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We’ll ‘monetise our gas’ – Akufo-Addo

February 17, 2017 by oilgas in News in Brief with 0 Comments

nana addoPresident Nana Akufo-Addo has said Ghana intends monetising its gas resources from the Jubilee, TEN, and Sankofa oil fields.

“Our oil and gas deposits in the Jubilee, TEN and Sankofa fields offer us the perfect opportunity to create petrochemical industries, including monetising our gas to create a multi-billion dollar gas feedstock industry,” Nana Akufo-Addo said at the New Year Greetings with the Diplomatic Corps on Wednesday, 15 February.

“We have the opportunity to link together our numerous natural resources, like food produce, bauxite, iron ore, oil and gas, with our talents, energy and sense of enterprise to turn our nation into an economic powerhouse in Africa, generating employment and income for our youth,” the president said.

Below is the president’s full speech:

I am honoured to have all of you present at this evening’s event and happy to see you. Some faces are familiar, as I had the privilege of meeting them during my time as leader of Ghana’s opposition, and a few others also, from the now distant days of my period as Foreign Minister. Others I am seeing for the very first time. Nonetheless, I am happy to see you here at the seat of the presidency and I know that, over the course of my tenure of office, we will have the opportunity to meet regularly and interact

I am particularly touched that I have become Ghana’s President in this sixtieth year of our independence, a symbolic year, and I hope that the remembrance of the sacrifices and efforts of our founding fathers, those who gave their lives to achieve our independence, will guide and motivate me in the discharge of this high office. I pray for God’s support.

At the onset, let me thank Ambassador Mrs. Pavelyn Tendai Musaka of the Republic of Zimbabwe for her leadership these past years as the Dean of the Diplomatic Corps. Your Excellency, everyone I have spoken to pays glowing tribute to you, and I can only encourage you to keep it up.

As you are all aware, I am in the process of forming my government. I have been in office for some 5 weeks, and so far so good. Parliament has approved all 36 of my ministerial nominees; the 10 Regional Ministers are currently being vetted; and shortly I will announce my nominees for the positions of deputy Ministers. The various Metropolitan, Municipal, and District Chief Executives will soon be announced, and, already, a number of heads of state institutions and agencies have been appointed, albeit in acting capacities, pending the constitution of the Council of State.

Yesterday, I announced the names of 11 eminent Ghanaians who I have appointed to the Council of State, and I have sent to Parliament for its approval the names of two distinguished former leaders of our security services for appointment to the Council of State, as required by the Constitution. The election of regional representatives to the Council, which will complete its composition, will take place tomorrow. I expect that, by the middle of next month, God-willing, the full complement of the Akufo-Addo administration will be in place, so we can mobilise all our forces to deliver on the mandate entrusted so emphatically on our shoulders by the Ghanaian people on December 7, 2016.

Ghana, today, is facing a promising future. We have enjoyed the longest period of stability since independence. We are, arguably, the most stable, fluorishing democracy in our region and continent, who showed, on the 7th of December last, dignity and serenity in the exercise of our sovereign franchise. We have a large pool of educated Ghanaians, both in Ghana and in the Ghanaian Diaspora, and a hardworking population from which we can draw to drive our economic development. We have seen sustained economic growth over the last two decades. Despite the decline of the last few years, we continue to be one of the leading producers of gold and cocoa in the world, and on top of all that, we are now an oil producing economy. Sadly, however, the structure of our economy has not changed substantially since the era of Governor Gordon Guggisberg – an exporter of raw materials with little or no value-addition activities. This is why I have called our economy the Guggisberg economy.

My government’s commitment, which I have attempted to articulate over the years, will be to inspire the transformation of the structure of the Ghanaian economy. My government’s economic vision will focus on executing an integrated industrialisation programme, with a clear bias towards supporting our small and medium scale enterprises with access to science and technology, incentives and markets to make them more productive and competitive. We plan on introducing programmes that will boost productivity of the agricultural sector and introduce incentives that will encourage our banks to provide affordable credit and other financial services to SMEs and launch a new wave of viable industries across Ghana. This is summed up in our slogans “1-District-1-Factory” and “1-Village-1-Dam”.

