Governor of the Bank of Ghana (BoG), Dr. Ernest Addison, highlighted the steady progress of the local economy.
He emphasized that Ghana’s foreign reserve level was on the rise, with an impressive injection of $300 million bolstering the reserve.
Speaking before the Public Accounts Committee of Parliament on Monday, April 8, 2024, Dr. Ernest Addison shared these insights.
“For the economy as a whole, I can tell you that things are improving, our foreign exchange reserve levels are improving. Thanks to Members of Parliament who recently approved a facility, so $300 million was added to our reserves.”
Following a downturn in the economy triggered by the Russia-Ukraine war, the government announced on July 1, 2022, its decision to seek a $3 billion financial bailout program from the International Monetary Fund (IMF).
Subsequently, a delegation from the IMF visited the country from July 6 to July 13, 2022, to engage with Ghanaian authorities regarding potential economic support measures.
A staff-level agreement between the Government of Ghana and the IMF was reached in December 2022.
On May 17, 2023, the IMF’s executive board approved Ghana’s $3 billion loan facility.
The first installment of $600 million was received by the Bank of Ghana (BoG) on Friday, May 19, 2023.
The government stated that the IMF program aimed to restore macroeconomic stability and ensure debt sustainability, among other objectives.
Ghana’s economy is anticipated to remain under the IMF program for a period of three years.
American economist, Steve Hanke, has restated challenges bedeviling Ghana‘s economy and reiterated a call for a currency board to combat galloping inflation.
In a tweet dated January 10, 2023, Hanke measured inflation (per his independent global tracker) at 77%, 27 percentage points above the official rate of 50%.
He stressed that the prevailing challenges pointed to an economy that was headed for failure using the terminology “going down the tubes.”
“Ghana is in 8th place in this week’s inflation table. On Jan 5, I measured Ghana’s #inflation at a stunning 77%/y. #Ghana’s economy is going down the tubes. To rein in inflation, GHA must install a currency board,” his tweet read.
It is not the first time he is calling for a currency board to be put in place to hep salvage the economy.
Hanke has also been very critical of government’s resort to the International Monetary Fund (IMF) amid an economic crunch that government has partly blamed on aftershocks of the COVID-19 pandemic and the Russia-Ukraine war.
Ghana had a torrid 2022 amid an economic crisis that forced government to seek an IMF facility at a time the cedi was rapidly depreciating, inflation was galloping and government was faced with multiple downgrades by rating agencies.
Government has promised to turn around the economic fortunes of the country after sealing a Staff-Level agreement with the IMF with the hope that funds from the US$3 billion facility will be released early this year.
Ghana is experiencing a deep economic crisis, with a rampant inflation that has reached almost 40% and its currency that has fallen by almost half compared to the US dollar.
The government’s finances are also at their lowest point in years.
President Nana Akufo-Addo, who has faced several protests in the West African country because of the situation, admitted that Ghana is in crisis and blamed what he called “malevolent forces…that have come together at the same time” referring to the COVID and Russia’s invasion of Ukraine.
Ghana, along with many African economies, was still recovering from the pandemic when it was hit by the global increase in theprice of food and energy, caused by the war in Ukraine. But the country also had to deal with the fell of the Cedi – its currency – that has been one of the world’s worst performing against the dollar this year
Home of 31 million people, Ghana is now one of the most affected by the crisis in the region, and that’s heavily felt for those who rely on imports and depend on the dollar to obtain their products.
“The amount you will use to import let’s say one container; these days, you have to double the amount. The same goods, the same quantity but the amount has been doubled,” said Obeng Krampah, a businessman from Accra who imports used home and office furniture from Europe and America to sell in Ghana,
“I have used dollar to buy the goods, paid freight, and then calculating duty in dollar for me to pay so when the goods is out, definitely I have to factor everything inside, so the final consumer is bearing the whole cost,” he added.
But for the consumers the situation is also difficult, less people spend in non essential things, and that’s felt by the shopkeepers and business people in the capital of the country.
Mary Sarfoa is an entrepreneur that has worked for more than 30 years importing used sofas from Europe.
“Previously, the longest time I would take to sell my wares is within one or two months then I go back (to Europe to buy) but this time, it’s been four months since my last import and I have only sold three sofas,” she said, “If you look behind me, we have so many packed sofas, even the container is full, the economy is not going well,” she complained, showing her products.
The Importers and Exporters Association of Ghana have been reeling over challenges leading to months of uncertainty.
Samson Asaki Awingobit, the Executive secretary of the association, said that like Sarfoa and Krampah, the situation is affecting a lot of business that have either been forced to shut down or stopped importing.
“Every businessman that is in this country has lost sales, month by month over 50%,” he said. “Many people are winding up or stopping from importing into this country.”
Ghana’s government blamed the pandemic and the war in Ukraine as some of the drivers of the economic crisis, but analysts think that the poor performance of the country to help investors to make business is also a factor to consider.
Louis Yaw Afful, an international trade analyst, said infrastructure development, the energy prices as well as business governance – how simple it is to do business in the country – influence the decision of investors.
“Once we (Ghana) ignored those sides for some time and we are underperforming, they (investors) will look for the competitive country that has all these as a one,” he said.
Ghana’s cost of living has risen exponentially with inflation reaching almost 40%, one of the highest levels in the last years.
Last week the government said it has agreed on a debt management strategy with the IMF as the country faces high risk of debt distress.
The country’s finance minister, Ken Ofori-Atta told the parliament that to deal with the crisis, Ghana will freeze hiring of public and civil servants among other measures.
“Nobody in his or her right state of mind will gloat if the country’s economy collapses,” he posited.
“We won’t be here if the minister had earlier admitted his guilt of running the economy down,” he stressed.
The finance minister last Thursday in parliament revealed that the ministry of finance has conducted a Debt Sustainability Analysis (DSA) based on Ghana’s macroeconomic outlook and analysed the country’s capacity to finance its policy objectives and service its debts.
He said: “The sustainability of our debt has been continuously affected by the negative impact of exchange rate depreciation, particularly on external debt, as well as the crystallisation of significant contingent liabilities in recent years.”
The current debt sustainability analysis conducted, Mr Ofori-Atta noted, reveals that “Ghana is now considered to be in high risk of debt distress.”
“Mr Speaker, despite the heightened debt levels, the government remains committed to ensuring that debt is brought to sustainable levels over the medium to long term,” he indicated.
To this end, Mr Ofori-Atta announced: “We will implement a debt exchange programme to address the challenges identified in the portfolio in collaboration with all relevant stakeholders including the Ghanaian public, investor community and development partners.”
Furthermore, he said the government will continue to strengthen its oversight of all SoEs, in particular, the financial and energy sectors.
Ghana is expected to record slow growth in economic activities in 2023 as the Government tightens expenditure amid reduction in revenue targets and missing macroeconomic performance for 2022.
Presenting the “NKABOM” (Unity) budget to Parliament on Thursday, Mr Ken Ofori-Atta, announced that the country’s projected monetary value of final goods and services for 2023 would be 2.8 per cent.
This is a decline in growth in economic activities, compared with the revised overall real Gross Domestic Product (GDP) of growth of 3.7 percent for 2022 and the initial growth target of 5.8 per cent.
The Government said it was expecting a total Revenue and Grants of GHS96,842 million (16.4 per cent of GDP) in 2022, down from the 2022 budget target of GHS100,517 million (20.0 per cent of GDP) being 3.7 per cent reduction.
It also revised total Expenditure (including payments for the clearance of arrears) downwards to GH¢135,742 million (22.9 per cent of GDP) from the original budget projection of GH¢137,529 million (27.4 per cent of GDP).
Meanwhile, the interest on Government’s borrowing increased from GHS37,447 million (7.5 per cent of GDP) to GHS41,362 million (7.0 per cent of revised GDP), mainly on account of inflationary pressures and exchange rate depreciation resulting in higher cost of financing.
