Maritime
Keta Port: Govt invites investors to express interest
Government, through the Ghana Ports and Harbours Authority (GPHA) has invited prospective partners to formally express interest in any aspect (or a combination of aspects) of the Keta Port Project.
This is in a bid to create a fair and competitive opportunity for all potential and interested parties who desire to be a part of the Port of Keta development agenda.
Accra-Lomé railways and roads
GPHA emphasised that the new port’s feasibility is dependent on the development of other port-supporting transportation infrastructure such as railways, roads and highways, particularly the Accra-Lomé and other major routes to the nearest regional capitals.
Master Planning and Feasibility Studies completed
In a request for expression of interest published in the media, GPHA said it has completed the first general Master Planning and Feasibility Studies exercise to validate the site selection process.
Estimated cargo projections calculated
It has also calculated the estimated cargo projections, preliminary socio-economic impact, and potentials for the development of the port, maritime, special economic zones, and port-city clusters relevant to the realization of the Port of Keta Development project.
First-level investment strategy review completed
Also completed is a first-level investment strategy review, considering the basic feasibility indicators within the enclave that should be tweaked to enhance the Project.
Public Private Partnerships
GPHA through its Directorate of the Port of Keta has registered the Project with the Government of Ghana (GoG’s) Public Private Partnerships (PPP) plan under the supervision of the Ministry of Finance.
Major business clusters expected
When completed, the Keta Port Project is expected to create the enabling environment for the development of major business clusters such as terminals (multipurpose, containers, iron ore / dry bulk ore, salts, cruise/passengers/recreation, petroleum bulk, etc.) special economic zones (factories, transit and transshipment storage, value addition services, etc.), maintenance services (shipyards, dry docking, and bunkering) and other services (city development, hospitality, recreational, inter-cultural, etc.).
GPHA in its notice expressed willingness to engage with potential investors, partners who can demonstrate proof of their relevant experience and capability to provide funding and guarantee at least three of the following components:
Capability to fund and construct the main port infrastructure
Capability to fund and construct the main port infrastructure (dredging, land reclamation, quay walls, relevant cargo terminals, supporting administrative facilities and internal roads, etc.) as well as equip and operate the terminals, based on business models in the likeness of project-financed Build, Operate and Transfer (BOT), or similar structures.
Funding of hinterland access roads and highways
Prospective partners must be able to fund the construction and operations of hinterland access roads and highways linking the port to the major trunk road networks, cities, and related public utility infrastructure.
Ability to attract anchor industries
The applicants must also be able to attract anchor industries to establish factories within the Keta area and or nearby regions and generate import and export cargo to feed the port.
Ability to attract partner shipping lines
The partners must also have the ability to attract partner shipping line(s) that will use Keta Port as one of their hubs to provide some guaranteed vessel and cargo traffic through the port.
Funding shipyards, maintenance yards, oil, and gas services enclaves
Bidders must also have the capacity to fund, develop, and operate special services facilities such as shipyards, maintenance yards, oil, and gas services enclaves, etc.
Case-by-case basis engagements
The GPHA will receive expressions of interest and will take time to engage the applicants on a case-by-case basis towards clustering the business interests, recognizing synergies, and coordinating the potential development interests.
Extensive due diligence
It will also exercise the right to conduct extensive due diligence to seek to verify any or all claims in any of the submissions.
- VALCO workers asking for dollar indexed salaries untenable – 4 November 2022
- 2022 Fuel price increases: Petrol-94%, diesel-136% in 10 months – 19 October 2022
- Coalition: New producer price too low, it will kill cocoa industry – 18 October 2022
Mr Michael Luguje, Director General of the Ghana Ports and Harbours Authority (GPHA) has disclosed that an investment capital of $200 million is needed to revamp the PSC Tema Shipyard.
The Shipyard, which operates as a separate entity was handed over to the GPHA to manage, operate, and attract investors into the shipbuilding activity.
Mr Luguje said the Shipyard, which was originally part of the Tema Port project, was separated and had gone through a lot of phases before the government handed it over to the GPHA to prepare it and look for a strategic partner to invest in it.
The GPHA Director General told the Ghana News Agency in Tema that in 2017, GPHA started to retool the Shipyard as it bought some equipment to make it attractive to investors.
He noted that as the biggest shipyard in Central and West Africa, up to $200 million was needed to modernize it.
