BoG explains the re-denomination of cedi

The Bank of Ghana (BoG) on Monday said the design and the features of the new notes and coins, which would replace the current cash in circulation, would soon be made known to the public.

Briefing the press in Accra, Mr Van Lare Dosoo, First Deputy Governor of the Bank, said there would be practical guidelines and a coherent education programme for the public before the switch to the new denomination.

He said the Ghana Cedi to be introduced in July 2007 would receive legislation from Parliament to validate it use. The Governor, Dr Paul Acquah last Saturday announced the re-denomination of the cedis by setting 10,000 cedis to one new Ghana Cedi (GH Cedi) which would also be equivalent to 100 Ghana Pesewas (Gp).

This means that 500,000 cedis would be equivalent to 50GH Cedis; 200,000 cedis would be equivalent to 20GH cedis; 100,000 cedis would be equivalent to and 10GH cedis; 5,000 cedis would be equivalent to 50Gp; 2,000 cedis would be equivalent to 20Gp and 1,000 cedis would be equivalent to 10Gp.

The series of the new set of notes would be 0ne GH Cedi, Five GH Cedis, 10 GH cedis, 20 GH cedis and 50 GH cedis whilst the coins take 1Gp, 5Gp, 10Gp, 20Gp, 50Gp.

Both the old and new cedi bank notes and coins would be in physical circulation for a period of six months after which the old notes and coins would only be exchanged at the Bank of Ghana and any commercial or rural bank. After the period, the old notes would not be legal tender but could be exchanged at the banks for the new currency.

The external value of both the old and new currencies would be the same as the purchasing power would not change because the cedi would not be devalued or re-valued. Explaining the rationale further to journalists at the press briefing, Dr Ernest Addison, Head of Research, BoG, said experience elsewhere had shown that re-denomination of a currency by dropping zeros in the relative prices of domestic price relation led to significant efficiency gains in the context of strong economic fundamentals and macroeconomic stability.

This, he said, was the situation characterizing Ghana’s economy today hence the major policy decision. He said the growth environment of the economy was strong and positive, with all the underlining conditions such as inflation, interest rates, money supply and exchange rates showing good expectation of policy credibility.

Dr Addison said the benefits the new notes and coins would bring to the economy were incalculable. He said it would reduce the cost and overall risk of carrying large sums of notes, inject efficiency in the payment system, in particular the use of Automated Teller Machines (ATMs), and simplify accounting records.

Dr Addison said it would also reintroduce the culture of using coins in Ghana, promote tourism expenditures, make significant gains in cost of bank notes production and facilitate the introduction of the use of vendor machines and car parking meters. Dwelling on the implementation process, Ms Catherine Ashieley of the Issues Depart of the BoG, said 49 countries world wide had successful gone through the process of re-denomination.

She said research analysis had shown that within the first three months of introduction, about 75 per cent to 80 per cent of the old currency was likely to be withdrawn from circulation since most people would like to switch to the new denomination as early as possible.GNA

Regional workshop on Government Securities opens

Dr Chris Itsede, Director-General of the West African Institute for Financial Management (WAIFEM), said on Monday that a good government securities market was essential to facilitate the achievement of monetary objectives.

In a speech read for him by Mr Arthur Ankrah, Director Financial Sector Management Department of WAIFEM, at a regional workshop on pricing and marketing of Government Securities, Dr Itsede said the securities market was an alternative to central bank funding of budget deficit because of its minimal distortion on monetary policy.

Besides, it provided instruments for effective monetary policy management. The one-week course is necessitated by the growing pressure on most countries to bridge financing gaps through reliance on domestic sources and also because domestic mobilisation is crucial to the launch of the West African Monetary Zone. Dr Itsede said the existence of such a market could enable the Government to respond to shocks, he said.

He said when a Government Securities Market was complemented with a sound domestic debt management strategy; it could relax the fiscal burden by reducing debt service costs over the medium to long term period thereby reducing Government exposure to interest rate and other financial risks.

At the microeconomic level, such a market could strengthen overall financial stability, enhance financial intermediation and spur competition among financial services providers. "As Government and Private Sector Securities Markets develop, commercial banks tend to develop related financial infrastructure and products and intermediate credit more competitively."