Our oil and gas deposits in the Jubilee, TEN and Sankofa fields offer us the perfect opportunity to create petrochemical industries, including monetising our gas to create a multi-billion dollar gas feedstock industry. We have the opportunity to link together our numerous natural resources, like food produce, bauxite, iron ore, oil and gas, with our talents, energy and sense of enterprise to turn our nation into an economic powerhouse in Africa, generating employment and income for our youth.

My government is not going to shy away from making the critical choices that are necessary for the long-term interest of our people. We are going to invest heavily in building up the most important ingredient of development: the intellectual property of the people – the mind – education, education, education – our sure key to success. We want to add value to our human capital, add value to our governance, add value to our public services, add value to our infrastructure and add value to our economy. We will govern honestly. We are determined to get Ghana once again to lead our continent on two fronts: in entrenching democracy and the rule of law, and in transforming the structure of the African economy to a modern, manufacturing kind that has the capacity to generate jobs for our people, and create and spread wealth across the length and breadth of our vast continent.

It was not for nothing that Ghana was the first black African country to break free from colonial rule. We are determined to show that we can emulate the successes of the Asian nations, and, thereby, create a modern, prosperous nation. We believe that a world dominated by a handful of rich nations, with the majority of nations in the south languishing in poverty and misery, is not a prescription for global security. Our generation is not seeking hand-outs from anybody, and neither are we going to be pawns or victims. And to paraphrase Edmund Burke, the famous British statesman, it is in the interest of global equilibrium that wealth should be found everywhere.

Our common humanity requires that we forge partnerships with the developed world that would lead to the transformation of the lives of the Ghanaian and African peoples, a transformation that would bring the mass of our people out of poverty into a marked enhancement of the quality of their lives. To this end, perhaps now more than ever, I wish to assure you that all the alliances and friendships that we have entered into over the last 60 years are going to be developed and maintained during my time as President of the Republic. We are determined to leverage these alliances and friendships to grow our economy and nation.

Ghana’s engagement with other African countries will be the prime focus of its foreign policy. Ghana will be very active members of ECOWAS and the AU. It is in this spirit that we deployed some 208 troops as part of ECOWAS’ mission to the Gambia. This mission created an enabling environment for the effective enforcement of the rule of law in the Gambia, and, thus, made it possible for a peaceful resolution of the electoral impasse. The decisive election of our compatriot, Thomas Kwesi Quartey, a professional diplomat, who acted as Secretary to my predecessor, President John Dramani Mahama, as Deputy Chairperson of the African Union Commission, and the election of Kathleen Quartey Ayensu and Daniel Batidam onto two legal organs of the AU, at the just ended 28th Summit of the AU in Addis Ababa, points to Ghana’s determination to retake her pride of place amongst the comity of nations on the continent. We support fully the important decisions taken at this year’s AU Summit. Proposals for institutional reforms of the AU were considered and accepted. The Summit agreed on new, sustainable ways of financing the AU so the body can be self-sufficient and preserve its self-respect by weaning itself off dependence on the charity of others. The Assembly of Heads of State also signed up to the Continental Free Trade Agreement, whose purpose is to ensure significant growth of intra-Africa trade, as well as to assist countries on the continent to use trade more effectively for growth and sustainable development.

The growth of democracy in our country and continent is threatened by the spread of terrorism. Ghana stands firmly with all civilised nations in repudiating terrorism as an instrument of political action and commits itself to doing everything within its means to support regional, continental and global efforts to defeat this 21st century scourge.

Ghana is equally committed to the reforms of the global political order. The inability of the United Nations to undertake the reforms of its institutions that will reflect the realities of our times, and not the realities of the post-war world, represents a manifest injustice against the peoples of Africa. We, on this continent, are an integral part of the global order, and global institutions should reflect this fact. For a handful of states who emerged as the dominant powers in the world after the Second World War of the 20th century to continue, in the 21st century, to be the sole arbiters of international security remains, to us, a structural deficit, which the world community should no longer tolerate. I had the privilege as Foreign Minister of chairing the colloquium of Foreign Ministers that fashioned the Ezulwini Consensus -–Africa’s common position on UN reforms. I continue to subscribe to the goals of that consensus, and would use this occasion to call for the reform of the Security Council to reflect the realities of our time.