The largest spender in the Ghanaian economy – the Government, also announced several policy measures to reduce expenditure as it readies to implement the International Monetary Fund (IMF) loan support programme.
The IMF loan support programme is aimed at restoring macroeconomic confidence and make the economy resilient to alleviate the plight of Ghanaians amid the current economic hardship.
Among others, the Government said there would be a freeze on new tax waivers for foreign companies and review of tax exemptions for free zone, mining, oil and gas companies in 2023.
There would also be a freeze on the hiring of civil and public servants, in addition to reduction of expenditure on appointments, salary freezes and suspension of allowances on housing, utilities, and clothing.
Metropolitan, Municipal and District Assemblies (MMDAs), Ministries, Departments and Agencies (MDAs) and State-Owned Enterprises (SOEs) have also been directed to reduce fuel allocation to political appointees and their Heads by 50 per cent.
In the first half of 2022, the Services sector led growth in the economy by contributing an average share of 46.2 per cent, with the Agriculture sector recording 21.7 per cent, and Industry sector contributing 32.1 per cent.
This trajectory is expected to continue in 2023, with the Services sector projected to grow by 46.6 per cent, industry – 33.4 per cent, and Agriculture – 20 per cent.
Meanwhile, for an economic structure like Ghana, it is expected that agric and industry will lead the economic growth through increased agricultural production and industrial activities, before transitioning to the services sector.
While all these show that Ghana’s economy will record a slow growth in 2023, Mr Ofori-Atta said the Government was determined and had resolved to confront the current daunting economic challenges facing the nation head-on and reset the economy.
He said: “In the immediate term, we will work towards securing an agreement with the International Monetary Fund, execute the debt exchange programme, improve the management of foreign exchange, and support our local productive capacity for food security.”
The budget, the Finance said, would focus on Government’s resolve to structurally transform the economy through aggressive domestic revenue mobilisation, boosting local productive capacity and promoting a diversified and vibrant value-added export sector.
Also, there would be streamlining of expenditures, protection of the poor and vulnerable, expansion of digital and physical infrastructure and the implementation of structural and public sector reforms.
Mr Ofori-Atta, therefore, called for the support of all Ghanaians and said: “This is the time to rebuild, not to destroy and tear down. Let us work together for our collective benefit.”
The private sector of Ghana’s economy continued to significantly deteriorate in October, with output, new orders, input inventories, and employment all seeing accelerating declines. In their remarks, the panelists hinted at the serious consequences of worsening cedi-dollar exchange rates, which they claimed had an impact on customer demand.
As a result, mood reached its lowest point in more than two and a half years, and businesses also expressed concern about the global macroeconomic environment.
Prices data, on the other hand, indicated significant rates of input-cost inflation, with purchase charges being particularly high.
However, the rate of overall input price inflation slowed down, but the rate of increase in selling prices picked up speed.
In reality, only August’s increase in output charges was higher than the current pace of growth.
The S&P Global Ghana Purchasing Managers’ Index™ posted below the neutral value of 50.0 for the ninth month in a row (44.0 in October from 45.6 in September), signalling another deterioration in business conditions. The latest result was the third-weakest in the survey’s history, exceeded only by that seen during the pandemic’s height in March and April 2020.
Central to the latest deterioration were accelerated falls in output and new orders. In fact, the rates of declines in both cases were the most pronounced since the pandemic’s initial phase (in March and April 2020), and the third-steepest in the survey’s history. According to panel comments, clients were deterred from placing orders in light of high prices. Firms scaled back their output levels in response to weaker demand.
Lower output requirements led firms to reduce their purchasing activity sharply, with the rate of decline quickest since April 2020. Pre-production inventory holdings were also cut, amid growing pressure on firms’ profits and weaker inflows of new work.
Ghanaian firms also reduced their headcounts during the month, with the rate of decline solid and the quickest since June 2020. Recent pressure on costs led firms to scale back on workforces, but they also blamed a lack of new orders.
Outstanding business at Ghanaian private sector firms fell, signaling ten consecutive months of decline. Moreover, the rate of backlog depletion was sharp and the quickest since March. Subdued demand conditions allowed firms to work through their incomplete work.
Vendor performance improved in October, signalling the fifteenth successive month of improvement. That said, lead times shortened at the weakest rate since start of the year.
Purchase costs continued to rise markedly, despite inflation softening to a three-month low. The rise was overwhelmingly linked to unfavourable cedi-dollar exchange rate movements. Despite moderating to a three-month low, the overall rate of input price inflation was substantial. In response, firms hiked their selling charges at the second-fastest rate in the survey’s history, with the latest increase outpaced only by that seen in August.
Ghanaian businesses foresee an expansion in output by October 2023, with firms hopeful that market conditions will stabilise and price pressures will ease. That said, the degree of optimism was weakest since start of the COVID-19 pandemic in March 2020.
Shreeya Patel, Economist at S&P Global Market Intelligence said: “The latest PMI data for Ghana signalled another marked deterioration in business conditions at start of the fourth quarter. Output and new orders fell sharply, with the rates of decline among the quickest in the survey’s history and surpassed only by those seen during the pandemic’s initial phase in March and April 2020. Consequently, firms grew less optimistic of their output expectations over the year-ahead, and cut their headcounts solidly.
“Recent performance largely reflected the unfavourable cedi-dollar exchange rate movements, which exerted upward pressure on costs and selling prices. The higher revisions to selling prices deterred customers from placing orders in October.
“The Ghanaian economy has struggled over the last year or so, and latest data suggests the troubling trading conditions are set to persist. Recent currency weakness has pushed the economy deeper into contraction territory, with businesses showing increased concern over the current environment. For now, firms hope that the currency recovers and price pressures subside.”
Scores of Ghanaians have rubbished President Akufo-Addo’s address to the nation on the state of the economy, which took place last Sunday.
Describing the address as a publicity stunt, some Ghanaians have touted that the President failed to address the locus of the challenges burdening the economy.
Prior to Akufo-Addo’s speech on Sunday, October 30, 2022, citizens envisaged that the President would highlight key measures to address some specific challenges they believe are the causes of the country’s economic crisis.
Among other things, some Ghanaians wanted the president to scrap taxes on petroleum products, downsize his government, halt the construction of the national cathedral, and sack his Finance Minister, Ken Ofori-Atta.
However, to their dismay, the President focused on other challenges that he believes are the main factors crippling the economy.
President Akufo-Addoalso listed five measures his government would be implementing to turn around the adverse impact.
He mentioned that the government will improve the revenue collection effort from the current tax-revenue to GDP ratio of 13% to somewhere between 18-20%.
He also indicated that the government will reduce Ghana’s total public debt-to-GDP ratio to some 55% in present value terms by 2028.
The President added that his administration will, among other things, review the reforms in the energy sector, capping of statutory funds, implementation of the exemptions Act, a new property rate regime, a 30% cut in the salaries of political office holders and encourage the habit of eating what you grow policy.
Taking to his Facebook page, the Member of Parliament of North Tongu, Samuel Okudzeto Ablakwawho expressed his disappointment stated that Akufo-Addo should have apologised for the economic difficulties he has “imposed” on Ghanaians in his address.
Mr Ablakwa said “just imagine how President Akufo-Addo would have been celebrated by Ghanaians tonight if he said the following: I am sorry for the economic difficulties I have imposed on you; I have with immediate effect fired Ken Ofori-Atta and Charles Adu Boahen; I am reducing the size of my government by 40%; I am slashing taxes on petroleum products.”
Commenting on the 30% salary cut by Akufo-Addo’s, former Finance Minister, Seth Terkper, said the measure is insufficient in helping the government in its debt sustainability.
He noted that “30% fall in staff wages to help fiscal consolidation? Total Expd: Budget (c135.6b), Rev. Budget (c133.8b), hence reduction is c1.8b (only 0.0133%). Note, total wages & allowances rise, not decrease: Budget (ghc35.8b) vrs Rev. Budget (c37.9b) = c2.1b or 0.059%. Waiting for 2023B.”
