we finally conclude the three pillars of our survival and long-term competitiveness. we are relieved

that the execution of the financial transaction can take place. we will now shift all our focus towards a timely implementation of our turnaround plan reboot plus. “thanks to the support and trust

we receive from our shareholder lufthansa, the belgian government and from all our employees, we can create a strong and competitive Brussels airlines with long-term perspectives, an important engine for the Belgian.”

MONDAY AUGUST 24, 2020

Feature

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The COVID-19 pandemic: Foreseeable food Insecurity BY ANTHONY ADONGO APUBEO

t is no longer news to hear countries announcing the number of confirmed cases of the novel Corona Virus Disease (COVID-19) pandemic and Ghana as a country is not exempted from this natural disaster. The infectious disease has neither “a passport nor visa” but has been able to travel across most borders and territories across the globe causing havoc to every economy including the world superpowers such as the United States of America and China. It is, however, important to note that one of the areas that most African countries including Ghana are not paying much attention to, is the devastating effects the virus is causing to the agriculture production sector, which is likely to affect food security to rock the African continent. According to the Food and Agriculture Organization of the United Nations 2020 report on the State of Food Security and Nutrition in the World, the COVID-19 pandemic could push up to 132 million people into hunger by the end of 2020. To quote excerpts from the report, “as progress in fighting hunger stalls, the COVID-19 pandemic is intensifying the vulnerabilities and inadequacies of global food systems. While it is too late to assess the full impact of the lockdowns and other containment measures, at least, another 83 million people and possibly as many as 132 million, may go hungry in 2020.” In Ghana to be specific, when President Nana Addo Dankwa Akufo-Addo announced the partial lockdown in some areas of Accra, Tema, Kumasi, and Kasoa, food prices went up and the government had to spend huge sums of money on food to cater for the vulnerable. Food crisis is a looming pandemic that many countries may not foresee while they are battling to curb the spread of the virus especially developing countries such as Ghana of which if pragmatic measures are not taken to boost agriculture production, food security crisis would be the worst pandemic to hit the country and the world at large. There is an old adage in Gurune, which says, “if a stone is falling, everybody protects his or her head,” what this simply means is that if there is any looming disaster, individually, one would do whatever it takes to guard himself or herself against it before thinking of saving someone else. This is what the outbreak and spread of the COVID-19 pandemic has presented to the world and there is no doubt that the new disease living with us would have dire consequences on every sector of the economy including food and nutritional security. Ghana food imports It is clear that the agriculture sector

is the backbone of Ghana’s economy as about 70 percent of its population is directly or indirectly engaged in farming and depend largely on farm produce for survival. Despite the huge numbers engaged in agriculture, the country has over the years faced food security and nutritional issues and has been importing some kinds of foods especially grains such as rice, and that was even before the outbreak of the COVID-19 pandemic. Statistics available from the Ministry of Trade and Industry indicates that Ghana spends more than $1 billion each year to import only rice into the country and in 2017, an amount of $1.1 billion was spent on only rice importation. According to the Ministry of Finance in 2018, food imports cost the nation an average of US$2.4 billion annually, being importation of rice, sugar, sorghum, frozen chicken, and meat among other food items for domestic and industrial consumption. Concerns from farmers Speaking in an interview with the Ghana News Agency in Bolgatanga in the Upper East Region, some farmers expressed the fear that the pandemic would greatly affect agriculture production in the area, especially among the smallholder farmers. Many of the farmers expressed the fear that as they mainly engage manual labour on their farms, the mode of transmission of the virus and the prescribed measures they had to take to protect themselves would make it difficult for them to engage in the normal farming practices such as engaging communal labour. To them, the COVID-19 pandemic had drained all their financial resources such that paying for mechanization services as an alternative to the manual services as well as taking care of their families, which was practically difficult. Reverend John Akaribo, a farmer at Nyariga, a community in the Bolgatanga Municipality said most of the farmers particularly the smallholder farmers depended on the proceeds of previous yields, however, the lockdown did not allow farmers to sell their products. He said most of the farmers, especially dealers in perishable produce incurred losses as a result of the restrictions on travelling and most people could not afford farm inputs and other agriculture services to undertake production. Mr Charles Kwowe Nyaaba, Head of Programmes and Advocacy of the Peasant Farmers Association of Ghana (PFAG), explained that apart from the subsistent farming, any other forms of farming would be reduced due to the COVID-19 pandemic. He said group farming would not be practiced since the money to hire mechanization services would be a challenge. He explained that most farmers due