Our commitment to the values of democracy, respect for human rights and the rule of law will continue to shape our foreign policy. I would, therefore, like to renew my commitment to Ghana’s continued collaboration with your respective countries and international organisations in this symbolic year and in the many years ahead, in order to advance further our common pursuit of greater co-operation, and to deepen and strengthen our ties of friendship.

There is a new wind of optimism and revival blowing today across our country, which we are determined to harness to bring about the progress, prosperity and happiness of the Ghanaian people.

I wish you and your families well, and above all, success in your duties as accredited representatives of your countries and international organisations to Ghana.

Happy New Year, Afehyiapa, and may God bless us all.

Thank you.

Source: Ghana/

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Revenue mobilization from the oil sector for Agricultural production in Ghana, a myth or reality?

We are back with Penplusbytes Online Discussion on Oil and Gas. This latest episode, starting from today Monday 6th June,…

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    • Comment by Godwill Arthur-Mensah,my take on the mobilization of oil revenues

    I strongly believe that the petroleum revenues had not been strategically invested in the agricultural sector and I agree with Dr. Ishmael Ackah, the Head of Research, Monitoring and Evaluation at the Africa Centre for Energy Policy (ACEP), who stated in a forum in Takradi last year that Government have not made strategic investment in agriculture because in 2014 budget, 70 percent of the agriculture budget went into the construction of  four sea defence walls projects, instead of food crop production or aquaculture.

    Currently, the cost of cassava is very high in the Western Region and in other parts of the country because the demand had outstripped supply due to decline in production.

    Over the years, growth in the agricultural sector had declined, recording growth of 7.4 per cent in 2008 followed with 7.2 per cent, 5.3 per cent and 0.8 per cent in 2009, 2010 and 2011 respectively, according to statistics available to the Ministry of Food and Agriculture.

    It is unfortunate that Government had been replacing its normal allocation to the agricultural sector with petroleum revenues allocation as determined by the Annual Budget Funding Amount (ABFA), instead of the Petroleum revenues complementing the usual allocations.

    Moreover, some peasant farmers in the Western Region had complained bitterly that oil and gas companies had bought arable land meant for agricultural purposes for the construction of their warehouses and thus, deprived them of their livelihoods.

    Godwill Arthur Mensah

    GNA, Regional correspondent(Western Region)

    Comments by Justice Adoboe

    Ghana must avoid making the oil and gas sector another enclave economy.

    Ghana must avoid making the oil and gas sector another enclave economy as the mining sector has been over the years. The fact that our oil sector is a very small one whose direct  impact on the economy in general is quite negligible so far is the same reason part of the revenue accruing from the sector should be re-invested in agricultural development.

    Petroleum can cease to flow tomorrow, but our arable lands which are crying for cultivation will still be  there, investing and the decisions and efforts we make today at investing in the agric sector modernization is what will determine our food security tomorrow.

    As Climate Change is becoming a reality in our case with prolonged drought, short periods of rain but causing severe flooding, especially affecting the northern sector which is Ghana’s granary and the source of legumes and many root crops, the need  of investing in  irrigation across the length and breadth of the country is no more a in doubt but an issue demanding immediate action.

    If we can invest in a quarter of the 1.9 million hectares of irrigable land the country has, we can be assured of an all-year round production of certain key food crops that we spend scarce foreign exchange importing today

    so far only 28,000 hectares of irrigable lands have been irrigated across the country, so you see why we keep importing tomatoes from Burkina Faso.

    Beyond investment in crop cultivation, we also need investment in the other portions of agriculture value chain, talking about input production, storage and timely  supply, modern harvesting, drying and storage methods and facilities.

    As we see investments coming into cocoa processing so also must we invest into food processing and marketing in order to prolong the availability of our key staples.