Taking his part, Ransford Gyampo, a lecturer at the University of Ghana, asserted that the President’s address was inadequate and failed to address some fundamental issues.
According to him, the president failed to pinpoint how his government intends to achieve the objective of restoring confidence in the economy and hope in the people.
Arguing his point out, he said, “the ratio of our debt to GDP was around 56% in 2016. It is now expected to hit 104% according to the World Bank by the close of 2022. We must focus on addressing this rather than the manoeuvrings to keep power. There’s no potent campaign message than fixing our current challenges.”
The President declared that Ghana’s economy is in crisis in a televised national address on October, 30, 2020 after rehashing the hardship of Ghanaians.
“For us, in Ghana, our reality is that our economy is in great difficulty. The budget drawn for the 2022 fiscal year has been thrown out of gear, disrupting our balance of payments and debt sustainability, and further exposing the structural weaknesses of our economy.
“We are in a crisis, I do not exaggerate when I say so. I cannot find an example in history when so many malevolent forces have come together at the same time,” he added.
“But, as we have shown in other circumstances, we shall turn this crisis into an opportunity to resolve not just the short-term, urgent problems, but the long-term structural problems that have bedeviled our economy.
“I urge us all to see the decision to go to the International Monetary Fund in this light,” he stressed.
Read the President’s full Address Below
ADDRESS TO THE NATION BY THE PRESIDENT OF THE REPUBLIC, NANA ADDO DANKWA AKUFO-ADDO, ON THE ECONOMY, ON SUNDAY, 30TH OCTOBER 2022.
Fellow Ghanaians, good evening.
Back in 2020, at the outbreak of the Corona virus pandemic, I started a regular conversation with you that came to be popularly known as Fellow Ghanaians.
It was a time of great fear of the unknown, and the entire world felt at risk. I came into your homes regularly to tell you what the experts were discovering about the virus, and what we should do.
Now that we have seen the worst of the COVID-19, I can tell you that there were moments during those times when I was distraught, there were moments when I was in despair about the apparent inadequacy of our health facilities, and there were moments when I wondered if the dire predictions made about dead bodies on our streets would truly happen.
But I knew that I owed it to all of us that, as your president, I had to hold my nerve, show leadership and take us out of the crisis. With your help and support, and the great mercies of the Almighty, we can say that we emerged from the ravages of the pandemic with one of the lowest mortality rates globally. In fact, Ghana’s handling of the pandemic won universal acclaim.
We could all see in real time the devastation that was being wreaked on economies during the pandemic, but I doubt that anyone imagined the extent of the damage. Our economy, here in Ghana, like many, many others around the globe, was thrown into turmoil.
When I said, at the height of the COVID pandemic, that we knew what to do to bring the economy back to life, but not how to bring people back to life, it was not said in jest. We had done it before, and we were on course to doing it again. Ghana’s economy grew by a remarkable 5.4% in 2021, signifying a strong recovery from the 0.5% growth recorded the previous year due to the COVID-19 pandemic. In fact, in the last quarter of 2021, our economy grew at seven percent (7%), only for the Russian invasion of Ukraine in the first quarter of this year to aggravate the effects of COVID-19, and plunge the global economy into even greater turmoil from which it has not yet recovered.
The whole world has been taken aback by the speed with which inflation has eaten away people’s incomes. Economies, big and small, have experienced, over this year alone, the highest rise in cost of living over a generation; the highest rise in government borrowing in over fifty (50) years; the highest rise in inflation for forty (40) years; the steepest depreciation in their currencies to the US dollar over the last thirty (30) years; the fastest peak in interest rates for over twenty (20) years; and the greatest threat of unemployment in peace time; with over a hundred million people being pushed into extreme poverty.
Between the end of 2019 and now, inflation in Ghana has increased by five-fold, in Togo by sixteen-fold, by eleven-fold in Senegal, and by seven-fold in Cote d’Ivoire. In truth, however, the fact that there are petrol queues in France does not make it more tolerable that the trotro price from Kasoa to Circle has doubled in the past one year, nor does it make it any more tolerable that the price of cooking oil goes up every other week.
It is important to state that mentioning the increases in prices worldwide is not meant to belittle the scope of suffering here, but simply to help us put things into some perspective, and, hopefully, learn some useful lessons about how other people are coping.
Fellow Ghanaians, this is why I am back in your homes this evening to ask for your support, as we work together to get our economy back into good shape.
In April, after the Cabinet retreat of the first quarter, and recognising the deteriorating macroeconomy, my government announced a thirty percent (30%) cut in budgetted discretionary expenditures, and a thirty percent (30%) cut in salaries of the President, Vice President, Ministers, Deputy Ministers, MMDCEs and political office holders, amongst other measures.
And, since July, when the Government took the difficult decision to go to the IMF to seek support, I have been speaking publicly at different fora on the subject of the economic difficulties we face, especially during my recent tours, so far, of nine (9) regions, and interacting directly with you, the Ghanaian people. It is also true that many of you have felt the need for me to come back to the Fellow Ghanaians format, that brings us all together.
For us, in Ghana, our reality is that our economy is in great difficulty. The budget drawn for the 2022 fiscal year has been thrown out of gear, disrupting our balance of payments and debt sustainability, and further exposing the structural weaknesses of our economy.
We are in a crisis, I do not exaggerate when I say so. I cannot find an example in history when so many malevolent forces have come together at the same time. But, as we have shown in other circumstances, we shall turn this crisis into an opportunity to resolve not just the short-term, urgent problems, but the long-term structural problems that have bedeviled our economy.
I urge us all to see the decision to go to the International Monetary Fund in this light. We have gone to the Fund to repair, in the short term, our public finances, and restore our balance of payments, whilst we continue to work on the medium to long-term structural changes that are at the heart of our goal of constructing a resilient, robust Ghanaian economy, and building a Ghana Beyond Aid.
I am able to report to you, my fellow Ghanaians, that the negotiations to secure a strong IMF Programme, which will support the implementation of our Post COVID-19 Programme for Economic Growth and additional funding to support the 2023 Budget and development programme, are at advanced stages, and are going well.
We are determined to secure these arrangements quickly to bring back confidence and relief to Ghanaians. We are working towards reaching a deal with the IMF by the end of the year. This will give further credence to the measures Government is taking to stabilize and grow the economy, as well as shore up our currency.
I know that the increasing cost of living is the number one concern for all of us. It is driven by fast escalating fuel prices at the pumps, which is caused by high crude oil prices on the world market and our depreciated currency. I know that this is putting intolerable pressure on families and businesses. I know that people are being driven to make choices they should not have to make, and I know that it has led to the devaluation of capital of traders and painfully accumulated savings. Furthermore, Government is working to secure reliable and regular sources of affordable petroleum products for the Ghanaian market. It is expected that this arrangement, when successful, coupled with a stable currency will halt the escalation of fuel prices and bring relief to us all.
I hear from the market queens also that another factor fueling the high prices is the high margins that some traders are slapping on goods, for fear of future higher costs. I say to our traders, we are all in this together. Please let us be measured in the margins we seek. I have great respect and admiration for the ingenuity and hard work of our traders, especially those that take on the distribution of foodstuffs around the country, and I would hesitate to join in calling them names. I do make a heartfelt appeal that we all keep an eye out for the greater good, and not try to make the utmost profits out of the current difficulties.
In language that every market woman and, indeed, every trader in our country understands, let me say that the basic problem we face is that we are not making as much money as we need to spend, and what little money we do make is going to pay for the debts we have contracted to fund the development projects we must have. Not enough of us are paying our taxes, not enough of us are producing to generate the revenues that we need.
Nevertheless, my ambitions for Ghana remain high. All our children should be educated and trained with skills that will enable us be competitive in the world. We need to close rapidly the infrastructure gap, we need to build a world-class healthcare system, and we need to build confidence in ourselves to make ours the happy and prosperous place it deserves to be.
I believe we can and we will find the means to achieve these goals, even if the immediate measures we have to take are painful.
