Business24 Newspaper 30th November, 2020

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MONDAY NOVEMBER 30, 2020

NO. B24 / 133 | NEWS FOR BUSINESS LEADERS

MONDAY NOVEMBER 30, 2020

US$15bn pledged for Ghana’s petroleum hub

Gov’t cautioned on tax breaks for oil and gas sector

By Joshua Worlasi Amlanu macjosh1922@gmail.com

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he Natural Resource Governance Institute (NRGI) has cautioned government to avoid granting tax breaks to companies in the oil and gas sector.

Cont’d on page 3

FDA supports first ever factory of physically challenged persons

By Eugene Davis ugendavis@gmail.com

John Peter Amewu, Energy Minister

By Sani Abdul-Rahman

T

he Ministry of Energy has shortlisted three bids for Ghana’s petroleum hub project, with one of the investors pledging up to US$15bn to fund the storage component of the ambitious programme.

The bids have since been forwarded to the Attorney-

General’s Department for review and advice, with a response expected by yearend for the project to take off in January.

“Expression of interest was massive, but three were chosen and forwarded to the AG for advice,” technical advisor to the project, Dr. Eric Yeboah, told Business24.

Analysts say the US$60bn

ECONOMIC INDICATORS EXCHANGE RATE (INT. RATE)

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project will be the biggest private investment in Africa.

The 20,000-acre petroleum hub will have four refineries with a cummulative capacity of 600,000 barrels per day (bpd), two oil jetties, four million-capacity tank farms, and two petrochemical plants.

Cont’d on page 2

BRENT CRUDE $/BARREL

POLICY RATE

14.5%

NATURAL GAS $/MILLION BTUS

GHANA REFERENCE RATE

15.12%

GOLD $/TROY OUNCE

OVERALL FISCAL DEFICIT

11.4% OF GDP

PROJECTED GDP GROWTH RATE AVERAGE PETROL & DIESEL PRICE:

Cont’d on page 3

INTERNATIONAL MARKET USD$1 =GHC 5.7027

0.9% GHC 5.13

T

he Food and Drugs Authority (FDA) has assured its support for companies and entities working with Persons Living with Disability (PLWD) The Chief Executive Officer of the FDA, Mrs. Delese Darko said the support is meant to ensure the growth of local businesses and to offer unending opportunities and hope to all physically challenged persons across the country.

CORN $/BUSHEL COCOA $/METRIC TON COFFEE $/POUND:

Follow us online: $41.26 2.622 1,922.57 329.50 $2,339.27 $109.65

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Editorial / News

MONDAY NOVEMBER 30, 2020

Editorial

Great start to petroleum hub dream!

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hana’s desire to establish a petroleum hub is progressing steadily. The dream is a rather ambitious one with many critics casting doubts about government’s ability to get it done due to the sheer quantum of investment required.

But the Energy Ministry over the weekend told Business24 that it has shortlisted bids from three investors willing to kickstart the first phase of the project.

According to analysts, the US$60bn project will be the biggest private investment in Africa.

The 20,000-acre petroleum hub is expected to have four refineries with a cumulative capacity of 600,000 barrels per day (bpd), two oil jetties, four million-capacity tank farms, and

two petrochemical plants.

The Energy Ministry stated that one of the shortlisted investors is pledging up to US$15billion fund the storage component of the ambitious programme.

The bids have since been forwarded to the AttorneyGeneral’s Department for review and advice, with a response expected by year-end for the project to take off in January.

The hub, which will be located at Bonyere in the Western region, targets very large and ultra-large crude carriers (VLCCs and ULCCs) traversing the West African coast, a popular route for European vessels.

The project is expected to accelerate the growth of Ghana’s downstream petroleum sector and make the country a major

player in Africa’s oil and gas industry.

Government is targeting US$1.56bn in export tax revenue through the project, which is projected to create about 780,000 jobs and increase GDP by more than half by 2030.

The devastating effect of the pandemic means that such massive capital injection into the economy could not have come at a better time.

It is also heartwarming to know that the pandemic has not scuttled this dream.

Much as the economy badly needs this injection especially a project of such magnitude, government must ensure it fulfills its obligations to the people directly affected by the establishment of the hub.

US$15bn pledged for Ghana’s petroleum hub Continued from cover The hub, which will be located at Bonyere in the Western region, targets very large and ultra-large crude carriers (VLCCs and ULCCs) traversing the West African coast, a popular route for European vessels.

The project is expected to accelerate the growth of Ghana’s downstream petroleum sector and make the country a major player in Africa’s oil and gas industry.

Government is targeting US$1.56bn in export tax revenue through the project, which is projected to create about 780,000 jobs and increase GDP by more than half by 2030.

“We expect to serve the VLCCs and ULCCs, and also explore the market opportunities in the subregion,” Dr. Yeboah said after a stakeholder engagement with residents of Bonyere over the weekend.

Phase one scheduled for January An estimated US$12bn is needed to fund the first phase of the three-phase project. The first phase comprises land valuation

and compensation, followed by development of petrochemical plants, a refinery and tank farms.

Completion of phase one will make available a projected crude refinery capacity of 350,000 bpd and storage capacity of one million, with ancillary facilities and services scheduled for the second and third stages respectively.

“Surveyors have already started work, and we are in talks with the communities on compensations and settlements,” Dr. Yeboah added.

Displacement and compensation Although the project had been designed to ensure minimal displacement, some communities

and farmlands will be affected.

However, residents are upbeat about the project, banking their hopes for youth employment and infrastructural development on the creation of the hub.

“The project will help Jomoro District, and our kids will get jobs too,” Samuel Cudjoe, a resident of Bonyere, told Business24.

The Energy Ministry has asked for 20 competent youth from each community within the enclave for vocational services training to position them for employment when the project takes off next year.

“The communities will engage us through their consultants on land valuations and appropriate compensations to ensure they are not shortchanged,” the project’s technical advisor said.

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News

MONDAY NOVEMBER 30, 2020

Gov’t cautioned on tax breaks for oil and gas sector Continued from cover The institute’s latest briefing, which assessed the risk of a “race to the bottom” in how oil- and gasproducing countries manage tax issues in the pandemic context, said with the drop in oil prices, some countries will likely have to decide whether they will give tax breaks to oil and gas companies to attract or retain investment.

“The tax breaks on most currently-operating oil and gas projects are likely unnecessary and a waste of public money,” NRGI cautioned.

“Companies’ operating costs and taxes in all of the studied countries are well below the current price per barrel. These costs matter because companies tend only to stop production when the market oil price is below the costs of continuing to operate the project,” it explained.

In the case of Ghana, the average operating cost is US$16 per barrel, whereas tax on upstream production is only US$5, leading to a total cost per barrel of US$21. This remains well below the current price per barrel

of more than US$40.

Experts say the payments that oil and gas companies make to governments—in the form of production shares, taxes and royalties—are often larger per barrel of oil produced than the actual cost of production. When times are tight, this is where companies often look to cut their overall costs.

However, NRGI said tax breaks

to oil and gas companies during price slumps have a volatile history.

“The wrong choice can mean countries lose out in the medium to long term, or companies gain a tax break that was unnecessary, reducing muchneeded government revenue,” the institute stated.

In the 2020 budget, government projected a benchmark oil price

of US$ 62.6 per barrel. However, in July, the finance minister predicted oil revenue would be 50 percent lower than anticipated due to the pandemic. Currently, oil is trading around US$48 per barrel.

Sharing his opinion on the matter in an interview with Business24, Dr. Steve Manteaw, the former chairman of the Public Interest and Accountability Committee (PIAC), the body which monitors the use of petroleum revenue in Ghana, noted that some oil and gas companies have started lobbying for tax reliefs to give them space to invest in their projects.

