Ghana Is the Star in IMF’s 2019 Economic Growth Forecast
Ghana will be the fastest-growing economy in the world this year, according to the International Monetary Fund. The lender’s growth forecast of 8.8 percent for the producer of cocoa, gold and oil dwarfs the 6.6 percent median in a Bloomberg survey. The IMF’s projection in its latest World Economic Outlook published Tuesday is “way too generous,” Neville Mandimika, an analyst at FirstRand Group Ltd.’s Rand Merchant Bank, said on Twitter.
Ghana holds rate but won’t hesitate to tighten if needed
Ghana’s central bank left its policy rate steady at 16.0 percent but said it would not “hesitate to take immediate and decisive policy actions including on a tighter monetary policy stance, should these risks materialize and threaten to dislodge the disinflation process.”
The Bank of Ghana (BOG), which has been in a monetary easing cycle since November 2016, said its monetary policy stance is still relatively tight and real interest rates in Ghana are comparatively high but there are risks to its outlook for inflation from the depreciation of the cedi.
After BoG cut its rate by another 100 basis points in late January, the cedi fell around 11 percent in February through mid-March, with BOG attributing this to seasonal pressures on the back of foreign exchange demand by importers and corporates, and sentiment over the economic outlook after the completion of the IMF-supported program and its implication for the next election cycle.
The cedi was trading at 5.35 to the U.S. dollar today, down 9 percent this year.
Although the full pass through of this depreciation to inflation has yet to be assessed, BOG noted the overshooting of the exchange rate had corrected to 5.2 percent at the end of March compared with 8 percent as of March 19, and is of the view that a slowing pace of disinflation and upside risks to the outlook for inflation are not enough to dislodge inflation expectations.
Since November 2016 BOG has cut its key rate by 10 percentage points as inflation has steadily declined.
Ghana’s inflation rate rose to 9.2 percent in February from 9.0 percent in January but this is well down from over 19 percent in March 2016, helped by the tight monetary policy stance, and inflation is still within BOG’s medium-term target band and inflation expectations remain well-anchored.
Ghana’s economy remains relatively strong, BOG said, adding the negative output gap seems to be closing at a relatively modest pace and 2018 growth is projected at 5.6 percent after average growth of 6.1 percent in the first three quarters, with 2018 non-oil output growing at 5.8 percent.
For 2019 growth is projected to rise to 7.6 percent, with the composite index of economic activity showing growth of 3.2 percent in January, up from 2.4 percent in December.
Helped by slightly higher crude oil and gold prices amidst lower cocoa prices – Ghana’s three main exports – Ghana’s trade surplus improved to 1.3 percent of GDP in the first quarter from 1.1 percent in the same period last year, leading to a 0.3 percent surplus in the current account.
Together with inflows from Ghana’s $3 billion Eurobond in March, the balance of payments is estimated to show a surplus of some US$3.135 billion, or 4.6 percent of GDP, for the first quarter. Excluding the Eurobond proceeds, the surplus is seen at $449 million.
Government of Ghana announces 10 measures to make Ghana an easier place to do business
A multisectoral technical team from across Government agencies presented the ambitious business reform plan to key stakeholders at Labadi Beach Hotel.
The planned reforms are within the framework of the World Bank Group’s Doing Business Report, which provides objective measures of business regulations for local firms in 190 economies and selected cities at the subnational level. The reforms will cover starting a business, obtaining construction permits, getting electricity, trading across borders, and resolving insolvency.
“These reforms are further demonstration of government’s commitment to removing the obstacles that have long kept businesses in Ghana from reaching their full potential. We aim to unleash the Ghanaian entrepreneurial spirit and open our doors to the world” Vice President Bawumia said.
The Doing Business Report has become the global benchmark for measuring how friendly countries are for businesses. The “zero-sum ranking” fosters keen competition among countries as those that don’t reform faster than their peers can go down in the ranking even if their business environment does not change. Ghana ranked 114thin the 2019 ranking, up from 120th in 2018.
“Through our work in advising Government in over 80 countries globally and over 30 in this region, we know that having the commitment at the highest level of leadership is one of most important ingredients of the reform agenda,”said Ronke-Amoni Ogunsulire, IFC Country Manager for Benin, Burkina Faso, Ghana, Niger, and Togo. “With the appropriate reform structures in place, efficient coordination and accountability mechanisms, Ghana has the right formula to succeed and implementing an investment climate conducive to growth of businesses” she added.
