Business24 Newspaper - July, 2020 by Business24 Online

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WEDNESDAY JULY 1, 2020

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World Bank lines up US$715m support for Ghana Gov’t moves to reduce auto imports

BY NII ANNERQUAYE ABBEY

The Country Director of the World Bank, Pierre Frank Laporte, says the bank is currently processing financial support that could reach up to US$715m to help government combat the COVID-19 pandemic as well as execute other projects. Mr. Laporte told Business24 in an interview that the amount includes a US$100m financial support request made by government to enable it undertake a set of projects relating to its fight against the pandemic. This amount follows a similar support offered by the bank at the onset of the pandemic in early April, when an amount of US$100m was approved as part of the COVID Emergency Preparedness Response Support initiative. “We are going to give US$315m to Ghana through two projects,” Mr. Laporte said. “The first is a jobs

and skills project, which will focus on improving the environment and make funds available for SMEs and focus on building skills in that area. The other project is the recently launched Ghana Accountability for Learning Outcomes Project (GALOP), which will support teaching and learning through modern in-service teacher training and provision of learning materials.” The Country Director expressed confidence that government’s request should be approved by end of July to provide the needed resources to tackle the pandemic and its ramifications. He added: “Early in the [World Bank’s] next fiscal year, by September 2020, we expect to bring roughly another US$400m in new projects, including one in the financial sector which will provide credit lines to the development banks and provide guarantees for SMEs. Additional funds will also be dedicated to the water sector— and this time we are focusing on Kumasi.”

MORE ON PG 19

*EXCHANGE RATE (INT. RATE)

USD$1 =GHC 5.6230*

*POLICY RATE

14.5%*

GHANA REFERENCE RATE

15.12%

OVERALL FISCAL DEFICIT

6.6 % OF GDP

PROJECTED GDP GROWTH RATE PRIMARY BALANCE.

1.5% -1.1% OF GDP

AVERAGE PETROL & DIESEL PRICE:

GHc 5.13*

INTERNATIONAL MARKET BRENT CRUDE $/BARREL

42.30

NATURAL GAS $/MILLION BTUS

1.78

GOLD $/TROY OUNCE

1,685.06

CORN $/BUSHEL

329.50

COCOA $/METRIC TON

2,384.00

COFFEE $/POUND:

+5.70 ($108.30)

COPPER USD/T OZ.

220.15

SILVER $/TROY OUNCE:

editor@thebsuiness24online.net

17.07

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‘Made-in-Ghana’ VW, start of a new era The old generation of Ghanaians speak passionately about a time when the country was a major assembling hub for automobile in the sub-region. There were, indeed, initial successes with assembling automobile for the local market.

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The factories, ideas and policy seem to have died with the initiators. Bedford or Neoplan vehicles are rarely seen on our streets, except for few rural communities who rely on heavily remodeled Bedford vehicles for carting their farm produce to major markets in the city. The presentation of a Bonafide Vehicle Assembler Certificate to VW Ghana, as part of government’s grand strategy to facilitate the assembly of world-renowned automobile brands

locally and reduce auto imports, therefore. has set the country on a new path—to assemble vehicles locally and reduce the importation of decade-old vehicles into the country. With a staggering US$1.85billion vehicle imports annually--of which used vehicles (5-10 years old) constitute about 70 percent— which puts a significant stress on available foreign currency, the state is looking to cut down on imports. Health and environmental impact are other reasons for government’s desire to have vehicles assembled locally. Imported used cars, most of which have been involved in serious accidents or floods, have been named as the possible cause

of hundreds of road accidents in the country. Indeed, VW has established a local subsidiary, VW Ghana, and appointed a Ghanaian Chief Executive Officer, Mr. Jeffrey Oppong Peprah. He is expected to lead his team assemble five Volkswagen models--Tiguan, Amarok Pickup, Passat, Polo, and Teramont-- in their Accra plant. Parliament has also enacted a law banning the importation of ten-year old vehicles. This new development may temporarily affect some used car dealers but the end result should be well communicated to get all relevant stakeholders to support this new endeavor.

World Bank lines up US$715m support for Ghana (…CONTINUED FROM COVER )

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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)

Debt service relief ith resource-dependent countries like Ghana, which have been badly hit by the pandemic, asking for a debt service respite from both multilateral and bilateral institutions, Mr. Laporte stated that government may have to formally notify the bank if it intends to benefit from such a favour. He said although government agrees that a suspension of its debt service commitments with the Washingtonbased lender would offer it some respite, the bank is yet to receive an official request to that effect. “Ghana has not yet officially made a request for debt service suspension. The Finance Minister and his team are still considering this. There are several issues related to that—for instance, there are benefits and costs of such engagement.” President Akufo-Addo in April announced that an agreement had been reached with the Bretton-Woods institution to freeze the country’s debt service commitments for the rest of the year. Ghana’s outstanding debt to the World Bank stood at US$4.2bn as at May 31. Mr. Laporte said while a formal notification is yet to be received by the bank from Ghana, other countries that made a similar request have been put on a watchlist by some credit rating agencies—which perhaps could be a reason holding government back.

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Gov’t moves to reduce auto imports BY DOMINICK ANDOH

Trade and Industry Minister Alan Kyerematen has presented a Bonafide Vehicle Assembler Certificate to VW Ghana, as part of government’s grand strategy to facilitate the assembly of worldrenowned automobile brands locally and reduce auto imports. With a staggering US$1.85billion vehicle imports annually--of which used vehicles (5-10 years old) constitute about 70 percent—which puts a significant stress on available foreign currency, the state is looking to cut down on imports. Health and environmental impact are other reasons for government’s desire to have vehicles assembled locally. Imported used cars, most of which have been involved in serious accidents or floods, have been named as the possible cause of hundreds of road accidents in the country. Touring the facility with the Trade Minister after the presentation of the certificate, Chief Executive Officer of the VW Ghana, Mr. Jeffrey Oppong Peprah, revealed that the company has commenced commercial

production under a registered local company VW Ghana. VW Ghana presently produces five Volkswagen models in its Accra plant namely: Tiguan, Amarok Pickup, Passat, Polo, and Teramont. Assembly of new cars and used car market With no significant car assembling plants, used and salvaged automobiles are among the highest

imports of the country. Top five imported goods in descending order are vehicles, machinery, electronics, cereals and plastics. The stark statistics of imported used cars made Volkswagen (VW), Nissan, Toyota and Sinotruck request for action to be taken as a pre-requisite to their entry in order to ensure there is market for their

products. Currently, importers of used cars, which are 10 years and above are made to pay a fine in addition to the duties on the car as determined by the Ghana Revenue Authority (GRA)—Customs Division– computation. The Customs Amendment Bill, 2019, therefore, seeks to ban the import of overage vehicles –10 years or older.