He said since taxes are fixed by Parliament, any decision to grant tax reliefs would requirement an amendment of the law.

“For this reason, I would advise government not to touch the tax laws and therefore not to grant any reliefs that may require an amendment to our tax law, but to put together a package that helps to mitigate the hardship in the interim without touching the tax laws,” he recommended.

FDA supports first ever factory of physically challenged persons Physically challenged and disabled people are one of the She made this remark at the largest oppressed groups in launch of the National Social Ghana. There are an estimated 8 Development Awards and the million disabled people living in launch of the first-ever factory Ghana, forming almost 20 percent to employ persons living of the 30 million population. with disabilities by the Ghana Currently, only one percent Dreams Disability Development of physically challenged are in Foundation (GDDDF). employment in Ghana. They The event had two objectives: comprise mental health victims, first to reward and promote the visually impaired and the persons who have contributed physically challenged. greatly to social development Though government introduced in the country and secondly to a policy to employ 50 percent launch and raise funds to support of all physically challenged at the maintenance of machines and the various toll booths across other logistics for the Foundation. the country, the number of such The GDDDF, a local natural persons overwhelms the total fruit juice beverage producer number of toll booths which located at Kasoa Ofankor is set hovers a little over 200 in Ghana. to officially begin operations in However, this initiative by the December this year. For a start, GDDDF supported by the FDA, in the Foundation will employ 60 line with government’s flagship people, of which 40 are physically One District, One Factory (1D1F) challenged. initiative, is touted as one of the At full capacity, GDDDF will surest measures to reduce the employ a total of 5000 disabled percentage of unemployment persons to work in various among physically challenged departments of the factory. people in Ghana.

Continued from cover

Mrs Delese Darko, CEO, FDA

Addressing dignitaries at the launch of the factory, Mrs. Delese Darko, pledged the support of the FDA through technical supports and reduced fees to help facilitate the growth of local industries particularly those that employ the physically challenged.

Mrs. Darko advised the Foundation to ensure they adhere to good manufacturing practices.

She said it is the priority of the FDA that every enterprise with a PLS license would progress higher from their current level to the advanced level, as this would contribute to make the

industrialisation agenda a reality in Ghana.

Richard Offei, CEO and Founder of GDDDF expressed gratitude to the FDA for the PLS innovation which has enabled the smooth and gratis registration of their natural fruit drink product.

Indeed, the GDDDF, is part of the FDA’s Progressive Licensing Scheme of which 56 SMEs were licensed in July this year, to produce local products that meet international standards to generate employment, earn income and thrive the fortunes of SMEs.

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News

MONDAY NOVEMBER 30, 2020

Registrar-General to strike out businesses with old records

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usinesses which have yet to update their records on the e-register database could have their names struck out for not conforming to the standards required under the new Companies Act, the RegistrarGeneral, Mrs. Jemima Oware, has cautioned.

Speaking at a virtual seminar on the topic Ghana’s Business Ecosystem—Business Registration, Establishment, Regulatory Reforms, Immigration & International Trade, she said the Registrar-General’s Department has amended company registration documents and the department’s systems to conform to the new Companies

Registrar-General Jemima Oware

Act. The seminar was organised by the UK-Ghana Chamber of Commerce as part of its Doing

Business with Ghana series.

The Companies Act 2019 (Act 992) became fully operational from October 1, 2020.

According to the RegistrarGeneral, several benefits come with registration of businesses, including access to financial services, ability to attract institutional customers, opportunity to bid for public contracts, access to support schemes, access to existing tax incentives, branding, recognition and visibility.

She said under the new law, all companies are required to declare their beneficial owners. A beneficial owner is an individual or natural person who owns, controls, has interest in, or exercises influence over a legal person (or arrangement) or receives substantial benefits from an individual.

Mrs. Oware said the beneficial owner requirement will help promote transparency and help investors know whom they are doing business with.

Eni develops innovative technology to fix the CO2 using artificial light

E Tullow to boost production with new drilling programme

By Joshua Worlasi Amlanu macjosh1922@gmail.com

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ullow Oil is planning to boost production in Ghana in the coming years as part of its new strategy to improve the company’s fortunes.

In a statement issued last week, the company said it will launch a multi-well drilling programme in the second quarter of 2021 under the first phase of its investment agenda.

The programme is expected to boost production and lower operational costs.

“This plan, alongside a rigorous focus on costs, is expected to generate material cash flow over the next decade, which the group anticipates will enable reduction of its current debt levels,” Tullow explained.

Tullow said it has produced

just 400m barrels of oil (gross) from 2.9bn barrels of oil in place in Ghana so far, representing 14 percent of potential production.

It added that the new plan will deliver production growth in the medium term and the ability to sustain production over the longer term.

The plan is expected to generate US$7bn of operating cash flow over the next 10 years, with 90 percent of the company’s future capital expenditure earmarked for its West African producing assets.

“The plan focuses our capital on a deep portfolio of shortcycle, high-return opportunities within our current producing asset base and will ensure that Tullow can meet its financial obligations and deliver material value for our host nations and investors,” Rahul Dhir, Tullow CEO, said.

ni has announced the launch of an experimental plant for the biofixation of carbon dioxide through the cultivation of microalgae with the aid of artificial LED light.

The plant, built at the Eni Research Centre for Renewable Energy and the Environment in Novara, represents a further important step forward for towards its objectives of decarbonisation and promoting a circular economy.

The algal biofixation process allows to fix carbon dioxide by exploiting chlorophyll photosynthesis to enhance CO2 as a raw material in high-value products such as algal flour for food / nutraceutical markets, and / or bio-oil – not in competition with agricultural crops – to be used as a raw material in bio refineries.

This is a technology based on an entirely Italian supply chain. Eni is accelerating its application in the field as it sees it as a strategic solution for the reduction of climate-altering emissions.

The pilot plant, consisting of 4 photobioreactors, is integrated with renewable energy sources and is based on Photo B-Othic technology, with which Eni has signed a License Agreement.

Photo B-Otic was created to support the development of biofixation technology and starts from the initiative of MEG, Everbloom,

Abel Nutraceuticals and the Arcobaleno Cooperative, which is a majority shareholder and has promoted this entrepreneurial initiative, which is the result of decades of research work in field of nutraceuticals and biotechnologies in collaboration with the DIATI of the Politecnico di Torino.

The photobioreactors on which the technology is based are composed of innovative hydraulic panels, in which the micro-algae circulate, equipped with LED lighting panels that spread the light evenly, identifying the preferred wavelengths for photosynthesis.

The modulation of light for intensity and quality is controlled according to the optimal growing conditions.

The advantages of this technology are its high CO2 fixation efficiency, simplicity, modularity and compactness, as well as its ability to operate 24/7. These factors make it interesting as a potential solution to be implemented across all logistically favorable areas, even in sites that cannot be used for agriculture or abandoned and converted industrial areas.

Currently, the pilot plant has reached very promising daily biomass productivity data which – where confirmed on a larger scale – could allow a plant with a footprint of 1 hectare to produce 500 tons of biomass per year, trapping 1000 tons of CO2.

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News

MONDAY NOVEMBER 30, 2020

Bill to ensure ethical procurement heads to Parliament

By Patrick Paintsil p_paintsil@hotmail.com

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draft practicing bill for procurement and supply chain management professionals in the country has been readied for approval

by Parliament, Basil Ahiable, Chairman of the Council of the Ghana Institute of Procurement and Supply (GIPS), has disclosed.

