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A MONTHLY MAGAZINE BUSINESS & FINANCE JULY 2012 / ISSUE 017 GH¢10.00 Dollarisation of economy: Matters arising (page 27) Obamas new policy - Any good news for Ghana? (page 38) Glo Mobile causes stir in telecom market - Whats secret? Talal Fattal-- (page 54) a multi-talented business success USA........................$7.00 CFA ZONE....... CFA 2,500 UK..........................£5.00 NIGERIA..................N1000 (page 18) EUROPE................. 5.00 SOUTH AFRICA..........R45 AUSTRALIA.......... A$8.50 SOUTHERN AFRICA...R45 THE FIRST BUSINESS READ IN GHANA Follow us online at www.ghanabizmedia.com AZINE AG LY M ONTH A M JULY 2012 / ISSUE 017 Editor BUSINESS & FINANCEGH¢10.00 Felix Dela Klutse Deputy Editor Utche Okwuosah Senior Writer Dollarisation of economy: Effah Amponsah Matters arising (page 27) Obamas new Contributors policy - Any good news for Ghana? Daniel Nonor (page 38) Glo Mobile causes stir Talal Fattal-- Justice Lee Adoboe in telecom market - Whats secret? a multi-talented (page 54) General Manager business success (page 18) CFA 2,500 CFA ZONE....... Martino Kashif .......$7.00 N1000 USA................. NIGERIA.................. £5.00 A..........R45 UK.......................... SOUTH AFRIC 5.00 RICA...R45 EUROPE................. OUTHERN AF $8.50 S ALIA.......... A [email protected] AUSTR Follow us online at www.ghanabizmedia.com THE FIRST BUSINESS READ IN GHANA Deputy Manager, Marketing Michel Kouassigan [email protected] JULY 2012 / ISSUE 017 Deputy Manager, Circulation Front Cover: Talal Fattal, CEO of Metro TV -Ghana & Subscriptions Josiah Spio-Garbrah [email protected] Editorial Committee Prof. Paul N. Buatsi Prof. Kwame Addo Contents Ms. Johanna Awotwi Mr. Gaddy Laryea 5..... Editors Suite 14..... Trade Mr. Ray de Bono Nana Robert Mensah About a month ago, a local news China is currently commanding great Mr. Fredrick Alipui reports emerged that the Kingdom of attention from the global economies Ms. Dede-Esi Amanor-Wilks the Netherlands have announced their due to its consistent increase in Nana Spio-Garbrah intention to withdraw their funding consumer spending. Office Location: support for Ghanas budget after Ghana Business & Finance 2012. What is the reason? Read this African Business Media piece to find out. House No. 7, 18..... Cover Story Lamb Street (Off Farrar Avenue) The mention of Metro TV and Soccer Adabraka, Accra Academy pops up one name - Talal Ghana 6..... World Economy Fattal, a multi-talented man whose Mailing Address: Get to know the emerging dynamics contributions to the media and P.O. Box 0772, Osu, Accra, Ghana characterising the developed and economy of Ghana are apparent. How Tel: +233 302 240 786 developing economies in the world. much do you know him? Fax: +233 302 240 783 [email protected] [email protected] 8..... News in Brief [email protected] [email protected] Bring yourself up to speed on the business and business-related news in Ghana Branding, Layout & Design of the 12..... Manufacturing Ghana Business & Finance magazine GHACEM is now attempting to hold by Dmax Studios in Malta, EU. (www.dmax.tv) World Bank responsible for the latters statement on breaking duopoly of cement CEO & Art Director Barclays Libor controversy production. Is the move by GHACEM is on Page 57 Ray de Bono necessary? [email protected] Senior Designer-in-Charge of Publication Sasha Vella & Team Studio Support Executive (in charge of GB&F Online) Jonathan Galea & Team IT Strategy Director Uwe Schoenfeld Subscribe online at www.ghanabizmedia.com or please refer to page 53 All information contained within this magazine is the property of Ghana Business & Finance and is not to be used without written authorisation from the publishers. Although every effort is made to ensure the correctness of information submitted for publication, the magazine may inadvertently contain technical inaccuracies or typographical errors. Ghana Business & Finance assumes no responsibility for errors or omissions in this publication or other documents that are referenced by or linked to this publication. Contents continue overleaf JULY 2012 3 22..... Banking and Finance 36..... Oil and Gas 44..... Analysis Having met its required minimum Ghanaians are learning the hard It is interesting to behold how the capital through the equity way; conserving forest cover by tables are turning in the favor of participation, UT Bank proposes subsidising consumption of LPG Africa regarding macroeconomic to inject new vigour into its passion is proving extremely costly as growth to the disadvantage of the to remain trusted partners to SMEs. free-riders demand overwhelms developed economies. Africa is How would it do this? supply, and threatens to upend the gradually soaring! Read this piece programme. to learn more. 24..... Diplomatic Relations India is fast establishing itself as a 38..... Feature 54..... Special Report new friend of Africa and After months of braving much The predictions of telecom particularly Ghana, when it comes