    If we put these things into practice, the need for GMOs for higher production won’t arise.

    Meanwhile, as we do these investments, the number of those going to be in direct cultivation would reduce, but the other portions along the value chain that would be developed, input production, storage and distribution; drying, processing; storage as well as marketing have the potential to yield more jobs that are higher paying than the sector does now.

    Taking the first step of putting money into the real needs of the agriculture sector is key. As for the reason it was the agric sector investment that had its budget slashed last year as a result of the oil price drops I think was a decision not well thought-out.

    Justice Lee Adoboe

    Senior Correspondent Accra Bureau of the Xinhua News Agency





    MESSAGE FROM DR ISHMAEL ACKAH:  Revenue mobilization from the oil sector for Agricultural production in Ghana, a myth or reality?(DISCUSSION)

    1. Is there a relationship between the fortune of the agriculture sector and a rise of the oil and gas sector?
    Answer: Yes. The oil sector affects agriculture in two main ways. First is the labour  mobility effect. The oil sector draws on the agriculture and other sectors for labour. There are instances where the youth especially leave their farms to go and look for non-existing jobs in the oil sector,. Second, increased foreign exchange into the economy can lead to the appreciation of the cedi and make agriculture inputs expensive, which will in turn make agriculture exports expensive and non-competitive. Both channels can lead to reduction in agriculture output.
    1. What are the drivers or rationale to move resources from oil and gas to agriculture sector?
    Oil resources have two main limitations. First, since oil prices are volatile, revenues are volatile too. Second, oil resources are exhaustible. Due to these reasons, countries that have been successful in managing their oil resources well diversify. Since agriculture provides a competitive advantage to Ghana in terms of fertile land, cheap labour and productive, it is important to build the agriculture sector with oil revenues to serve as a buffer during oil price shocks.
    1. Which countries are suffering a decline in agriculture due to the discovery of oil and gas?
    Nigeria was once the number 1 palm oil producer in the world before oil production started around 1958.
    1. Does Ghana have an inter-sectorial link between the Petroleum and Agriculture ministry?
    No.However, the Finance Ministry usually unofficially serve as the link between different Ministries
    1. Is it a reality that revenues from the oil sector has been mobilized for Agricultural development or not?  If it is what are the things to show?  How many people have benefited from the Oil revenue in the agriculture sector?
    Agriculture is one of the four priority areas that have received oil revenues over the past 5 and half years. Agriculture received about 9.2% of the total oil revenues in the first 5 years. This is relatively low compared to GNPC’s 39%. There is little to be shown for this investment since the sector faces challenges such as oil revenues substituting instead of  complementing traditional sources of funding such as IGF, GOG and development partners. In addition, there are issues of misapplication. For instance, in  2014, 170,62 million Ghana cedis or 43.91 million U.S. dollars was allocated to the agriculture sector from oil revenues.Out of this amount 69 percent went into sea defence projects. Finally, allocation from oil revenues to agriculture has seen a ”see-saw” trend. For example, in 2013, 2.5% of ABFA wa allocated to agriculture. This increased to 31% in 2014 and reduced to 3.5% in 2015. In 2016, it is projected to be 28%. This affects proper planning and productivity. The sector needs an investment plan, guided by effective monitoring and evalutaion and measurable indicators
    6. Oil Revenues as Substitutes instead of complement to the Agric. sector
    Yes. Oil revenues now constitute more than 90% of the capital and goods and service budget of agriculture. This means agriculture will be affected most when there is low oil prices.
    7. Low level  of oil revenues investment in agriculture
    Yes. agriculture has received only 9.2% of oil revenues over the past 5 years.
    8. Have the oil producing districts shown decline in the Agriculture production?
    The oil is produced offshore and the fishermen have been complaining about low catch since the oil production. Alternative livelihood systems have been developed by oil companies.However, it should be institutionalized and properly targeted.
     Inline image
    Ishmael Ackah, Ph.D
    Head of Policy Unit 
    Africa Centre for Energy Policy (ACEP)


    My take on this issue is that the development of Agriculture in Ghana as a result of oil is purely a myth with very little result to show for.

