Ghana’s Atewa forest is one of the most beautiful and scenic landscapes in the country. It is seen as the better of only two Upland Evergreen forests left intact in the country, forming part of the six dominant vegetation zones of Ghana based on different climates zones.
The Atewa forest is part of the Guinean Forests of West Africa which stretch from southern Guinea into eastern Sierra Leone and through Liberia, Côte d'Ivoire and Ghana into western Togo. Deforestation has massively reduced the size of the forests and the Upper Guinea Forest is now restricted to a number of more or less disconnected reserves and a few national parks acting as man-made refuges for the region’s biodiversity.
The Atewa forest landscape is remote and pristine, providing the habitat for a major collection of Ghana’s biodiversity. It has been named as one of Ghana’s 30 globally significant biodiversity areas.
But the forest is under threat. Last year Ghana signed a memorandum with China to explore Ghana’s deposits of bauxite – the primary ore in aluminium. The deposits are found in two locations – Awaso with very high deposits in the moist semi-deciduous forest zone of western region of Ghana, and Atewa, with minimum deposits and located in the Upland Evergreen forests in the Eastern Region of Ghana.
Under the memorandum Ghana will cede 5% of its bauxite resources to the Chinese. In turn, Beijing will finance $2billion worth of infrastructure projects that include rails, roads and bridge networks. The Ghanaian Parliament has passed the Ghana Bauxite Integrated Aluminium Industry Act which would provide a legal framework to exploit country’s bauxite deposits.
Yet the government says it still has to validate the true worth of the bauxite deposit in the forest.
As a botanist I view the Atewa landscape as a scientific gold mine. A recent impact assessment by the US Forest Service corroborates the concerns of several conservation groups about the potential damage that mining would cause.
I believe strongly that Atewa is not for mining and that it must be preserved. Firstly, it needs to be preserved as a living natural history laboratory. Secondly, it should be protected because it provides a vital resource – water. Thirdly, it is a precious gift whose value cannot be quantified, but which must be lived, felt and appreciated. Finally it is a naturally bequeathed heritage that must be protected for future generations to enjoy.
An interesting characteristic of the Atewa forest is that the canopies of its trees are not easily visible as they merge with the surrounding clouds creating a beautiful cloud cover line. This is very rare in the Ghanaian landscape. This feature is described in local parlance as the phenomenon in which the trees are in direct communication with the firmament of the heavens and bring good tidings to the ground underneath.
Scientifically, the phenomenon is responsible for the daily condensation of water vapour which falls as precipitation. As a result the mountain top is kept permanently moist. This in turn explains the interesting hydrological networks beneath the soil surface. The water percolates down to create under ground water ways as well as water falls and many streams and tributaries that coalesce or combine to form Ghana’s famous three rivers. These are the Ayensu, Birim and Densu.
The three eventually drain their basins as they meander through the forests and farm fields providing essential water resources to over 5 million inhabitants. They also deposit suspended clay and silt materials as fertile alluvial for crop production during the rainy periods when they burst their banks and overflow.
The Atewa landscape provides rich forest cover for climate regulation, a show piece to illustrate climate adaptation to avoid drought, reduce poverty and enhance sustainable livelihoods and improve human well being in its catchment area.
The landscape has been the subject of research by geologists, hydrologists and geo-morphologists. A geologist studies studies the solid, liquid, and gaseous matter that constitute the Earth while a geo-morphologist studies the earth’s surface. A hydrologist is a scientist who researches the distribution, circulation, and physical properties of the earth’s underground and surface waters.
Studies of the fauna and flora of the area have brought up new scientific discoveries of species like the critically endangered white-naped mangabey Cercocebus lunulatus. This shows that the knowledge of the faunal and floristic diversity and to a large extent the microbial diversity is still at the exploratory stages.
I would strongly argue that the Atewa landscape is an important species discovery destination, awaiting extensive research and studies. It should, therefore, not be disrupted or destroyed by mining.
Tullow Plc has made oil discovery in its Jethro-1 exploration well, drilled on the Orinduik licence offshore in Guyana.
