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Ghana Update Summer 2008

Ghana Update Summer 2008

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Published by: simguybar on Feb 17, 2009
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06/14/2009

 
    G    H    A    N    A     U    P    D    A    T    E
A WHITAKER GROUP PUBLICATIONSEPTEMBER 2008
I
NVESTMENT
 
IN
A
GRIBUSINESS
A year aer the Government of Ghana signed a $547-million Millennium Challenge Account (MCA) compactwith the US, Ghana’s Millennium Development Authority (MiDA) has several projects underway that will ultimately transform the lives of millions of the nation’s farmers.
In April, the Bank of Ghana (BoG) made its first agricul-tural loans through MiDA’s Agricultural Credit Program(ACP), which aims to improve credit services to farmersand agro-processors. e program is funded through a $40.7million revolving loan facility, administered by the BoG andavailable to 32 accredited financial institutions such as com-mercial banks, savings and loan companies, rural and com-munity banks and financial NGOs.In addition, grant funds are available to financial institu-tions to establish new offices, to provide training for ruralbanks and financial NGOs on credit and management skillsand to establish pilot programs to speed the flow of creditalong the agricultural value chain, such as with voucher pro-grams to retailers.ACP loans are available to micro, small and medium-sizedenterprises engaged in production, transportation, storage,marketing, processing and related value-added activities in- volving high-value horticultural crops. ese include fruitsand vegetables and staple crops including cereals and tu-bers.Beginning early in 2009, MiDA will begin the construc-tion and rehabilitation of 950 km of feeder roads to reducetransportation costs and decrease the time it takes to bringagricultural products to market.Construction has also begun on five new schools in theGomoa East and West Districts of Ghana. In all, 35 schoolsare to be rehabilitated under MiDA’s community services pro-gram. About $75 million from the MCA compact has beenearmarked to provide social services such as water, electric-ity, sanitation and education in the target areas. MiDA, incollaboration with the US Agency for International Develop-ment (USAID), will also fund the training of new teachers.e five-year MCA compact seeks to increase farmers’ in-comes through private sector-led agribusiness development.It is comprised of three main projects: e Agricultural Project will train farmer-based organiza-tions, develop irrigation, facilitate land tenure, improve postharvest and credit services, improve value chain services andinvestments and rehabilitate feeder roads. e Transportation Project will upgrade the National High-way, build and rehabilitate Afram Basin trunk roads and im-prove the Volta Lake ferry service. e Rural Development Project will strengthen public sec-tor procurement capacity, rehabilitate and build educationalfacilities, construct water sanitation facilities, electrify ruralareas, improve and network rural banks, and improve the na-tional payment system.
MCA COMPACT BEGINSTO TRANSFORM GHANA’SAGRICULTURE SECTOR
President John Kufuor is welcomed by Prime Minister Patrick Manning and Mrs. Manning upon his arrival inTrinidad and Tobago. e President was in the countryin August to discuss expanded commercial ties betweenGhana and the Caribbean nation.
E
NVIRONMENT
UN HOLDS CLIMATE CHANGETALKS IN GHANA
Delegates from 160 countries met in Accra in August todiscuss a successor pact to the Kyoto Protocol, the agree-ment adopted in 1997 to help reduce the emission of green-house gases.
e Accra meeting is part of a series of United Nations-sponsored talks in the run-up to the UN Conference on Cli-mate Change to be held in Copenhagen in December 2009.More than 1,600 participants at the Accra conference dis-cussed policies and incentives to reduce emissions from de-forestation - which accounts for 20% of global greenhousegas emissions - and forest degradation in developing coun-tries. ere was also a joint discussion on the finance andtechnology needed to limit emissions and adapt to climatechange.e talks were described by Mr. Yvo de Boer, head of theUN Climate Change Secretariat, as a “golden opportunity”for Africa to ensure that it obtained the investment and fund-ing necessary to meet the challenges of climate change.e World Bank estimates that $170 billion will be neededbetween now and 2030 to enable developing countries toadapt to the impact of climate change.A UN report released in August outlined clean energy projects that were underway in several African countries in-cluding Mali, Mozambique, Madagascar and Kenya. Mr. deBoer emphasized, however, that Africa needed to do more totake advantage of the UN’s carbon credit program that allowsrich nations to invest in clean energy projects in the develop-ing world to offset their own carbon emissions.
 