    A 2014 Annual Report of the International Fund for Agriculture Development (IFAD) suggests that West and Central Africa received in excess of US$157.8 Million representing about 22.1% of the total share of  US$713.4 Million funds for financing programmes and projects approved in 2014 alone.

    Although IFADs core mandate is to finance the growth of Agriculture and its value chain to ensure food security in countries, it has interestingly started funding natural resource management especially in cities where these God-given resources are found.

    The following is how the various sub-sectors were impacted through the distribution.

    Agriculture and natural resource management – 32%, Market and related infrastructure – 16%, Rural financial services – 13%, Others 13%,

    Policy and institutional support – 10%Community-driven and human development – 8%, Small and microenterprises – 7%

    Therefore, in 2014 Ghana received its share of the funds distributed  with a breakdown as follows;

    GHANA: Ghana Agricultural Sector Investment Programme (GASIP)

    GASIP will work to reduce poverty in rural Ghana sustainably.

    It will have three components: value chain development; rural value chain infrastructure; and knowledge management, policy support and coordination. Smallholder farmers and resource-poor rural people will be the main targets, particularly women, young people (aged 15-24 years) and young adults (aged 25-34 years). This national programme will be governed by a demand- and market-driven approach. The initial design and financing will cover the first two cycles (six years).

    Approved loan amount: SDR 23.7 million (equivalent to approximately US$36.6 million)

    Approved ASAP grant amount: SDR 6.5 million (approximately US$10.0 million)

    Total programme cost: estimated at US$113.0 million, of which national government will provide US$7.6 million, beneficiaries US$4.6 million, districts US$1.7 million and participating financial institutions US$17.5 million. IFAD is expected to seek additional financing of US$35.0 million in 2016-2018

    Approximate reach: 55,000 households .

    Although Ghana discovered oil in commercial quantities in 2010, and attained middle-income status in 2011, the overarching effect of oil revenue on Agric in this regard is yet to be felt with Agriculture contributing only some  0.04% of GDP.

    We should perhaps take note that Ghana has also been the largest recipient of IFAD‘s loans and grants in the West and Central Africa region since 1980.

    As a journalist, it beats my imagination why these resource nations find it extremely difficult to adequately fund Agriculture which employs the majority of its people. Perhaps Ghana is not alone in this struggle. Uganda, Mozambique and Tanzania can all be fingered. But this should no way be an escape for our leaders to sit up and salvage the situation.

    Finally, the recent Panama Papers which exposed two sons of prominent leaders allegedly involved in illicit financial flows and tax havens i.e Former President John Agyekum Kufour and Kojo Annan, son of former UN Secretary General Kofi Annan should not be swept under the carpet.

    Civil Society organizations like ACEP in Ghana should not be hypocritical to this and they cannot turn a blind eye on the matter. Ghanaians need to be educated on the truth on the issue and certain outcomes reached in this regard.

