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22.08.2003 Business & Finance

VEEP urges ECOWAS member-states to honour financial obligation

By GNA
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(From Beatrice Akua Asamani GNA Special Correspondent, Lome)

Lome (Togo), Aug. 22, GNA- Ghana's Vice-President, on Friday inaugurated the first Board of Governors of the ECOWAS Bank for Investment and Development (EBID), with a call on the Board to devise innovative strategies to collect the 11 million Units of Account call-up capital owed by member countries.

"You would have to discuss, dispassionately and address the issue of Member States' arrears to call-up capital of the Bank," Alhaji Aliu Mahama said on Friday in Lome, Togo.

"This is a matter of great concern, which has to be resolved immediately, else, the international capital market would not take this new Bank seriously".

About 750 million dollars is required for the call-up capital. EBID, the financial arm of the 15-member regional body that replaced the ECOWAS Fund, will support regional integration, infrastructure and other development programmes in the public and the private sectors.

The Bank has two subsidiaries that would support the development of ECOWAS through the financing of special programmes and projects. They are ECOWAS Regional Integration Bank and the ECOWAS Regional Development Fund.

Alhaji Mahama said the objectives of the Bank to support the private sector as the engine of economic growth was laudable, but explained that efforts to foster regional integration through infrastructural projects and alleviation of poverty, would not materialised if member states neglect their financial obligations. "The entire continent of Africa is still in a precarious economic situation, characterised by a very high population growth and a relatively low rate of growth.

"Indeed the economic performance of African states remains below the seven per cent growth rate fixed by the Millennium Development Goals that aim at reducing poverty by half, by 2015."

Vice-President Mahama advised the highest decision making body of the Bank, to rise above the problems with their collective energies, determination and pragmatic strategies to facilitate the growth of the economies of member states.

He suggested the need for a Railway Link between Ghana, Togo, Benin and Nigeria to facilitate the objectives of the New Partnership for African Development (NEPAD).

Mr Christian Adovelande, President of the EBID said only 43 per cent of the total call-up capital for the first phase, has been paid by member countries.

Mr Adovelande complained about the poor collection rate of levies but said efforts would be intensified to improve them. He, however, acknowledged the poor economic performance rate of African economies, saying it has deteriorated from eight to two percent last year.

He expressed his determination to work with the Board of Governors to transform the Bank into a "cradle of performance and excellence".

Togolese Prime Minister, Koffi Sama said internal funds would not be adequate for project financing and encouraged managers of the Bank to implement programmes that would secure adequate external funds. "You must be progressive and dynamic in your mobilisation drive to meet the expectations of the people", he said.

Mr Samuel Apea, Managing Director of the ECOWAS Fund from 1993-1998 told the Ghana News Agency (GNA) in an interview in Lome that the major challenge of the Bank was the mobilisation of contributions from member states.

He said the World Bank and the European Union (EU) were being deterred by the attitude of non-payment of levies and call-up capital to give their support to the EBID.

The ECOWAS Regional Integrated Bank would focus on financing the private sector while the ECOWAS Regional Development Fund would fund non-commercial public sector and poverty reduction programmes and also serve as a facility to support the effort of NEPAD.

It took 13 years to transform the ECOWAS Fund into a Bank to meet changing trends and needs of the sub-region.

The Board of Governors are members of the ECOWAS member states that are either Finance or Economic Planning Ministers while the Board of Directors is made up of technical experts.

Dr Kofi Konadu Apraku, Ghana's Minister of Regional Integration and NEPAD is a member of the Board of Governors while Mrs Matilda Obeng-Ansong, Managing Director of the Ghana Commercial Bank (GCB) is serving as a Board Director. 22 Aug.03

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