News Guide Africa

Category: News

  • NPA warns cars to stop refuelling vehicles with passengers onboard

    National petroleum authority

     

    The National Petroleum Authority (NPA) has cautioned commercial drivers against refuelling vehicles with passengers onboard.

     

    According to the Authority such practice endangers the lives of passengers as they are exposed to harmful chemicals.

     

    Speaking at the NPA Central Regional sensitisation durbar in Cape Coast, the Central Regional Manager of NPA, Mr. Michael Opoku-Obiri, said one of the primary risks associated with refuelling is the inhalation of toxic fumes.

     

    He explained that gasoline contains harmful chemicals like benzene, a known carcinogen.

     

    These fumes can easily enter vehicles through open windows or doors, exposing passengers—especially children and the elderly—to health risks such as nausea, dizziness, and respiratory issues.

     

    He noted that despite the open, well-ventilated nature of most fuel stations, drivers often overlook the dangers of trapped fumes inside vehicles.

     

    Many drivers routinely stop at gas stations without asking passengers to exit the vehicle.

     

    Whether rushing to drop kids at school, heading to work, or running errands, refuelling with passengers inside the car is a common practice.

     

    However, this seemingly harmless habit has serious safety implications, with the most significant danger being the risk of fire.

     

    From January to July 2023, Ghana recorded 3,819 fire incidents across various sectors, with commercial and fuel-related fires being major contributors.

     

    Mr. Opoku-Obiri indicated that the Authority had implemented several safety regulations to ensure public safety at fuel stations.

     

     

    He explained that while refuelling may seem like a routine task, it carries significant risks that are often underestimated.

     

     

    ‘By taking simple precautions, such as ensuring passengers exit the vehicle and remaining vigilant about potential hazards, drivers can significantly reduce the dangers associated with refuelling’, he said.

     

    Mr. Opoku-Obiri also noted that although specific rules governing the refuelling of commercial vehicles are not publicly available in one comprehensive document, general safety guidelines and warnings are emphasised.

     

    He gave the assurance that the NPA will continue its efforts to raise awareness, educate, and inform dealers of petroleum products, consumers, and passengers about the dangers of neglecting safety measures in the use of gas and fuel.

     

    In her speech, the Paramount Queen Mother of Agona Nsaba, who also serves as the President of the Central Regional Queen Mothers Association, Nana Adwoa Nkansah Aduam III, called for stricter enforcement of the NPA regulations on refuelling vehicles with passengers onboard. She noted that this practice posed significant health and safety risks to the public.

     

     

    Nana Adwoa Nkansah Aduam III emphasised that the NPA must ensure stricter enforcement of its public safety mandate.

     

    In light of the frequent fire outbreaks at gas and filling stations in recent years, Nana Aduam stressed the need for increased public education on safety measures related to fuel and gas usage.

     

    She commended the Authority for its ongoing efforts to educate the public on safety protocols within the petroleum industry. However, she also called for further action, especially as the country approaches the dry season when the risk of fire incidents is heightened.

     

  • Improve Ghana’s business climate – US Ambassador tells gov’t

    Virginia Palmer

    Ghana must work to improve its business environment, US Ambassador to Ghana, Virginia Palmer has said.

     

    Speaking at the 2024 Ghana Oil and Gas Conference, organised by the Ghana Upstream Petroleum Chamber, Ambassador Palmer said: “Improving Ghana’s business climate will be an important next step and one it must tackle.”

     

    She explained: “This means a commitment to contract sanctity, including provisions on international arbitration.”

     

    Further, she noted that making such an improvement “means clear, consistent and fair treatment by the Ghana Revenue Authority.”

     

    Also, she noted that it means “speedy dispute resolution” as well as “real consultations to changes to localisation requirements and timely payments and proper applications of VAT exemptions in this key sector.”

     

    Representing Mr Herbert Krapa, the Minister of State at the Energy Ministry was Chief Director James Yaw Amoah, who said: “We have accelerated efforts to tap into our untapped petroleum reserves, adopting investor-friendly fiscal regimes.”

     

    “We are evaluating alternative pathways to utilise domestic refinery capacity, increase the use of domestic LPG and address the economic impact of these changes,” he added.

     

  • JPMorgan CEO to visit Africa in growth push

     

     

    JPMorgan

    JPMorgan Chase (JPM.N), opens new tab CEO, Jamie Dimon, plans to travel to Africa in mid-October in a push by the biggest U.S. lender to expand on the continent, four sources familiar with the matter told Reuters, his first trip there in seven years.