to the long processes in acquiring credit facilities at the financial institutions, resort to families and friends for support, however, due to the COVID-19, their businesses have been challenged. “Because of COVID-19, farm implements such as tractors have not been imported to provide mechanization services, you will go to the valleys and you will see several farmers queuing for tractor services, the ones the Ministry brought are not good for the kind of farming we do,” he added. Government’s efforts to improve food production Though the government through the Ministry of Food and Agriculture intends to increase the number of farmers benefiting from the flagship programme, Planting for Food and Jobs (PFJs) for this year, more needs to be done to avert any possible food and nutrition crisis. For instance, Mr Francis Ennor, the Upper East Regional Director of the Department of Agriculture, stated that the government had increased the number of beneficiary farmers under the PFJs to 200,000 from the 130,000 enrolled in 2019. He said although his outfit has begun implementing strategies through the Savannah Zone Agriculture Production Improvement Productivity (SAPIP) and the Savannah Zone Investment Programme (SIP) to increase commercial production of rice, maize and soybeans, more investment needs to be done to avert any food shortage. “As a country, we are self-sufficient in maize, cassava, and tubers except for rice. The importation of rice is still very high and we are taking rice production very seriously. If we don’t sit up and do more, it is going to affect food availability in the coming year,” he added. Recommendations Statistics has it that, annually, Ghana imports about 70 percent of the rice it needs. It is now clear that without increased domestic production of food particularly rice, which Ghanaians consume more than any other kind of foodstuff,

there will be a shortage of it on the market. It is heartwarming to hear the increase in the number of people benefitting from the PFJs, however, it would be commendable if the government could offer farmers free inputs instead of subsidizing the price, it would alleviate the cost of production and enable the poor farmers to expand their farms. In order to meet the high demand for food and other agriculture products particularly rice, government needs to invest strategically in large scale rice production, by supporting commercial farmers to expand their farms. The government last year pledged to make the Fumbisi Rice Valley in the Builsa South District of the Upper East Region, the hub of rice production in West Africa and there is no better time to fulfil this promise than now, by supporting farmers in the area and other valleys across the country to sustainably cultivate rice for local consumption and export. The government further needs to connect the farmers especially the farmer unions to the financial institutions to ensure that they receive credit at reasonable interest rates to be able to expand their farms. To ensure the availability of the farm market produces, to encourage farmers to upscale their farming, the government needs to implement policies that would ensure that Ghanaians eat what they grow while other public institutions are compelled to purchase local agricultural products. It would not be out of place for government to treat agriculture specially and develop coordinated policy and lucrative stimulus packages for farmers, agribusinesses and other people engaged in the agriculture value chain, to increase production. This would help revive the economy, alleviate smallholder farmers from extreme poverty, and put Ghana back on track to achieving the Sustainable Development Goals (SDGs) as well as prevent any unforeseeable food insecurity.

MONDAY AUGUST 24, 2020

Africa Business

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Cell C to close 128 stores putting 546 jobs on the line The job cuts are in addition to Cell C’s plans to lay off 960 workers, announced in June Mobile operator Cell C said on Friday that it expects to close about 128 stores across the country, more than half its retail footprint, with 546 jobs on the line as it seeks to cut costs and restructure its operations. The job cuts will be in addition to Cell C’s plans to lay off 960 workers, announced in June. “The retail environment has changed and this has been fasttracked by the impact of Covid-19 and the evolving purchasing habits of consumers,” Cell C, which is not listed and is 45% owned by Blue Label Telecoms, said in a statement. “Much as banks are moving away from bricks-and-mortar branches, Cell C is embracing digital solutions and driving digital inclusion by leveraging collaborations and partnerships.” The consultation process for the job cuts announced in June started on July 30 and the company said it subsequently made a voluntary severance package offer. Earlier in August Cell C, which has struggled to turn a profit since its formation in 2001, said it was making good progress with

finalising its recapitalisation plan that will improve its liquidity and debt profile. These efforts have included cost savings through procurement cuts, a year-long hiring freeze, and a review and discontinuation of

certain products. SA is grappling with one of the world’s highest unemployment rates, at about 30%, with estimates that it could reach as high as 40% by the end of 2020. Companies such as MultiChoice

and Telkom have embarked on similar action to that of Cell C in the past year, citing changes in technology and shifts in customer behaviour that have reduced the need for a number of roles. (Businesslive)

Nigeria to enact reciprocity over international flights ban Nigeria Aviation Minister Hadi Sirika said on Thursday that his country will ban flights from those countries refusing Nigerian flights permission to land due to the ongoing Covid-19 pandemic and the subsequent restrictive measures imposed. Sirika told reporters: “The principle of reciprocity will be applied. If you ban us from coming to your country, the same will apply the other way.” However, a spokesperson for the minister clarified that Sirika wasn’t referring to banning citizens of these countries, rather meant that landing permits won’t be issued to aircraft coming from those countries that have banned Nigerian carriers. The director-general of the Nigerian Civil Aviation Authority confirmed that authorities were still drafting the list of countries whose carriers won’t be granted permission to land in Nigeria, adding that European Union countries are among those barring Nigerian flights. Nigerian authorities earlier this week declared their intention to resume international flights on 29 August following a suspension

that lasted for almost 5 months. All international flights (except for essential or repatriation flights) have been suspended since March. The country will start with four daily international flights landing in Lagos and Abuja airports, with Sirika revealing that the number of passengers landing in Nigeria would be initially limited to 1,280 a day. Nigeria has reported more than 51,000 Covid-19 cases so far with 989 people losing their lives to the disease.

MONDAY JULY 20, 2020

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