The bill, when passed, will allow GIPS to impose sanctions on members who violate ethical and professional standards in their line of duty whilst cushioning them from undue influence and

pressure from their superiors and influential persons.

“This, indeed, is one of the fundamental milestones that will engender total transformation of the procurement landscape in Ghana.

The passage of this bill will not only bring sanity into the procurement space but also ensure that professionals are engaged and properly placed to manage procurement systems in their respective organisations,” Mr. Ahiable said at an induction of new members of the institute within the local government service.

To the GIPS Council Chair, having such a legislation will drastically reduce the incidence of procurement malpractices that have brought some level of disrepute to the profession.

“The passage of a law to regulate the licensing and practice of procurement and supply in the country was long overdue and the next parliament and government should prioritise it,” he noted.

GIPS is the de-facto local professional body for procurement professionals, practitioners and students in the country.

It is dedicated to the promotion

of high standard of integrity and probity in the practice of procurement and supply chain management.

President of the Institute, Collins Agyemang Sarpong, tasked the inductees—comprising qualified members (MGIPS) and associate members –to uphold the ethics and high standards required of the profession in the discharge of their duties.

“GIPS is ready to help with requisite training of procurement officers within the local government service to equip them with the necessary skills that will ensure economic spend of the national revenue in line with all the ethical behaviours,” he added.

NBSSI, SNV sign MoU to support and create Green Businesses

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he National Board for Small Scale Industries (NBSSI) has signed a memorandum of understanding with the SNV Netherlands Development Organisation to support and create Green Businesses in Ghana.

The agreement under the SNV Ghana’s “Boosting Green Employment and Enterprise Opportunities in Ghana (GrEEn)” project seeks to support the transition of local economies to green and climate-resilient ones.

It also aims to improve employability and entrepreneurship capabilities of youth, women and voluntary returning migrants, as well as support, incubating and accelerating MSMEs so they offer decent and sustainable jobs to youth, women and voluntary returning migrants.

Mrs Kosi Yankey-Ayeh, Executive Director NBSSI and Mr Anjo van Toorn, the Country Director SNV signed the deal on behalf of their respective organisations.

Commenting on the deal, Mrs Yankey-Ayeh said as Ghana sought to restructure the economy during and after the COVID-19 pandemic, emphasis needed to be placed on exploring new and under-explored areas of wealth and job creation.

“This calls for special attention on the agriculture sector, renewable energy, water, Sanitation and Hygiene, and that is exactly what this MoU aims to do,” she said.

She said Ghanaian MSMEs had focused on the conventional areas of trade and commerce and had done little about exploring

the business opportunities in renewable energy, water, Sanitation and Hygiene.

“These areas have fantastic opportunities that can be leveraged to create sustainable jobs for the teeming unemployed youth. It is for this reason that this MoU brings a good sense of excitement and prospect for the future,” Mrs Yankey-Ayeh said.

She said the initiative was in line with the government agenda to equip the teeming unemployed youth with entrepreneurial skills and provide sustainable jobs.

The GrEEn Project will be implemented for four years in selected Metropolitan, Municipal and District Assemblies (MMDAs)

across two Regions of Ghana, namely, the Ashanti and Western Regions.

“With a clear objective of creating economic and employment opportunities for youth, women and returning migrants by promoting and supporting sustainable green businesses, I am convinced that it will challenge the beneficiaries to explore a new avenue for wealth creation,” she said.

Mrs Yankey-Ayeh assured that the NBSSI would provide the needed support and collaboration at both the national and local levels to ensure that the partnership achieved the expected objectives.

On his part, Mr Toorn said the project’s target was to achieve the training of at least 5,000 people, 3,500 creating self-employment opportunities, 100 MSMEs incubated and accelerated and 1,500 decent and sustainable jobs.

He said in the cooperation NBSSI and SNV would want to build coordination and synergies at national, regional and Metropolitan, Municipal and District Assembly levels.

Mr Toorn said with the signing of the MoU, NBSSI would participate in the GrEEn project steering Committee at the national level.

There will also be the creation of synergies between GrEEn interventions and NBSSI departments and centres at national, regional and MMDAlevel to support MSMEs and support the implementation of the government MSME policy and Covid19 recovery plan.

Mr Toorn said the project would also support the delivery of Business Advisory services to MSMEs in the Western and Ashanti region with a focus on green and circular economy and support awareness-raising and information provision for youth and women interested in green businesses.

“GrEEn is about youth employment, migration, green businesses, climate -no small issues. That’s why we need partnerships and pool resources.

Only together we can effectively address these issues,” Mr Toorn added.

GNA

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Feature

MONDAY NOVEMBER 30, 2020

Referral networking: shared knowledge and increased opportunity

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he success of most business is built on a strong referral network.

Few will have had the money to advertise their way to success, so they will have focused their efforts instead on increasing their client base by forming and nurturing mutually beneficial relationships and interacting with others to exchange information and develop professional or social contacts.

The benefits of networking don’t end there either: networking also puts people in touch with other resources, such as industry experts, accountants, and lawyers, who can help businesses in other ways.

However, effective networking requires time, effort, and commitment.

There’s far more to networking than simply attending business events and conferences, swapping business cards with as many people as possible and exchanging a few pleasantries.

That really can’t be described as true networking: it’s simply socialising, and that won’t lead to a steady stream of leads or referrals, nor will it help to build the business.

Successful networking requires focus. The businessmen and entrepreneurs who reap the greatest benefits from networking are the ones who have a clear idea of what they want to achieve, and a strategy which will help them achieve

this. They’ll know exactly who they want to meet at business breakfasts and, most importantly of all, they’ll know why they have to meet them. They’ll then follow up these contacts, and be prepared to invest time and energy in building relationships: they’re prepared to put in the extra effort because they know these cultivated relationships will more than likely result in a steady stream of referrals.

What are the business benefits of networking?

• Building a business from scratch takes time and requires total focus and unqualified commitment. In the early stages it can often be a lonely and unfulfilling experience.

The ride can be made much more comfortable, however, when new businesses surround themselves with a like-minded network of friends and associates who have trodden the same path before and share their drive and commitment.

• A network is the perfect forum for sharing ideas and knowledge. As a business person you’ll be able to discuss your point of view, ask for feedback, build your knowledge and learn to see things from another’s perspective. The chances are that within the network there will be others who already experienced what you’re experiencing, and they’ll be able to mentor you and offer guidance and support.

Most importantly of all, they’ll

be able to help you avoid making some of the mistakes they made.

• Networking will lead to eventually open up new opportunities.

When these opportunities will arise, or what they’ll be will only become known in the fullness of time.

A network can support you and prepare you so that when these opportunities do materialise you’re fully prepared to take them.

• Networking won’t just open up opportunities with those who are directly part of the network: by networking you’ll be gaining exposure and building connections with other business people in their network too. Networking is effectively a two way street. If one of your colleagues knows someone in their network is looking for the sort of product or service you offer, and you’ve built strong connections with others in your network; there’s every likelihood you’ll get a referral.

• Networking will increase your business’ visibility and get you noticed. The more functions you attend and take part in, the more your face will become known. If you are seen to be a knowledgeable, supportive and reliable person who is always keen to share useful information, advice and tips, you’ll be able to further increase your business’ reputation. You’ll be the person they turn to when they are in need of the services

you offer: your business will be the one which is most likely to get the leads and referrals.

Authored by: Business Breakfast (BforB)

for

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We are here to help you get new business from quality business introductions and referrals made through our meetings.