BoG urges PPP to boost manufacturing capacity BY KWASI ANKU

The central bank has advocated an increased Public-PrivatePartnerships (PPP) in crucial infrastructure development across the country to boost the local manufacturing of key products. Mrs. Elsie Addo Awadzi, the Second Deputy Governor of Bank of Ghana said: “We need critical public-private sector investments in key infrastructure over the mediumterm to increase the manufacturing capacity of our economy postCOVID-19.” Though the country recorded a positive trade balance in 2018, key imports than continue to put pressure on available foreign exchange include refined petroleum (US$738M), cars (US$466M), rice (US$425M), non-fillet frozen fish (US$303M), and delivery trucks (US$274M). She said the country needs to retool, re-equip and fund the Micro, Small and Medium Enterprises (MSMEs) to leverage technology for increased productivity so that some of the imported item can be made

locally and reduce our dependence on imports. Mrs. Awadzi, was speaking at Engine Business Network (EBN) Micro, Small, and Medium sized Enterprises (MSME) virtual conference on the theme: “MSME manufacturing capabilities, responding to covid-19 and opportunities beyond” in Accra. She called for a renewed focus on equitable and inclusive growth to ensure that the MSME sector, and in particular, women and youth entrepreneurs were not left behind. She said the Bank of Ghana has taken steps to improve access to credit for MSMEs through the banks, savings and loans companies, microfinance companies, and rural and community banks. Mrs. Awadzi encouraged all the MSMEs to approach their financial institutions to explore financing and other opportunities available for them. “I encourage you also to engage actively with the Ghana Association of Bankers, and industry associations representing the savings and loans companies, microfinance companies, and rural

and community banks, to help these institutions better understand the needs of members and to fashion out specific products and services to support you,” she added. She said the Central Bank was committed to ensuring that policies and regulatory measures help to promote macroeconomic stability and growth, not only for a few, but for all Ghanaians. She said by promoting monetary and financial stability, “we seek to create an enabling environment that

supports all economic players to contribute their fair share to socioeconomic development and nationbuilding.” She said the Bank of Ghana has recently launched the Ghana Sustainable Banking Principles in partnership with the Ghana Association of Bankers and the Environmental Protection Agency. These are a set of seven principles adopted by banks in Ghana in November 2019, by which they committed to scaling up lending to five key sectors of the economy in a manner that promotes good environmental management practices and social justice including through gender equity and access to finance for all. Mrs. Awadzi said while the impact of COVID 19 on the sectors has been severe, there is much hope with the recovery ahead, and there were enormous opportunities in the postCOVID world. “What is more, policy makers have made interventions to help cushion the impact of the pandemic on the MSME sector,” she said.

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IMF predicts Africa’s sharpest contraction in five decades BY NII ANNERQUAYE ABBEY

The International Monetary Fund (IMF) is predicting that the COVID-19 pandemic is set to push the sub-Saharan Africa (SSA) economy to its lowest growth in nearly fifty years. The latest prediction comes after the Fund further revised downwards an earlier prediction made in April when a lot of SSA countries were beginning to impose restrictions on movement to contain the spread of the pandemic. The Washington-based institution in its latest Regional Economic Outlook Update for the region stated that economic activity is now projected to contract by some 3.2 percent, reflecting a weaker external environment and measures to contain the COVID-19 outbreak. Tourism-dependent economies, oil exporting countries, and other commodity exporters saw larger downward revisions in the latest update. Commenting on the implication of this negative growth, Abebe Aemro Selassie, Director of the

IMF’s African Department said on the average, per capita incomes across the region will fall by 5.5 percent in 2020, back to levels last seen nearly a decade ago. This, he said, will likely lead to more poverty and widen income inequality as lockdowns disproportionally affect informal sector workers and small- and medium-sized companies in the services sectors. “Many authorities in Sub-Saharan Africa face a particularly stark set of near-term policy choices; concerning not only the scale of support they can afford, but also the pace at which they can reopen their economies. “Regional policies should remain focused on safeguarding public health, supporting people and businesses hardest hit by the crisis, and facilitating the recovery,” said Mr. Selassie. According to him, while the immediate priority remains the preservation of health and lives, as the region starts to recover, authorities should gradually shift from broad fiscal support to more affordable, targeted policies; concentrating in particular on the poorest households and those

sectors hit hardest by the crisis. “Looking even further forward, and once the crisis has waned, countries should refocus their attention on transforming their economies, creating jobs, and boosting living standards—clawing back some of the ground lost during the current crisis. As before the crisis, part of this effort will require putting fiscal positions back on a path consistent with debt sustainability; which will in turn require a renewed determination to implement revenue-mobilization, debtmanagement, and public financial management reforms. While the Bretton Woods institution predicts an immediate turnaround for growth, recovering to 3.4 percent in 2021, it says that would largely be contingent on continued gradual easing of restrictions that has started in recent weeks. Also, a growth rebound would further be boosted by the region avoiding the same epidemic dynamics that have played out elsewhere. The Fund called for more international support for the region stating that this year alone,

Abebe Selassie, Deputy Director IMF African Department.

countries in the region will face additional financing needs of over US$110bn, and despite initial efforts from donors US$44bn of this is yet to be financed. “This crisis is unprecedented. Our members need us now more than ever. And our efforts today will have significant consequences down the road, not only in helping our members offset the immediate tragedy of the crisis, but also in ensuring that peoples’ lives and livelihoods are not destroyed forever,” Mr. Selassie added.

ACET, IMF to hold webinar on Africa’s post-COVID-19 recovery and growth BY BENSON AFFUL

The African Center for Economic Transformation (ACET) will host International Monetary Fund (IMF) African Department Director Abebe Aemro Selassie at a webinar on Tuesday, July 7 to discuss policy actions for Africa’s economic rebound in the aftermath of the COVID-19 pandemic. The Zoom event, “Priorities for Africa’s Recovery, Growth, and Transformation”, will focus on pressing questions that governments must answer in crafting policy responses that meet immediate needs without compromising long-term development goals. What actions will have the most impact for the most people? How are those actions implemented effectively? How can the IMF and other development partners best support governments? In addition to Mr. Selassie, panelists will include Dr. K.Y. Amoako, ACET President and Founder; Ms. Mavis Adu-Gyamfi, incoming ACET Executive Vice

President; and Prof. Benno Ndulu, former governor of the Bank of Tanzania. The pandemic has exacted a heavy toll on global economies, with Africa hit especially hard. According to the World Bank, the African continent is expected to experience its first recession in 25 years. A United Nations report predicted a billion people globally could be pushed into poverty, with Africa’s fight against poverty set back by as much as 30 years. “The impact of COVID-19 cannot be understated,” said Dr. Amoako. “African countries must focus on implementing policies that will spur economic recovery and growth in their countries in the short, medium, and long terms.” ACET recently published a list of 10 policy priorities that, if implemented in the local context, will help countries recover lost gains but also help ensure the broader economic transformation agenda stays on track. Participants will include a cross-section of development stakeholders, including policymakers, advisors, academics, media members, and

the general public. Registration is free and available here. The African Center for Economic Transformation (ACET) is an economic policy institute supporting Africa’s long-term growth through

transformation. We produce research, offer policy advice, and galvanize action for African countries to develop their economies, reduce poverty, and improve livelihoods for all their people.