The well is expected to hold 100 million barrels of oil in excess of expectations. Tullow Guyana B.V. is the operator of the Orinduik block with a 60 per cent stake. Total E&P Guyana B.V. holds 25 per cent with the remaining 15 per cent being held by Eco(Atlantic) Guyana Inc.
Mr Kweku Andoh Awotwi, the Executive Vice President, Tullow Ghana, said the initial discovery suggested that it was in commercial quantities.
Mr Awotwi was speaking to journalists on the sidelines of the Tullow Ghana Media Capacity Building Programme on Essentials of Upstream Oil and Gas Industry in Accra.
The two-day training is designed to equip participants with fundamental knowledge of the oil and gas sector. It is also to provide an in-depth understanding into technologies, coverage and operations, particularly in Ghana of the sector.
The event was facilitated in collaboration with the Aberdeen Drilling School and the RigWorld Training Centre. He said the discovery in the South American country meant that there are opportunities for people in the Tullow organisation.
“At one hand it is good for Tullow PLC and at the other hand it is good for staff of Tullow Ghana, currently half of the people on the rig are Ghanaians,” he said.
The Executive Vice President said more wells needed to be drilled to see what was in there.
A statement issued by the Company said the Jethro-1 was drilled by the Stena Forth drillship to a Total Depth of 4,400m metres in approximately 1,350 metres of water. It said an evaluation of logging data confirmed that Jethro-1 was the first discovery on the Orinduik licence and comprises high quality oil bearing sandstone reservoirs of Lower Tertiary age.
The well encountered 55m of net oil pay which supports a recoverable oil resource estimate which exceeds Tullow’s pre-drill forecast.
It said Tullow would now evaluate the data from the Jethro discovery and determine appropriate appraisal activity.
This discovery significantly de-risks other Tertiary age prospects on the Orinduik licence, including the shallower Upper Tertiary Joe prospect which will commence drilling later this month following the conclusion of operations at the Jethro-1 well.
The non-operated Carapa 1 well will be drilled, later this year, on the adjacent Kanuku licence to test the Cretaceous oil play.
Access to energy plays a critical role in economic development. But bad government policies have affected energy security in many developing countries.
It is estimated that two out of three households (almost 600 million people) in sub-Saharan Africa have no access to electricity. Ghana has also had its challenges. A shortage of generating capacity led to rationing in 2014 and 2015, with serious consequences for the economy.
Nearly five years later the country faces the exact opposite problem: excess electricity. Ghana’s Finance Minister Ken Ofori-Atta set out the scale of the problem in his mid-year review budget on July 29. He said that the problem posed grave financial risks to Ghana’s economy. This is because the government is carrying legacy debt in the energy sector, which threatens to put a huge strain on its finances.
According to Ofori-Atta, plans have been put in place to deal with the challenges in the energy sector. A recommendation has since been made to Parliament to support the renegotiation of all take-or-pay contracts to take-and-pay.
How did Ghana move from not having enough power five years ago, to being burdened with a massive energy bill as well as too much electricity?
At the heart of Ghana’s problem was how it responded to the power shortages in 2014. These hit the economy hard, leading to the mining and manufacturing sectors contracting, and unemployment going up. To address the problem, the government fast-tracked private power plants. The current glut in electricity – as well as the cost overheads – can be attributed directly to the way in which the contracts were drawn up.
Ghana’s experience is a cautionary tale for countries that find themselves in a situation of having too much electricity at any given point. Without careful forward planning, proper data-driven analysis, and transparent, competitive, corruption-free contracting processes, any country could find itself in the same situation as Ghana.
Emergency power producers
Due to challenges with public financing of energy infrastructural projects, many countries – including Ghana – have been turning to the private sector for investment in the energy sector. As a result independent power producers are receiving much more attention on the continent.
At the heart of Ghana’s energy sector challenges were the take-or-pay contracts signed by the government. To address the shortfalls it was facing, it contracted three emergency power producers during the 2014 - 2017 period. The contracting was done without a competitive process. On top of this the government signed 43 power purchase agreements.