     

    Dimon is expected to visit Kenya, Nigeria, South Africa and Ivory Coast during the trip next month, two of the sources said. JPMorgan already has offices in South Africa and Nigeria where it offers asset and wealth management and well as commercial and investment banking services.

     

    Overseas markets have been a key focus area to generate growth for JPMorgan — which has assets of over $4.1 trillion and operations in more than 100 countries.

     

    In 2018, Dimon said the lender wouldlook at entering Ghana and Kenya. Local regulators in those two countries had blocked JPMorgan’s growth plans, according to media reports.

     

     

    Kenyan President William Ruto said in February 2023 after a meeting with a senior JPMorgan executive that the bank had committed to opening a new office in Nairobi.

     

    It was not immediately clear how close JPMorgan is to opening in these countries.

     

    Major global banks are seeking to gain a bigger share of sovereign debt and corporate transactions in Africa, analysts said, while also aiming to serve more international companies that have operations on the continent, said Eric Musau, head of research at Nairobi-based Standard Investment Bank.

     

    International lenders are seeking to grow their revenues by offering wealth management services that provide access to investments like offshore equity, debt and mutual funds, Musau added.

     

     

    Banking giants are also offering private banking services, seeking to differentiate themselves from local and regional lenders that are prevalent in retail markets.

     

    While most consumers on the continent have access to financial services through local and regional commercial banks, private banking “is where the next evolution will be,” said Francis Mwangi, CEO of Kestrel Capital, a Nairobi brokerage.

     

    JPMorgan is among the top five international private banks by assets under supervision and growth in overseas markets is a key priority, it said in May.

     

     

    In the last five years, about 700 bankers have been involved in expanding into 27 new locations worldwide, generating $2 billion in revenue for its commercial and investment bank, JPMorgan’s President Daniel Pinto told investors in May.

     

     

    JPMorgan has an advisory board of international executives and former policymakers that have links to Africa, including Nigerian billionaire Aliko Dangote and former British Prime Minister Tony Blair who founded the Africa Governance Initiative.

     

    Major global lenders have adopted differing strategies for individual sub-Saharan markets, targeting the fastest-growing areas while seeking to distinguish themselves from local and regional competitors.

     

    Standard Chartered(STAN.L), opens new tabhasfocused on markets like Kenya.

     

    Assets under management in the East African nation grew by a quarter last year to 185.5 billion Kenyan shillings ($1.4 billion), it said.

     

    Source: Reuters

     

     

  • Ghana arranges to pay $111mn debt to Trafigura

    Government of Ghana 

    The Government of Ghana has reaffirmed its commitment to settle an outstanding USD111 million judgment debt owed to oil giant Trafigura, following concerns about delayed payments raised on social media.

     

    The debt stems from a power purchase agreement dispute that has escalated to threats of asset seizure in South Africa and the United States.

     

    Responding to a petition from Trafigura’s subsidiary, the Ghana Power Generation Company (GPGC), in a statement issued last week, the Ministry of Finance assured that arrangements had been made to clear the debt.

     

    This assurance followed Trafigura’s warning that further delays could prompt the seizure of Ghanaian properties abroad.

     

    “We have made the necessary arrangements to pay off the outstanding claims agreed with Trafigura after several rounds of negotiations. We are surprised at the circulation of this letter on social media.

     

    “The Government of Ghana remains committed to honouring its obligations under the Settlement Agreement with Trafigura to bring this matter to closure,” the Finance Ministry’s statement said.

     

    The dispute dates back to a January 2021 ruling by a UK tribunal, which found the Government of Ghana liable for breaching a 2018 power purchase agreement with GPGC.

     

    The tribunal awarded GPGC USD134 million, of which only USD23 million has been paid.

     

    In August 2024, Trafigura briefly seized Ghana’s Regina House in London as part of efforts to recover the debt.

     

    GPGC’s recent petition, which was also sent to Ghana’s Attorney General, Godfred Yeboah Dame, warned of further asset seizures if the outstanding balance is not settled.

     

    Trafigura last week petitioned Ghana’s Finance Minister Dr. Mohammed Amin Adam over an unresolved judgment debt.

     

    This warning comes in the wake of Trafigura’s acquisition of Regina House, a key commercial property in London, after government failed to settle a USD134 million judgment related to a terminated power purchase agreement.

     

    The oil giant is threatening to seize state assets in South Africa if payment is not made.

     

    The dispute dates back to a January 26, 2021 ruling by a UK tribunal, which found that Ghana had breached its contractual obligations by terminating its agreement with GPGC, a foreign power company, in 2018.