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Business Outlook Series Part III Preparing your business for funding: What do investors want? BY CDC CONSULT

f you ask business owners, managers and entrepreneurs the topmost challenge they face with their businesses, you are most likely going to be told it is with funding. Today, this need has been heightened with businesses requiring financial support to navigate the impact of the COVID-19 pandemic. An even more important question that needs to be answered is this: Is it really the case of lack or unavailability of funding to businesses in the country or the case that the businesses do not meet what is required by the funding institutions or both? Admittedly, funds are not in abundance, yet one can still raise reasonable funding for his/her business venture if businesses are prepared well enough to access these funds. The two sides of the coin would be explored in Parts III and IV of the Business Outlook Series. Part III of this series seeks to provide insight into what funding institutions or investors look for in businesses to serve as a guide to businesses in developing their investor readiness. Part IV would discuss investor requirements for businesses that wish to access funding as well as what businesses could do to be prepared to attract and access funding. First of all, it should be clear that investors and funding institutions take risks when putting their hardearned money into a business and so are careful to select which business to invest in. In other words, business owners and managers must understand that, there are alternative investment opportunities available to those who have the funds and so are comparing many opportunities by evaluating the risk – return of each business before making a decision. Here are some factors that investors and funding institutions, irrespective of the type of funding (equity, debt or hybrid) consider: • Legal Structure of the Business: The legal structure of a business communicates different levels of risk. For example, a limited liability company that has multiple ownership may be deemed less risky than a sole proprietorship in terms of shared risk. A limited liability company however suggests owners are less personally liable for corporate failure as compared with partnerships and sole proprietorship. The legal structure also influences the legal obligations such as governance requirements, financial statements

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preparation, tax obligations among others. Investors process legal structures differently and are largely more comfortable with a limited liability structures that has well-diverse ownership. Business Model: Investors mostly define their sectors of focus and the nature of businesses in which they wish to invest. The business model provides information on the business’ sector/industry of operation and nature of business. More importantly, the business model provides the rationale of how the

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business creates, delivers and captures value. It is the basis for innovation, serves as a basis for revenue generation, and serves as a common objective that is shared by those involved in the business. Investors will evaluate the business model to satisfy themselves that the communicated value would meet clients’ needs and that the business suits their investment focus. Profile of Owners, Board and Management Team: Investors are primarily concerned with the risk exposures of the owners of

the business. A key area of concern is Politically Exposed Persons (PEPs). PEPs are deemed to carry a high level of reputational and political risk and investors are gravely concerned. Investors also want to be sure the business has competent board and management team members that have relevant and diverse skills set to lead the business. The profiles of owners, board and management gives investors insight into the credibility and degree of trust (…CONTINUED ON PAGE 9

WEDNESDAY JULY 1, 2020

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(…CONTINUED FROM PAGE 7

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they can place on them to protect their investment. Market Availability: The viability of the business depends significantly on the quality of the markets it serves. A growing market gives confidence of ready demand for the goods and services. Investors look forward to the business’ in-depth understanding of the markets the business serves. Investors pay attention to market trends over the period. Investors are comfortable when there are off-taker agreements and other pre-production contracts with major customers especially where the funding is intended for expansion. Competition: A business’ ability to take advantage of available markets also depends on the degree of competition in the market. The investor would be keenly interested in the level of competition in the market and most importantly, the business’ competitive advantage, market share and competition strategies. Supply Chain: Investors and funding institutions are also interested in knowing the reliability and adequacy of all major sources of supply of key inputs to the business. The number and power of suppliers to influence the activities of the business is of much concern to investors. They will therefore evaluate service level agreements signed with major suppliers and the extent to which they are enforceable. Current Level of Investment: The current level of

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investments the owners have made in the business to some extent, determine the owners’ commitment to the business idea and is important to potential investors and funding institutions. Investors would like to share the business risk with the investee, so it is important when the owners have committed adequate resources to the business. Financial Health: Generally, it is believed that the success or failure of the business’ operations is expressed in the financial performance and position of the business. Investors are therefore interested in the financial performance, financial position and the cashflows of the business. Investors pay attention to the gearing levels of the business to assess the risk of insolvency. It is important to state that the reliability of these financial information is of major consideration and that is why the audited financial statements is preferred. Investors would also like to evaluate the trends in the profitability, liquidity and capital structure of the business. The evaluation of the financial performance and extent of reliability of the financial information are usually checked through financial due diligence exercise. Business Strategies: Investors may be impressed with the business’ historical performance. They however view the safety of their investment as one that depends on the future viability of the business. Investors are

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therefore interested in what strategies management have to ensure the business remains competitive and profitable in the medium to long term. They look forward to wellthought-through objectives with well-defined road maps for achieving these objectives. Compliance: Investors, especially where they are foreign, place emphasis on the business’ compliance with legal and regulatory requirements. They pay attention to issues such as compliance with licensing requirements; obtaining and adhering to certification rules; keeping the environment safe; treating employees and other stakeholders fairly; meeting tax obligation among others. This is because legal sanctions have a high potential to damage the reputation and continuity of the business. No investor would want to risk his funds nor reputation with a non-compliant business. Business Culture: Investors are mostly external to the business and would therefore rely on existing business structures and practices as the first step to safeguarding their investment. They pay attention to practices such as adherence to business policies and procedures; attitude towards work; corporate core values and adherence to same; relationship between superiors-subordinates; human resource management style among others. This is used to assess the sustainability of the business’ internal environment and its impact on the general health of the

business. In conclusion, it should be noted that investors and funding institutions have their own expectations that businesses seeking funding must meet and this puts some significant responsibility on business owners and managers to be ready before seeking funding. Remember that, your business is but one of the many investment options available to the investor. Consider the fact that ultimately, the investor selects the business whose risks translates into the potential returns. The look forward to minimized risks and maximized returns.

Watch out for the next edition: What should business do to meet investors’ expectations. Remember to wash your hand under running water, wear your nose mask when going out and never forget to comply with the social distancing protocols. For more information and targeted services in funding services; 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

600m mobile subscribers in Africa to benefit from ECA’s digital health platform BY BENSON AFFUL

The United Nation’s Economic Commission for Africa (ECA) has launched a platform that will reach out to about 600million mobile subscribers across the continent Known as Africa Communication and Information Platform for Health and Economic Action (ACIP), the platform is a mobilebased tool for two-way information and communication between citizens and governments. It furnishes national and regional COVID task forces with userguaranteed survey data and actionable health and economic insights that will enable authorities to better analyze pandemicrelated problems and implement appropriate responses. Vera Songwe, Executive Secretary of the Economic Commission for Africa (ECA) said, “with this platform, we have the possibility of

reaching between 600 million and 800 million mobile subscribers in Africa.” Dr. John Nkengasong, Director of Africa CDC said the platform offers a “unique opportunity to change the way we conduct disease surveillance, enhance our ability to acquire good and timely data, and make all Africans count.” The launch was presided over by President Denis Sassou Nguesso of the Republic of Congo who lauded the initiative and noted that it “responds to member states’ requests for assistance in collecting and processing essential data to respond effectively to COVID-19” President Alpha Condé of Guinea pledged to “make sure that all 55 AU member states are part of this initiative (ACIP).” He said the uncertainties around COVID-19 make a strong case for Africa to speedily embrace the fourth industrial revolution, ensuring

better internet access and affordability. Ms. Songwe deplored the state and high cost of Internet access in Africa stating, “In an era of pandemic and economic crisis, it’s even more difficult for people to spend the little resources they have to pay for access.” The good news, however, is that while the ECA is working with key stakeholders to solve the problem of internet access, reliability, and cost, the ACIP can already reach over 80percent of Africa’s mobile users without adding the burden of cost on them. “We, as operators, can waive the charges for USSD because chances are that many people battling the pandemic in some rural areas may not have airtime,” Robert Shuter, CEO of MTN said. He said the uniqueness of the ACIP initiative got MTN and its “competitors to agree that this was an area for collaboration and

cooperation.” Mr. Shuter said the technology can be used on any handset and on any device and that the platform “presents a very simple menu to users and enables us to collect very important information that policymakers can use to identify where the issues and hotspots are.”