But the demand for electricity never went up at the anticipated rate due to tariff increases and slow economic growth. As a result, the plants ended up producing excess capacity. The installed capacity according to the Energy Commission of Ghana is 5,083 MW, almost double the peak demand of 2,700 MW. Of this, 2,300 MW has been contracted on a take-or-pay basis. This means that Ghana is contractually obliged to spend money for excess capacity that’s not being consumed.
The result is that the government is paying over US$500m (almost Ghana Cedis 2.5 billion) annually for power generation capacity that’s not being used.
There is also an overhang for gas. And because the government contracted gas supply on a take-or-pay basis, it must pay whether the gas is utilised or not. Thus, from 2020, if nothing changes, Ghana will face annual excess gas capacity charges of between US$550 and US$850 million yearly. This is even after the current government terminated two other liquefied natural gas contracts in 2017.
Independent power producers
Ghana’s excess electricity problem – and its solution – boils down to the arrangements made with independent power producers.
The contracting process failed to avoid a number of pitfalls. These included:
A lack of flexibility in contracts. The terms and conditions are often difficult to change once purchase power agreements are signed because of a fear of putting off future investors.
Fixing prices in foreign currency exchange, typically US dollars.
Threatening competition. According to a World Bank report, independent power producers often suffocate competition once in operation. There is huge potential for inefficiencies if the independent power producers meet a large share of the load.
Inflated prices: the World Bank report argues that independent power producers often inflate supply prices for utilities, which raises end-user prices.
Currency risk protection: unlike other foreign investments, investors in independent power producers are often shielded from currency risk. Most negotiate take-or-pay contracts where all the power generated must be bought whether needed or not. Because payments are made in dollars, this becomes more like international debt than equity investment.
Corruption. This often creeps in when the stakes are high in contract negotiations. They are often done secretly and only become visible when there is a change of government. As the Public Services International Research Unit puts it: “Establishing power generation in excess of the country’s requirements is a feature associated with corruption ….if the process provides an income source for those negotiating the contracts”.
Political expediency. According to a Business Insurance report “the fundamental problem with creating independent power producers in developing countries is that initially it is based on political expediency. These things sometimes bear no relation to economic reality.”
Independent power producers have contributed immensely to Ghana’s quest to meet its power generational capacity. But lessons from Ghana’s excess electricity challenges show that unless negotiations are done with utmost transparency and care, agreements that are struck can pose financial risks and breed corruption.
This precautionary principles would save many countries from experiencing the same fate as Ghana.]
Ghana has been chosen by the African Union (AU) to host the secretariat of the African Continental Free Trade Area. It beat other competing countries including Egypt, Eswatini, Ethiopia, Kenya, Madagascar and Senegal to win the bid.
As a free trade area, member countries have come together and agreed not to impose tariffs, quotas and other trade barriers on goods and services. The agreement is expected to enlarge markets and diversify exports, particularly manufactured goods. According to US-based think tank the Brookings Institute, intra-African trade stands at about 14%, while the share of manufactured goods to the rest of the world stands at 18%. Trade among Asian countries is much higher – at 59% – and even higher among European countries at 69%. The hope is that the African free trade area will boost trade across the continent by 52% by 2022 .
The core mandate of the secretariat will be to implement the free trade agreement, which has been ratified by 25 out of 54 countries. Once all have ratified the deal, it will create the world’s largest free trade area since the formation of the World Trade Organisation in 1995.
Africa’s free trade area will cover a market of 1.2 billion people with a combined Gross Domestic Product (GDP) of US$2.5 trillion.
The secretariat’s job will be to recruit personnel, train them, and develop organisational capability. The secretariat will also have to implement policies handed down by the governing body, keep the media informed, organise conferences and identify potential funding sources. It will also monitor and evaluate the progress of policies and programmes.
This is a first for Ghana which has not hosted a continental secretariat. The hope is that it can emulate the success of other African capitals that have befitted from hosting the AU and the United Nations. Addis Ababa is home to the AU headquarters while Nairobi hosts two of the UN’s biggest bodies. For its part, South Africa hosts the Pan-African Parliament.