Kindly join our next meeting using this link: https://rb.gy/qrf4pl

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Aviation

MONDAY NOVEMBER 30, 2020

Aviation industry agrees vital slot use relief

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he Worldwide Airport Slot Board (WASB), comprising Airports Council International (ACI World), the International Air Transport Association (IATA), and the Worldwide Airport Coordinators Group (WWACG) released a joint recommendation for airport slot use relief for the northern summer 2021 season.

The organizations called on regulators worldwide to temporarily adopt more flexible slot rules in line with the recommendation as quickly as possible in order to preserve essential air transport connectivity.

As a result of the collapse in demand from the COVID-19 crisis, some 65% of direct city pair connections vanished in the first quarter of 2020. Slotregulated airports serve almost half of all passengers and are the backbone of the global scheduled airline network. But recovery is impossible while there is no certainty on the rules governing the use and retention of airport slots.

The existing slot rules were never designed to cope with a prolonged industry collapse.

Regulators temporarily suspended the rules for Summer and Winter 2020 to give the industry vital breathing space.

International air traffic, though, is only expected to return to about 25% of 2019 levels by summer 2021.

In order to preserve connectivity while air traffic recovers, a more flexible system of slot regulation is essential.

The Worldwide Airport Slot Board (WASB) which is the forum for bringing together representatives from the airport, airline and slot coordinator community to agree positions on slot rules, has worked on a proposal to regulators that preserves the best of the existing rules, while providing the necessary flexibility to aid recovery. The WASB position recommends the following be adopted before the end of 2020: • Airlines that return a full series of slots by early February to be permitted to retain the right

to operate them in summer 2022.

• A lower operating threshold for retaining slots the following season. In normal industry conditions this is set at 80-20. The WASB recommends this be amended to 50-50 for Summer 2021.

• A clear definition for acceptable non-use of a slot. For example, force majeure as a result of short-term border closures or quarantine measures imposed by governments.

“It is vital that regulators quickly adopt the WASB proposals on a globally harmonized basis.

Airlines and airports need certainty as they are already planning the 2021 Summer season (which begins in April)

and have to agree schedules.

Delays in adopting new rules will further damage the industry at a time when industry finances, and 4.8 million jobs in air transport, hang by a thread,” said Alexandre de Juniac, IATA’s Director General and CEO. “Creating a globally-compatible approach to the crucial issue of airport slots is an important part of underpinning a recovery of aviation. The united position of the air transport industry on what needs to be done to protect connectivity and choice in the best interests of passengers is a clear signal to regulators of the extreme urgency of the situation.

Action is needed now as any delay makes recovery for air transport, and the global economy, more difficult. We need regulators to recognize the crisis we are in and act with speed and flexibility,” said Luis Felipe de Oliveira, Director General of ACI World.

“WWACG welcome the possibility to work out a common ground together with IATA and ACI World for the preparation of the 2021 Summer season. It is important that relevant authorities take appropriate action to secure the aviation industry the necessary predictability in the planning process in these extraordinary times for the entire industry,” said Fred Andreas Wister, Chairman, WWACG.

New IATA guidance prepares for global vaccine distribution

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he International Air Transport Association (IATA) released guidance to ensure that the air cargo industry is ready to support the large-scale handling, transport and distribution of a COVID-19 vaccine.

IATA’s Guidance for Vaccine and Pharmaceutical Logistics and Distribution provides recommendations for governments and the logistics supply chain in preparation for what will be the largest and most complex global logistics operation ever undertaken.

Reflecting the complexity of the challenge, the Guidance was produced with the support of a broad range of partners, including the International Civil Aviation Organization (ICAO), International Federation of Freight Forwarders Associations (FIATA), International Federation of Pharmaceutical Manufacturers and Associations (IFPMA), Pan

American Health Organization (PAHO), UK Civil Aviation Authority, World Bank, World Customs Organization (WCO) and World Trade Organization (WTO).

The guidance includes a repository of international standards and guidelines related to the transport of vaccines and will be updated regularly as information is made available to the industry. Accompanying the guidance, IATA established a joint information-sharing forum for stakeholders.

“Delivering billions of doses of a vaccine that must be transported and stored in a deep-frozen state to the entire world efficiently will involve hugely complex logistical challenges across the supply chain.

While the immediate challenge is the implementation of COVID-19 testing measures to re-open borders without quarantine, we must be prepared for when a vaccine is ready. This

guidance material is an important part of those preparations,” said IATA’s Director General and CEO, Alexandre de Juniac.

Key challenges addressed in IATA’s Guidance for Vaccine and Pharmaceutical Logistics and Distribution include; The availability of temperaturecontrolled storage facilities and contingencies when such facilities are not available; Defining roles and responsibilities of parties involved in the distribution of vaccines, particularly

government authorities and NGOs, to assist safe, fast and equitable distribution as broadly as possible The industry preparedness for vaccine distribution which includes: capacity and Connectivity: The global route network has been reduced dramatically from the pre-COVID 22,000 city pairs. Governments need to re-establish air connectivity to ensure adequate capacity is available for vaccine distribution.

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Feature

MONDAY NOVEMBER 30, 2020

USB appoints Prof Mark Smith from Grenoble, France as its new Director

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he University of Stellenbosch Business School has appointed Prof Mark Smith (49), previously the Dean of Faculty at the Grenoble Ecole de Management in Grenoble, France, as its new Director.

Prof Smith is a seasoned academic and highly acclaimed researcher who is skilled in the dissemination of academic knowledge. Over several years, he has published in or made contributions to well over 70 academic books and journals.

His research areas include youth employment policy, the integration of ethics across the business world, gender and the labour market, the role of business in social innovation, and the transition from education to employment.

Hi experience includes leading over 160 permanent academics and in his previous role, he

was Director of one of the largest European doctoral schools for management sciences.

Says Prof Ingrid Woolard, Dean of the Faculty of Economic and Management Sciences at Stellenbosch University, “Prof Smith brings with him a wealth of knowledge and experience in areas that align well with USB’s academic focus areas and vision for the school. USB, its faculty, students and alumni operate in a globally connected world.

Fresh perspectives from another world region will help to ensure that we, and our graduates, remain relevant.” USB forms part of Stellenbosch University, the leading research university in Africa.

Prof Smith has considerable experience in leading large-scale research projects for, among others, the European Commission and global foundations. These investigations cover topics such as

pay transparency, youth labour, women on executive boards, and the improvement of living and working conditions.

According to Prof Woolard, this will serve USB well as closer collaboration with the business sector and commissioned research are strategically important to the business school.

Prof Smith is an active member of the Responsible Research in Business and Management (RRBM) initiative led by the European Foundation for Management Development (EFMD) and the USA-based Association to Advance Collegiate Schools of Business (AACSB).

He is also an expert advisor to various European organisations and foundations. Both USB and Prof Smith’s current school hold the three major international accreditations, namely AACSB, EQUIS and AMBA. Says Prof Smith, “I am thrilled

to be joining this leading tripleaccredited business school, recognised in Africa and worldwide for its commitment to promoting a societal impact via business research and education.

For me, the personal and professional challenge of coming to South Africa and contributing to Stellenbosch University’s vision to be the leading researchintensive university on the continent is very exciting”.

Prof Smith has two children. He is passionate about the outdoors, enjoying running and cycling.

He is also looking forward to sampling the rich cultural life of Cape Town and South Africa.

CONTACT DETAILS Dr Marietjie van der Merwe USB Representative Marie@ globalnatives.com +230 606 2341 / +230 5 701 1362

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Transhipment at the centre of the world

I

t was in 1884 that the Greenwich Meridian was established at the International Meridian Conference held in October 1884 in Washington, D.C. as the line of zero Longitude forming the basis for navigation and time keeping throughout the world.

