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19.11.2005 Business & Finance

Financial instruments to attract more remittances in pipeline

By GNA
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From Emily Nyarko, Special GNA Correspondent, Tunis

Tunis, Nov. 19, GNA - Government is devising ways of attracting more remittances through the use of financial instruments for development purposes.

It is estimated that government could attract more funds or triple remittances through official channels using financial instruments such as bonds for development purposes.

Remittances that are transferred to Ghana through official channels are estimated at two billion dollars. Vice President Alhaji Aliu Mahama made this known when he received a team of Ghanaian experts from the African Development Bank (ADB) during the Second Phase of the World Summit for the Information Society (WSIS) in Tunis.

The Vice President Mahama led a Ghanaian delegation made up of Information, Communications and Technology (ICT) experts from the Ministry of Communications, National Communications Authority and some members of the national committee of the WSIS to participate and contribute to discussions towards a final document for the implementation stage of information society's goals.

Ghana is also the Chair of the African community.

The team of experts, which was led Mr Charles Boamah, an official of the ADB had suggested that government devised means of attracting funds through remittances for which he said unscientific survey proved that for every dollar remitted through official channels, three dollars was received through unofficial means.

The team also urged government to concentrate on building a vibrant tourism sector, which was the driving force of foreign exchange earnings in Tunisia.

They also asked the government to network with Ghanaian experts in the Diaspora in order to derive maximum benefits for development and gave the assurance that they were ready to work for Ghana if invited. The team gave areas of interest of the ADB for the private sector for which Ghanaian companies could apply to expand businesses and to contribute towards job creation and development.

Alhaji Mahama said cabinet had discussed the issue of remittances and expressed the hope that such a mechanism proposed by the team would be soon be operational.

The Vice President, who had earlier discussed some areas of support with the President of Tunisia...said that country operated a similar mechanism and had expected to attract about 500 million dollars when it began operating but received three times more than the target. He said serious work was ongoing to double earnings from tourism sector by 2007.

The sector is the third highest foreign exchange earner in Ghana. The Vice President said it was estimated that blacks in the Diaspora spent about 40 billion dollars in foreign exchange revenue on tourist sites and that if Ghana could attract about three percent of that amount, it could boost development in the country.

He mentioned a series of projects being undertaken by the sector Ministry such as the Joseph's project, tourist receptions being established on tourism routes in Ghana and efforts to monitor trends at the ports of entry.

Alhaji Mahama said, so far Golden Tulip Hotel had expressed interest in revamping the former City Hotel; Hilton Hotel was about to establish in Ghana; the Saudi's interest in the former Ambassador Hotel was pending while a South African company had also shown interest to construct a Hotel on the Accra Hearts of Oak Park in Accra. The Vice President welcomed the suggestion to utilise expertise of Ghanaians living outside of Ghana and said it was in this direction that the current Minister of Trade and Industry facilitated the skills bank project and said government was working towards its realisation. He touched on progress made so far to develop the country since the present government took office and said inflation would have hit a single digit but for the high price of crude oil.

He said interest rates had declined from nearly 50 per cent, adding that, "the current prime rate is attractive for business to access loans for expansion."

Alhaji Mahama also spoke about improvements in the education sector, efforts to make health facilities accessible to all, improvements in the agricultural sector, transportation and human resources.

On ICT, the Vice President said Ghana needed to move faster in order to catch up, adding, "what we have seen here is scaring and we must do all we can to catch up."

He however, urged members of the team to device ways of attracting investments to the rail sector, which had the potential to also generate more revenue through both the southern and northern routes to and from the neighbouring countries since the road transport was having a toll on the current road facilities.

Communications Minister Albert Kan-Dapaah defended the early reading of the government's budget for 2006 and said it was a good practice to have a financial and development plan ready in order to know priorities to work with at the beginning of the year. He said the budget concentrated on incentives for the private sector and job creation and observed that government needed more ideas but required the trust of the private sector in order to achieve the set objectives.

The International Telecommunications Union (ITU) and United Nations are spearheading the WSIS, which ends on Saturday. The summit aimed at bringing stakeholders together and adopt strategies for the application of ICTs for development. The first phase of the summit was held in Geneva, Switzerland in 2003 and adopted a declaration of principles and 15-point action plan to guide stakeholders in promoting access to and the use of ICT tools and infrastructure to transform the lives of people.

The second stage of the summit in Tunis, dubbed: "Summit of Solutions" is aimed to translate the declaration of principles and the action plan into concrete action plans for implementation by the about 50 heads and stakeholders attending it.

The objectives of WSIS are linked to the MDGs, which aims to half the worlds poverty by 2015. WSIS also aims to translated access to and use of ICTs through the use of information and databases in all sectors for development.

More than 10,000 delegates from 176 countries made up of Heads of State and government, top level executives from over 200 companies including Alcatel, Ericsson, France telecom, Google, Microsoft and Nokia, civil society groups and the media attended the summit.

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