DeniAfrica

The IHT reports on the KenGen IPO:

In their market debut, the shares closed at nearly four times the issue price of 11.9 Kenyan shillings, or 16 U.S. cents, a ringing endorsement of the first privatization since President Mwai Kibaki’s coalition took over in 2002, pledging economic reforms.
The listing crowned a successful government campaign to promote share ownership among the wananchi - ordinary people in Swahili - that brought renewed interest in capital markets and drew many investors to the stock market for the first time.
With demand three times the number of stocks on offer in Kenya’s first IPO in a decade, the KenGen story has inspired pride among Kenyans weary of press reports about rampant corruption, crime and hunger.

The World Bank reports:

The World Bank Board…approved US$140 million in support of the implementation of Ghana’s Growth and Poverty Reduction Strategy (GPRS II). This year’s budget support is the fourth in the series under the Multi-Donor Budget Support (MDBS) framework under the new GPRS II.
Referred to as the Fourth Poverty Reduction Support Credit (PRSC-4), it is to be used to promote gains made in the areas of primary education and health, as well as to help sharpen the focus on growth-related areas in the energy, financial and natural resource management sectors.
Three previous PRSCs amounting to US$375 million of direct budget support were disbursed by the World Bank to support GPRS I.

Cameroon Tribune reports:

Executive Directors of the World Bank and the IMF concluded that Cameroon had fulfilled the Completion Point conditions under the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative, based on satisfactory implementation of macroeconomic, structural, social and governance measures.
More specifically, it was agreed that Cameroon had established a track record of commitment to PRSP implementation and poverty reduction. The authorities were commended on the actions taken in 2005 to restore fiscal discipline and correct the deterioration of public finance, thereby strengthening macroeconomic stability. It was also noted that the share of budgetary resources allocated to priority sectors, especially social development and infrastructure, had increased steadily since implementation of the first full Poverty Reduction Strategy Paper (PRSP). Finally, progress which has taken place in the implementation of structural reform in particular in the transport and forestry sector was highlighted

DENI Meeting with Hon. Kwadwo Baah-Wiredu, Saturday, April 22, 2006

Participants

Minister’s Entourage

· Hon. Kwadwo Baah-Wiredu, Minister of Finance
and Economic Planning, Accra

· Angela Farhat, Ministry of Finance & Eco Planning

· E. Ako-Adjei, World Bank Group, Washington

DENI Program Consultants

· Fred Kwoba, US-Africa Business Council, Boston

· Bestway Zottor, Nubex Technologies, Canada

· Richmond Fordjour, Fannie Mae Corp., Washington

· Yaw Owusu, Ghana Cyber Group, Washington, DC

Meeting Methodology

The meeting was by Teleconference with Participants dialing a special number followed by a PASSCODE to access the Teleconference.

Date & Time:

Saturday, April 22, 2006, 3:00 pm-4:00 pm.

Agenda:

Introduction of DENI

Minister’s Response

State-Owned Enterprises

DENI Directory

1. Introduction of DENI

1.1 Bestway Zottor
Zottor introduced the DENI Program Consultants and briefly outlined the purpose of the meeting—arranged to formally introduce the proposal for boosting private asset ownership in Ghana through mobilizing the human and financial resources of Ghana’s 2.8 million Diaspora Community with full participation of Ghanaians at home. The intent is to accelerate the economic growth and development that President Kufuor has called for.

1.2 Fred Kwoba
Kwoba touted DENI as an excellent facilitator of Ghana’s and Africa’s privatization programs of State-Owned Enterprises (SOEs). Most Africans will be happy to invest all of their DENI proceeds in any of the SOEs slated for privatization. Fred emphasized to the Minister that we (1,000,000 Ghanaians x $1,000) will raise (in 8 months) a fund of $1,000,000,000 for the Government that is not a loan and is not grant. No strings attached. No conditionalities. The program is totally owned by the Ghana Government and its nationals at home and abroad. All this in exchange for asset shares in privatized SOEs - thus keeping the family jewels in the family, instead of selling them to foreigners. Then take 1,000,000 direct participants x 20 (extended family factor) = 20,000,000 Ghanaians (the entire population) stands to benefit from this single program alone in terms of poverty reduction. It’s a win-win situation for everybody.

1.3 Richmond Kyei-Fordjour
Kyei Fordjour asked Hon. Kwadwo Baah-Wiredu if Ghana’s state-owned enterprises keep detailed financial records, showing company’s performance in the last ten years or more.