Running from the North to the South Pole and separating the Eastern Hemisphere from the Western. This Prime Meridian Line (0° E/W) passes through the centre of the Harbour Basin of MPS Terminal 3 at Tema Port, which is the closest point on Earth to the Centre of the World where the Greenwich Meridian Line (zero degrees longitude) crosses with the Equator Line (zero degrees latitude).

Meridian Port Services Limited (MPS) is the leading Container Terminal/Port in West Africa by virtue of its location at THE CENTRE OF THE WORLD as well as its commitment to continuous improvement in infrastructure, superstructure and the service levels provided to stakeholders with the best of the world’s technology to boost its operations.

Once more the MPS superb investment in creating valuable opportunity to the shipping lines has been put to good use in connecting continents and effectively serving markets thanks to the enabling infra & super structure of MPS Terminal 3.

Chief Executive Officer of MPS Mr. Mohamed Samara mentioned some of the key developments at the MPS Terminal 3 leading to the attainment of the status of a shipping hub; “The efficiency, accessibility, the short waiting time at anchorage, fast vessel

turnaround time, higher port capacity and berth availability are the optimal criteria for making Terminal 3 a hub on the west coastline of Africa. Moreover, MPS Terminal-3 has the best synchronised frequency of calls (berthing Windows), number of shipping lines, highest volume per vessel call in West Africa making it the ideal first port of call with the shortest trade transit time and transhipment hub.” Said Mr Samara.

The MSC NATASHA started her voyage from the Far East port of Dongguan Anch in the early hours of 14th October and stopped at several ports starting with 21 hours call at Chiwan on the 15th October then 1 day and 10 hours stay in Singapore on the 22nd October followed by another 13 hours stop at Colombo on the 27th October. She then

proceeded on a direct call to West Africa going around the Cape of Good Hope stopping at Lomé on the 12th of November and arrived in Tema on 18th November at 06h00 and sailed by midday on the 19th November.

Besides the many thousands of containers that had been loaded and offloaded at the various port stops, the MSC Natasha discharged and loaded at MPS Terminal 3 a total of 3,524 TEUs of gateway volume to Ghana and the neighbouring landlocked countries but more interestingly MSC Natasha brought with her 2,200 TEUs that belong to South America.

The 2,200 TEUs of transhipment containers will stay at MPS Terminal-3 for few days and will be loaded on MSC ALBANY to be shipped to the respective final country of destination in South

America (mainly Brazil) MSC NATASHA was built in 2011 and her length overall (LOA) is 366 m, beam is 48 m. Her Gross Tonnage is 141,649 Tonne with container capacity of 13,556 TEUs. She is one of 15 vessels operated

by MSC on this Far East-West Africa weekly service that enjoys a berthing window arrangement at MPS’ Terminal 3.

Meridian Port Services Limited (MPS) is a joint venture between the Ghana Ports and Harbours Authority and Meridian Port Holdings Limited, with Bolloré Transport & Logistics and APM Terminals. MPS is the region’s most efficient Container Terminal, it provides the shipping lines with the highest productivity levels (discharge/load) with real-time electronic data interchange using a top-notch Terminal Operating Systems.

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Zappos ex-boss and Las Vegas entrepreneur Tony Hsieh, 46, dies after house fire

T

ony Hsieh, the former CEO of online shoe and clothing retailer Zappos.com, has died after a house fire in the US state of Connecticut.

Mr Hsieh, 46, who had been on a family visit at the time, only recently retired after 20 years leading Zappos, acquired by Amazon for more than $1bn.

He also played a key part in the restoration of central Las Vegas.

Tributes poured in on social media. Zappos said that the world had “lost a tremendous visionary”.

Tony Hsieh also wrote the book Delivering Happiness, which set out his philosophy of focusing on both customer and employee care.

A statement from, DTP

Companies, the company Mr Hsieh invested in to transform downtown Las Vegas, said he was with his family when he died on Friday. Details of his injuries and the cause of death have not been released.

“Tony’s kindness and generosity touched the lives of everyone around him, and forever brightened the world,” the statement said.

Amazon acquired Zappos in 2009 but Tony Hsieh stayed on as boss, saying: “We think of Amazon as a giant consulting company that we can hire if we want.”

Current Zappos chief executive officer, Kedar Deshpande, said Tony Hsieh’s “spirit will forever be a part of Zappos”.

The Las Vegas Review-Journal said Mr Hsieh had pumped a fortune into the once-neglected central Las Vegas and became the face of its revitalisation.

His “Downtown Project” helped fund start-ups, restaurants and other ventures.

Las Vegas Mayor Carolyn Goodman told the Review-Journal Mr Hsieh’s death was “a tragic loss”.

Ivanka Trump also tweeted about the loss of a “dear friend”.

BBC

Stocks rise on Wall Street as S&P 500 hits record high this month released results

T

Pandemic calls off Christmas markets in Europe

T

he European plazas where people would usually gather at crowded stalls to partake in hot mulled wine, gingerbread, sausages and other delicacies are just empty squares.

Christmas markets, a cherished tradition in Germany and neighboring countries, have joined the long list of annual traditions that were canceled or diminished this year because of the coronavirus pandemic.

November saw many European countries impose partial or tougher lockdowns as new virus cases soared. The restrictions are either being retained or only partially loosened as Advent begins Sunday.

Nuremberg’s sprawling,

bustling Christkindlesmarkt, one of Germany’s best known holiday markets and traditionally a big tourist draw, was called off a month ago. Markets across the country — including in Frankfurt, Dortmund and many in Berlin — have suffered the same fate, with authorities canceling the events or organizers concluding that it didn’t make sense to push ahead with their plans.

Over the border in France, the roughly 300 stalls of Strasbourg’s popular Christmas market won’t go up this year. And it’s the same story in the Belgian capital, Brussels.

AP

he S&P 500 rose to a record high Friday as investors continue to look forward to the distribution of a COVID-19 vaccine and relief for the global economy.

The benchmark index rose 8.70 points, or 0.2%, led by gains in technology companies, and closed at an all-time high of 3,638.35. The Nasdaq also closed at a record helped by gains in Apple, Tesla, Zoom and other tech companies.

Positive developments on the vaccine front have driven doubledigit gains in the major indexes this month as investors look forward to progress in gaining control over the pandemic that plunged the global economy into its deepest slump since the 1930s. That optimism persisted this week even as one vaccine candidate suffered a setback and cases of coronavirus remain at elevated levels.

Meanwhile, retailers were hoping that their slumping sales get a boost from shoppers on Black Friday but early indications are that store traffic was light.

The Dow Jones Industrial Average, which earlier this week crossed 30,000 for the first time, rose 37.90 points, or 0.1%, to 29,910.37. The Nasdaq gained 111.44, or 0.9%, to 12,205.85.

U.S. markets closed at 1 p.m.

Eastern after being shut for the Thanksgiving holiday.

Health care companies also posted solid gains. Moderna jumped 16.4% and Pfizer rose 1.9%. The two companies earlier

showing their COVID-19 vaccine candidates were highly effective in tests. The shares got a boost Friday after a competing vaccine suffered a setback.

The University of Oxford and AstraZeneca also this week released positive test results about their vaccine. But researchers have questioned how Oxford and AstraZeneca calculated the effectiveness of their vaccine.

The AstraZeneca CEO said the company might conduct another trial. AstraZeneca shares were flat.

Still, hopes for a vaccine have offset concerns about spiking coronavirus cases in the U.S. and other parts of the world. U.S. states and European governments are re-imposing controls on business and travel as infection rates surge.