At the just ended Cabinet Retreat at Peduase Lodge, my government agreed on the framework for the Post COVID-19 Programme for Economic Growth and the IMF support for its implementation, as well as the work being done by the Ministry of Finance in preparation for the 2023 budget. At the Cabinet Retreat, we took some firm decisions that should put us on the path that will take our nation out of the current economic difficulties. Let me try and give you an outline of the main decisions without getting into the technical language that baffles many of us.
To restore and sustain debt sustainability, we plan to reduce our total public debt to GDP ratio to some fifty-five percent (55%) in present value terms by 2028, with the servicing of our external debt pegged at not more than eighteen percent (18%) of our annual revenue also by 2028.
We are committed to improving the revenue collection effort, from the current tax-revenue to GDP ratio of thirteen (13%) to between eighteen and twenty percent (18-20%), to be competitive with our peers in the West Africa Region. The GRA is rolling out an extensive set of measures to support this enhanced revenue mobilisation. All of us must do our patriotic duty, and support the GRA in this exercise.
We are aiming to restore and sustain macroeconomic stability within the next three (3) to six (6) years, with a focus on ensuring debt sustainability to promote durable and inclusive growth while protecting the poor.
We have decided to review the reforms in the energy sector, capping of statutory funds, implementation of the exemptions Act and a new property rate regime. We have decided also to continue with the policy of thirty percent (30%) cut in the salaries of political office holders including the President, Vice President, Ministers, Deputy Ministers, MMDCEs, and SOE appointees in 2023, just as we will continue with the thirty percent (30%) cut in discretionary expenditures of Ministries, Departments and Agencies.
My fellow Ghanaians, the success of our efforts at diversifying the structure of the Ghanaian economy from an import-based one to a value-added exporting one is what will, in the long term, help strengthen our economy. We are making some progress with the 1D1F but our current situation requires that we take some more stringent measures to discourage the importation of goods that we can and do produce here.
To this end, we will review the standards required for imports into the country, prioritise the imports, as well as review the management of our foreign exchange reserves, in relation to imports of products such as rice, poultry, vegetable oil, tooth picks, pasta, fruit juice, bottled water and ceramic tiles, and others which, with intensified government support and that of the banking sector, can be manufactured and produced in sufficient quantities in Ghana. Government will, in May 2023, that is six (6) months from now, review the situation. We must, as a matter of urgent national security, reduce our dependence on imported goods, and enhance our self-reliance, as demanded by our overarching goal of creating a Ghana Beyond Aid.
Much as we believe in free trade, we must work to ensure that the majority of goods in our shops and market places are those we produce and grow here in Ghana. That is why we have to support our farmers and domestic industries, including those created under the 1-District-1-Factory initiative, to help reduce our dependence on imports, and allow us the opportunity to export more and more of our products, and guarantee a stable currency that will present a high level of predictability for citizens and the business community. Exports, not imports, must be our mantra! Accra, after all, hosts the headquarters of the Secretariat of the African Continental Free Trade Area.
Fellow Ghanaians, as the French would say, l’argent n’aime pas le bruit, to wit, money does not like noise, sika mpɛ dede. Where there is chaos, where there is noise, where there is unrest, you will not find money. If you talk down your money, it will go down. If you allow some unidentifiable person to talk down your money, it will go down.
The recent turbulence on the financial markets was caused by low inflows of foreign exchange, and was made worse in the last two to three weeks, in particular, by the activities of speculators and the Black Market. An anonymous two-minute audio message on a WhatsApp platform predicting a so-called haircut on Government bonds sent all of us into banks and forex bureaus to dump our cedis, and, before we knew it, the cedi had depreciated further. All of us can play a part in helping to strengthen the cedi by having confidence in the currency, and avoiding speculation. Let us keep our cedi as the good store of value it is. To those who make it a habit of publishing falsehoods, which result in panic in the system, I say to them that the relevant state agencies will act against such persons.
Indeed, some steps have been taken to restore order in the forex markets and we are already beginning to see some calm returning. We will not relent until order is completely restored. The following actions have been taken thus far:
1) enhanced supervisory action by the Bank of Ghana in the forex bureau markets and the black market to flush out illegal operators, as well as ensuring that those permitted to operate legally abide by the market rules. Already some forex bureaus have had their licenses revoked, and this exercise will continue until complete order is restored in the sector;
2) Fresh inflows of dollars are providing liquidity to the foreign exchange market, and addressing the pipeline demand;
3) the Bank of Ghana has given its full commitment to the commercial banks to provide liquidity to ensure the wheels of the economy continue to run in a stabilized manner, till the IMF Programme kicks in and the financing assurances expected from other partners also come in;
4) Government is working with the Bank of Ghana and the oil producing and mining companies to introduce a new legal and regulatory framework to ensure that all foreign exchange earned from operations in Ghana are, initially, paid to banks domiciled in Ghana to help boost the domestic foreign exchange market; and
5) the Bank of Ghana will enhance its gold purchase programme.
I am confident that these immediate measures designed to change the structure of our balance of payment flows, sanitise the foreign exchange market to ensure that the banks and forex bureaus operate along international best practices, together with strengthened supervision, will go a long way to sanitize our foreign exchange market, and make it more resilient against external vulnerabilities going forward.
Over the course of this week, I have held several fruitful engagements with the Trades Union Congress and Organised Labour, the Ghana Employers’ Association, the Association of Ghana Industries, the Ghana Association of Banks, the Private Enterprise Federation, the Association of Forex Bureau Operators, the Association of Market Queens and Women, all of whom represent important stakeholders of the Ghanaian economy. They expressed their concerns and proposed solutions on how best to solve our problems. I have been encouraged by the enthusiasm of these interest groups to help Government address these challenges, and I intend to continue these engagements with other groups.
I also want to assure all Ghanaians that no individual or institutional investor, including pension funds, in Government treasury bills or instruments will lose their money, as a result of our ongoing IMF negotiations. There will be no “haircuts”, so I urge all of you to ignore the false rumours, just as, in the banking sector clean-up, Government ensured that the 4.6 million depositors affected by the exercise did not lose their deposits.
Anuanom, menim sɛɛ asetenamu ayɛ din. Nanso, ma obiaa empa aba, monkͻso enya gyidie ɛwͻ mabam mu. Nhyehyɛ yɛ aa ɛtumi maa Free SHS ɛni 1-District-1-Factory ɛbaa mu nu; nhyehyɛ yɛ aa ɛboaa ma yetumi pam corona yariɛ no efri oman ni mu; saa ɛnso na maban ɛ toto niemayie saa mereyi ama ahotͻ aba oman nimu, efri sɛɛ mewͻ gydie sɛɛ ɛko no yɛ Awurade Nyankopͻn ni ko.
Anyɛmimɛi, mile akɛ nibii ewa, shi nyɛ ka shia gbeye. Nyɛ yaanͻ ni nyɛ naa hemͻ kɛ yeli akɛ gbɛjianͻto ni hani free SHS ba min, gbɛjia nͻto ni hani 1-District-1-Factory ba min, gbɛjianͻto ni hani wͻ nyɛ wͻ shwe Corona hela kɛshi wͻ man nɛ min; nakai nͻͻ ni mi amlalo ba to gbɛjianͻ koni hejͻlɛ aba maa min, ejaakɛ, miyɛ hemͻ kɛ yeli ak3, ta, Nyͻnmͻ ta lɛ ni.
My government has always been cognisant of the importance of implementing policies and social interventions to relieve Ghanaians of hardships. It is for this reason that over the first five (5) years in office government reduced electricity tariffs cumulatively by 10.9%, we provided free water and electricity as well as reduced tariffs for the entire population during a whole year of the COVID-19 pandemic; we increased the share of the District Assemblies Common Fund to persons with disabilities by 50%; we exempted Kayayei from market tolls; we expanded the LEAP by one hundred and fifty thousand (150,000) beneficiaries; we expanded School Feeding from 1.6 million children to 2.1 million children; we restored teacher and nursing training allowances; we absorbed the cost of BECE and WASSCE exam registrations for parents; no guarantor is now required to obtain student loans. The Ghanacard is sufficient; and we have implemented free TVET as well as free senior high school education.