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Low internet access driving inequality BY MERCEDES GARCÍA-ESCRIBANO

OVID-19 and the Great Lockdown triggered a mass migration from analog to digital and highlighted that access to the Internet is crucial for socioeconomic inclusion. High-speed Internet is key for working from home, for children’s education when they can’t attend school in person, for telemedicine, for benefiting from social support programs, and for enabling access to financial services for everyone, especially for those living in remote areas. Still, Internet usage remains a luxury: half of the world’s population does not have access to the Internet, either through a mobile device or through fixed line broadband. As the map in this chart of the week shows, the digital divide— the gap between those who have Internet access and those who don’t—is more like a chasm, both within and between countries. Advanced economies like the United States, France, Germany, the United Kingdom, and Canada have the highest access rates. Big emerging economies show large disparities in the proportion of Internet users in their populations, which range from about two-thirds in Brazil and Mexico to about onethird in India. Countries in sub-Saharan Africa, followed by many in emerging and developing economies in Asia, are among those with the lowest access to the Internet despite being world leaders in mobile money transactions. There is also a large variation in Internet connectivity by firms in subSaharan Africa—only about 60 percent of businesses use email for business compared to about 85 percent in Europe and Central Asia. Wider inequality The lack of universal and affordable access to the Internet may widen income inequality within and between countries. • Within countries. Income inequality and inequality of opportunity may worsen— even in advanced economies— because disadvantaged groups and people who live in rural areas have more limited Internet access. The disparity between men and women in their labor force participation, wages, and access to financial services may increase where there is

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a gender gap in access to the Internet. This could be the case in many emerging and developing countries where fewer women than men own a mobile phone. Between countries. The relatively low Internet access might depress productivity in emerging and developing countries. IMF staff research finds that a one percentage point increase in the share of Internet users in the population raises per capita growth by 0.1–0.4 percentage points in subSaharan Africa. The COVID-19 pandemic demonstrates that having reliable Internet allows some businesses to continue operations amidst lockdowns, which keep economies running.

So, how can policymakers support affordable and universal access to the Internet? Governments can foster a digitalfriendly business and regulatory environment for the private sector. This can be instrumental to accelerate and finance investments in infrastructure. Government support, for instance by ensuring the Internet investment is complemented with universal electricity access, is essential. In addition, subsidies may be needed so that all households—including disadvantaged groups and those in rural and remote areas—have access to quality Internet, and to ensure there is no digital gender gap. For example, in response to the COVID-19 crisis, the governments of El Salvador, Malaysia and Nepal have

introduced Internet fee discounts or waivers. Policies should also be geared to closing the Internet gap for firms. Broadening small businesses’ access to financial products such as loans will allow these firms to undertake productive investments in information and communications technology. Governments could also see fiscal savings from digitalization. They can lower the public cost of tax compliance through greater access to taxpayer data and improved spending efficiency, which in turn, may help financing these policies. Given the increasing role of the Internet for the economy and for accessing public services, policies to foster an inclusive recovery must aim to tackle the digital divide within and between countries. (IMF.org)

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No More Free-Lunch Bailouts BY MARIANA MAZZUCATO AND ANTONIO ANDREONI

he COVID-19 crisis and recession provides a unique opportunity to rethink the role of the state, particularly its relationship with business. The long-held assumption that government is a burden on the market economy has been debunked. Rediscovering the state’s traditional role as an “investor of first resort” – rather than just as a lender of last resort – has become a precondition for effective policymaking in the postCOVID era. Fortunately, public investment has picked up. While the United States has adopted a $3 trillion stimulus and rescue package, the European Union has introduced a €750 billion ($850 billion) recovery plan, and Japan has marshaled an additional $1 trillion in assistance for households and businesses. However, in order for investment to lead to a healthier, more resilient, and productive economy, money is not enough. Governments also must restore the capacity to design, implement, and enforce conditionality on recipients, so that the private sector operates in a manner that is more conducive to inclusive, sustainable growth. Government support for corporations takes many forms, including direct cash grants, tax breaks, and loans issued on favorable terms or government guarantees – not to mention the expansive role played by central banks, which have purchased corporate bonds on a massive scale. This assistance should come with strings attached, such as requiring firms to adopt emissionsreduction targets and to treat their employees with dignity (in terms of both pay and workplace conditions). Thankfully, with even the business community rediscovering the merits of conditional assistance – through the pages of the Financial Times, for example – this form of state intervention is no longer taboo. And there are some good examples. Both Denmark and France are denying state aid to any company domiciled in an EUdesignated tax haven and barring large recipients from paying dividends or buying back their own shares until 2021. Similarly, in the US, Senator Elizabeth Warren has called for strict bailout conditions, including higher minimum wages, worker representation on corporate boards, and enduring restrictions on dividends, stock buybacks, and executive bonuses.

And in the United Kingdom, the Bank of England (BOE) has pressed for a temporary moratorium on dividends and buybacks. Far from being dirigiste, imposing such conditions helps to steer financial resources strategically, by ensuring that they are reinvested productively instead of being captured by narrow or speculative interests. This approach is all the more important considering that many of the sectors most in need of bailouts are also among the most economically strategic, such as airlines and automobiles. The US airline industry, for example, has been granted up to $46 billion in loans and guarantees, provided that recipient firms retain 90% of their workforce, cut executive pay, and eschew outsourcing or offshoring. Austria, meanwhile, has made its airlineindustry bailouts conditional on the adoption of climate targets. France has also introduced fiveyear targets to lower domestic carbon dioxide emissions. Similarly, many countries cannot afford to lose their national automobile industry, and are seeing the bailouts as an opportunity to drive progress toward the sector’s decarbonization. As French President Emmanuel Macron recently argued, “We need not only to save the industry but to transform it.” While extending €8 billion in loans to the sector, his government is requiring that it turn out more than one million cleanenergy cars by 2025. Moreover, having received €5 billion, Renault must keep open two key French plants and contribute to a FrancoGerman project to produce electric batteries. As Renault’s major shareholder, the French government will be able to enforce these conditions from both outside and inside the company. In some cases, governments have gone beyond conditionality to alter ownership models. Germany and France are acquiring or increasing (respectively) the state’s equity stake in airline companies, citing the need to safeguard national strategic infrastructure. But there are also negative examples. The auto-industry bailout has played out very differently in Italy than it has in France. The FCA Group has convinced the Italian government – which has historically provided large subsidies to Fiat – to grant its subsidiary FCA Italy a €6.3 billion guaranteed loan with basically no enforceable conditions. FCA Italy is expected to merge with the French PSA Group by the end of this year, and the FCA Group itself is no longer even an Italian

company. Born in 2014 from the merger of Fiat and Chrysler, it is domiciled in the Netherlands, and its financial headquarters are in London. Worse yet, the company has a poor track record of keeping its investment commitments in Italy, which has fallen off the global map as an auto producer, both in terms of volume and electric vehicles. In other negative cases, major companies and sectors have leveraged their monopoly or market-dominant bargaining power to lobby against conditionality, or have exploited central banks’ support, which tends to come with fewer or no conditions. For example, in the UK, EasyJet was able to access £600 million ($746 million) in liquidity from the BOE, despite having paid £174 million in dividends a month earlier. And in the US, the Federal Reserve’s decision to start purchasing riskier high-yield bonds has fueled moral-hazard fears. Among those standing to gain are US shale-oil producers, which were already highly leveraged and mostly unprofitable before the pandemic arrived. Far from a step toward state control of the economy, conditional bailouts have proven to be an effective tool for steering productive forces in the interest of strategic, broadly shared goals. When designed or implemented incorrectly, or avoided altogether, they can limit productive capacity and allow speculators and insiders to extract wealth for themselves. But when done right, they can align corporate behavior with the needs of society, ensuring

sustainable growth and a better relationship between workers and firms. If the crisis is not to go to waste, this must be part of the post-COVID-19 legacy.