But for a successful development of the Market, conditions such as a sound macro-economic policy framework, prudent and sustainable fiscal policies, property rights and an effective legal, tax and regulatory infrastructure are required. Also important are efficient and secure settlement mechanisms and a liberalized financial system.

Dr Itsede called for the nurturing of primary dealers while a secondary dealer system was being evolved.GNA

Asantehene's convoy involves in accident

Barely 24 hours after the convoy of Vice-President Aliu Mahama got involved in a motor accident that claimed the lives of three security details, another accident involving the convoy of Asantehene, Otumfuo Osei Tutu II has occurred in Brong Ahafo.

An eyewitness, Mr. Kwame Siaw, a teacher, told the Ghana News Agency on telephone he was on board a metro mass transit bus when the accident occurred near Bawuah Farms at Nsoatre, off the Sunyani-Berekum road.He said a Mercedes Benz saloon car driven by one of the sub-chiefs in the Asantehene's convoy, in an attempt to avoid hitting the vehicle in front of him veered off the road and somersaulted into the bush.

The convoy was travelling to Seikwa in Tain district to attend the 15th anniversary celebration of the enstoollment of Nana Kweku Dwuma Ankoana II, Omanhene of Seikwa Traditional Area and the launch of an Educational Endowment Fund.Meanwhile the injured have been taken to the Berekum Governemnt Hospital and are responding to treatment.

When contacted, Chief Superintendent Christian Yohonu, Commander of Sunyani Municipal Police confirmed the incident.In another development, the four injured persons in the accident at Chiraa, near Sunyani, involving the Vice President's convoy were reported to be responding to treatment at the Regional Hospital in Sunyani when GNA visited the hospital.

They are Mr. Peter Ekpedzor, 46, driver, Mr. Awortwi Bonni Fred, 25, bondman, Mr. Edward Bediako 28 and Mr. Abdul Rahman, 35, both cameramen of Metro TV.

The names of the dead were not disclosed as the hospital's authorities said they were waiting for directives from the Vice President's office before they could do so.Meanwhile, Barima Afari Minta II, Chief of Chiraa, has, on behalf of the chiefs and people of the area expressed condolences and sympathy to President Kufuor and Vice President Aliu Mahama and the families of the victims of the accident.

In a telephone conversation with the Ghana News Agency, the chief said the chiefs and people were really saddened at the incident and expressed the hope that all Ghanaians would console with the bereaved families of the victims who suffered in the course of rendering services to the state.

He reiterated his appeal for a re-designing of the road from Sunyani to Techiman to avoid the recurrence of such accidents and the subsequent loss of lives.The chief noted that the nature of the road had made it accident-prone, culminating in many deaths in this year alone.

Nana Afari cited that there are as many as 35 curves on the road, coupled with many hilly points and this had made it quite difficult for drivers not conversant with the nature of the road to ply on it safely.
Source:GNA

Veep in Accident - Three Die

One of the cars in the Vice President, Aliu Mahama’s convoy was yesterday involved in a fatal motor accident at Chira, near Sunyani in the Brong Ahafo Region, at about 2:30pm.

At least two people, believed to be the vice president’s security guards, died on the spot, while a third died at the hospital.

The convoy was en route to Sunyani after paying a courtesy call on the Omanhene of Techiman Traditional Area, Oseadeyo Akumfi Ameyaw IV, and inspecting the up-grading project of the Asuogyaman Secondary School in Awirewa,Techiman.

One of the seven persons on board the Land Cruiser, with registration number GR978W, died instantly while the other died on the way to the hospital.

Five others including media personnel and the driver sustained various degrees of injury, with one in a very critical condition.

The five, who are receiving treatment at the Sunyani regional hospital, are likely to be flown to the 37 Military Hospital today for further treatment.

The bodies of the deceased have been deposited in the morgue awaiting autopsy.

The site of the tragedy is said to be a flash point, known for such fatal accidents.

It is a sharp curve on a slope and drivers who are not familiar with the road run into frequent accidents.

The driver of the vehicle, which was directly behind that of the Vice President’s, is said to have veered off the road in an attempt to prevent his car from hitting the vice’s and consequently somersaulted. The vehicle which had one of its front tires busted was damaged beyond repair.

An eyewitness explained that about seven cars behind the accident vehicle, including that of the Vice President’s would have suffered the same fate, but for the skillfulness of the driver.