It is obvious, fellow Ghanaians, that you have a government that cares. We are determined to restore stability to the economy, and provide relief. We are all in this together, and I am asking for your support to rescue Ghana from the throes of this economic crisis.
I have total confidence in our ability to work our way out of our current difficulties. We are not afraid of hard work. We will triumph, as we have triumphed many times before. Let us unite, and rally around our Republic, its institutions and its democratic values, and insist that, under God, we will emerge victorious from our current difficulties. For this too shall pass, as the Battle is the Lord’s.
I will be coming regularly to keep you updated about the measures your government is making to move our country forward, and tackle our economic challenges.
God bless us all and our homeland Ghana, and make her great and strong.
I thank you for your attention, and have a good evening.
Actress and model, Efia Odo, has labeled President Nana Addo Dankwa Akufo-Addo as “too proud” to admit he is to blame for the worsening economic situation in the country, particularly with the free fall of the Cedi.
Her comment comes on the back of the local currency trading at GH₵15 to a US dollar. Reacting to the development in a Twitter post on October 24, Efia Odo said the Cedi depreciation rate has reached a stage of a state of emergency.
While expressing concern over the alarming situation, she predicted that the Cedi may further depreciate and trade at GH₵20 to a dollar by December.
“$1 has now reached 15 cedis. This is the State of Emergency! By December the $1 will reach 20 cedis. The president is too proud to admit he fucked up! We need to do something,” Efia Odo tweeted.
This is not the first time Efia Odo has raised questions on the Cedi depreciation. In an October 20, 2022, tweet, at the time forex bureaus were reporting that a dollar had reached a record 13 Ghana cedi mark, Efia posed a rhetorical question on her timeline.
“$1=13 Cedis. Did we die and wake up in hell?” she asked.
In recent times, showbiz personalities such as Lydia Forson and Yvonne Nelson have called out the government over the cedi depreciation.
Actor Prince David Osei, a known campaigner of the government ahead of the 2016 elections, has also threatened a protest amid calls for the government to fix the economy.
On her part, broadcaster Nana Aba Anamoah published an open letter on the economy among others, calling on Finance Minister Ken Ofori-Atta to resign.
The economy is facing major headwinds that have been characterized by galloping inflation, consistent depreciation of the cedi and general high cost of living and of doing business.
The government is hoping to reach a deal with the International Monetary Fund, IMF, for an economic support programme aimed at shoring up the economy and easing the burden on ordinary Ghanaians.
The Forum for Public Sector Associations and Unions have asked the Government not to apply a “haircut” to Tier 2 Pension Funds as part of a “probable” debt restructuring programme.
The Forum said it had taken note of media reports suggesting that about 94 per cent of Tier 2 Pension contributions placed in Government securities might be affected by the said debt restructuring agenda.
At a press conference in Accra today, Thursday, October 20, 2022, Mr Isaac Bampoe Addo, Chairman of the Forum, said any such decision on the Tier 2 Pensions would contravene provisions of the National Pensions Act, 2008.
“If the Government was to pursue the restructuring of Ghana’s debt by touching pension funds, placed in government securities, it would be tantamount to the deceit of benefits envisaged under the Three Tier Pensions Scheme,” he said.
Mr Addo said following the media reports, the Forum officially wrote to the National Pensions Regulatory Authority (NPRA) for clarification.
He said the NPRA, in its response to the Forum, assured that: “there’s no such policy or decision at the moment to restructure Ghana’s debt and as regards the 94 per cent of Tier 2 pension contributions placed in government securities.”
Mr Addo said the decision to place a larger proportion of Tier-2 funds into Government Securities, was due to the fact Government paid all the Temporary Pension Fund Account (TPFA) at the Bank of Ghana in government securities.
He said the Occupational Pension Schemes had efficiently grown the Tier-2 Pensions Funds that would allow the schemes to pay “better lump sum” to its contributors on retirement.
“Thus, if the government would want to touch these funds, that are privately managed, it would be tantamount to the Government reaping where it has not sown,” he said.
The Forum is made up of nine public sector Unions and Associations, including the Civil and Local Government Staff Association, the Ghana National Association of Teachers; the Ghana Medical Association; the Ghana Registered Nurses’ and Midwives’ Association, and the National Association of Graduate Teachers (NAGRAT).
The rest are the Judicial Service Staff Association of Ghana, Coalition of Concerned Teachers Ghana, and the Ghana Hospitals Pharmacists Association.
The Forum constitutes about 70 per cent of the public sector payroll.
Ghana’s Pension Scheme is in three tiers. The First Tier is the Basic National Social Security Scheme for all workers in Ghana. It is a defined benefit scheme and mandatory for workers to have 13.5 per cent contributions made on their behalf, and managed by SSNIT.
The Second Tier is a defined contributory Occupational Pension Scheme mandatory for workers with 5 per cent contribution made on behalf of members. The contribution is managed privately by approved Trustees.
The Third Tier which includes all Provident Funds and all other Pension Funds outside Tiers I and II is a voluntary scheme.
Section 102 of the Pensions Act states: “the accrued benefits of a member in an occupational pension scheme shall not be attached in execution of a judgment debt or be used as a charge, pledge, lien or be transferred, assigned or alienated by or on behalf of the member.”
• Ghanaian merchants with political clout serve as fronts for Chinese fishing companies;
• Although it is forbidden for foreign vessels to fish in Ghanaian waters, the number of vessels owned and operated by Chinese companies has increased over the previous ten years;
• Although trawlers don’t always intend to catch the fish they net, the tactics utilized are unsustainable, using nets that are termed “illegal” or irregular as they scoop up fish from various depths;
• Local fishermen are harmed by industrial methods, yet trawler operators have built partnerships with them by selling them their extra catches.
• There is a major cost to Ghana’s economy. In money terms, Ghana loses US$50 million dollars annually that should go to the fiscus; but perhaps the more profound effect is on food security and nutrition with many fisherman saying that the depletion of fish is so severe, they are unable to catch enough to sustain themselves, let alone generate sufficient food to feed their families;
• The ill effects can be summarised in three respects: Ghana’s economy loses US$50 million/year to transhipment activities; more than half the fish (60 percent) consumed in the country is imported, causing the government to lose revenue; subsidies to the fishing industry are not recovered due to the losses suffered by the artisanal fishermen;
• Fisheries regulations stipulate the mature size of fish to be harvested. Once any fish below that size is caught, it is regarded as illegal fishing.
• The decrease in fish stocks has a knock-on economic effect. Religious leaders have lamented that when there’s a sparse or no harvest, it affects the offerings of church members; furthermore, the people working in the industry have numerous dependents putting them under pressure in terms of survival;
• People worst affected by the demise in fish stocks and distortions in the fishing industry say there is lack of political will to tackle the challenges faced by artisanal fishermen.
It is 12 January 2022 and on the shores of Prampram, a fishing community in the Greater Accra region near the industrial and fishing port of Tema, about 22 fishermen gather in a shed. They would normally be out in their canoes, but on this Tuesday morning, they are playing draughts while discussing their misfortunes due to the proliferation of Chinese-owned and run industrial trawlers.
Prampram Fishermen play draughts to while away the time,, 12 January 2022
Usually under cover of darkness, fishing vessels take to the waters off Ghana’s coast close to Togo.
Chinese-owned vessels proliferate and now appear to control Ghana’s waters and the fishing industry, producing and supplying fish to cold stores in Ghana and Togo, many of which are largely owned by the foreigners. Ghana has no official or bilateral fishing agreement with China. But the Chinese fishing investors and companies come to Ghana via a “back door” – they use high profile Ghanaians who, for a fee, front for them. They go into hire purchase agreements under which the Chinese bring their vessels to Ghana, register them in the names of the Ghanaians and use the Ghana flag as if they are local vessels, but in reality the owners are Chinese. The vessels are manned only by Chinese, who are the technical operators and instructors on the vessels, a factor confirmed to us by the chief director at the Ministry of Fisheries.