The presence of the AU in Addis Ababa has been credited with an increase in property valuations as well as job creation.
In making its bid, Ghana took advantage of its strategic geographical location in West Africa. It has put a great deal of effort into making the country a gateway and a trade hub in West Africa.
Hosting the free trade area secretariat will come with costs and benefits - direct and indirect.
In establishing its credentials to host the secretariat, the Ghanaian government would have set out the country’s most notable achievements.
These would have included the fact that it’s been an exemplary member of the AU. For example, in 2007 it was among the first countries to be reviewed by the African Peer Review Mechanism – the self-assessment mechanism used to measure good governance.
The fact that it put its hand up sent a signal to other countries that the peer review process was credible.
Other factors that would have played in Ghana’s favour are that the country’s economy has been showing strong growth.
It is one of the fastest growing economies in the world with an average GDP growth of about 6%. In addition, it comes second to Cape Verde in West Africa in terms of the United Nations Human Development index.
In one of the most unstable sub regions in the world, Ghana also has a tradition of relative peace and security, a key parameter for hosting a secretariat.
In addition, Ghana has had the advantage of learning about trade collaboration through its membership of the Economic Community of West African States (Ecowas).
Costs and benefits
While Ghana has enjoyed benefits from the arrangement, like many other West African States, it has not been able to harness its full potential. For example, border controls remain cumbersome, delaying transits due to the numerous check points, huge unofficial payments at the borders.
The most direct cost to the country will be the $10 million pledged by President Nana Addo Dankwa Akufo-Addo to support setting up the secretariat. The AU is also expected to contribute funds and appeals have been made to international funding agencies.
Ghana’s hope is that hosting the secretariat will boost the hospitality sector – and more broadly the services sector – and generate increased international exposure.
There should also be a boost for job creation as the secretariat hires staff; ranging from economists to translators, administrators and technicians.
There is no clear deadline on when the secretariat is expected to be up and running. The AU itself still has to clear a number of hurdles,, including adopting a structure, staff rules and regulations, and the secretariat’s budget.
Ghana and Cote d’Ivoire have agreed to legislate the minimum producer price to be paid to cocoa farmers as a means to safeguard their income.
The two countries agreed to pay farmers a guaranteed minimum price of 70 per cent of the floor price of $2,600 per tonne.
Mr Joseph Boahen Aidoo, Chief Executive of Cocobod told a press conference on Monday, that farmers would be entitled to bonus payment when the achieved average gross Free On Board (FOB) price at the end of the Cocoa season is between the minimum of $2,600 ($2,700 Cost Insurance Freight (CIF) - $2,900 ($3,000 CIF).
He said the countries agreed that a stabilization account be created under the Cocoa initiative of both countries and provided for in the Charter.
In this respect, two accounts would be set up for each country within the secretariat in Accra where any extra value above $3,000 CIF or $2,900 Gross FOB of the Achieved Weight Average will be deposited.
Mr Aidoo said the only mandate for which monies could be disbursed from the account was for the sole purpose of supporting the Achieved Weight Average if it falls below $2,300 CIF or $2,200 Gross FOB.
“It is instructive to note that, this new arrangement fixes a constant $400 for each tonne of cocoa from the two countries. So for example, with the 900,000 metric tonnes of cocoa produced last year, it would have fetched about $360 million dollars from the upper level of the supply chain to us here in Ghana at the lower level of the cocoa value chain,” he explained.
Ghana’s economy grew 6.7 per cent year-on-year in the first three months of 2019 compared to 5.4 per cent in the same period last year, the Ghana Statistical Service said this week.
The quarter-on-quarter seasonally adjusted growth rate was 1.6 percent compared to 1.7 per cent for the last three months of 2018, Professor Samuel Kobina Annim, Government Statistician said at a News briefing.
Non-oil growth for the first quarter stood at 6.0 per cent year-on-year compared to 4.2 last year.
For the first quarter of 2019, the Services sector expanded 7.2 per cent year-on-year with the information and communication sub-sector recording the highest year-on-year quarterly GDP growth rate of 37.0 per cent.