     

    The tribunal awarded GPGC USD134 million in damages, covering interest and arbitration fees. Yet, despite the tribunal’s clear mandate, the government has only made partial payments, leaving a substantial sum outstanding.

     

    Over the past four years, Trafigura has sought to recover the owed amount, leading to a U.S. court judgment that added USD111.4 million in interest to the original debt.

     

    In a recent petition submitted to the Finance Ministry on Monday, 23 September 2024, the company expressed frustration over government’s prolonged delays in settling the matter, demanding immediate payment and warning of potential legal action if their requests are ignored.

     

    Ghana’s failure to respond to the U.S. court ruling further complicates the situation, as it resulted in a judgment favouring GPGC based on Ghana’s waiver of sovereign immunity and commitment to international arbitration.

     

    This has exacerbated the country’s financial obligations, hindering efforts to resolve the debt.

     

     

     

  • IPGGs says can’t guarantee reliable power supply’… after ECG betrayal

     

    Independent Power Generators Ghana

     

    Erratic power supply looms as the Chamber of Independent Power Generators Ghana (IPGGs) feel betrayed for the failure of government and Electricity Company of Ghana to pay a $1.4 billion debt owed to them, is threatening their businesses.

     

    In a letter signed by the Chairman of the IPGGs, Togbe Afede XIV, to the Ministry of Finance received on August 16, 2024, the power generators warned of dire consequences for the sector if the Finance Ministry failed to meet them over the matter at the earliest possible time.

     

    “We respectfully, as a matter of urgency, demand an appointment to meet with you to discuss and resolve these critical issues. This meeting must occur at the earliest opportunity next week, as any further delay could be catastrophic for the nation’s power supply stability. We kindly request that you confirm your availability for this meeting at your soonest convenience,” the letter said.

     

    “The current situation is extremely disappointing as the IPGs played a major role in working with the government to support its necessary restructuring of the country’s indebtedness in order to qualify for the IMF loans,” continued the letter.

     

     

    It added: “Not only did many of the IPGs agree to a haircut on the arrears owed to them at the time; IPGs agreed to defer a significant portion of future payments to enable the government to recover under the IMF programme.”

     

    The power producers further mentioned: “Despite the economic hardship this caused the IPGs, we agreed to this structure to ensure the IPGS would receive consistent payments to cover our operations and debt obligations.”

     

    “We are hardly a year removed from shaking hands with this new arrangement and ECG is already materially in default to the amount of $1.4 billion. As you can imagine, we feel highly betrayed by the situation we find ourselves in today”, the Chamber indicated.

     

    It warned: “We are in a dire strait as the government of Ghana and ECG have not fulfilled their end of the bargain. If the current situation continues, the IPGs will be left with no option but to exercise their rights under their respective contracts and to discontinue any unfulfilled negotiations. At this point, we cannot guarantee our cooperation moving forward, nor can we guarantee the continued reliable supply of electricity beyond August 30, 2024.”

     

  • Ghana cocoa loses 27% export value – GSS

    Cocoa Production

     

    The export value fell from GH₵1.57 billion in the second quarter of 2023 to GH₵1.15 billion in 2024, marking the fifth consecutive quarterly decrease

     

    Ghana’s cocoa bean export value has seen a sharp decline, dropping 26.9% in the second quarter of 2024, according to data from the Ghana Statistical Service.

    The export value fell from GH₵1.57 billion in the second quarter of 2023 to GH₵1.15 billion in 2024, marking the fifth consecutive quarterly decrease.

     

    The drop is part of a broader downward trend, with a 24.7% fall in the first quarter of 2024 compared to the same period in 2023.

     

    The value plunged by 80% between the first and second quarters of 2024, translating to a GH₵4 billion reduction.

     

     

    Ghana’s cocoa industry is facing a tough production season, with output by June 2024 reaching just 429,323 metric tonnes—less than 55% of the average in previous years.

     

    This could result in the country’s lowest annual production in over two decades.

     

    The global cocoa market is grappling with a four-year supply deficit, driven by poor harvests in both Ghana and Ivory Coast, causing prices to rise.

     

    However, Ghana has not benefited from this price increase due to rampant smuggling. Farmers, frustrated by low local prices and delayed payments, have turned to trafficking rings, leading to the loss of over a third of the 2023/24 cocoa output, amounting to around 160,000 metric tons.