The disease has killed more than 1.4 million people worldwide and there are 61 million confirmed cases, according to data gathered

by Johns Hopkins University.

The pandemic has brought significant changes to the traditional Black Friday shopping holiday. Many retailers are beefing up their safety protocols, moving their doorbuster deals online and curbside pickup options as a last grasp at sales before the year ends.

Retailers need a boost from Black Friday and holiday shopping altogether to try and recoup sales lost to the pandemic.

Early indications are that people are staying home and choosing to do any shopping online.

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Money Laundering, the hidden card in the PPA Saga… who takes the blame?

T

he Chief Executive Officer (C.E.O) of the Public Procurement Authority (PPA) of Ghana, Mr Adjenim Boateng Adjei was on October 30th ,2020 sacked by the President as recommended by the Commission on Human Rights and Administrative Justice (CHRAJ) report after a 14months investigation into an allegation of conflict of interest.

The CHRAJ investigation followed an exposé dubbed “Contracts for Sale”, a Manasseh Azure Awuni investigation, aired on Joy News TV on 21st August 2019 that revealed how Mr Adjei used his position as the C.E.O to influence the award of government contracts to Talent Discovery Ltd (TDL), a company he had co-founded with his brother -in-law subsequent to his appointment. TDL then retails these contracts to third parties at a fee up to 18% of the total contract sum.

The National Risk Assessments (NRA,2016&2018) cited corruption through the abuse/ misuse of public office for personal gains as one of the Money Laundering threats , and all the examples given were related to contracts by Politically Exposed Persons(PEPs),as such it is very disturbing for our Anti -Money Laundering , Counter Terrorism Financing and Proliferation of Weapons of Mass Destruction (AML/CFT& P) regime if it has to take the work of an investigative journalist to prompt such an investigation into abuse of office by a PEP through contract after his accounts with three different banks had received over GHS41.7million($7.1million) in cash and in multiple currencies

within 28months(from his appointment) prior to the exposé in clearly suspicious manner as revealed by the report.

Basically, the collective obligation of The Financial Intelligence Centre(FIC), the Bank of Ghana (BoG) and the Accountable Institutions(Banks) is to ensure that any use of the banking system for Money Laundering is detected and reported to investigative authorities for further investigations and prosecution, therefore Mr Adjei’s case indicates a system deficiency ,but who do we blame for this? Although from the outside one cannot tell who is at fault, a juxtapose of the roles of each institution with the facts in the report gives idea of how each institution could have contributed to the failure.

Banks (GT BANK, UMB & STANBIC) The role of the bank is to detect and report to the FIC any suspicious /usual transactions by its customers.

Bank of Ghana and Financial Intelligence Centre Anti-Money Laundering/ Combating The Financing of Terrorism & The Proliferation of Weapons of Mass Destruction (hereafter called BOG& FIC AML/CFT& P) guidelines defines suspicious transaction as ” one which is unusual because of its size, volume, type or pattern or otherwise suggestive of known money laundering methods. It includes such a transaction that is inconsistent with a customer’s known legitimate business or personal activities or normal business for that type of account

or that the transaction lacks an obvious economic rationale”.

To be able to perform this role effectively, 1.3 of BOG& FIC AML/ CFT& P guidelines obliges banks to implement Customer Due Diligence (CDD) as part of the overall AML/CTF&P compliance program CDD involves the scrutiny and monitoring of the customer to ensure that the customer is truly who he/she purports to be, operates the account for the stated purpose and transactions undertaken are in consistent with the bank’s knowledge of the customer, the customers income or business and risk profile.

In a situation where the customer poses high risk of Money Laundering, the scrutiny and monitory must be increased which is normally called Enhance Due Diligence (EDD).

EDD includes source of funds, source of wealth and increased transaction monitoring, in addition to the simple verification and monitoring required for lowrisk customers.

Mr Adjei as a high-risk customer • Politically Exposed Person (PEP)- senior public offical His position as C.E.O of PPA makes him a senior public official thus a PEP in line with the BoG& FIC AML/CFT& P guidelines PEPs are classified as high risk because of the high possiblity of using their position and influence to involve in Bribery and Corruption.

• Past events An adverse media search reveals that the Adade Committee

recccommeded dismissal and prosecution of Mr Adjei for his involment in a procurement scandal in 2002 at the Ghana Water Company Ltd.(GWCL) where he was Chief Manager (material).Although he avoided prosecution and susequently reinstated , this information in my opinion calls for Mr Adjei to be classified as a high risk cutomer.

Enhance Due Deligence (EDD) requirements Having established that Mr Adjei is a PEP and that matter a high risk customer , the banks are obliged to perform Source of wealth (SoW) , Souce of Funds(SoF) and an increased transaction and activitiy monitoring • Soure of Funds(SoF) Source of funds is about identifying and understanding the origin of the funds that Mr Adjei would deposit into his account either from his employment income or business etc. If it is from his employement, his letter of appointment or payslip could be used to verify the amount.If it is from his business , the management accounts, bank statmements and the amount of revenue or income that could be ideally generated from such business activity could be used.

This is to create a profile of how much is likely to be deposited into the account.If the funds would be paid in by third parties, attempt must be made to identify the relationship between the third parties and Mr Adjei.

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CONTINUED FROM PAGE 21 • Source of Wealth(SoW) The purpose of a SoW investigation is to build a logical and holistic picture of the source of an individual’s net wealth SoW is about understanding the activities that had contributed to the accumulated wealth of Mr Adjei overtime. This involves estimating the Net worth of the customer, demanding to know the activities that generated the wealth and corroborating the information provided. For instance, which buildings and cars does he own, which business does he have interest in and enquiring how they were financed e.g., from trading profits, gift, inheritance etc. Unexplained gap between the funding activities and the net worth could signify an illegality and the customer must be monitored closely. Corroborating Mr Adjei’s business interest would reveal among others the companies that he co-founded subsequent to his appointment which includes TDL(the company for selling government contracts).

• Increased transaction and activity monitoring The banks would have to intensify the scrutiny of Mr Adjei’s account activities ,increasing the number of his trasactions that are to be examined further in the bid to increase the chance of of identifying suspicious transaction. Its just like the extra caution we take when a known thief comes to visit.

The National Risk Assessment (NRA)in 2018 mentioned that over 85% of Universal Banks in Ghana have AML automated tool as such given the status of these banks in Ghana , it is fair to conclude that they have automated AML tools that allows real-time monitoring and reporting of large and unusual transactions and picked most of the his GHȻ41.7million worth of transactions(Excerpt below) for further investigations STANBIC “In respect of his USD account number 9040002473180, the Respondent opened it on 03-042017, within a month after his appointment with an opening balance of $5, 000. Four months after opening the account, significant cash amounts had been deposited into that account, including the following: Cash Deposits: From 01-08 -2017 to 08-09-2017, cash amounts totalling over $125, 000 was deposited by Faustina Mildred and

Christabel into the Respondent’s Account.

The Respondent withdrew $30,000 and $10,000 cash from his account in a day.

On that same day (08-09-2017), Christabel deposited cash amount of $15,000 into the account.

The respondent again made a cash withdrawal of $40,000 on 27-09-2017 and about a week later, he made a cash deposit of $50,000. Earlier, Christabel made a cash deposit of $40,000.

On 15-02-18, Faustina Mildred made a cash deposit of $50,000 and another $100,000 on 21-0318. Five days after that, one Kofi Appiah Dwomoh made a cheque payment of $100,000 into the account.’’

In respect of his Cedi Account No. 9040002313337 at the same bank, opened on 21 January 2017 before his appointment, a total of 3.83 million Cedis was credited, and 3.81 million Cedis debited, to the account between the date of his appointment as CEO and 29 August 2019.’’