    Malise Otoo

    Managing Editor,
    Ghana Daily News
    No. 10A Christianborg Castle Road, Osu-Accra, Ghana
    P.O.Box DK 817, Darkuman, Accra
    Comments from Tanko Mohammed Rabiu
    As Ghana congratulates and award farmers today in Bolgatanga in the upper east region, a lot of farmers’, agriculture experts and energy experts are calling on the government to invest heavily in agriculture from the oil revenues. This according to them agriculture contributes faster to poverty reduction than does industrial investments. Agricultural spending has wider redistributive effect citing some examples; Indonesia used its oil rents to supply fertilizer to farmers and develop new crops, building the basis for the country’s green revolution. They also invested heavily in agricultural research to identify new commodities that could improve on export potential. Malaysia invested its oil revenues into forestry and palm oil, building very successful industries. Chile, used proceeds from copper to invest into new agricultural commodities, such as salmon, a product that had not been part of the country’s export products before and other countries who are also using oil revenues to improve in agriculture.
    At the height of the global financial and economic crises in 2007, Ghana discovered oil and gas in commercial quantities estimated at 1.8 billion barrels reserves. In spite of the modest production levels, oil has now become the second largest export of Ghana – US$2.7 billion in 2011 to US$3 billion in 2012; following gold and overtaking cocoa since then. Ghana is also gradually becoming a net exporter of crude oil with oil imports of US$3.3 billion in 2012 versus oil exports of US$3 billion. Over the last 4 years, Ghana earned about US$2.7 billion in revenues to the state. With new discoveries being developed, Ghana could earn more from its share of crude oil. With increasing oil revenues as a result, many are skeptical if Ghana can avoid the curse of oil and transform its oil wealth into positive development outcomes.
    In Ghana, research has shown that at the national level, agricultural public expenditures have the highest returns in terms of agricultural productivity. For one marginal cedi invested in agriculture, GH¢16.8 is returned, feeder roads – GH¢8.8, Health – GH¢1.3. In spite of the potential of this sector to contribute to the country’s development, there continue to exist a wide funding gap in public expenditure. Agricultural share of public spending is currently at 8.5%, which has been insufficient to generate the levels of growth that would reduce poverty levels significantly. This is lesser than the Maputo Declaration of a minimum spending of 10%. If Ghana is to become a full middle-income country by 2015 and see decline in poverty rates of almost 70 percent, the share of agricultural expenditure in public spending would have to almost double from the current 8.5 to 14.1 percent.
    Nevertheless, Allocation of oil revenues to agriculture was increased in the 2014 Budget from GHS20 million in 2013 to GHS136 million in 2014. Agriculture share of oil revenues were allocated to investments focused on small holder farming but farmers are asking for more improvement in the sector. In a telephone interview with the 1996 national best farmer Aloko Dongo who is still in active farming expressed his dissatisfaction on the declining state of agriculture saying farmers do not have access to credit facilities to enhance in their activities. He said many a times a lot of farmers commit suicide after failing to pay back loans taken from financial institutions and said lack of access to market, storage facilities and disease control.
    Speaking to Dr. Amin Adam, the executive director for Africa center for energy policy, ACEP, in an exclusive interview after his presentation on political economy of Ghana’s oil and gas sector/follow the money at a media training for journalist in the extractive sector, said agriculture is the easiest way to reduce poverty in Ghana looking at the scope of the agriculture industry where the sector has more working force. He said there is the need for more citizen participation in decision making process I the oil and gas sector so as to benefit the poor and the vulnerable.
    On the morning of the national farmers’ day celebration, TV3’s morning show “new day” hosted O.B Amoah, a member of the NPP, John abdulai Jinapor deputy minister of power and a member of the CPP. All the panelists reiterated the need for government to invest more of the oil revenue to agriculture and mean while John Jinapor said despite these challenges, government is investing a lot in agricultural industrialization from different funding sources examples like the fomenda sugar factory, shea butter factory at Buipe, rice mills in Tamale and Nasia.
    According to the 2015 budget, 3.95% of the total budget went to agriculture and only 1.39% was spent and in the 2106 budget it declined to 3.5% which according to agriculture expert is not encouraging and not good for a developing country like Ghana. An amount of GHC 501,501, 708.00 is allocated to the agriculture ministry representing 3.5%.
    Most of the farmers I spoke to want more share of the oil revenue to agriculture because agriculture is the most easiest way to reduce poverty and the only sector where the poor can make livelihood from without huge investments.
    The table below shows how oil revenues were allocated to agriculture from 2012 to 2013.
                                                                                                                                                                                                                                                                           SECTORS                               ABFA 2012        RANK     ABFA 2013    RANK
    Office of the President
    Parliament of Ghana
    Finance and Economic Planning
    local government
    Food & Agriculture
    Lands & Natural Resources
    Trade & Industry
    Envir, Science & Technology
    Tourism and Culture
    Water Resources, Wrks & Housing
    Roads and Highways
    Employment & Social Welfare
    Youth & Sports
    MDAs Total
    Source: ACEP
    Tanko Mohammed Rabiu
    Regional Correspondent, Tamale
    TV3 News Network Limited

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