     

    In response, Ghana’s Cocobod has raised the farm gate price by 45% for the 2024/25 season, increasing it from GH₵2,070 to GH₵3,000 per 64-kilogram bag.

     

    Previously, Ghana’s prices were GH₵490 lower than those of neighbouring Côte d’Ivoire, fuelling smuggling.

     

     

    With the new price, Ghana now offers GH₵440 more per bag than Côte d’Ivoire, though the latter has yet to announce its 2024/25 pricing.

     

  • Banks credit risk threatens sector’s recovery

    Bank of Ghana

    Adnan Adams Mohammed

     

    Ghana’s banking sector recorded a heightening credit risks in the first half of the year.

     

    According to Bank of Ghana data, the industry’s non-performing loans ratio was 24.1 percent in June 2024, up from 18.7 percent in June 2023. Representing more than 5 percent rise in NPLs.

     

    Although, not directly related to credit risk, but a worrying trend in the banking sector is total monetary value lost to fraud. Cases recorded increased by 21% in 2023 to GH¢63 million compared to GH¢52 million in 2022. The number of staff involved in these fraudulent activities in Banks and SDIs rose from 188 in 2022 to 274 in 2023, representing an increase of 46%. This erodes depositors confidence which eventually affects banks funds available for lending.

     

    “Elevated credit risks pose threats to the recovery process,” Bank of Ghana Governor, Dr Ernest Addison has warned while speaking at the annual general meeting of the Ghana Association of Banks in Accra, last week. “This is despite improved performance of the sector.”

     

    “The consistent rebound in profits, adherence to recapitalisation plans, and enforcement of strict credit underwriting standards are expected to help ensure that banks remain on the path to full recovery and resilience,” he added.

     

    “Enhanced performance of the banking sector, amid the obvious challenges, was made possible in part through the unrelenting partnership of GAB with the Bank, especially during the difficult DDEP process.”

     

    The Governor urged the association to reflect on the recent developments in the banking sector, strategise to consolidate the gains made and aim to sustain confidence in the industry for economic growth.

     

     

  • Banks resilience improves..but more need to be done

     

    Banking sector

     

    Adnan Adams Mohammed

     

    Ghana’s banking sector remains resilience in spite of global financial crisis, the Bank of Ghana Governor has said.

     

    Justifying that, banks are posting strong capital and liquidity buffers, improved performance notwithstanding the impact of the Domestic Debt Exchange Programme (DDEP) on the balance sheet of banks.

     

    In spite of these performance, the Governor believes more efforts needed in terms of monetary policy and and economic management reforms to solidify the resilience of the banking sector.

     

    “A lot remains to be done to promote a more resilient banking industry”, Dr Ernest Addison said when addressing the annual general meeting of the Ghana Association of Banks last week in Accra. Emphasising that, “several policy measures have been implemented to achieve the regulator’s objective of ensuring that the sector remains “strong, stable, and viable” to support the country’s growth agenda.”

     

    In the first half of 2024, the banking sector performance “pointed to continued recovery from the impact of the DDEP”, the Governor indicated.

     

    Total banking sector assets grew by 33.3 per cent to GH¢323.1 billion as of the end of June 2024, relative to 21.2 per cent growth as of the end of June 2023.

     

    Profitability, liquidity, and efficiency indicators also improved over the period.

     

    Also, the Capital Adequacy Ratio (CAR), adjusted for reliefs, remained unchanged at 14.3 per cent, between June 2023 and June 2024. Without reliefs, the CAR was reported at 10.6 per cent in June 2024, higher than the 7.4 per cent recorded in June 2023, Dr Addison added when he spoke at the recently held annual general meeting of the Ghana Association of Banks.

     

    It is remarkable to acknowledge that, in February 2021, the Bank of Ghana was admitted as a member of the Basel Consultative Group (BCG) in recognition of the continued efforts to enhance the enabling regulatory environment.

     

    Ghana, therefore, became one of the four countries, including Tunisia, Mauritius, and Nigeria to obtain BCG membership at that time.

     

    “Over time, the Bank has actively participated and contributed significantly to BCG activities aimed at promoting supervisory cooperation and implementing supervisory standards by the Basel Committee on Banking Supervision (BCBS),” Dr Addison noted.

     

    “This achievement has further strengthened the Bank’s commitment to promote the safety and soundness of the banking sector through effective regulation and supervision. In furtherance to this, the Bank continues to ensure the evolution of its regulatory reform roadmap to address the emerging risks in the financial system; inputs from new and revised policy papers by international standard-setting bodies such as the Basel Committee on Banking Supervision (BCBS); concerns and suggestions raised by key stakeholders such as GAB; and other external shocks to the Ghanaian financial system and economy.”