At the time of filing this report, the driver was also receiving treatment.

In a related development one of the Vice President’s dispatch riders was also thrown off his motor-bike, while traveling to Techiman earlier in the morning.

The front tyre of the bike busted around Yawhimah, 10 minutes drive from Sunyani.

He was apparently saved because of his helmet.

Work on National Electronic Fibre Backbone takes off soon

Professor Mike Ocquaye, Minister of Communication on Saturday said work on the National Electronic Fibre Backbone to make Ghana an Information Technology (IT) motorway would begin soon.

Parliament had already approved a 30 million dollar loan with an additional 50 million dollar grant from China for the facility to make internet connectivity and general IT networking easier to accelerate development prospects in the country.Prof. Ocquaye announced this when addressing a durbar to climax the maiden homecoming of Old Students Association of Dzodze Penyi Secondary School (DZOPOSA) at Dzodze.He said another 40 million dollar scheme called E-Governance system in which IT would be applied in policy implementation between Government, Ministries, Departments, Metropolitan; Municipal and District Assemblies as well as the business community was also in the offing.Prof. Ocquaye noted that there were prospects in the country's youth in IT as the new economic lifeline in the world and asked all and sundry to take advantage of the system to build their capacity in knowledge, business and education.He commended DZOPOSA for coming together to propel the growth of their alma mater in the right spirit of nation building. "I urge you the students to learn hard despite the situation in the school because victory is sweet after a great battle. Performance is the essence of education or else we are wasting our time," Professor Ocquaye said.Professor Ocquaye suggested that a system be devised for evenly distribution of educational facilities in schools to avoid the situation in some deprived schools.He presented three sets of computers being the first batch of five sets from Internet Ghana for a proposed computer laboratory in the school and pledged to negotiate with the management of Ghana Telecom (GT) to extend a line to the area from Denu to hook the computer centre onto the net.Dr Emmanuel Srofenyo, a Medical Practitioner and President of DZOPOSA said the association spent about 400 million cedis mobilized from members and 400 bags of cement donated by the management of Diamond Cement company for the expansion and refurbishment work on the old school library which was inaugurated as part of the homecoming. Mr Ebenezer Attieku, Headmaster of Dzodze Penyi Secondary School changed from Dzodze Training College in 1972, had continued to grapple with inadequate and poor facilities and commended DZOPOSA for its programmes to rehabilitate some of the infrastructure. He expressed appreciation to Government for the construction of a multi-million cedi assembly and dinning hall project at the school. 2