Mariana Mazzucato, Professor of Economics of Innovation and Public Value and Director of the UCL Institute for Innovation and Public Purpose, is the author of The Value of Everything: Making and Taking in the Global Economy. Follow her on Twitter: @MazzucatoM.

Antonio Andreoni, Associate Professor of Industrial Economics and Head of Research at the UCL Institute for Innovation and Public Purpose, is Visiting Associate Professor of the Fourth Industrial Revolution at the University of Johannesburg’s South African Research Chairs Initiative. Copyright: Project Syndicate, 2020. www.project-syndicate.org.

WEDNESDAY JULY 1, 2020

Education

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UG receives grant from The Andrew W. Mellon Foundation to support the establishment of a Centre for Teaching and Learning Innovation The Andrew W. Mellon Foundation has awarded a grant of US$800,000 to the University of Ghana, to support the establishment of a Centre for Teaching and Learning Innovation in the Humanities. The grant which will run for four years, starting from the 2020/2021 academic year, forms part of an amount of US$4 million the Foundation committed to the University of Ghana in 2016 to enhance scholarship through teaching and research in the Humanities at the University of Ghana. The proposal was developed and submitted by Professor Kwame Offei (immediate-past ProVice-Chancellor, Academic and Student Affairs) and Professor Samuel Agyei-Mensah, Provost, College of Humanities as Principal Investigators, with immense support from the Vice-Chancellor Professor Ebenezer Oduro Owusu. Mr. Benedict Fosu Adjei, Senior Assistant Registrar at the Regional

Institute for Population Studies (RIPS), Mrs. Afia Serwaa Attrams, Research Development Officer, Office of Research, Innovation and Development (ORID) and Ms. Nancy Owusuaa, Project Administrative Support Staff also contributed significantly in putting the proposal together. The proposal builds upon a planning grant earlier received from The Andrew W. Mellon Foundation, which enabled the project team to embark on exploratory visits to some institutions in South Africa and United States of America with functional Teaching and Learning Centres. It also involved internal and external stakeholder consultations, including faculty, Deans and academic leaders at the University of Ghana as well as national educational regulatory institutions. The project aims at strengthening the University’s teaching and

learning culture to respond to the needs of key internal stakeholdersour students, and further enhancing the University’s global appeal. The project will support faculty and to a limited extent, postgraduate students in three key areas: teaching excellence, technology and writing support. The objective is to support faculty to shift from purely didactic approaches to teaching and introduce innovative teaching and learning approaches that engender learner participation, experience, and creativity. The project is also a step ahead in preparation of staff for the recent policy of the Ministry of Education to institute a certification program for all academic staff of tertiary education institutions in Ghana. By this policy, it will become mandatory for faculty to acquire a certificate in teaching before confirmation of appointment. This project therefore provides for built-in systems to be introduced, to enhance the teaching

skills of faculty at the University of Ghana. Established in 1969, The Andrew W. Mellon Foundation endeavours to strengthen, promote, and, where necessary, defend the contributions of the humanities and the arts to human flourishing and to the well-being of diverse and democratic societies. To this end, it supports exemplary institutions of higher education and culture as they renew and provide access to an invaluable heritage of ambitious, path-breaking work. The University of Ghana is grateful to the Foundation for the continued support for capacity building to respond to emerging transformations taking place in the tertiary education landscape. Congratulations to the Principal Investigators and Administrators for their hard work in putting together the proposal for the grant.

Breaking grounds of men dominated area …meet KNUST first female Vice-Chancellor She pursued graduate studies leading to the award of MPharm. in Pharmacognosy in 1999 and was appointed a lecturer the following year in the Department of Pharmacognosy, Faculty of Pharmacy and Pharmaceutical Sciences, KNUST. In 2003 she was awarded a Commonwealth scholarship to pursue a PhD at Kings’ College London, University of London, UK. She used this opportunity to successfully complete her programme and acquire a Graduate Certificate in Academic Practice (GCAP), from the same university. She returned to teaching at the Kwame Nkrumah University of Science and Technology in 2007 and was promoted to a Senior Lecturer in 2009 and further to an Associate Professor in 2014. Between 2011 and 2012. Prof. Dickson is a Phytochemist whose work spans the areas of bioactive natural products in the management of communicable and non-communicable diseases and she has been devoting time to natural products research with anti-infective, wound-healing, anti-inflammatory, anti-pyretic and antidiabetic properties among others; based on their ethnopharmacological usage. Her research has led to the isolation and structure elucidation of several bioactive natural products including cassane furanoditerpenoids, coumarins, alkaloids, glucosides and flavonoids with potentials as

leads in drug discovery. She firmly believes that Africans can reduce the continent’s disease burden by focusing on and exploring the use of its flora and fauna to generate lead compounds and standardized extracts for drug development in the fight against diseases. She is keen about phytopharmaceutical analysis and quality control of herbal medicines to ensure their safety and efficacy. She has successfully supervised a number of MPhil and PhD students and has published extensively in her research area. She has attended and presented research papers at several local and international conferences; and has over 50 publications in peer reviewed International Journals to her credit. She serves as a reviewer for several journals in pharmacognosy, natural products and phytochemistry as well as a reviewer for South Africa’s National Research Foundation and the KNUST Research Fund (KReF). Professor Dickson has been actively involved in the evaluation of papers of academic staff for promotion in both local and international universities and has been an assessor and external examiner for PhD theses locally and internationally. She is currently the Editor in Chief for the International Journal of Ethnomedicine and Pharmacognosy (IJEP) and editorial member of International Journal of Science and Research Methodology. Professor Dickson has been the Head of Department of Pharmacognosy

for three terms from 2009 to 2013. Before her appointment as ProVice-Chancellor, she was the Dean of the Faculty of Pharmacy and Pharmaceutical Sciences and also acted as Provost of the College of Health Sciences in the absence of the Provost. Professor Rita Akosua Dickson is a Board member of the Ghana Pharmacy Council and Pharmaceutical Society of Ghana. Before her appointment, she was the Chairperson of the Education sub-committee of the Pharmacy Council and serves as an examiner in the Ghana Pharmacy Council Professional Qualifying Examination for pharmacy graduates. She also served on the Continuous Professional Development Technical Committee of the Pharmacy Council. As a fellow of the Ghana College of Pharmacists, she has served on several committees locally and internationally in the area of Pharmacy Education and Training. She is currently a member of the Steering Committee of the Ghana National Medicines Policy Programme. Prof. Dickson membership of several local and international organizations including the Pharmaceutical Society of Ghana, Commonwealth Pharmacists Association (CPA), Society of Medicinal Plant Research (GA), International Society of Ethnopharmacology (ISEP), Phytochemical Society of Europe (PSE) and American Society of

Prof. Mrs. Rita Akosua Dickson is an alumna of Kwame Nkrumah University of Science and Technology (KNUST), Kumasi, Ghana. She graduated with a Bachelor’s degree in Pharmacy in 1994.