UMB “Number “428872”.

The Transaction summary indicates the following: 20-12-2018 Check payment by OAB Adjei RKP $60,000 21-12-18 Check payment by OAB Adjei RKP $60,000 02-01-19 Check payment by OAB Adjei RKP $50,000 “ It is important to state that the AML tools alert is not conclusive so the banks would have to investigate further and decide whether it’s a false positive or indeed a suspicious transaction that warrants filling with the FIC

MONDAY NOVEMBER 30, 2020

STRs with FIC if proper EDD had been effected in the light of the facts revealed by the report.

When quizzed about the funds, he mentioned sales proceeds from a Frosty Ice Natural Mineral Water Ltd, a company he had formed with his wife in 2019 subsequent to his appointment. Assuming the said business was even operating in 2017, and formally registered in 2019 an effective SOF and SOW would have revealed its not ideally possible for the business to generate such amounts in size and frequency.

Moreover, his postappointment monthly cash deposit of GHȻ1,490,090.80 and $255,404.88 is a huge jump from his pre -appointment average monthly deposit of GHȻ 18000 and $1000 and this is worth examining.

Finally, the fact that approximately all the cash deposits during the period were withdrawn or transferred to other companies including real estate’s companies, in an approach that may indicate layering and integration, and the volume of CTRs that must have filed on the customer, it is expected that any investigation carried out by the bank should result in filing with

risk customer, not performing SOF and SOW leading to poor monitoring and STR decisions.

It is also possible that the banks might have deliberately ignored any red flag to obtain the huge deposits thereby choosing profit over compliance and treat any potential fine as cost of doing business.

If it turns out to be any of the above, it will bear resemblances with the Lombard bank case in October 2020 involving €340,058 fine by the Malta Financial Intelligence Analysis Unit for Anti-Money Laundering breaches mostly related to PEPs and we should expect sanctions from regulator for breaches.

the FIC It would therefore be surprising but not impossible if none of the three banks filed an STR with the FIC. An argument could be raised that why should the bank continue the relationship if it had indeed filed the STR, although it is a valid argument, banks sometimes receives orders from the FIC to keep account going and in some instances ending the relationship would signify a tip-off which is an offense.

Credit: ICIJ

FinCEN files Two of the banks involved were named in the recent released by the ICIJ that accused banks of facilitating Money Laundering, it is therefore very important that we are clear on what actions the banks took in this case as any STR filed or remedial action taken could assist in mending any reputational damage suffered by these banks due to the release of the FinCEN files.

Currency Transaction Report (CTR) It is known that cash transactions facilitate money laundering as such 1.22 of BOG& FIC AML/CFT& P guidelines obliges Financial institutions to report to the FIC all cash transactions within Ghana in any currency with a threshold of GHȻ50, 000.00.

Looking at the transaction history in the report, majority of Mr Adjei’s transactions exceed this threshold as such the banks must have filed numerous CTRs with the FIC. Why suspicious transaction report must be filed on Mr. Adjei STR is a report to be submitted by the Banks to the FIC within 24hrs for any identified suspicious transaction. In the case of Mr Adjei one should expect that the banks must have filed several

Why the banks might have not filed strs on Mr. Adjei The banks might have genuinely not detected and reported the suspicious transactions as a result of weakness in the AML/CTF& P system. This could come from not classifying Mr Adjei as high-

The Bank of Ghana (BoG) The Bank of Ghana as the supervisory authority is mandated to effectively enforce the AML/CFT& P requirements and ensure compliance by the banks. This mandate is usually discharged through the issuance of guidelines on and off-site examinations, training, and sanctions.

The examination is to confirm whether the compliance programs of the banks are adequate and operating effectively to curb AML/CTF&P risk and to give appropriate sanctions or to see that remedial action is effected for any identified weakness or breach.

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CONTINUED FROM PAGE 23 PEPs review forms key part of Central banks’ AML/CTF examinations as such it could be assumed that BoG examined the PEP procedures of these banks within the 28months BoG performs procedures to determine whether the bank’s system for monitoring PEPs for suspicious activities and for reporting of suspicious activities is adequate. These procedures could include reviewing the accounts of selected PEPs for unusual/suspicious transactions , follow through to determine whether the transaction monitoring system detected such transactions and when detected, a review of the reasonableness of any decision by the bank regarding not filing an STR. The examination report is discussed with management to effect remedial action to correct any weakness or breaches and fines are applied where necessary.

One could reasonably expect that, being the C.E.O of government’s contract awarding authority, and a co-signatory to the TDL bank accounts Mr Adjei should be part of any PEPs list for BoG’s examination given that abuse of office for personal gain was identified as Money Laundering threat in the 2018 NRA and all cases (GYEEDA, COCOBOD NLA),cited relates to PEPs office abuse in contract related issues., Moreover, the volumes and values of cash transactions by Mr Adjei and the number of CTR’s to have been filed on his behalf should add him to any material list for any examination.

One could therefore conclude that any effective examination by BoG during the period included review of Mr Adjei’s accounts for and identified the unusual transactions and where the banks did not complete an STR, appropriate action was taken and as part of remedial action subsequently STRs were filed with the FIC. The BoG could also pass the information to the FIC for investigations if it identified that STRs were deliberately not filed by the banks.

How Bog could have contributed to the failure BoG may not have selected the accounts of Mr Adjei for review or did select that account but did not detect the unusual transactions.

In that case the effectiveness of its risk-based examination could be questioned.

There could also be the

situation where officials may be compromised/ or be under duress to overlook the transactions in case the banks did not file STR. One cannot rule out the possibility of no on-site examination during the period as a result of inadequate resource or the fact that those banks are rated to have strong AML/CTF hence less frequent examinations.

Financial Intelligence Centre (FIC) The FIC is mandated to receive, analyse, and transmit disclosures on suspicious transactions to appropriate authorities like CHRAJ, EOCO if the need be. If it turns out that the Banks or BoG sent suspicious report to the FIC, then the onus lies on the FIC to show if it did trigger investigations or not.

The FIC analyses the data contained in the reports together with other Currency Transaction Reports and any other data it accessed to make decision whether in its opinion, the evidence substantiate the suspicion and warrants reporting to the investigative authorities for further actions.

Therefore, it is not every Suspicious Transaction Report (STR) received from the banks that passes to investigative authorities for prosecution or further investigations Page 81 of the CHRAJ report indicates some work on the part of the FIC as it mentioned that CHRAJ obtained information from the FIC regarding the bank accounts and companies where Mr Adjei is a beneficiary owner. However, one cannot tell if the work is an STR triggered investigation or the exposé triggered investigations.

If the FIC did not receive STR and CTR on Mr Adjei from the banks or BoG there is not much it could have done and could not be faulted because the FIC has no powers to conduct onsite supervision of the banks so there may be limited possibility of identifying the issue.

Thankfully, the 2019 National Policy on AML/CTF indicates

that by December 2021 the AntiMoney Laundering Act, 2014 (Act 874) would be amended to grant the FIC powers to perform on-site supervision and apply sanctions.

Having established the above, the following scenarios could have happened with the FIC within the 28months prior to the exposé: 1. That the FIC did not receive any STR on Mr Adjei from the banks nor BoG 2. That the FIC received STRs in time and concluded it does not warrant reporting to investigative authorities 3. That STRs were received in time but the FIC had not commenced/ concluded its investigation 4. That STRs were received so late and not possible to conclude investigations before the exposé Any of the above possibilities is not a sign of an effective AML/ CTF regime given the time frame and what was revealed in the report.