Ghana’s reforms which will take effect between March and June 2019 include:
1. For companies applying to register without a TIN number, the TIN number will now be generated automatically online at the point of application;
2. Launch of a mobile app and an online platform for the ease of filing tax returns; Individuals will be able to file their taxes online by April 2019
3. Implementation of an electronic justice system that allows the automated serving of court process with speed and ease;
4. Removal of the requirement for a commissioner of oaths in registering a company when the companies bill is passed;
5. Merger of all four starting-a-business application forms: TIN application, SNNIT application, Business Operating Permit application and Business Registration forms;
6. Automation of the application for Business Operating Permit along with instant online issuance following payment;
7. Reduction and automation of the steps to getting electricity;
8. Automation of the construction permit system along with instant online issuance following payment;
9. Reduction in physical examination of containers through the use of risk engine;
10. Government is working towards the passing of the Insolvency Bill and the Companies’ Bill into law by Parliament.
The objective of the Doing Business Stakeholders workshop was to engage and create awareness within the private sector which is ultimately the beneficiary of the ambitious reforms introduced by the Government of Ghana.
Africa should strive for its own ‘Nordic values’
Norway and its Scandinavian neighbours have long been viewed as global leaders when it comes to gender parity and wider environmental, social and governance (ESG) issues. I was therefore surprised to see that the Norwegian oil fund had only recently published its position paper on board diversity (“Norway’s oil fund backs gender equality push”, Report, February 16), views that it had reportedly held since 2018.
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The COVID-19 pandemic has been tough on everyone, but women have shouldered the bulk of the burden at home and at work.
Most years, International Women’s Day offers an opportunity to focus on the progress the world has made in pursuit of gender equality. Over the past decade, we have made huge leaps around the world. But sadly, this year feels different. The COVID-19 pandemic has been tough on everyone, but women in particular have shouldered much of the burden at home and at work. Years of progress have ground to a halt or, in some areas, regressed.
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The Role Of The Company Secretary Under The Companies Act, 2019 (Act 992)
Over the years, ALA has been approached by various groups of people wishing to incorporate their new entities with wide ranging objectives and activities. Very often, the request for these services, have come with an additional request for our company secretarial services.
It is observed that whiles a number of companies routinely engage the services of Company Secretary in satisfaction of the requirements for the incorporation of a company, a vast majority of these companies do not seem to appreciate the nature and role of the Company Secretary in the governance structure of a company. Indeed, this paucity of knowledge regarding the role of the Company Secretary in the day-to-day operation of a company also holds true as far as the nature and role of the Board of Directors (“Board”) of a company is concerned. It is envisaged that the role and legal remit of the Board will be the subject of another publication in the future.
The aim of this article is to outline the role of the Company Secretary as enshrined in the Companies Act, 2019 (Act 992) (“the Act”), which is the current legislation relating to companies. The Act was immediately preceded by the Companies Act, 1963 (Act 179) (“the previous Act”).
The Appointment of the Company Secretary
Usually, Company Secretaries are appointed by the first directors at incorporation. The appointment is done by letter, which would indicate the conditions of service, including remuneration. The candidate would then have to consent to the role in writing and the written consent must be filed at the Registrar Generals Department (“RGD”). The requirement to consent in writing is a requirement imposed by Act 992; which is perhaps a reflection of the gravity of the task the Secretary is required to perform under the Act.
The Company Secretary can be changed subsequently by the passing of a resolution by the Board.
Who qualifies to become a Company Secretary?
In terms of qualification, it can be observed that Act 992 departs radically from the repealed Act 179. The repealed Act 179 provided that all companies must have a Company Secretary (above the age of majority) without spelling out what qualifications the proposed Company Secretary should have. In contrast, Act 992 outlines various stringent requirements that a person ought to satisfy to qualify for appointment as Company Secretary.
The enhanced role of the Company Secretary under the current arrangements is a reflection of the centrality accorded to the Company Secretary in keeping the corporate governance machinery in motion. It also stems, in part, from lessons drawn from the recent corporate governance failures arising from lack of control and supervision of several financial institutions, lack of governance policies and programmes, inefficient Boards and Board Action which culminated in the collapse of several financial institutions in Ghana.
Under Act 992, the Company Secretary for any Company must have:
i. obtained a professional qualification or a Tertiary level qualification as that equips the Company Secretary to have the requisite knowledge and experience to efficiently perform the functions of a Company Secretary; or
ii. must have previously been appointed as a Company Secretary; or
iii. been practicing under the supervision of a qualified Company Secretary for a period of at least three years; or
iv. is a member in good standing of the Institute of Chartered Secretaries and Administrators; or the Institute of Chartered Accountants; or a barrister or Solicitor in good standing, or
v. by virtue of an academic qualification, or as a member of a professional body, appears to the directors as capable of performing the functions as the secretary of the company.
It is observed from the foregoing, that the qualifications for the Company Secretary are enhanced under Act 992, with the expectation that a person who occupies that position has a sufficient level of education, skill and experience to perform the now broadened functions under Act 992.