On the other hand, the Finance and Insurance sub-sector recorded the lowest growth of 2.1 per cent, Prof. Annim said.
The year-on-year quarterly GDP growth rate for Agriculture is 2.2 per cent for the first quarter of 2019.
The livestock sub-sector recorded the highest year-on-year growth rate of 5.5 per cent, while the Forestry and logging sub-sector recorded the lowest, with a contraction of 5.8 per cent.
The year-on-year quarterly GDP growth rate for the Industry sector is 8.4 per cent for the first quarter of 2019.
The Mining and Quarrying sub-sector recorded the highest year-on-year quarterly GDP growth rate of 20.9 per cent for the period, while the construction sub-sector recorded the lowest, with a contraction of 8.7 per cent.
Meanwhile, the Producer Price Inflation fell slightly to 6.7 percent in May from 7.1 per cent in April.
The Mining and Quarrying sub-sector recorded the highest year-on-year producer price inflation rate of 15.1 per cent, followed by the manufacturing sub-sector with 6.2 per cent.
The utilities sub-sector recorded the lowest year-on-year producer inflation of 1.1 per cent.
Ghana and Ivory Coast announced that they had won concessions from stakeholders in the cocoa industry, including acceptance of a $2,600 floor price for a tonne of cocoa.
The two nations had threatened to stop selling their production to buyers unwilling to meet a minimum price.
Following a two-day meeting called by the two top cocoa producers who together account for over 60% of the world’s production, Joseph Boahen Aidoo, chief executive of the Ghana Cocoa Board, told a news conference that their demands had been accepted in principle by the participants.
“Ivory Coast and Ghana have suspended the sale of the 2020/2021 crop until further notice for preparation of the implementation of the floor price,” he said.
Calling the move “historic”, he said that “this is the first time when the producers have called consumers and the first time whereby suppliers have called buyers to come and engage on price,” he said.
“Over the years it has been the buyers who have determined the price for the suppliers.”
Aidoo added that there would be a follow-up meeting to work out how to implement the agreement.
The world’s chocolate market is worth around $100 billion, of which only $6 billion go to cocoa producers.
Joe Ghartey, Ghana’s minister of railways development, says he has cancelled the MoU with the China Railway Construction Corporation Corporation (International) Nigeria Limited (CRCC-Nigeria) “for breach of confidentiality”.
Ghana had entered into CRCC- Nigeria for the construction and rehabilitation of a 560-kilometre standard gauge railway line.
However, after a report in TheCable comparing railway contract costs in Ghana with Nigeria’s, the minister came under pressure to do “damage control”.
In a statement sent to TheCable on Monday, Ghartey acknowledged that the ministry signed an MoU with CRCC-Nigeria.
TheCable had reported that CRCC offered to rehabilitate and construct a 560-kilometre standard gauge railway line for Ghana at $2 billion, with terminals at Aflao and Elubo.
“Messrs CRCC-Nigeria expressed interest in supporting the Ministry to develop and modernise Ghana’s railway network, particularly the Trans-ECOWAS line, which runs along the coast between Aflao, on the border with Togo, and Elubo, on the border with Cote d’Ivoire,” the statement read.
“The purpose of the MoU is for CRCC-Nigeria to undertake feasibility studies through the use of independent consultants.
“CRCC-Nigeria is responsible for verifying the project cost as estimated by the feasibility studies and also raise capital to finance the project.”
However, the minister said his ministry was yet to respond to a proposal by CRCC-Nigeria to establish assembly plants for building locomotive coaches and wagons.
The ministry was, however, silent on the 340-kilometre Eastern line project that is estimated to cost $2.2 billion which will link Accra, Tema and Kumasi,
In March, Rotimi Amaechi, Nigeria’s former minister of transportation, had told reporters that the $1.5 billion allocated for the 146-kilometer Lagos-Ibadan project has been altered due to additional construction work on the project but refused to disclose the new sum.
TheCable understands that the new cost is $2 billion — which is exactly the amount CRCC-Nigeria is offering to construct and rehabilitate the 560-kilometre standard gauge railway line in Ghana.