Pharmacognosists. Her people-oriented approach to leadership is underpinned by her commitment to both staff and students in providing them with opportunities for their development. She is receptive to new ideas and creative thinking from both staff and students. Prof. Dickson enjoys inspiring and mentoring the next generation through talks and engagements, as she motivates them to build their leadership skills and competencies. She is passionate about the youth and enjoys encouraging girls to take up careers in science. She loves to cook and share traditional meals with friends and family and is happy to spend some time in the gym when she can afford it. Prof. Rita Akosua Dickson is a Christian of the Baptist denomination and worships at Grace Baptist Church, Amakom, Kumasi. She is married to Nana Dickson; a banker and the couple is blessed with four daughters.

WEDNESDAY JULY 1, 2020

Mining

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IronRidge to prospect for lithium at Mankessim site Green Metals Resources Limited, a subsidiary of IronRidge Resources Limited has been granted the Mankessim South exploration license in Ghana, the company has announced. The license provides IronRidge with full ownership of a contiguous prospective lithium exploration license adjacent to the Company’s Ewoyaa Lithium Project. According to a press statement from the company,the Mankessim South mineral exploration license PL3/109, covers 13.02km2,has been granted to the Company’s wholly owned Ghanaian entity Green Metals Resources Limited. The license lies directly south of the Mankessim license which hosts the Company’s Ewoyaa Lithium Project, with a mineral resource estimate of 14.5Mt at 1.31% Li2O in the Inferred and Indicated category, including 4.5Mt at 1.39% Li2O in the Indicated category. Already, the field teams have been re-mobilised to site to commence low-cost regional exploration programmes, including grid auger drilling, mapping and sampling within the newly-granted license and surrounding resource footprint area. Long-lead baseline environmental and social studies and monitoring

activities are ongoing as well as additional optimisation metallurgical test-work is ongoing at the Nagrom laboratory in Perth, WA. The release further states that it is an ideal infrastructure support; license located within 110km of the operating Takoradi deep-sea port, within 100km of the capital Accra and adjacent to the sealed bitumen Takoradi - Accra highway and highpower transmission line. Commenting on the Company’s latest progress, Vincent Mascolo, Chief Executive Officer of IronRidge, said:”We are delighted to have been granted the Mankessim South exploration license, which further consolidates and enhances our Cape Coast Lithium portfolio and strategy. “The newly-granted license represents highly prospective ground within the immediate lithium pegmatite resource corridor and is an extension of tenure directly adjacent to, and along strike from, the Ewoyaa Lithium Project which hosts a JORC compliant resources of 14.5Mt at 1.31% Li2O, including 4.5Mt at 1.39% Li2O in the Indicated category. “Additional spodumene-bearing pegmatites have been observed at the Saltpond By-Pass pegmatite

Vincent Mascolo, Chief Executive Officer of IronRidge

within the newly-granted license, and 960m from the southern margin of the current resource footprint, boding well for potential future resource upgrades. “Field teams have been mobilised to site and are preparing to re-

commence low-cost, value-adding exploration, focussing on defining surface pegmatite mineralisation through weathered and transported cover using grid auger drilling.” Source: Reuters

South Africa’s recession deepens in first quarter as mining plummets

Communication helps limit Covid impact at South Deep

South Africa’s recession deepened in the first quarter of 2020, with official data on Tuesday showing that gross domestic product contracted 2% from the previous three months, led by declines in mining and manufacturing. The economy was already frail before the coronavirus pandemic hit South Africa in March, with JanuaryMarch being the third consecutive quarter of contraction and following a 1.4% decline in GDP in OctoberDecember. Tuesday’s data nevertheless beat analysts’ expectations for a contraction of 3.8% in the first quarter. “While this was nowhere near as bad as the market had feared, there is little in the data to be upbeat about,” said Razia Khan, chief economist for Africa and the Middle East at Standard Chartered. “The year/year decline was modest, with the return of growth in agriculture providing some support. But the read-across to other sectors, and the expenditure breakdown of GDP, provides plenty of reason to be concerned.” Statistics South Africa said mining contracted by 21.5% in JanuaryMarch, while manufacturing was down 8.5%. Compared to the same period a year ago, GDP shrank 0.1% in the first quarter after a 0.5% decline in Q4 2019.

Way ahead of any indication of national lockdown, South Deep gold mine started an intensive and focused communication awareness campaign to shield its people from the coronavirus pandemic. It placed a lot of reliance on leadership across the board, going down to basic family leadership, and put effective communication platforms in place that have stood it in great stead. “The strapline on our communications is about taking care of yourself and taking care of those you love and care about. The gold reserves will be in the ground after the pandemic. We need to make sure that we get all our people through this, with their families and their loved ones. Then we can rebuild after the pandemic,” says Martin Preece, executive VP and head of the South Africa region for Gold Fields. (Also watch attached Creamer Media video.) “We’ve focused on leadership, a lot of communication awareness, a big drive on non-pharmaceutical interventions, pushing hygiene practices, social distancing, right from the beginning, and all learning new habits and new behaviours,” adds Preece, who regards one of the most important aspects as South Deep’s “meaningful and collaborate approach with our colleagues from organised labour, who have stood side-by-side with

A strict nationwide lockdown from late March has been partially eased to allow key sectors like mining, manufacturing and retail to resume operations, but the outlook remains gloomy. The Treasury sees GDP contracting by 7.2% this year. First-quarter spending in the economy shrank 2.3% compared with October-December, Stats SA said. Then, it had contracted 1.2% from the prior quarter. While household expenditure grew 0.7% and government expenditure was up 1.1% in the quarter, gross fixed capital formation shrunk by 20.5%. “Tentative green shoots of consumer recovery will have been completely overridden by the COVID crisis, and rise in joblessness since then,” Khan said. “When an economy’s starting point — even prior to the COVID lockdown — is an unemployment rate that is over 30%, it is difficult to imagine what further deterioration looks like.”

us, helped us to develop protocols, and helped us drive the change of behaviour with our people”. South Deep set great store on identifying those with comorbidities, using existing databases on personnel with potential comorbidities and through on-mine screening and occupational medicals, classifying them into lowrisk, medium-risk and high-risk comorbidity categories. Those in the high-risk category, currently totalling 115 people, have been placed on precautionary sick leave. Work-from-home arrangements and opportunities to change to lower-risk working environments were looked at for those in the medium-risk and lowrisk categories. In addition, South Deep will probably not be recalling a further 169 people because they are also a serious comorbidity risk. “The idea is to put people on precautionary leave who have comorbidities and change their working arrangements to enable us not to expose them to unnecessary risk,” says Preece.