Our investigations have ascertained that Ghanaians are fronting for the Chinese for an initial fee of between US$1,500 and US$2,000 dollars in addition to about 5% from the earnings generated by the vessels annually.
On its website in May 2022, the Chinese fishing Company Shandong Oceanic displayed pictures of its large fleet of fishing trawlers on Ghanaian waters on the Atlantic Ocean clearly depicting their presence and dominance in Ghana’s territorial marine waters.
Trawler fleet by Shandong Oceanic operating in Ghana’s Atlantic waters.
Of major concern is the use of unauthorised and unapproved methods by the Chinese fishing companies in trawling the fish from the bottom, mid and surface of the ocean. Our information is that they use nets with unapproved openings in a bid to “grab” all the fish. These Chinese-owned vessels are also accused by local fishermen of fixing huge lights in the sea at night to attract and easily capture large stock.
Unwanted parts of the catch are then sold on the high seas to local fishermen and foreign vessels in what experts describe as transhipment and is referred to locally as ‘saiko,’ which is illegal. Saiko is big business in places like Elmina and the Takoradi Fishing harbour. Fishermen fix refrigerators into their canoes and wooden trawlers to store sardinellas and other catches bought from Chinese industrial trawlers.
At the Tema main Fishing Harbour in Ghana, vessels like AFKO 805 AFRICA PRINCESS, AFRICA STAR , ATLANTIC QUEEN , LONG TAI1, and LONG TAI 2 are operating as vessels owned by Shandong Zhonglu, according to information obtained from the Ministry of Fisheries . Other Chinese vessels like MENGXIN3 MENGXIN 4,. LU RONG YUAN YU, 219 LU RONG YUAN YU 968, LU RONG YUAN YU 969 also operate in Ghana’s waters in the Gulf of Guinea and the Atlantic Ocean.
In June 2019, the LU Rong Yuan Yu 956, a Chinese trawling vessel was apprehended in Ghanaian waters with illegal nets and undersized small pelagic fish on-board. The pelagic fish form the staple catch of the local artisanal canoe fishers. The full fine of US$1 million was imposed on the vessel by the regulatory agency but the vessel owners refused to pay. In May 2020 the vessel was caught again for similar offences and for using nets with mesh sizes below the legally accepted level. It was let off the hook again.
The People Worst Affected by Overfishing and proliferation of Chinese vessels
40-year-old Beatrice Otoo has been processing fish through the traditional smoke fishing method at Chokor in Accra for the past 20 years. But the fish processing business has shrunk in recent times.
“The market has gone down. People don’t buy or patronise our fish as they used to because they claim they are expensive and that living conditions are hard. Besides that, fish is scarce to get nowadays. Previously, we used to buy fish from the local artisanal fishermen but now the fishermen don’t bring (in) fish. What they bring are insufficient for the market.
So we now rely on what the Chinese bring to the various cold stores in Tema. These days there are no bumper harvests … not even in the month of August when fish harvests are in abundance.
Yes, it’s because of the Chinese heavy industrial trawlers that are taking all the fish in the sea. I went to the market today and made a profit of ghc50 cedis( US$5) which I am coming to spend with my kids, when it gets finished I will go again tomorrow and sell to make some profit. I really get tired and worried.
If nothing is done about curbing the situation (relating to the trawlers), our business may collapse. A carton of fish today is about ghc450, a few weeks ago it was sold for around ghc250, this increase is over 250 percent and it keeps increasing. I really don’t enjoy doing this business due to the scarcity of fish and the escalating prices.
Beatrice Otoo speaking to the team while smoking her fish on the hot fire under the scorching sun
Mary Aku Allotey is 47 years old and has been processing fish for over 27 years now. According to her, the fish processing business has not been lucrative for some years now. “Years ago we made profit from this business but not anymore. Things are hard nowadays. They (authorities) and the market forces keep increasing the price of fish and we don’t have money to sustain our business. We also don’t have good husbands to take care of us and our children.
“The entire burden has been put on our shoulders. Taking care of our children through this unprofitable fish processing business is like walking in hell on earth.”
She says that complaining does not help.
“The cold store operators tell us that the taxes imposed on them and the fish by the government are high, hence the high cost of the products. Also most of the fish caught by the trawlers in Ghana are sent to Togo. The authorities know about what I am telling you. So we sometimes go to Togo to buy fish when they become scarce in Ghana and this doubles the price due to the transportation cost and the cost of import duty. Sometimes when we go to the Tema fishing harbour and we don’t get fish, we are compelled to go to places like Takoradi, Elmina, and even Benin to buy fish.”
A carton of fish today (12th June 2022) is between ghc450 and ghc500 cedis, something that was ghc250 4 months ago. The price of a carton of fish today is said to have increased to between Ghc600 and Ghc 1,000 cedis.
“The fish processing business has become a debt- incurring challenge rather than a profitable venture. We are incurring debts every day because the local artisanal fishermen don’t bring fish anymore and we have to depend on the cold stores for the expensive fish brought by the Chinese trawler vessels. Now all our children have become thieves and robbers because when they eat at home and don’t get enough or get satisfied they resort to stealing and robberies”.
Years ago, only tuna and salmon used to be sold in cartons to the “high class” in society. “Today, they put everything in the cartons, both big and small, the juvenile fishes, the sardinelas and all in the cartons and sell at outrageous prices to us,” says Ms Allotey.
Oko Aryee, a 50-year-old fisherman is concerned about the use of light in night fishing. “They are fishing in an unauthorised zone and use lights to attract the fish. In the process they extract juvenile fish that should have been allowed to grow more. I can say we are doomed if nothing is done about the situation. There is need for an urgent solution”.
Ishmael Aryee is a 42-year old artisanal fisherman who has been fishing for 24 years. “They use nets with mesh sizes below the legal standards of the Fisheries Commission and use them to harvest the small pelagic fish offshore.
“Many years ago when I joined my father in the fishing business, one wouldn’t come to the shores of Prampram without getting fresh sea fish of all types. We were catching and harvesting huge volumes of fish daily. Today, things have changed and we don’t get them anymore because these Chinese trawlers use unauthorised fishing gear to trawl the depths of the sea and grab everything into their vessels to sell. They engage in transhipment and sell to all vessels they come across at sea both in Ghana and Togo. They sell to those who have money to pay (while on the) high seas. If I am not mistaken, over 60 percent of fish stocks in our waters are gone as a result of their illegal fishing activities”.
Local fishermen operate out of canoes with small engines that are powered by fuel.
“We don’t get anything after spending money to buy premix fuel to power our canoes,” said Mr Aryee.
Ishmael Aryee , expressing his frustration
Mike Abekah Edu, Western Regional Secretary of the Ghana National Canoe and Fishermen Council ( GNFCC) says allowing foreign trawlers onto Ghanian waters has decimated fish stocks, in particular the small pelagic varieties usually harvested by artisanal fishermen. The decline has pushed the fishermen towards illegal activities. Mr Abekah Edu interacting with the Journalist
“As a representative of the artisanal fishers, we support the suspension of all trawlers 100 percent, we plead with the government to suspend them for about 3 or 4 years to help sanitize the fisheries industry. Their activities are the cause of illegal fishing in Ghana and even in the artisanal fisheries sector. The government should suspend them for 4 years to see the revival or the resuscitation of the fisheries industries. For the pelagic and the small fishes to rejuvenate, there needs to be a period of transition for them. I don’t think these Chinese people are needed in our fisheries industry. Whatever you tell them they ignore and hide under the cover of darkness and do illegal and irresponsible fishing. Ghana is losing about US$7 million every year by issuing fishing license fees and fines for trawlers that are far too low compared to the revenue they generate . Licence fees are low compared with other countries and insignificant since almost all the trawlers are owned by the Chinese
Mike Abekah Edu, General Secretary of the Ghana National Fishermen and Canoe Council
48-year-old Nii Asempa has been working as a fisherman for the past 28 years. He was also an aspirant Assemblyman at the recent District Assembly elections at Ningo Prampram. He told the investigative team that they have made several complaints on several platforms about the use of the Chinese fishing nets and vessels that are contributing to the depletion of Ghana’s fish stocks but there hasn’t been any tangible response by the government and the regulatory agencies.