Ghana obtained a provisional Effective Implementation (EI) rate of 89.89 per cent, the highest by an African country, after the International Civil Aviation Organization (ICAO) concluded its Coordinated Validation Mission (ICVM) this year.
The validation, is in line with the United Nations Aviation Agency’s Universal Safety Oversight Audit Programme (USOAP).
The ICVM assessed Ghana’s safety oversight system on all eight ICAO Critical Elements (CEs), namely: Primary Aviation Legislation; State Operating Regulations; State Civil Aviation System and Safety Oversight Functions; and Technical Personnel Qualification and Training.
The other CEs that were validated included; Technical Guidance, Tools and the Provision of Safety-Critical Information; Licensing, Certification, Authorization and Approval Obligations; Surveillance Obligations; and Resolution of Safety Concerns.
Ghana, recorded a substantial improvement across all eight CEs, and the team from the UN specialised aviation agency identified no significant safety concerns (SSCs).
It comes after a nine-day follow-up onsite activity by a four-member team of experts from ICAO to validate corrective measures undertaken by Ghana following a USOAP audit in November 2006.
Mr Joseph Kofi Adda, Minister of Aviation, Who announced this at a press briefing in Accra, urged the Ghana Civil Aviation Authority (GCAA) to immediately develop an action plan towards the implementation of corrective measures that have been recommended by the ICAO team.
“Ghana’s air transport industry enjoys strong government support, which is a crucial determinant for the aviation sector’s ability to maintain an ICAO compliant regulatory framework and to achieve accelerated sustainable growth of the sector in the years ahead,” he said.
The Minister stated that in line with President Nana Addo Dankwa Akufo-Addo’s vision of re-positioning the country as the sub-region’s Aviation hub, Parliament recently passed the Ghana Civil Aviation (Amendment) Act, 2019 (Act 985) together with the Legislative Instrument on Aircraft Accident and Serious Incident Regulations,2019 (LI 2375) to ensure enhanced compliance with ICAO’s Standards and Recommended Practices (SARPS).
Mr Simon Allotey, the Director-General of GCAA, said the new achievement was an enviable milestone and was a true reflection of the robustness of the country’s safety oversight system, which ultimately translates into improved safety of airline operations.
“By adhering to ICAO’s SARPS related to safety oversight, GCAA effectively ensures that aviation service providers and airline operators maintain an acceptable level of operational safety,” he said.
“Our performance of 89.89 per cent is world-class and places Ghana at the top spot in Africa in terms of safety oversight, considering that the average EI rate on the continent stands at 52 percent, which is lower than the global average of 66.5 percent and below ICAO’s current minimum target of 60 percent,” Mr Allotey added.
The Director-General expressed gratitude to the Ministry of Aviation, Board of Directors, Management and staff of GCAA for the successful outcome of the ICVM, and to the members of the ICAO team for the professionalism, objectivity and cooperation exhibited throughout the process.
The final rating will be communicated to Ghana within six-weeks after validation of the provisional score by ICAO.
An e-commerce platform, Jiji has announced the acquisition of OLX in Ghana and four other counties in Africa.
The details of the deal was made available via a statement by Naspers on Wednesday.
Consequently, OLX users in Ghana would be directed to Jiji marketplace in a transaction backed by one of Jiji’s cornerstone investors, Digital Spring Ventures.
According to the statement, both companies have also reached an agreement to acquire the other OLX businesses in Nigeria, Kenya, Tanzania, and Uganda, subject to regulatory approvals.
The statement noted that all users of the sell-and-buy classifieds websites of OLX Nigeria, OLX Ghana, OLX Kenya, OLX Tanzania, and OLX Uganda would be redirected to Jiji.
The Chief Executive Officer and co-founder of Jiji, Anton Volyansky, while making comment on the deal, said, “Users will always come first for us. We warmly welcome OLX’s customers to the Jiji family and we look forward to our new customers joining Jiji on its …online shopping experience.”
OLX shut down business in Nigeria last year February while it maintained its online marketplace as workers were laid off.