He explained that the GPHA still supported the operations of the Shipyard as there was a lot of prospects for it and stressed that retooling could be gradual.
Mr Luguje said: “The way the Shipyard is now; it cannot borrow even up to $10 million on its own therefore investors are needed. The GPHA was also not in a position to borrow more since it has invested a lot into the Tema and Takoradi Ports.”
GNA
- VALCO workers asking for dollar indexed salaries untenable – 4 November 2022
- 2022 Fuel price increases: Petrol-94%, diesel-136% in 10 months – 19 October 2022
- Coalition: New producer price too low, it will kill cocoa industry – 18 October 2022
Effective January 2023, the 30% discount on import values of general goods and 10% discount on home delivery value (HDV) of used vehicles will no longer apply.
Consequently, valuation of all goods will continue to be done in line with the World Trade Organization (WTO) valuation agreement, WCO Customs Valuation Compendium and the customs act 2015 (act 891) section 60 on used motor vehicles and section 67 relating to general goods.
In a notice to the trading public, Ghana Revenue Authority (GRA) has scrapped the policy in its entirety.
Benchmark Value Discount Policy introduced in April 2019
In an attempt to make the Ghanaian ports competitive, reduce smuggling and increase government’s revenue from the port, government in April 2019 introduced Benchmark Value Discount Policy.
50% discount on general goods
The policy provided a discount of 50% on the delivery or benchmark values of imports with the exception of vehicles.
30% discount on used vehicles
The delivery values for used vehicles were reduced by 30%.
Govt loses GH¢9bn
Government lost nearly GH¢9 billion in revenue from taxes generated on imported goods as a result of the introduction of the benchmark values which resulted in reduction of duties.
The amount was lost between April 2019, when the implementation of the policy started, and March
Traders did not reduce prices
Despite the reduction in duties, there was no corresponding reduction in the prices of imported goods on the Ghanaian market.
AGI opposes policy
Association of Ghana Industries (AGI) opposed the policy arguing that it had cheapened imports and dampened demand for local substitutes, leading to the collapse of local manufacturing companies.
The Association made the point that while a number of countries offered export rebates to their firms to develop export trade, Ghana’s benchmark discount policy offered universal import rebate that only promoted importation and that policy distorted the micro and macro-economic fundamentals.
Guided by the overarching framework of Ghana’s industrial transformation agenda, one district, one factory (1D1F) initiatives, Planting for Food and Jobs, Fertilizer subsidy and Ghana’s export development agenda, the AGI is of the view that the benchmark discount policy in its current form runs counter to the government’s own agenda to industrialise.
In the 2022 Budget Statement, indicated government’s intention to review the policy in respect of all imports followed by a communication to remove the discount policy.
The government however suspended moves to remove the discount policy to allow for extensive stakeholder engagement on the viability of the policy and its impact on both government revenue and the domestic manufacturing industry.
Policy reviewed in March 2022
After extensive stakeholder engagements the discount offered for vehicles was reduced from 30% to 10% while discount for all other goods was also reduced from 50% to 30% effective on Tuesday, March 1, 2022.
Now, the government has completely scrapped the policy.
- VALCO workers asking for dollar indexed salaries untenable – 4 November 2022
- 2022 Fuel price increases: Petrol-94%, diesel-136% in 10 months – 19 October 2022
- Coalition: New producer price too low, it will kill cocoa industry – 18 October 2022
Eight countries have commenced guided trading under African Continental Free Trade Area (AfCFTA).
The initiative seeks to test the operational, institutional, legal, and trade policy environment under the AfCFTA, and to send an important positive message to African economic managers.
Rationale
The guided trade initiative aims to test the readiness of participating state parties under the AfCFTA, demonstrate that the AfCFTA trading documentations are operational and viable and confirm that the Customs and Revenue Authorities of the participating countries under the AfCFTA agreement are ready to process imports and exports.
It is also expected to serve as a gateway to encourage continued trade under the AfCFTA, resulting in a multiplier effect and increased opportunities for SMEs, youth and women in trade and ultimately establishing sustainable and inclusive economic development.
The 8 countries
The eight countries are Ghana, Kenya, Rwanda, Tanzania, Egypt, Mauritius, Cameroon and Tunisia.
5 African Union regions
These countries were selected to represent the five African Union regions, namely: Western, Central, Eastern, Southern and Northern Africa respectively.