Mr Asempa and other fishermen have raised their concerns with the authorities several times and protested and demonstrated against the trawlers, but he says the transhipment activities had the support of some officials of the Fisheries Commission and is being done “undercover” at sea.
Caption: Nii Asempa showing us some of the unapproved nets used for the illegal fishing activities
47 year old Osa Sagbo, a fisherman accuses the authorities of “twisting and changing the figures to hide the truth.” “It is appalling and unfortunate. These kinds of attitudes towards us have the recipe to cause confrontation between local fishermen and the foreigners. It has the potential to trigger a major conflict between us.”
OSA Sagbo, 2nd from Left, stressing his frustration to the team
55-year-old Ago Martey has been an artisanal fisherman for 40 years and says he has never before seen the kind of destruction of the fishing industry as has been happening today due to the activities of the Chinese-owned trawlers. “Before the mass arrival of the Chinese trawlers, we experienced bumper harvests of various fish types daily. Fish was in abundance and we fishermen could sell more to take care of ourselves and families. Today the situation has changed”.
Kwadwo Kyei Yamoah, the Programs Manager at the Friends of the Nations (FON), one of the NGOs active in Ghana’s Fisheries sector in an interview with me said: “When these trawlers started operating in our waters many years ago most of them were not targeting the endangered fish species like the sardinelas because those were basically reserved for the local fishermen.”
Mr Yamoah said the trawler operators dumped parts of the catches for which they had no use, back in the sea.
“Though this dumping was against the law, the fines for this practice, “were not that much to deter them,” he explained.
Local fishermen observed the dumping and would approach the trawlers and negotiate for the catch being discarded, thus starting the practice of transhipment.
“This became a competition among local fishermen who would sail out to sea just to collect the “unwanted” fish from the Chinese trawlers. Most fishermen then familiarised themselves with the industrial trawlers and started bartering with them. They would send vegetables, oil and other items to these vessels on the high seas in exchange for the unwanted fish which was also dubbed ‘seite’ in Chinese which means (what is bad must be discarded )”.
“The trade at sea morphed into a “By-Catch Association” an association of canoe fishers who are self-trained in the transhipment or “saiko” business. Now they purchase fish from the Chinese trawler vessels because of the illegal space that has been provided for them to operate. It is sad that a whole industry has emerged in Elmina out of this illegal business.”
“The system for industrial trawling allows for potentially powerful individuals with political connections to own fishing licenses. Getting a fishing license in Ghana is very difficult unless you are politically connected or led by somebody who is politically connected. The non-political ones will usually seek the support of the political ones in an attempt to secure licenses.”
“In fisheries the operators of the trawlers are not powerful, it is the weakness in the system that has made them powerful,” says Mr Yamoah.
“Fish is the cheapest source of protein and Ghanaians consume a lot of fish. Almost every food goes with fish; yes even breakfast, and when there is fish available you will see the nutritional and health value. A few years ago when there were bumper harvests you will see that fish in abundance, even in the regions far from the coast. So when fish harvests go down, it seriously affects food security . Not only that. it also affects employment, health and wellbeing and also affects the dependants of fisher folks . This sometimes affects their education and they find it difficult to survive on three meals a day” when there’s a scarcity.
Out-of-Court Settlement
According to Kwadwo Kyei Yamoah “Section 116 of the Fisheries Act deals with compounding offences and the introduction of an out-of-court settlement committee. The perpetrators or offenders, once they admit wrongdoing, then negotiate the amount to be paid in fines. The norm is that mostly the fines imposed under the out-of-court settlement committee is below the minimum threshold provided for under the law. Ifk, for instance, the law says that when somebody engages in saiko the minimum fine should be US$1 million dollars, but sometimes they are far below the stipulated amount. So that raises issues.
Fines are also not consistent. For instance someone (a trawl operator ) commits an offence that requires a US$1000,000 fine but the person is charged only US$100,000 by the out-of- court settlement committee instead. Another person commits the same offence and is charged US$50,000.”
“Furthermore, it is not mandatory for vessels operating in Ghana to have International Maritime Organization (IMO) numbers. These are numbers that enable regulators and monitors to track and trace vessels wherever they are in the world. The numbers indicate when they were manufactured and, the kind of fishing they are expected or licenced to engage in. The IMO number doesn’t change. So to help us track multiple offenders even along the shorelines, we need to make the operators display these numbers of their vessels. It must be included in the law.”
Illegal, Unregulated and Unreported fishing
The fisheries regulations give us the mature size of fish to be harvested, so once you catch any fish below that size, it is regarded as illegal fishing, explains Mr Yamoah
“Lack of political will”
Providing supervision of regulatory agencies to avoid omissions and commissions would help to address some of the challenges in the fisheries sector, says Mr Yamoah.
“When we talk about regulatory omissions or illegality, it is the regulatory agencies rather looking the other way and refusing to do their job; sometimes there are incentives for them to abandon their duties and look the other way and find excuses,” says Mr Yamoah.
A lot of these activities can be stopped on land. Any illegality that happens at sea begins on land.
In the artisanal sector, the minister of Fisheries, Mavis Hawa Koomson issued a directive under which any landing site found to have engaged in any form of illegal, unregulated or unreported fishing activity be denied supplies of premix fuel.
Once the government is unable to enforce the law it sometimes begins to shift the blame.
An entire industry has emerged in Elmina out of illegal business activities.
Glaring anomalies in the system:
I am told that our security agencies and the system are firm but I don’t see that pragmatically on the field, asserts Mr Yamoah.
“Our system for industrial trawling allows for potentially powerful individuals with political connections to own fishing licenses. Once that happens for instance, in cases where political financiers are owning licences, it becomes difficult for the political parties in power to handle such political financiers”.
In 2008 the Minister of State, ordered trawler operators to land at a designated fishing port and they obeyed. But that practice ended with a change in government.
Through saiko fishing or transhipment alone Ghana is losing over US$50 million dollars per year. “We are losing huge sums also from importing about 60 percent of our consumption and also putting in subsidies that cannot be recovered.
For instance if you hear government appealing to fishermen to stop illegal fishing, it’s like government appealing to armed robbers to stop robberies since those too are also illegal.
For Nii Asempa, Stephen Quartey , Osa Sorgbo , Ishmael Aryee Ago Martey , Oko Ayee and numerous other fishermen , the Chinese fishing sailors are very powerful due to the protection given to them by the political powers and politicians they connect with in Ghana.
For them since there is no political will to end the Chinese capture and invasion, their activities will continue to get worse until there is an uprising against them
Illegal, Unreported and Unregulated (IUU) fishing activities
Unapproved nets, the use of obnoxious chemicals in fishing, and fishing within prohibited areas are commonplace. For instance if you are licensed to fish in an inshore exclusive zone (IEZ) and you fish outside or beyond the IEZ, it’s a form of IUU and vice versa.
By law you are supposed to land the fish at the port. If you don’t land it and you dispose of some at sea through transhipment it attracts punishment when caught .
Fronting
You need no less than US$10 million as minimum capital to register and operate trawlers in Ghana as operating costs of these vessels ranges from US$10 million to US$20 million. Most Ghanaians don’t have the wherewithal to raise the finances or capital to operate them. So they bring in foreign vessels that end up dominating the local industry. That is the challenge facing the fishing industry.
The Regional Maritime University and industry players are looking at how best to train Ghanaian navigators and fishers .