WEDNESDAY JULY 1, 2020

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News

ITA Launches E-Lab Innova Training Programme for Ghanaian agribusiness companies The Italian Trade Agency, an Italian government agency that supports business development, partnerships and collaborations between Italian companies and their local counterparts, has launched the first E-Lab Innova educational training programme in Ghana to, among other things, help improve the technical and managerial skills of Ghanaian agribusiness companies in order to support their access to European Union markets. The programme, launched in partnership with the Ghana Export Promotion Authority (GEPA), the Association of Ghana Industries (AGI), and other Italian partners including Italian partners AICS and Macfrut, also aims at fostering business partnerships with Italian companies and improving the Ghanaian value chain and local industry development and employment. Other objectives include promoting technology transfer and innovation on the model of Italian agribusiness districts and foster opportunities for technical industrial partnerships with Italian companies.

The project is part of a greater effort put in place by Italy in Ghana to boost economic ties with Ghana, particularly in the agrobusiness area. In this regard, Italy’s CDP joined a syndicate of international lenders in a US$600 million package in favour of Ghana’s Cocobod, to enhance the cocoa sector productivity and sustainability. Moreover, ITA is supporting Ghanaian agribusiness exporters participation to MacFrut , a major international event to connect with both suppliers and buyers of the industry that will take place in September. Opening the training programme held via Google hangout, Dr. Alessandro Gerbino, the Head of ITA for Ghana, Nigeria and Cote d’Ivoire said the E-Lab Innova training programme “is the first of a longer term engagement programme that will also involve trade visits from Italian companies, meetings, exhibitions and other activities to boost trade cooperation between Italy and Ghana.” Dr. Gerbino, whilst expressing his gratitude to the GEPA and AGI,

added that “E-Lab Innova presents an opportunity for Ghanaian companies involved to benefit from the technical knowhow of their Italian counterparts and for Italian agribusiness companies to get to understand agribusiness in Ghana and to find ways to collaborate.” The Head of the Agribusiness Department of the AGI, Fatima Alimohamed, who represented the CEO of the association commended ITA for rolling out the E-Lab Innova training programme to help Ghanaian agribusiness companies. According to her Ghanaian agribusiness companies are “still growers and exporters of raw materials whilst we should be adding value to our produce at this stage in our development.” She further added that “the potential to improve growth is there and this can be developed through such training exercises as this one being organized by ITA.” In all, nineteen (19) agribusiness companies from Ghana took part in the first training session including Bomarts Farms, HPW, Ropryn Company Limited, Red River

Dr. Alessandro Gerbino

Foods, GKV and Gold Coast Fruits. Others include Ohu Farms, Maphlix Trust Ghana, Gamosa Limited, C.A.D ghana and Prudent Exports. LabInnova will involve around 40 Ghanaian companies totally. ITA operates through a worldwide network of 79 offices in 65 countries and in Ghana, it operates under the Italian Embassy.

More than 690,000 young people to benefit from COVID-19 recovery programme BY KWASI ANKU

Over 692,000 young people are set to benefit from the COVID-19 Recovery and Resilience Programme (CoRe) launched by the Springboard Road Show in partnership with the MasterCard Foundation and Solidaridad. The programme, which seeks to support young people in the country in the wake of the COVID-19 pandemic, is designed to provide support through e-mentoring, e-counselling and e-coaching to equip them with relevant skills. It will enable them to survive and thrive during and after the disruptions of the COVID-19 pandemic. Participants are expected to be drawn from both the formal and informal sectors. The CoRe programme, which will run from June to November, 2020, will provide support to the beneficiaries in areas such as: building resilience; health awareness; wellness and safety; building relevant workplace skills and job readiness in a postpandemic era. It will also involve weekly radio and online mentoring sessions in English and various Ghanaian languages as well as counselling for the beneficiaries.

Mrs. Comfort Ocran, the Executive Director of the Springboard Road Show, speaking at the virtual launch of the programme, said the programme was an extension of the work the Springboard Road Show Foundation had been doing with young people through the Springboard Road Show and the Virtual University in the past fourteen years. She said the COVID-19 pandemic had made it imperative to have an intervention of this nature. “The COVID-19 pandemic is probably the biggest disruption to our way of life in living history,” she said. The Executive Director said the negative impact of the pandemic cut across social, cultural, psychological, economic, financial and every other aspect of human life, hence the need to introduce such a programme to support the young ones. Ms Nathalie Akon Gabala, the Regional Director, West, Central and Northern Africa for MasterCard Foundation, said the Foundation had been working on the continent for over a decade to increase access to education and financial services and in the wake of COVID-19, it was clear that it needed to step up its game on the continent to address the pandemic. “Our aim is to create dignified

Comfort Ocran

work for young people and we have an objective of creating 30 million jobs for young women and young Africans over the next ten years,” she said. Mr Bossman Owusu, the Acting Country Director of Solidaridad, said the programme sought to provide counselling for young people to be able to cope with the stress and anxiety that had been

brought by COVID-19. “It gets to that point where we need to provide that counselling to help them to be able to cope with the stress and anxiety that has been brought by COVID-19. The programme, therefore, has the back of all young people who have put in very great efforts to support agriculture,” he explained.

WEDNESDAY JULY 1, 2020

Feature

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The EmployeePreneur Journey – Esi Akosua Aboagyes’s story (… CONT’D)

BY GATHY FAIDOO

Esi Akosua Aboagye finally returned home and gradually settled in. She was excited about her new job and role and her business was showing future prospects. Esi Akosua joined one of the famous corporate giant which she named the “mighty School”. When joining the mighty school she had a career shift, she moved from marketing communication to Human Resources. Before we go into the details of her new career path, let’s talk a little about how she landed the job at the mighty school. On her way back from one of her job hunting escapades, she met an old university mate , they had a quick chat and Esi enquired about her job, in the conversation her friend mentioned that she was working at the ‘mighty school’. Esi quickly asked for name of the recruitment manager. Her mate mentioned it and told her that the man was a francophone. Guess what happened next! The following day Esi Akosua dressed up, grabbed her career portfolio and went directly to look for the recruitment manager at the mighty school. At the premises of the outfit she confidently requested to see “Mr. Recruitment Manager”, to her surprise the Recruitment Manager accepted her visit and she was welcomed to one of the meeting rooms, they had a long chat in French and that was the genesis of their beautiful professional relationship. “Mr. Recruitment Manager” was very excited to have met a young Ghanaian professional expressing her self fluently in French. Our past shapes the person that we are today for the good and the not so good. How we view our past experiences both consciously and sub-consciously shape how we approach life. Every past experience one goes through be it good or bad has a part to play in the future endeavors of the individual. Be thankful for everything that happens in your life; it’s all an experience. – Roy T Bennett When Esi Akosua left her comfort zone as a young graduate to go and work in a foreign land, she was just satisfying her young adventurous self, but what she didn’t realize was that she was going to build skills that were

going to be a stepping stone for her future career. By taking this risk, she was able to polish her second language (French) which she had studied for her undergrad. Esi Akosua was looking for an opportunity in the marketing and sales division of the mighty school however after her conversation with Mr. Recruitment Manager she was offered an HR Administration role, which she accepted without hesitation. A very typical behaviour of Esi, she grabbed every opportunity that came her way and ensured that she made that best out of that experience. As Sheryl Sandberg (COO Facebook) was rightly advised by Eric Schmidt (CEO Facebook); “If you’re offered a seat on a rocket ship, don’t ask what seat, just get on”. This is exactly what Esi Akosua did, she got on the rocket ship and begun her career in a whole new field. Risk taking in career is inevitable. To progress in one’s career, sometimes you need to take up cross functional moves. Cross functional moves expands or widens your current skills, knowledge and experience. This period in Esi Akosua’s career was her ‘eureka moment’. She became aware of her key competencies, skill and knowledge and straight away knew what she wanted to focus on in the next 5 years of her life. With this move her career aspirations became clear. Being a teacher and trainer at heart, she knew right away which stream in HR she was going to specialize in. The training and development department became her dream department. She spent the next 3 years in the HR administration role,