1.4 Yaw Owusu
Yaw Owusu recommended a pragmatic schedule for implementing DENI in Ghana, beginning with the arrival of the DENI team in Accra in June 2006.

2. Minister’s Response

2.1 Hon. Kwadwo Baah-Wiredu

The Minister of Finance thanked Kwoba, Zottor, Owusu and Fordjour for their initiative, expressed confidence in the DENI proposal, and assured the team of his ministry’s and the Kufuor administration’s support. Hon. Baah-Wiredu reiterated that government has reduced corporate tax from 32.5% to 28% to and recently to 25%.

2.2 DENI as Budget-Deficit Reduction Strategy

Hon. Baah-Wiredu concurred with the idea that a successfully implemented DENI would help address Ghana’s persistent budget deficit situation, among other benefits. For instance, of the $8 Billion requested by all ministries in Ghana, the government raised only $2.6 Billion through internal revenue sources, whereas Grants represent $700 Million and loans account for $600 Million, leaving a budget deficit of $4.1 Billion.

2.3 Government & Privatization

Hon. Baah-Wiredu hailed Ghana government’s privatization initiatives that have improved the operations of state owned enterprises recently. For instance the government purchased VALCO for $18 million to rescue the company from near bankruptcy. The company is doing quite well. The government also helped resolve Juapon Textiles’ liquidity problems through an innovative investment vehicle set up by the government.

2.4 Infrastructure

The government’s infrastructure development efforts have been improving. Hon. Baah-Wiredu cited works on the Tamala-Salaga road and the upgrading of the Accra-Kasoa and the Accra-Nsawam highways into dual carriages.

3. State Owned Enterprises

3.1 Key Industries and needed investment capital estimated by the Government.

· Afforestation = $2 Billion

· Telecommunication = $500 Million

· Housing = $500 Million

· Roads = $1 Billion

· Railway = $1 Billion

· Water = $1 Billion

· Total = $6 Billion.

3.2 Targeted SOEs

On mobilizing Ghanaians abroad to buy SOE’s, Hon. Baah-Wiredu advised the DENI team to pursue Tema Oil Refinery as top priority as the government seeks to sell 35% of the company. Others include the following:

· Ghana Commercial Bank

· Ghana Oil Company Limited (GOIL)

· State Insurance Corporation (SIC)

· Social Security & National Insurance Trust (SSNIT)

4.0 DENI Program Consultant Directory

4.1 Ghana DENI Mission

Fred Kwoba, Bestway Zottor, Richmond Kyei-Fordjour and Yaw Owusu are working out the schedule for 8 knowledgeable individuals to visit Ghana in June 2006 to begin the development of DENI into a full-fledged project and marketing it, first and foremost, to all stakeholders in Ghana, including Ghana’s parliament. During the same period, due diligence work will be done on the SOEs to be offered for sale to Ghanaian expatriates

Representative	Title	City, State	Email	Phone
Frederick Kwoba	Exec Dir, US-Africa Bus Council	Boston, Mass	frederick.kwoba@deniafrica.com	(781) 648-2535
Bestway Zottor	CEO, Nubex Technologies, Inc.	Ottawa, Ontario	bestway.zottor@deniafrica.com	(613) 236-3965
Yaw Owusu	CEO, Ghana Cyber Group, Inc.	Bristow, Virginia	yaw.owusu@deniafrica.com	(646) 207-2515
Richmond Fordjour	Consultant, Fannie Mae Corp	Washington, DC	richmond.kyei-fordjour@deniafrica.com	(646) 678-0159

4.2 DENI Implementation

Hon. Kwadwo Baah-Wiredu advised the DENI Team to contact Secretary Drusilla and Hon. Kwaku Agyeman Manu, the Deputy Minister of Finance & Economic Planning at 021-66-55-87 in Accra to discuss the proposed DENI trip to Ghana

GhanaWeb reports on the state of Ghana Telecom:

The age-old notion that national telecom firms represent a crown jewel in assets for countries is ill-conceived and should make way for modern-day realism. Due to rapid changes in the telecommunication industry, governments are not well-positioned to preside over the industry’s affairs. Government bureaucracies are inherently lethargic and not nimble enough to leverage the ever-changing technological innovations that have persistently engulfed the industry. This explains why many governments have chosen to privatize their telecom ministries…It is only by so doing that telecommunication can become a backbone to the economic transformation of Ghana that invariable culminates in the realization of the country’s vision of accelerated economic development.