It is further explained in the Act that “a professional or tertiary level qualification is a discipline with an offering in company law practice and administration”.
The new requirements suggest that at the minimum, the Company Secretary should have a good knowledge of company law and legislation. This is critical because of the advisory role they play to the Board of Directors. In practice, the Company Secretary must also be conversant with relevant regulations governing the sector or industry to which the company belongs, in particular where they relate to corporate governance.
It must be noted that these restrictions on the appointment to the role of Company Secretary applies to both public and private companies.
What does the Company Secretary do?
Compared to the previous legislation, the Act broadens the duties of the Company Secretary and elevates the role. In addition to the traditional duties of issuing notices, recording minutes, drafting resolutions and filing statutory documents, company secretaries now play an advisory role to the shareholders and the directors of the company. The company secretary per the Act steers the affairs of the Board for the effective governance of the company.
The duties of the Company Secretary as provided for by Section 212 of the Act include the following: –
a) assisting the Board to comply with the constitution of the company and with any relevant enactment;
b) keeping the books and records of the company;
c) ensuring that the minutes of the meetings of the shareholders and the directors are properly recorded in the form required by the Act;
d) preparing and issuing out notices in the name of the company;
e) ensuring that the annual financial statements of the company are despatched to every person entitled to the statements as required by the Act;
f) ensuring that all statutory forms and returns are duly filed with the Registrar;
g) maintaining the statutory registers of the company;
h) providing the Board with guidance as to the duties, responsibilities and powers of the Board and on the changes and development in the laws affecting the operation of companies;
i) informing the Board of legislation relevant to or affecting meetings of shareholders and directors, and their failure to comply with the legislation and reporting accordingly at any meeting; and
j) advising the directors on their responsibilities as directors.
How important is the role of the Company Secretary?
The importance of the company secretary’s role has thus far merely been seen to be akin to the role of an office secretary, which is a very flawed perception of who a company secretary is.
The current as well as the previous Act makes it mandatory for every company to have a company secretary – which may be either an individual or a corporate body. Section 211(6) of the Act provides that “where a company carries on business for more than six months without a Company Secretary, the company and every officer of the company that is in default is liable to pay to the Registrar an administrative penalty of twenty-five penalty units (GHC300.00) for each day that the company continues to carry on business without a Company Secretary after the expiration of the period of six months”.
Where the position of the Company Secretary becomes vacant, the Act provides that “an act required or authorised to be done by or to the Company Secretary may, if the office is vacant or there is not for any other reason, a person capable of acting as Company Secretary, be done by or to an assistant or a deputy Company Secretary or any other officer of the company appointed by the directors to be acting Company Secretary”.
The foregoing is a depiction of the importance of the role of the Company Secretary. The role is indispensable and is the fulcrum that underpins the effective management of any corporate entity.
Although there is still the traditional “secretary” aspect of the role of a Company Secretary, this aspect is no longer the most relevant. The role of the Company Secretary has evolved from merely being an administrative assistant to the Board, to one which embodies a wider role of guiding and advising the Board and being at the helm of affairs where corporate governance is concerned. As stated above, the Board depends on the Company Secretary to guide and advise them not only on their statutory duties but also on corporate requirements and changes to the law.
In Ghana, we have in recent years come to learn the importance of maintaining governance structures that work for the effective running of our companies. The recent banking sector clean up clearly highlights the lapses in our governance structures and/or the flagrant disregard for corporate governance. Act 992 strengthens our corporate governance systems in many ways that would go a long way to ensuring the right checks and balances are in place for our companies to succeed. The role of the Company Secretary has no doubt grown in importance.
This specialised role of the Company Secretary in the Act requires the services of a qualified and competent individual or organisation to ensure compliance with the laid down requirements. The effective functioning of the Board, no doubt depends on the competence of the Company Secretary. The Company Secretary can be seen as the guardian of the company’s proper compliance with the law and best practice.
By Mansa Williams
Associate | Africa Legal Associates
ALA’s Nana Adjoa Receives Scholarship Award from 30% Club
The 30% Club is a global campaign led by Chairs and CEOs of top companies in the world, taking action to increase gender diversity at board and senior management levels to 30% and beyond.
By this award, Nana Adjoa, who is pursuing an Executive MBA at Imperial College, will represent the school as an Ambassador for Women in Leadership and will support the recruitment of high calibre candidates for future years in different ways, including: attending recruitment events, being featured in promotional materials and contributing to social media activity.
The Executive MBA Scholarship, was awarded to Ms Hackman based on the strength of her application and interview performance.
Already with a distinction in LLM from University of Dundee in Petroleum Law & Policy, obtained in 2009, her Executive MBA programme, which starts this February, will provide her with a thorough knowledge of all the essential business disciplines, as well as opportunities to specialise in areas that will directly benefit her role as Managing Partner of ALA, one of Ghana’s leading corporate law firms.