P
AGE
T
WO
G
REEN
R
EVOLUTION
AGRA PARTNERSHIPS YIELD SUSTAINABLE FOOD SOLUTIONS
Mr. Kofi Annan, former United Nations Secretary-General and the current Chair of the Alliance for a Green Revolutionin Africa (AGRA), spent time in Ghana in August highlighting the successful partnerships created with the assistance of AGRA to find sustainable solutions to the global food shortage.
Mr. Annan
 
held meetings with farmers and crop scientists and visited threesites in Ghana where smallholder farmers, the private sector and NGOs haveformed innovative partnerships that, he said, could hold the key to unlockingthe potential of African agriculture by linking farmers to local and regionalmarkets and training African crop scientists in crop breeding. Ghana is oneof the first sub-Saharan African countries to meet the first Millennium De- velopment Goal of halving hunger, measured in terms of undernourishment,by 2015.In Accra, the former Secretary-General visited a group of PhD candidateswho are part of the AGRA-funded program that aims to train 40 crop scien-tists at the University of Ghana-Legon over the next five years. Students at theuniversity’s West African Center for Crop Improvement (WACCI), launchedin March of this year, are working to improve indigenous crops like cowpeas,rice, millet and sorghum as well as non-indigenous crops like maize and cassava.e WACCI is the first training facility in Africa for crop science. “We’re building the crucible for agricultural developmentin West Africa,” Dr. Joe DeVries, Director of AGRA’s Program for Africa’s Seed Systems, told the
 Accra Mail.
“is program,which started in a building that was all but abandoned a year ago, is an anchor investment for AGRA. e focus is on buildinghuman capacity in African science that will result in long term results for the regions farmers.AGRAs goal is for scientists trained at WACCI and at its sister program in South Africa to develop and release more than1,000 improved crop varieties of African food staples over the next decade.While in Accra, Mr. Annan also met with the country representatives for the US Millennium Challenge Corporation(MCC) and the Government of Ghana’s Millennium Development Authority (MiDA). In June, AGRA partnered with theMCC and the MiDA to promote a dialogue that would lead to greater distribution and use of improved technologies andseeds for use by farmers. In 2006, Ghana signed a $547-million compact with the MCC to develop its agricultural communi-ties and sector.Mr. Annan also visited the Crop Research Institute in Kumasi where AGRA is funding three crop breeders who are de- veloping higher-yield, locally-adapted varieties of maize, cowpeas and cassava. In addition, AGRA recently launched a newagro-dealer development program, which aims to increase the number of trained agricultural seed and equipment merchantsin Ghana.At Nsawam, Mr. Annan met with members of the Afumkrom Vegetable Growers Association, a farmers’ cooperative thatwas started in 2005. Its members grow onions, peppers, okra, garden eggs, maize and cassava on one- and two-acre plots. efarmers discussed the need for more credit and regular irrigation to boost the cooperative farmers’ productivity.e African-led AGRA was established in 2006 in partnership with the Rockefeller Foundation and the Bill and MelindaGates Foundation. It works with African governments, other donors, NGOs, the private sector and African farmers to im-prove agricultural productivity and incomes while safeguarding the environment and biodiversity.
Training African crop scientists is a goal of  AGRA
Ghana, the first African country to voluntarily submit itself to the African Peer Review Mechanism (APRM), is expectedto set up a regional Center for Excellence within a year to generate knowledge about the process and safeguard the rigor-ous standards adhered to by the seven countries that have so far undergone the review.
“We want to strengthen the capacities of the various national councils running the APRM,” said Dr. Francis Appiah, Ex-ecutive Secretary of Ghana’s APRM Governing Council. “Currently, we do not have any blueprint to guide us because [theAPRM] is an innovation and if we are to sustain its integrity, we need to sustain the knowledge around it.e APRM was established under the framework of the New Partnership for African Development (NEPAD) and adoptedby the African Union as a self-monitoring tool to maintain a high standard of political and economic governance in Africancountries. us far, Ghana, Rwanda, Kenya, Nigeria, Algeria, South Africa, Burkino Faso and Uganda have undergone theprocess.Dr. Appiah said the center, which would be modeled aer the Kofi Annan International Peacekeeping and Training Cen-ter, would foster regional cooperation and link the APRM process to African universities as well as to the World Bank andinstitutions in Canada and Germany, which have agreed to help establish the center.e APRM was adopted in March 2003 in Abuja, Nigeria, by a committee of Heads of State and Government.
G
OVERNANCE
GHANA TO HOST APRM CENTER OF EXCELLENCE
 