“Most of these vessels that come from China and Asia have foreigners who are piloting ; foreigners who are engineers and fishers and navigators. So we are going there,” says Mr Dadzie.
“We are talking to and encouraging the operators to seriously look at the issue of local content in the industrial trawler sector and how best we can get Ghanaians who are well-trained and positioned to take up those key positions .
Under the local content law we are supposed to have about 15 percent of Ghanaians at the top management level of every fishing company. Currently it is below that, even less than 1 percent,” he says.
Asked why the Fisheries Commission always refer offending trawlers in IUU to the out- of- court- settlement committee for seemingly meagre fines instead of the proper court of law for prosecution, Mr Dadzie said: “The law is very clear. The offender can admit liability and say that I want to submit myself to the out- of -court settlement committee and the law defines the parameters within which the out- of- court settlement committee can operate.”
The trawlers are now sailing in the shallow waters where canoes operate, adding to the competition against artisanal fishermen.
Emanuel Essien
Over the past three years, the disappearance of Emanual Essien, an employee of the Fisheries Commission, has remained unsolved. The 28-year-old disappeared while inspecting a trawler on the high seas . The exact circumstances remain unclear.
Mr Essien’s disappearance has raised the matter of the need for greater technological surveillance instead of human observers on trawlers.
According to Michael Arthur Dadzie, Ghana is a member of the International Commission for the Conservation of Atlantic Tuna (ICAT) and as part of the regulatory measures, “we had to implement the regional observers program in the ICAT regions. This included human observers being deployed on board vessels.
“We have had issues of bribery, compromises, threats,” he says relating to the “human” dimension of monitoring.
“We already have VMS, vessel monitoring system and VIS systems installed to monitor the industrial vessels. What the minister of fisheries has lobbied the government to bring in the not too distant future is the Electronic Monitoring system (EMS) that enables installation of cameras on board vessels.
The Attorney General also studied the Essien police report and wrote to us that there is a presumption of death only after seven years.
Greater regulation:
Mr Dadzie says that the minister of fisheries will soon issue a ministerial directive on the type of gear that the trawlers, semi-industrial sector and artisanal sector should use. “We need to tackle the problem holistically”.
Project Funded by the Global Reporting Centre of the University of British Columbia
In the midst of worsening economic circumstances and the government’s plan to secure IMF support, Finance Minister Ken Ofori-Atta is hoping for a “Ghana miracle” to revive the economy.
Speaking to the media on Wednesday about the state of the Ghanaian economy, the Minister stated that “the sanctity and the well-functioning of the financial system are sacrosanct” and that the only way for the economy to recover is with the help and confidence of all Ghanaians.
In his speech, Ken Ofori-Atta was positive and compared the country’s economic revival to the great Celtic Miracle in Ireland in the 1980s, when Ireland was one of Europe’s poorest economies and was dubbed the “beggars of Europe.”
However, Ireland’s economic situation improved in the 1990s, and the country’s economy experienced impressive average growth rates.
This is the miracle Ken Ofori-Atta is hoping will materialise in the country’s economy.
“The sanctity and the well-functioning of the financial system are sacrosanct and we need the support and trust of all Ghanaians to deliver this. Let us join hands to get this done.
“The great Celtic Miracle in Ireland in the 1980s was the result of such collaborations, especially with Labour and we shall also be blessed with the Ghana Miracle,” the Minister said.
Meanwhile, the government in a bid to revive the economy has announced a 5-Member Committee consisting of prominent financial services professionals to lead extensive stakeholder engagements across all the key segments of the financial sector – banking, asset, management, pensions, and insurance – as part of moves to protect the financial system.
This is coming following the probability that the nation may undertake a debt restructuring programme.
The announcement of the Committee Members is expected to be made in the coming days.
According to Finance Minister, Ken Ofori-Atta, the committee will immediately get to work to engage key stakeholders in the financial services sector, additional to ongoing engagements with Civil Society Organizations (CSOs), social partners (labour unions, employers, and FBOs), academia, industry professionals, and the leadership of Parliament.
This, he says, is government ambition to protect the financial sector.
Prof. Godfred Bokpin, an economist at the University of Ghana, has stated that the IMF program by itself will not be sufficient to address the nation’s current economic issues.
To complement the actions the nation is taking to find long-term answers to the difficulties in the country, he said that a significant constitutional change on governance should be enacted.
Prof. Bokpin noted in a citinewsroom article on September 25, 2022 that while the government can show the IMF some level of stability in order to receive financial aid, this won’t end Ghana’s difficulties in the long run.
“The IMF program in itself is not enough. You can show enough commitment to the IMF that these are the fiscal adjustments that we want to do in order to bring our debt to a more sustainable level and therefore agree to lend to the country. But with where we are right now, merely focusing on an IMF program will not be enough,” he is quoted by citinewsroom.com.
He made the comments after Ghana’s economy was further downgraded by a rating agency, Fitch Ratings on September 24, 2022, from “CCC” to “CC”.
The government has however been asked to ensure that certain reforms to the public sector are pursued.
“Ghana needs to pursue concurrently, some kind of governance reform which will also entail doing some adjustments to our constitution. Also, initiating certain productivity-enhancing reforms across the entire spectrum of the public sector will help. An inefficient public sector represents a cost to the private sector as it interacts with the private sector,” he asserted.
Finance Minister, Ken Ofori-Atta, has encouraged Ghanaians not to give up amid the current economic crunch, but to continue to work hard for a prosperous Ghana.
He said the Government had put in place measures to lessen the plight of its citizenry and evidence of growth in the economy was seen in the second quarter Gross Domestic Product (GDP) figure.
Despite the rising cost of fuel and its attendant increases in food and transport fares, inflationary pressures, and Cedi depreciation, the economy grew by 4.8 per cent in the second quarter of 2022, compared with 4.2 per cent for 2021.
The growth, the Ghana Statistical Service said, was driven by manufacturing, crops, information and communication, and education sub-sectors.
The services sector recorded the highest growth of 5.2 per cent, followed by the agriculture sector with a growth of 4.6 per cent and industry, which had a 4.4 per cent growth.
Mr Ofori-Atta at the signing of an agreement with banks supporting the Government’s YouStart entrepreneurship initiative was confident the programme’s implementation would speed up efforts of economic recovery and transformation.
He said: “Indeed, the expected consequence would be the realization of a WISER (Wealthy, Inclusive, Sustainable, Empowered, and Resilient) society, with our young people more confident about their place in the World.”
He noted that other policies, including the homegrown economic programme with International Monetary Fund (IMF), from which the Government expects to receive a $3 billion loan the Fund would help restore and make the economy resilient.
“We’re having an arrangement with the IMF so that we move beyond the dependence on Government and donors into our creative synergies,” the Finance Minister said.
He said this as the Government prepared to present the Budget Statement and Economic Policy for the 2023 financial year, which Mr Ofori-Atta said would be read on November 15, 2022.
Drawing inspiration from Ghana’s first President, Osagyefo Dr Nkrumah, the Finance Minister encouraged Ghanaians to be courageous to work hard to achieve excellence despite the current economic hardship.
He quoted Nkrumah, saying, “Countrymen, the task ahead is great indeed, and heavy is the responsibility; and yet it is a noble and glorious challenge – the challenge which calls for the courage to dream, the courage to believe the courage to dare, the courage to do, the courage to envision, the courage to fight, the courage to work, the courage to achieve – to achieve the highest excellencies and the fullest greatness of man. Dare we ask for more in life?”
On entrepreneurship, he said the creation of Ghana as an entrepreneurial nation through the YouStart programme with support from the private sector was critical to having a robust and sustained economy.
“Almost 37 per cent of our population are between the ages of 15 and 35 face unemployment challenge and the public sector cannot absorb this level of population. So, we need to build a system in which can train to be entrepreneurial to also hire other people,” Mr Ofori-Atta said.
“I look forward to working alongside all of you to realize a transformed Ghana where: ingenuity is encouraged, innovation is supported and ultimately, prosperity is shared,” he emphasised.