Matchmaking businesses and products
The guided trade initiative facilitates trade under AfCFTA through matchmaking businesses and products for export and import between these interested state parties.
96 different products
At least 96 different products from the eight countries could be freely traded under the rules of AfCFTA.
Types of products approved so far
Products approved to trade under AfCFTA include horticultural products, pharmaceuticals, rubber, aluminum kitchenware, sugar, steel, and wooden products.
Duty-free and quota-free trading
These products originating from Africa will enjoy duty-free and quota-free trading among the partnering countries.
Tariff schedules
According to the AfCFTA Secretariat, participation in the guided trade initiative depends on whether countries have submitted their tariff schedules in accordance with the agreed modalities to trade preferentially amongst themselves.
Accra launch
Launching the guided trade initiative in Accra, Secretary-General of AfCFTA Wamkele Mene, said ”this is the moment the founding mothers and fathers of the Organization of African Unity have longed (for).
“We have finally honored and made reality the vision of those who liberated our continent.”
“We are connecting East Africa to West Africa, North Africa to Southern Africa. Trade will be the driver of inclusivity, creating opportunities for young Africans.
“So we have taken the first journey today, and I hope in 15 years, we will have succeeded in lifting millions and millions of Africans out of poverty.”
Products double or triple by next year
Mr Mene, said the launch was marked with a total of 96 products traded by eight countries and the number is expected to “double or triple” by next year.
Africa’s economic development at stake
He said it is more than just a legal test and more than just ratification because it is Africa’s economic development at stake.
“I am extremely proud that we are able to demonstrate to ourselves as Africans that we have the capacity and inclination to achieve this,” he said.
More countries expressing interest
Mr. Mene announced that more and more state parties are expressing interest as they conclude the process of domesticating the AfCFTA in their law.
East African member states dominate
East African member states have dominated the list of countries that have domesticated AfCFTA adequately to facilitate commencement of trade under the trading bloc’s framework.
Three out of the eight countries that have set the stage for trading under AfCFTA are from East Africa.
Kenya and Uganda export to Ghana
Kenya and Uganda have already undertaken trade under the AfCFTA Guided Trade Initiative with Kenya having exported exide batteries worth $77,000 on September 23 to Ghana following importation by Yesudem Company Ltd.
Kenya exports tea to Ghana
Kenya made its second export under the AfCFTA Guided trade initiative on October 5 which consisted of tea exports to Ghana.
The tea consignment exported from Kenya to Ghana had been produced by small-scale farmers and so there is a significant opportunity for small-scale.
Ghana to export ceramics to Cameroon
Under the guided trade initiative, Keda Ceramics of Ghana will export ceramic tiles to Cameroon.
Ghana to export palm kernel oil Kenya
Benso Oil Palm Plantation is also slated to export palm kernel oil to Kenya and Ghana will also receive approved goods from participating State Parties.
Minister for Trade and Industry Alan Kyerematen noted that the launch of guided trade among seven countries was symbolic in many ways.
“It symbolizes that AfCFTA is not just on paper but a reality. And we are moving from talk and negotiations to action.
“It also symbolizes that governments in Africa who have been involved in the negotiations are now giving way to the private sector to make it a reality,” Kyerematen stated.
Ghana building capacity of 200 companies
The National AfCFTA Coordination Office is also working with over 200 identified companies to help build their capacities to enhance competitiveness in the African markets.
On January 1, 2021 the AfCFTA Secretariat formally started trading under the AfCFTA agreement.
Since then, the Secretariat and State Parties have been working to put in place structures, procedures, processes, protocols, and documentation needed to enable the commencement of commercially viable trade amongst State Parties.
Africa still faces significant challenges in navigating logistical hurdles which present non-tariff barriers to the acceleration of trade under the Guided Trade Initiative.
The United Nations Conference on Trade and Development (UNCTAD) places intra-African exports at 16.6% lagging far behind Europe’s 68.1% and Asia’s 55%.
The agreement establishing the AfCFTA was signed in Kigali, Rwanda, on March 21, 2018.
- VALCO workers asking for dollar indexed salaries untenable – 4 November 2022
- 2022 Fuel price increases: Petrol-94%, diesel-136% in 10 months – 19 October 2022
- Coalition: New producer price too low, it will kill cocoa industry – 18 October 2022
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