How the FIC could have contributed to the failure If the FIC had received the STR’s from the banks and concluded the suspicions do not warrant reporting, then the decision of the FIC could be faulted given the facts in the reports. Although it could be argued that poor STR could lead to defective decision, the FIC has the powers to request for further information.More so if the right number of CTRs were filed, that could add to the STRs to trigger an investigation.

The FIC may have received the report in time, but investigations where not done or concluded due to in adequate resource to handle large volumes of STRs.I do agree that the FIC may not be faulted in the instance but one could not be wrong to expect that given the pervasive nature of the case and a PEP involved, it could have been among the priority areas of the centre.

We cannot rule out the issue of potential compromise or duress which might force officials not to work on the STRs creating

backlogs. It is because of some of these happenings that in July this year the German state prosecutors instigated a criminal action against some officials of the German Financial Intelligence Unit (FIU) and raided the office in Cologne.

Ghana being on Financial Action Task Force (FATF) increased monitoring list and European Union blacklist is an indication of a deficient AML/ CTF regime and events like this turns to give credence to the assessment of these institutions.

The Mutual Evaluation Report (MER) by Inter-Governmental Action Group against Money Laundering in West Africa (GIABA) that was used by the FATF in listing of Ghana noted that although there are sanctions available and applicable to natural or legal persons for noncompliance with the AML/CFT requirements, these sanctions are rarely applied in practice leading to the moderate ratings in Immediate Outcome (IO) 7 in effectiveness assessment. If we intend to be delisted by the EU and FATF, then we must apply the necessary punishments in this case to make our claim for high IO7 ratings in the next round of evaluation scheduled for May 2022. This year, countries are getting tougher in sanctions with $5.6billion fines levied by mid-year and Ghana must follow suit. For instance, in Kenya, five(5) banks were in March fined $3.75million and just this September Westpac in Australia received $1.3b fine for breaches.

Therefore, if it turns out that the banks are in breach, we should be seeing the Bank of Ghana sanctions applied and where it is the case that any of the officers in the three institutions were compromised the appropriate action must be taken.

Also, if inadequate resource on the part of the regulators caused the deficiency, government must allocate enough resource to them and regarding the FIC, the amendment of the Anti-Money Laundering Act, 2014 (Act 874) could be fast- tracked to allow it to perform on-site examinations as an extra layer in the fight.

It is my hope that this matter gets a very thorough review so the public can be assured that the Banks, FIC and BoG are all doing the maximum that could be done in the Fight against Money laundering leading not only to EU and FATF delisting but overall reduction in predicate crime.

Faisal Sowah LARYEA Financial Crime Enthusiast mrsowahlaryea@yahoo.com

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Grading the big pandemic test

F

rom the moment COVID-19 emerged as a global threat, it was clear that it would test every society’s strength, resilience, and response capabilities. Almost one year on, it is time to assess who passed the test, and who failed.

From a public-health standpoint, the answer is clear: East Asia – including Australia and New Zealand – passed the test with flying colors. As for the rest, Europe performed unevenly, the United States stumbled badly, and developing countries have struggled.

To be sure, luck played more than its part in explaining initially uneven performance. In Europe, Italy and Spain were hit extremely hard by the first wave, because the then-unknown coronavirus took root, unnoticed, until it erupted in full force. By contrast, Germany and Poland saw it coming and could take effective measures in time.

But while governments can ascribe unequal death tolls during the first wave to luck, the argument does not hold for the second wave. Policymakers cannot eschew responsibility for the uncontrolled spread of the pandemic in the US or its resurgence in Europe.

Two trade-offs dominate discussions on the policy response. The first one, between disease control and individual rights, is hard to avoid. Contact tracing and mandatory isolation are effective in combating the spread of the virus, but infringe on civil liberties.

China clearly stands apart for its disregard of individual freedom, but Western societies would also find it hard to accept the intrusive tracing measures taken in South Korea or Singapore. Like it or not, there is a price to pay for the freedom and privacy we cherish.

The second trade-off is not between saving lives and saving

the economy. Rather, it involves a choice between being stringent today and being forced to be more stringent tomorrow. European societies went for strict lockdown measures in the spring, and then all but ended social distancing over the summer.

By October, the only option left was to tighten the screws again.

Australia made a different choice and moderately increased the stringency of its disease-containment measures throughout its winter season. It was able to relax these controls just when European countries had to strengthen theirs.

In a recent commentary, the French economists Philippe Aghion and Patrick Artus lambasted European countries’ stop-and-go approach and argued that they would have been better off keeping enough containment measures in place throughout the summer. Indeed, despite being much less severe than the first one, the second lockdown is hitting already fragile firms and households, thereby darkening the economic horizon.

In hindsight, Europe might have avoided it by keeping gyms and bars closed this summer.

The bottom line is that, whether out of principle or inconsistency, Western societies made their choice, and East Asia made a different one. And for the second time in little more than a decade – the other instance being the global financial crisis – the West is trapped in a maelstrom while, this time, Asia sails on.

Regarding the economic response, the interesting contrast is the transatlantic one. The US approach under President Donald Trump has been to let companies fire staff (possibly with a rehire promise) but to engineer massive fiscal support through tax cuts and additional unemployment benefits.

European states have instead

relied on generalized governmentfinanced furlough schemes that preserve employees’ income and status, while (outside of the United Kingdom at least) providing less outright budget support. As a result, the International Monetary Fund reckons that the 2020 US fiscal deficit will reach a post-war high of 19% of GDP, almost twice the eurozone average.

On the whole, therefore, the US under Trump has deliberately put the economy first, opting for less public-health protection and fewer worker safeguards but more fiscal support. European countries have put public health and social protection first, relying on initially harsh confinement measures and open-ended support to preserve employment relationships, with little additional budgetary stimulus.

The output decline in the spring was inevitably much sharper in Europe than in the US (with the exception of Germany, where the lockdown was less stringent). But the increase in European unemployment was far more limited. Jason Furman of Harvard University estimates that what he calls the realistic US unemployment rate jumped from 3.6% before the crisis to 20% in April.

In Europe, by contrast, up to one-quarter of the labor force was furloughed, but only gig and temporary workers, as well as new labor-market entrants, ended up unemployed. For the vast majority, the social safety net worked much better than it did in America.

Remarkably, European output rebounded sharply when governments lifted the lockdowns, despite the relatively less generous fiscal support.

Third-quarter GDP in Germany and France was about 95% of pre-crisis levels, exactly like in the US (it was lower in Spain, largely because of the collapse

in tourism; data for Italy are not yet available). Any scars these economies might have suffered in the lockdown period did not rob them of their resilience.

Thus far, at least, Europe does not seem to be paying a price for its decision to put health above economics. And the US apparently is not benefiting from its larger fiscal stimulus, because consumers reacted to unprecedented uncertainty by hoarding cash at record rates.

Between January and April 2020, the US personal saving rate skyrocketed from 7% to 33%, and it remains well above normal. Money injected into the economy helped the poor, but on the whole, it ended up increasing bank deposits rather than consumption and output.

Admittedly, the jury is still out, awaiting results of the second European lockdown. But amid the fog of the war against the pandemic, one thing is already clear: while Europe may wonder whether it was right not to emulate Australia’s full pandemiccontainment drive, it has no reason to regret having rejected America’s misguided strategy.

About the author

Jean Pisani-Ferry, a Senior Fellow at Brussels-based think tank Bruegel and a Senior Non-Resident Fellow at the Peterson Institute for International Economics, holds the Tommaso Padoa-Schioppa chair at the European University Institute.

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MONDAY NOVEMBER 30, 2020