Nana Adjoa is a leading woman entrepreneur in Ghana, and has over the last 18 years, established and helped run businesses in real estate and mass media. She co-founded ALA in 2015, and before her current role, was the Company Secretary and Head of the Legal Department of United Bank for Africa (Ghana) Limited.
She is a member of the board of Asaase Broadcasting Company Ltd, which owns Asaase Radio in Accra and Kumasi. She is also a director of Gab Productions Limited, which owns the daily newspaper, The Statesman. Nana Adjoa served as a director of the eighth board of the Ghana National Petroleum Corporation.
She will play a particular role in initiatives to encourage women’s participation in MBA education and to champion gender parity within Imperial and beyond.
Under the leadership of Global Chair, Ann Cairns, the campaign of the 30% Club continues to expand its international footprint with presence in multiple countries/regions around the world.
“DEMOCRACY HAS BEEN BENEFICIAL FOR GHANA AND AFRICA” – PRESIDENT AKUFO-ADDO
“Democracy has been beneficial for the continent and for our country. We know, however, that the price of freedom is eternal vigilance, and vigilant we shall be here in Ghana. We shall not let our guard down, and allow the clammy embrace of the people by anti-democrats, who are disdainful and incapable of effective popular mobilisation through accepted channels, but who want shortcuts to power without the express support of the people.”
These were the words of the President of the Republic, Nana Addo Dankwa Akufo-Addo, when he delivered a speech at the 2021 Ghana Bar Conference, held in Bolgatanga, capital of the Upper East Region, on Monday, 13th September 2021.
Addressing the gathering, President Akufo-Addo data and history have proven, beyond all reasonable doubt, that all aspects of national life have witnessed significant improvements under democratic dispensations, in comparison to periods of military rule.
According to the President, “The 1970s and 1980s, the periods of unbridled authoritarian rule on the continent, were the eras of economic decline, worsening poverty, collapsing infrastructure and insecurity on our continent. GDP per capita in 1970, for example, according to the World Bank, stood at $220”.
He added that the “third wave of democratization” in Africa, beginning in the 1990s, saw GDP per capita rise, substantially, to six hundred and five dollars ($605) in 1995, declined marginally to five hundred and forty-seven dollars ($547) in the year 2000, and, in 2017, increased to one thousand, five hundred and fifty dollars ($1,550).
In Ghana, President Akufo-Addo stated that GDP per capita was three hundred and ninety-eight dollars ($398) in 1990, declined to two hundred and fifty-eight dollars ($258) in 2000, and it is now two thousand, two hundred and twenty-three dollars ($2,223).
Another key index of Human Development, life expectancy at birth, he said, was estimated by the World Bank at forty-five (45) years in 1970 in sub-Saharan Africa.
“By 1990, this had increased to fifty (50) years, and, in 2019, life expectancy at birth on the continent was sixty-one (61) years. In Ghana, it was forty-nine (49) years in 1970, and sixty-four (64) years in 2019. According to data from the World Bank, primary school enrolment in sub-Saharan Africa in 1970 stood at 54%, and had increased to 98.9% in 2019. It was 64% for us in Ghana in 1970, and by 2019, stood at 105% in 2019,” he said.
According to the President, the implementation of the Free Senior High School policy has brought 1.2 million Ghanaian children into the education ecosystem, the highest number of students in secondary school in Ghana’s history, four hundred thousand (400,000) of whom would otherwise have been excluded.
Additionally, he indicated that the National Health Insurance Scheme is operating more adequately, and is enjoying the confidence of the increasing numbers of its users, with the number of active members up from 10.6 million in 2016 to 12.3 million at the end of 2019, stressing that “the goal in sight is to attain Universal Health Coverage for all”.
With next year marking the 30th anniversary of the 1992 Referendum, President Akufo-Addo noted that the Ghanaian people showed through that process their commitment to democratic governance under a Constitution that guarantees the full enjoyment of fundamental human rights and civic liberties.
“The decision has ushered our nation into the longest, uninterrupted period of stable, constitutional democratic governance in her history, which has experienced, under the 4th Republic, three (3) peaceful transfers of power through the ballot box on three (3) separate occasions. The anti-democrats, who are always looking for occasions to sneer at democratic governance, should also bear the following data in mind,” he said.
Bar Conferences, the President explained, became concerned with constitutional rule, freedom of the press, independence of the judiciary and other matters that were of paramount interest to the citizens, who wanted to live under a governance structure that was insulated from authoritarian rule, whether of the one-party Union Government or military variety.
“The Bar joined, wholeheartedly, in the search of the people for democratic governance, where power emanates from the open decision of the ballot box, not from the coercive force of the gun, secretly undertaken behind the backs of the people,” he added.
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