Business News of 2014-04-28

‘Use unsaved oil revenue for investment’

Andrew Bauer, an economic analyst with New York-based Non-Governmental Organization (NGO) Revenue Watch Institute (RWI), has advised Government to use unsaved revenue from the country’s oil sector for investment.

This comes at a time when Ghana faces volatility in its non-oil revenue and increasing deficit and national debt levels.

Bauer, who made the suggestion recently in Accra when his outfit released its findings on Ghana’s petroleum funds, called on the authorities to spend the oil revenue in line with a national development plan to ensure maximum efficiency.

According to the RWI research, the Ghana Petroleum Funds meet 13 of the 16 good governance fundamentals, adding that the funds feature clear deposit, withdrawal and investment rules, effective oversight and other essential attributes of good governance. Emmanuel Kuyole, Africa Regional Coordinator for Revenue Watch, commenting on the report, said: “Together, the Ghana Stabilization Fund and the Ghana Heritage Fund manage more than US$450 million. Thanks to strong legal provisions, citizens have information on how much is deposited, invested and earned. This transparency is a significant gain. Too much sunshine does not spoil anything.”

However, researchers found that as at early 2013 when the period of study had concluded, there were still problems in terms of public disclosure of external audits and the detailed responsibilities of fund managers and staff.

Representatives of Ministry of Finance announced that Government had already engaged international accountancy firm, Ernst & Young, to conduct an external audit of the funds.

Dr Joe Amoako-Tuffuor of ACET Africa, in a remark noted that “it is one thing to have a strong law, but another to execute it. Ghana must avoid selective implementation which undermines credibility. Full implementation requires political commitment, diligence of public officials, and a public desire to see the law fully implemented.”

Experts on the panel agreed that there was the need for elaboration of a national development plan to guide expenditure decisions even though the report indicated that “Ghana has strong deposit and withdrawal rules that help prevent mismanagement of oil revenue.”

Source: Daily Guide
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