Source: GNA

Twists and turns in MP's "fake gold" case

The Accra Regional Police Command has denied that the National Democratic Congress MP for Sene, Felix Twumasi-Appiah who was arrested for allegedly attempting to sell fake gold to a businessman was detained on "orders from above."Mr Douglas Akrofi-Asiedu, Accra Regional Police Commander has told the Ghana News Agency that, he was surprised that the MP had the audacity to "peddle such lies." "I never know him, till after telling his story and mentioning his name, he added that he was an MP".Mr Akrofi-Asiedu said, "I told him that for him to invite Mr Charles Dejoe the businessman to be defrauded, he could be held responsible for his actions."He said his outfit took action before informing his superiors so the claim that the MP was detained on orders from above was not true but an attempt to put a spin on a purely criminal matter. Mr. Felix Twumasi-Appiah, and three others were arrested for allegedly attempting to defraud a businessman by selling to him fake gold dust to the tune of 800,000 dollars.The other suspects were Wallace Mensah, Kwantwi Barimah and Tony Delor.DeputySuperintendent of Police Kwesi Ofori of the Police Public Relations Directorate told the Ghana News Agency that Mr Charles Dejoe, the complainant, said he was outside the country when the MP called him that he had 50 kilogrammes of gold to sell at 16,000 dollars per kilogramme.Mr. Dejoe came to Ghana to buy the metal but suggested that the gold should be sent to the Geological Survey Department for testing. Mr Ofori said the suspects suggested that a sample should be tested and after the test, Mr Dejoe requested that the whole quantity, packed in a metal box and sealed, should be tested as well, but Mr. Twumasi-Appiah objected.Mr Ofori said the complainant became suspicious and informed the Police who stormed the Survey Department premises and arrested the suspects.Speaking to the GNA at the Accra Regional Police Headquarters on Saturday, Mr Twumasi-Appiah said earlier in the month, a friend called him to say that he had some people who had 50 kilogrammes of gold to sell and whether he (Twumasi-Appiah) could get a buyer for the precious metal.Mr Twumasi-Appiah, who is also an investment consultant, said he then got in touch with one Mr Charles Dejoe, a friend and a gold dealer, about the offer.Mr Dejoe, he said, then told him that he was out of the country but that, in view of the quantity of gold involved, he would personally come down to Ghana for the transaction.Mr Twumasi-Appiah said on Thursday, November 23, Mr Dejoe contacted him and he told him that the consignment was in.Mr. Dejoe then asked that they should meet at the Geological Survey Department (GSD) to test the quality, quantity and carat level of the gold.He said he got to the GSD on Friday after 1200 hours and met the said sellers of the gold numbering about six.He said, in view of where Dejoe's office was located at East Legon, and the fact that he Twumasi-Appiah did not have enough time to spend at the GSD he called Dejoe to ask that he named someone at the GSD who would witness the test.Dejoe gave him two names of the staff of GSD, but they were both not at work.He then proceeded for testing of the sample of gold brought by the sellers as a representative of the buyer.Mr Twumasi-Appiah said when Mr Dejoe finally arrived at the GSD premises he asked that the whole consignment be tested instead of just the sample at the expense of the sellers.Mr. Dejoe then requested that the 50 kilogramme box which the sellers had brought to the GSD be opened, whilst he Twumasi-Appiah was in the laboratory.He said Mr. Dejoe then called him in the laboratory and said that the sellers were not genuine people because they had refused his request for the box to be opened.But to ensure that the sellers paid for the cost of testing the samples, and because both he and Dejoe had unspecified amounts of cash in their vehicles, he Twumasi-Appiah called the police to give them adequate protection, in case the sellers turned out to be fraudsters.He said Mr. Dejoe also called the police 20 minutes after he had placed his call.When the policemen he had called arrived, they were able to arrest and handcuff two of the sellers after four of them had bolted.He said they were in the process of conveying the two sellers to the police station when the other policemen Mr Dejoe had called arrived and helped them to send them to the Accra Central Police Station.Mr Twumasi-Appiah said at the station, he was waiting for the statements of the two suspects to be taken when he was informed that the Regional Commander, ACP Akrofi Asiedu wanted to see him, only to be told by the Commander that there was order from above to detain him.He said he insisted to know by whose orders he was being detained but the police did not divulge that information to him.He was detained from 2100 hours to 2300 hours and later called from the back of the counter to go home and to report at the same police station on Saturday but when the Regional Commander arrived at post he asked that he should report back on Monday, November 27.He expressed amazement on how he had become the accused when he had requested the people to arrest the gold sellers. GNA

Central Bank to re-denominate Ghanaian cedi

The Bank of Ghana says beginning from the middle of next year, it will re-denominate the nation’s currency, the cedi. When the policy is implemented, the cedi will be set at 10,000 cedis to one new Ghana cedi, meaning an item that costs 10,000 cedis will be priced at one cedi. The Deputy Governor of the Bank of Ghana Dr Mahamadu Bawumia who confirmed the new upcoming policy, assured that it will not affect the value of the currency in anyway. The Governor of the Central Bank Dr Paul Acquah revealed the re-denomination at the annual dinner of the Chartered Institute of Bankers in Accra. The Governor explained that after years of economic stability, it was time to re-denominate the cedi to prevent the situation where people had to carry large sums of physical cash for transactions. Explaining details of the exercise to Joy News, the Deputy Governor of the Central Bank Dr Mahamadu Bawumia said the value of the cedi will not change but a smaller amount of money will be required for transactions. According to the Bank of Ghana, new notes and coins will be issued when the re-denomination exercise comes into effect by July next year and the highest cedi denomination will be 50 cedis which will be equivalent to present day 500,000 cedis.

Dr Bawumia assured the public that there was no cause for panic, as enough time would be allowed for people to change over when the policy was implemented.

The decision to re-denominate the cedi is to reduce the cost and risk associated with having to carry large sums of money in transacting business, the difficulties in calculating or preparing accounts with huge figures and the strain on the use of ATMS.