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AGE
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HREE
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EGIONAL
C
OMMERCE
GHANA & SOUTH AFRICATRADE TO INCREASE
Trade between Ghana and South Africa is expected to in-crease following the July 2008 signing of a Memorandum of Understanding (MOU) expanding trade between the GhanaExport Promotion Council (GEPC) and the MpumalangaEconomic Growth Agency (MEGA) in South Africa.
e agreement principally covers the agriculture, tourismand energy sectors and provides import, export, and invest-ment opportunities for both countries. e two organiza-tions have agreed to exchange economic and commercialinformation, implement trade promotion activities and fa-cilitate joint venture projects and training programs betweenthe business communities of the two countries.“Our main commonality with Ghana lies in the agro-pro-cessing sector where we can provide technology and equip-ment for them, among other things,” Mr. Andrew Bülter,MEGA’s Trade Promotion Manager told
BuaNews.
“ey chose this province because of its similarities in climate,economy and agricultural sector.”“is agreement is going to encourage business relations,said Mr. Collins Boateng, Executive Secretary of GEPC. “Wewant a partnership between businesses from Mpumalangaand Ghana, and we will facilitate that...by fielding business-men to participate in promotional activities in Mpumalanga,and help to identify businesses in Mpumalanga, and vice versa.”
E
MERGING
M
ARKETS
RENAISSANCE CAPITAL BUYSSTAKE IN GHANAIAN FIRM
Renaissance Capital, the Moscow-based investment bank and leader in emerging markets, has bought a 49% minor-ity equity stake in New World Investments Ltd., an invest-ment broker and financial advisory services firm in Accra.
Under the new agreement, NewWorld Investments willbe renamed NewWorld Renaissance Securities Ltd. and willwork closely with Renaissance’s investment banking, salesand trading, capital markets and research personnel in theiroffices in Lagos, Nairobi and London.“e Ghanaian market is a strategically important one inour West African development plan,” said Mr. Neil Harvey,CEO Africa & the Middle East for the Renaissance Group.“is investment gives us an opportunity to partner with astrong broker and advisor and play a leading role in the ex-citing development of both Ghana’s financial markets and itsimportance in the region as a whole.”e new partnership between Renaissance and NewWorld Investments follows a long period during which thetwo companies cooperated and shared resources and exper-tise on several projects in West Africa. It is viewed as a win-win situation for both companies.“Renaissance Group has the resources, as well as thetechnological infrastructure, to help scale up and deepen fi-nancial intermediation and investment banking services inGhana,” said Mr. Kwame Pianim,Director and outgoing CEO at NewWorld Investments. “e Ghanaianeconomy is widely viewed as havingexciting prospects, and the recentdiscovery of oil and gas in commer-cial quantities has strengthened thenational drive to position the coun-try as the financial gateway to theWest African sub-region.”Renaissance’s entry into theGhanaian market further cementsits foothold in Africa. “I fully expect the capital markets insub-Saharan Africa to develop as rapidly as they have donein Russia over the past 10 years,” said Mr. Stephen Jennings,CEO of the Renaissance Group. “We intend to replicate inAfrica the extraordinary success that Renaissance Group hashad and continues to have in Russia and the Commonwealthof Independent States (CIS).” e CIS is an alliance of 11 for-mer Soviet Socialist Republics.Renaissance also announced that the new CEO of New-World Renaissance would be Ms. Abena Amoah. Ms. Amoahwas previously with Strategic African Securities, an invest-ment banking firm in Ghana. She has served on the Boardsof the Ghana Stock Exchange and the Venture Capital TrustFund, and is an assessor to the High Courts of Ghana.
P
OVERTY
R
EDUCTION
WORLD BANK PROVIDES$145 MILLION IN BUDGETSUPPORT
e World Bank approved three credits in June to supportthe Government of Ghana’s 2008 budget under the multi-donor budget support (MDBS) framework.
e three credits include US$100 million for the Pover-ty Reduction Support Credit (PRSC 6), US$20 million forNatural Resources and Environmental Governance (NREG)and US$25 million for the Agriculture Development Policy Operation (AgDPO).e PRSC 6 credit is the cornerstone of donor supportfor Ghana’s poverty reduction strategy. is year it includesextra funding of US$20 million to help the government ad-dress increasing food prices and to scale up social programsto help poorer Ghanaians struggling with the rising cost of living as result of higher global fuel and food costs.e strategy focuses on accelerating private sector-ledgrowth, developing human resources, and promoting goodgovernance.e NREG credit supports government programs in theforestry, wildlife and mining sectors, as well as in environ-mental management. An important new focus of the NREGprogram is to support the adoption and implementationof the Extractive Industries Transparency Initiative in theemerging oil sector.e AgDPO credit supports further diversification of hor-ticulture exports and growth in agribusiness.

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