Category: Uncategorized

Recovering market: Regulatory reforms to facilitate equity market activity

Posted OBG AdminPosted in Uncategorized

  The equity market experienced reduced performance in recent years, with the Ghana Stock Exchange (GSE) Composite Index returning -0.29% and -10.44% in 2018 and September 2019, respectively. This is down from a high of 52.37% in 2017. Market capitalisation as of end-September 2019 was GHS56.3bn ($10.9bn), down from GHS66.1bn ($12.8bn) one year earlier. The downturn in the equity market can be attributed to rising yields in the fixed-income market and capital flight from foreign investors dumping local securities to take advantage of rate hikes by the US Federal Reserve. Additionally, local retail investors have been selling their stock portfolios to invest in better performing

Daniel Asare-Kyei-CEO-Esoko; Curtis Vanderpuije-CEO-ExpressPay; and Daniel Marfo-General Manager-Zipline Ghana

Going for gold: Multiple factors bode well for gold output, as the government prepares to open a new refinery

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  In 2018 Ghana overtook South Africa to become the top gold producer in Africa. According to the Ghana Chamber of Mines, total production increased by 11.9% in 2018, from 4.3m oz in 2017 to some 4.8m oz, with gains in output expected to continue beyond 2019. Global credit ratings agency Fitch also ranked Ghana’s mining sector first in Africa – ahead of both Botswana and South Africa – on its Risk Reward Index, which compares industry rewards and risk against others in the region.

Pham Hong Hai-CEO-HSBC Vietnam

Spending power: Growing consumer confidence and the rise of e-commerce presents opportunities for retailers to expand

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  Rising living standards, falling unemployment rates and lower inflation point to a turnaround in consumer demand in Ghana in the years ahead. After a slowdown in the uptake of retail space, renewed consumer confidence and increasing purchasing power could provide renewed impetus for the sector’s growth. Macro Indicators Per capita GDP has increased each year since 2015, reaching $4738 in 2018, up from $4457 in 2017 and $4135 in 2016. In comparison, the regional average for sub-Saharan Africa stood at $3968 in 2018 and

George Richani-CEO-Al Ahli Bank of Kuwait

Shipping solutions: Extensive port upgrades are linked to road and rail improvements

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  A raft of large-scale port expansions are under way as Ghana looks to establish itself as a centre for West African logistics. These developments are being buttressed by investment in road and rail infrastructure, as part of a drive to lower trans-shipment costs and improve links across local value chains. Tema Port Located some 30 km from the capital city Accra, Tema Port serves as Ghana’s main container port and maritime outlet for international transit. At less than half a day, Tema Port offers the lowest anchorage time in the region and serves as the first port of call on Africa’s western coastline, with

Pham Hong Hai-CEO-HSBC Vietnam

Cross-border connections: Many African governments are taking steps to promote regional integration and intra-continental tourism

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  Africa’s tourism sector is booming. With a growth rate of 5.6% in 2018, compared with the global average of 3.9%, the continent is home to the second-fasted expanding tourism industry in the world, after the Asia-Pacific region. Accounting for 8.5% of the continent’s GDP, tourism contributed a total of $194.2bn to African economies in 2018. Multiple governments have recognised the importance of tourism to their countries’ economic well-being. Many of them – particularly Kenya, Rwanda and South Africa – have adopted strategies to improve

Nhon Luc Ly-CEO-AIA Myanmar; Son Nguyen-Country President-Chubb Life Insurance Myanmar; Daw Zarchi Tin-CEO

Deep impact: Pubic officials and stakeholders evaluate advantages and concerns regarding a large influx of refugees

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As the political, economic and migration crisis rolls on in Venezuela, a significant number of refugees continue to make their way to Trinidad and Tobago. This had led to concerns over the possible economic consequences of the recent influx. In June 2019 the UN estimated that 40,000 people had arrived to T&T. As migrants now make up 2.9% of T&T’s population – the highest rate in the region, above the 2.65% recorded in Colombia – there are particular concerns over the impact immigration could have

Sheikh Ahmad Duaij Jaber Al Sabah-Chairman-Commercial Bank of Kuwait

Balancing act: Commodities investment is important for portfolio diversification

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Despite being a commodity-based economy – indeed, 36.1% of Trinidad and Tobago’s GDP is from the energy sector – local capital market investors have traditionally shied away from commodities investing. The asset class worldwide has underperformed compared to traditional investment vehicles such as stocks and bonds. The Bloomberg Commodities Index had an average annualised return of -5.7% from 2014 to 2019, while the S&P 500 Index and Bloomberg-Barclays US Aggregate Bond Index had annualised returns of 11. (https://otbsd.com/) 4% and 3.1%, respectively, over the same period. Sound Investment Despite the relatively poor performance of commodities in recent years, many global asset managers still allocate a

Nhon Luc Ly-CEO-AIA Myanmar; Son Nguyen-Country President-Chubb Life Insurance Myanmar; Daw Zarchi Tin-CEO

For the long haul: Government bond issuance dominates the debt market

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While Trinidad and Tobago’s primary bond market has seen 59 issuances since 2013, fewer than 15% were private corporate issuances. The government, either directly or through state-owned enterprises, has maintained a dominating presence in the debt market, which it taps to borrow the funds needed for infrastructure development projects and recurrent expenditures such as salary payments. Diversification Dilemma The fact that most of the debt is issued by the government poses a dilemma for portfolio managers seeking to diversify pension plans and mutual funds. The Insurance Act requires local funds and pension plans to invest at least 80% of their assets under management in domestic

Éric N’guessan-Managing Partner-EY Côte d’Ivoire

Green shoots: Efforts are under way to attract international investment to support the transition to renewable energy

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With an energy system entirely dependent on natural gas, the transition to cleaner energy generation has emerged as a pressing priority in Trinidad and Tobago. Indeed, per capita carbon emissions from energy-related activities in T&T are nearly 2.5 times greater than the world average, according to the Inter-American Development Bank. In June 2019 the government reaffirmed its commitment to generating 10% of its electricity from renewable sources by 2021, although it did not specify what energy sources it would prioritise. In the same month, the

Emmanuel Macron-President of France

Targeted development: National development blueprints outline priority sectors under broader efforts to diversify the economy away from oil

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  In its bid to drive diversification and economic growth outside the Muscat area, Oman has invested heavily in special economic zones (SEZs). A particular focus is on increasing the level of private sector activity, feeding into the Vision 2040 target of having 90% of GDP come from non-oil sectors and boosting the proportion of Omani employees in the private sector to 40%. Oman’s five-year plan for 2016-20 identifies five priority sectors for this diversification: manufacturing, tourism, transport and logistics, mining, and agriculture and fisheries.