building her skill, relationship and competencies in the organization. Before she knew it, there was an opportuning in the training and development wing of the HR division. This time she was promoted to take up the position. That was it for Esi Akosua, Just like yesterday, her she was in her dream role. She gave out her best and learnt so much on the job. The best part is that she worked with experienced colleagues who coached her in the various facets of training and development and this greatly shaped her way of work and built her expertise in the field. Esi Akosua’s journey as an EmployeePreneur was still on she was juggling her career and a business at the same time. Her career at this stage was demanding and thus was taking so much of her time to the point where she was left with very little time to take care of her business. Her business begun to dwindle, she had come to the point where she had to make some tough decisions. She decided to put the business on hold for some time to concentrate on her career. She used the next two years of her life to build on her current skills, knowledge and experience in training and development. Just as she was gaining mastery in her field, her current boss who was her coach was transferred to another country. Oh dear, Esi was devastated, she had built such a great relationship with this line Manager that she felt part of her was leaving. However, she was prepared to quickly adapt to the new ways of working. Her new boss arrived and work continued as usual. Unfortunately, Esi Akosua was

unable to manage her new boss as was expected in the corporate world. Stay tuned for what happens next….Read the next issue.

Gathy is an HR (Learning & Development) professional by day and after 5 she works as the creative lead of Pauligath a Ghanaian fashion retail company providing uniquely designed clothing for women & their tiny fashionistas. Being a teacher at heart and with a passion for learning and women empowerment she founded LWG (LearnWithGathy) an outfit she launched to provide strategies and tools that help women employees launch, grow and create profitable side businesses. These are proven strategies she has personally used to grow her clothing brand Pauligath. To create a support community to make running a side business and managing a career more rewarding, she set up the EmployeePreneursAfrica network to bring together business minded professionals who juggle a full time job and build a side business to provide free & cost effective training and essential business & leadership skills and to create a host of opportunities for personal, career and business growth.

WEDNESDAY JULY 1, 2020

Feature

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Reopening Asia: How the right policies can help economic recovery BY CHANG YONG RHEE

For the first time in living memory, Asia’s growth is expected to contract by 1.6 percent—a downgrade to the April projection of zero growth. While Asia’s economic growth in the first quarter of 2020 was better than projected in the April World Economic Outlook—partly owing to early stabilization of the virus in some—projections for 2020 have been revised down for most of the countries in the region due to weaker global conditions and more protracted containment measures in several emerging economies. In the absence of a second wave of infections and with unprecedented policy stimulus to support the recovery, growth in Asia is projected to rebound strongly to 6.6 percent in 2021. But even with this fast pickup in economic activity, output losses due to COVID-19 are likely to persist. We project Asia’s economic output in 2022 to be about 5 percent lower compared with the level predicted before the crisis; and this gap will be much larger if we exclude China, where economic activity has already started to rebound. Clouds on the horizon Our projections for 2021 and beyond assume a strong rebound in private demand; however, this may be optimistic for several reasons: • Slower growth in trade. Asia is heavily dependent on global supply chains and cannot grow while the whole world is suffering. Asia’s trade is expected to contract significantly due to weaker external demand, with total trade (exports plus imports) projected to decline by about 20 percent in 2020 in Japan, India, and the Philippines. Reorienting Asia’s growth model toward domestic demand and away from a heavy reliance on exports has begun but will take more time to be completed. • Longer than expected lockdowns. Even when lockdown measures are fully relaxed, economic activity is not likely to return to full capacity, due to changes in individual behaviors and measures put in place to maintain physical distancing and reduce contagion. Our recent study shows that while a lockdown may lead to a contraction in economic

activity—as measured by industrial production—of about 12 percent a month, a full reversal in containment measures may increase economic activity by only about 7 percent. In addition, many Asian economies— especially Pacific Islands countries—depend on tourism, remittances, and other services that require in-person contact, which will take a lot longer to recover. • Rising inequality. Inequality had already been rising in Asia, and our recent research shows how past pandemics led to higher income inequality and hurt employment prospects of those with limited education. These effects are likely to be exacerbated in Asia due to the large proportion of informal workers, making the recovery more protracted. • Weak balance sheets and geopolitical tensions. Weakened household and corporate balance sheets in many Asian countries can weigh negatively on investor sentiment and amplify the effect of increasing uncertainties associated with geopolitical tensions. But not all recent developments have been negative. Many Asian countries have been able to provide significant monetary and fiscal policy support—often in the form of guarantees and loans to households and firms. And lower oil prices and improved market sentiment and financial conditions are helping the recovery. However, these factors may not last. For example, our recent update on global financial stability cautions that a sharp adjustment in financial conditions—correcting the current disconnect between financial markets and other parts of the economy—could exacerbate already high borrowing costs for many Asian frontier markets and low-income countries, notably Pacific island countries. Policies for the recovery Asian countries are experimenting re-opening, and policies must be geared toward supporting the nascent recovery without exacerbating vulnerabilities. They must use fiscal stimulus wisely and complement it with economic reforms. The priorities include: Close coordination between monetary and fiscal polic y. Monetary policy should help ensure the flow of credit to households and business. Countries facing higher fiscal

constraints could also use the central bank’s balance sheet more flexibly, aggressively, and transparently to support bank lending to smaller firms. In the face of large outflows, balance sheet mismatches and limited scope for macroeconomic policy maneuver, temporary capital outflow measures may be needed. Resource reallocation. A robust recovery hinges on exiting the current phase of support and transitioning to new policies that help ensure resources are reallocated appropriately beyond the initial focus on preventing bankruptcies of incumbent firms, and thereby strengthen the solvency of firms. For example, flattening the bankruptcy curve by streamlining the restructuring and insolvency frameworks; ensuring that banks are adequately capitalized; and facilitating equity injections into viable firms and risk capital for new firms. Addressing inequalities. Access to health and basic services, finance, and the digital economy should be broadened. Social safety nets should be expanded to extend unemployment insurance coverage to informal workers. Addressing pervasive informality will also require comprehensive labor and product market

reforms to improve the business environment and removing onerous legal and regulatory obstacles (especially for startups), and policies to rationale the tax system. IMF support Since the outbreak of the pandemic, the IMF has offered policy advice, financial assistance, and other support—including virtual initiatives to enhance skills and develop capacity among government officials— to all its member countries. To date, the Fund has provided emergency support to 7 countries across the Asia-Pacific region, with others expressing interest in our emergency financing instruments. Given the large and looming uncertainties at this moment, countries with sound fundamentals may want also to consider use of the Fund’s precautionary credit lines such as the Flexible Credit Line and the Short-Term Liquidity Line to insure against an abrupt tightening in external liquidity. Indeed, S&P Global and Fitch have both published notes stating that facilities like the Fund’s precautionary credit lines could, by cushioning economies, support ratings. (IMF.Org)

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WEDNESDAY JULY 1, 2020