     

    Dr Addison disclosed that, the Bank commenced a thematic review of banks’ corporate governance practices to assess the effectiveness of their governance framework.

     

    “The exercise is ongoing and aims at ensuring full compliance with regulatory requirements such as the Corporate Governance and Fit and Proper Persons directives. Plans are underway to conduct a thematic review of the viability and sustainability of banks’ business models,” he said.

     

     

     

  • Africa Emerges as a Key Player in Global Energy Security

     

     

    With recent geopolitical events highlighting the vulnerabilities of global energy supply chains, Africa is attracting increasing attention as a reliable and promising source of oil and gas.

     

     

     

    As the world seeks to diversify its energy portfolios and ensure security of supply, investors are recognising the immense potential of Africa’s underexplored hydrocarbon reserves. This comes as other regions face ongoing challenges, leading to a renewed focus on stable, promising alternatives.

     

     

     

    Africa, long an overlooked energy region, has been attracting interest from global energy investors recently, thanks to its underdeveloped oil and gas resources, business-friendly governments and dynamic financial institutions. Now, the region seems increasingly attractive as a relatively stable and predictable geopolitical environment.

     

     

     

    African energy stakeholders have observed a surge in interest from international players eager to engage with the continent’s dynamic energy sector. The forthcoming AOW: Investing in African Energy event in Cape Town reports a significant uptick in energy leaders confirming their attendance.

     

     

     

    “Since other regional conflicts caused gas supply disruptions to Europe, we have seen a surge in interest in Africa as a supply base,” says Paul Sinclair, CEO of Sankofa Events, which owns AOW. “While we continue to hope for a peaceful resolution in all areas of conflict, we are also looking to explore how Africa can help ease global energy demand in this unsettling period.”

     

     

     

    Recent discoveries of significant oil and gas deposits in the Orange Basin offshore South Africa and Namibia, alongside expanding projects in Mozambique, Nigeria, Ghana, and other nations, underscore the vast potential of Africa’s hydrocarbon resources. This is in addition to the continent’s almost limitless renewable energy opportunities.

     

     

     

    “Africa offers so much for energy investors,” says Sinclair. “At the same time, there remain huge challenges with access to energy on the continent, something we want to put at the top of the AOW agenda to resolve. This is the ideal time to bring the continent’s energy resources into the mainstream economy and to look at not only driving advocacy around oil and gas development, but to ensure our resources are monetized locally for our own energy security.”

     

     

     

    Sinclair says there has been huge progress in the West African corridor with gas utilisation and he looks forward to AOW helping to drive development and monetisation of natural resources for domestic economic growth.

     

     

     

    “We want Africa to also help meet global energy needs and to be the supply base of choice for international energy security, while offering a parallel pathway to economic development for Africa,” he says. “We believe now is the time to accelerate upstream development.”

     

     

     

    • AOW: Investing in African Energy – owned by Sankofa Events – is Africa’s leading oil, gas & energy event. AOW brings together industry leaders to develop policy, share discoveries, secure investment, and shape Africa’s energy future. The event runs from 7 – 10 October 2024 at the CTICC 2, Cape Town.

  • ECG’s non-compliance with revised cash waterfall mechanism raises concerns – PURC

    PURC

     

    The Electricity Company of Ghana (ECG) has been found in violation of the revised Cash Waterfall Mechanism (CWM), as reported by the Public Utilities Regulatory Commission (PURC).

     

    The updated CWM, which took effect in August 2023 under President Nana Addo Dankwa Akufo-Addo’s directive, was designed to enhance financial stability in Ghana’s energy sector.

     

    According to the PURC, the revised guidelines mandated ECG to make monthly payments to stakeholders based on a model intended to ensure transparency and fairness in revenue distribution.

     

    However, ECG’s failure to adhere to these standards has raised significant concerns.

     

    “Following the adoption of the revised CWM, ECG was expected to make monthly payments to stakeholders according to the approved model.

     

    “Since the inception of the revised CWM, ECG has not complied with the guidelines as directed by the president, thus undermining the purpose of fair and equitable revenue allocation to sector players,” the PURC stated.

     

     

    The commission criticised ECG for its lack of transparency and consistency in revenue payments, attributing these issues to the worsening financial stability of the sector and declining service quality.

     

    “The lack of transparency and consistency in the payment of collected revenues has burdened the sector with worsening financial sustainability and deteriorating service quality,” the PURC added.