criticism for its lack of attention watchers that the entrance of Glo to trade and economic relations. on Africa, the Obama Mobile would cause a stir on the To what extent has both countries administration on 14 June launched telecom turf are coming to pass. leveraged on the relationship? an Africa strategy document that How is the situation like? seeks to clarify his administrations specific focus for engagement with 27..... Money Matters Africa. Read this article to find out 57..... Barclays Scandal the benefits of this strategy to Issues surrounding the dollarisation Ghana and other African nations. Barclays Libor controversy is on, of the Ghanaian economy still rages how much do you know about it? on. Read this story to find out matters arising out of this. 43..... Executive Suite Minister for Education Ambassador 30..... Photo Gallery Lee Ocran is a man who does not pull punches. In an interview with The month of July was inundated GB&F, he says technology with several business-related events education remains the driving force in the Accra metropolis. See the behind Ghanas education sector. photos. Read this piece to find out more. 32..... ICT This years electioneering campaign will surely take varied twists as politicians and political parties will have a wide range of digital publicity tools for their campaigns. Read this piece to find out more. India is fast establishing itself as a new friend of Africa and particularly Ghana... Page 24 Minister for Education Ambassador The Obama administration on Lee Ocran is a man who does not 14 June launched an Africa pull punches... Page 43 Special Report: The predictions strategy document... Page 38 of telecom watchers... Page 54 4 JULY 2012 Controversy surrounding budgetary support EDITORS SUITE bout a month ago, a local news reports emerged that Ghana is now at the level of lower middle income country so; A the Kingdom of the Netherlands have announced their it is now time to look at higher impact aid and get more added intention to withdraw their funding support for Ghanas value and value for money for each cedi spent. What the budget after 2012. Ambassador meant was that, with the attainment of the middle- income status, it was time Ghana acts fully fledged and weaned According to Dr. Ton van der Zon, First Secretary and itself off donor dependence. The credibility of this thought is Environment and Water Advisor at the Embassy of the Kingdom further underscored by the current state of Ghanas economy, of the Netherlands in Ghana, this decision was based on their where macro-fundamentals are showing that they are not dissatisfaction with the result they have been getting from their being built on a solid economic foundation. An economy that direct budget support over the years. He made this known to the depends on donor support to meet as much as 40% of its fund media in Accra at the opening of the third annual civil society requirement will always be vulnerable to all kinds of shock, more review of the natural resources and environment sector. so when those budget supports are withdrawn in unplanned circumstances. Consequently, the Netherlands decided to opt for specific programme funding where they can easily assess the outcomes By the way, just before going to press, the European Union (EU) and work more with decentralized government systems instead announced that, for the year 2012, it has disbursed a total of 24 of the central government, with the aim of ensuring development million to the Ghana government through the Multi- sustainability. Donor Budget Support (MDBS) framework, indicating that it has scaled down its own contribution by 2.4 million from its The implication of this decision is that, in the coming year 2013, 26.4 million support in 2011. Ghana will lose more than 25 million it had always received as budget support from the government of the Netherlands. The Perhaps to fully understand where the Netherlands decision is total contribution of the Netherlands to Ghanas general budget coming from, one needs take into account this New York Times support, since 2003, is estimated at 187.8 million. report published May, 2012. The report unveils that of all the people rocked by the debt and austerity tumult rattling Europe, Multi-donor Budget Support (MDBS) is a common phenomenon the famously prudent but prosperous Dutch were seldom on in most parts of Africa. In Ghana, it began in 2003. At present anybodys watch list; until now. Ghana receives such support annually from 11 donor countries and international agencies, some of these donors contribute It continues; This bastion of probity became a flash point of through their various agencies. The countries and agencies are euro zone turmoil last week, when the government fell in a Germany (KfW), UK (DfID), France, Netherlands, Denmark, showdown over how to cut the budget to keep the nation from Switzerland, Japan (JICA), World Bank, African Development getting caught in Europes long-running debt crisis...It is the Bank, European Commission and Canada (CIDA).