SSHFC IN GOOD STEAD

MD urges managers to keep up the momentum

The Social Security and Housing Finance Corporation is in good stead in terms of performance, in terms of how government thinks about the institution and in terms of corporate governance, Mr Tumbul Danso, Managing Director of the institution, reveals.

Pic: MD Tumbul Danso

“In terms of performance, you will recall that during the 2010 budget speech the performance of the Corporation has been one of the best among the parastatals. Two years ago, we made a surplus of over D97 million at the end of the year,” the managing director told the media practitioners on Thursday during a day-long sensitization organized by his institution for journalists from both the print and electronic media and held at their head office in Banjul.
He said the ‘wonderful performance’ of the Corporation has been recognized by the government in the sense that about two years ago “we were paid a national bonus payment of three months because we have this bonus agreement that we have entered into with the government”. At the end of every year the Corporation is assessed and bonus is paid base on performance, which is a demonstration of the wonderful performance of the institution.
The 2010 budget statement has indicated that the consolidated gross income of the Corporation increased from D268.7 million in 2007 to D502.05million in 2008 while recurrent expenditure increased from D98.7 million to D255.33 million. Thus, the corporation recorded a consolidated Net Surplus of D97.1 million. Total Net Assets grew from D3.09 billion in 2007 to D3.5 billion in 2008.

MD Danso explained that a couple of years back the Corporation was also promoted by the government from being category three institution to category one institution.

He said in terms of corporate governance, they continue to manage the affairs of the Corporation to the best of their abilities.
“All these has gone to demonstrate that the Corporation is in good stead in terms of performance, in terms of how government things about us,” the Managing director noted. “So I will definitely urge the managers of different section of the Corporation to ensure that they keep up the strength to make the Corporation reaches higher heights.”
He said: “We want to make sure that we keep ourselves involved in all the best practices just like it is done in other advance countries. I believe if other countries can do it, we in Africa can also improve on our system.
The Corporation is considered as one of the best in Africa and this had been demonstrated in terms of how many sister institutions has sent staffs on attachment to our institution, to come and study our system so that they can also replicate that in their institution.”
MD Danso told the media practitioners that Corporation has two main components that is the housing component and also social security component. The corporation is mandated by the government through an Act of parliament to provide social security services to the general public through membership it is also mandated to implement housing projects on behalf of the government. “Since 1982 we have been doing exactly that,” he said.
He explained that each of these two components has sub-components. Under the social security component there is the national provident fund, federated pension scheme, and the industrial injuries compensation fund. The housing finance fund under the housing component is to implement housing projects on behalf of the government.
He described the relation between the Corporation and the press as “mutual”. “It’s one of a symbiotic relationship for the mutual benefit of both parties. The corporation needs the press to help in its education campaign because we are involves in a whole lot of educational campaign and we need the press in that regard. The press also needs us to give them information to enable them to disseminate that information to the general public.”
He told the journalists: “We welcome any journalists anytime you want to visit us, our doors are open to you anytime you need our services. We are available at any point you needs us to give information on any aspect of our activities.”
The training was meant to create awareness, enhances compliance, and informs the media practitioners on the regulations that govern various schemes of the Corporation.

GAWFA heralds new beginning for Gambian Women

The new finance company launched by the Gambia Women’s Finance Association (GAWFA) to provide trade finance for women could be the start of better days to come for the country’s hardworking women. Lamin Jahateh reports.

Gambia Women’s Finance Company has launched its own finance institution – GAWFA Finance Company – to meet the business and trade finance needs of Gambian women in line with women economic empowerment.

The launching of GAWFA Finance Company, with celebration of joy, pride and victory, is a clear testimony that GAWFA is on the verge of achieving its vision of building a sustainable financial institution that will meet the aspirations of women in the vanguard of an evolving financial system, and regain market leadership by 2020 with a share of at least 50% of the market represented by local Gambian women.
“This is a timely and a very important move by GAWFA towards the economic and social empowerment of women and the development of the country at large,” said Aja Ida Faye Hydara, Executive Director of Women’s Bureau, while launching the GAWFA Finance Company on behalf of the Vice-President and Minister of Women’s Affairs, H.E. Aja Isatou Njie-Saidy, on Wednesday at the GAWFA headquarters in Kanifing.

“Launching GAWFA Finance Company today is a welcome move as the company is here to contribute to the empowerment of Gambian women,” she said, adding that though GAWFA has contributed and continues to contribute to the development of a lot of women in the country, “there is still a long way to go”.

Pic: CEO of GAWFA, Olie Njie Mbye, delivering her statement

GAWFA’s Chief Executive Officer Oley Njie Mbye, in her remarks, said: “At GAWFA we promote self-sufficiency, empowerment and capacity building which are integral not only for economic empowerment but also to human services and development in general. Having the resources for strategies alone is not enough but effective outcomes and sustainability are also fundamental for the advancement of women.”

The launching of GAWFA Finance Company is seen by many as a step in the right direction as it will provide banking services to that segment of the society who are hitherto “left out by the commercial banks” thus unable to access loan. Majority of these unbanked population are women many of whom are poor.

Gambian women are faced with the challenge of what is considered the “poverty trap”. The poor women are striving to escape from poverty but are limited to do so by using the meagre resources they own. The challenges of obtaining loans from financial institutions can be attributed to many factors of the “poverty trap”, but without loans or advances to augment their businesses and realise returns that can transform their economic conditions they would continue to wallow in the vicious cycle of poverty.

The GAWFA CEO, who has been a bank executive with over 16 years of diverse leadership experience, said: “Women are the most impoverished and underprivileged in the world. But we save bigger long term goals and are more committed to make positive changes in our lives progressively. We have effective leadership skills in managing scarce resources and can start something small and grow it big for better economic conditions.

She added: “It is therefore a moral obligation as global citizens not to lean back and ask what our governments are doing or can do; we need to get up and stand firm on our feet, roll our sleeves up and do our own part. We have our own part to play and ask ourselves what we can do for our country and the world in general to contribute directly or indirectly in many ways to socio-economic development.”

Mrs Njie-Mbye highlighted the unprogressive notion that women are generally expected to take secondary, passive role in obtaining credit, but major role in the household. “We are usually considered less suitable than men for higher responsibility on loan acquisition. It is paramount we solidify our own institution through microfinance, and have the ability to influence, or make decisions that affect our lives and be independent.”

The launching of GAWFA also witnessed the presentation of an award by staff of GAWFA to their CEO Njie Mbye, for being a wonderful and a competent leader who always lead by example.

According to Hannah Davies, chairperson of GAWFA board, GAWFA is the leading and first microfinance institution established since 1987 in The Gambia with over 48,948 members and over 13,682 active borrowers. “We also have several branch offices spread in the rural areas in The Gambia,” she said.

Aja Adulette Sey, a senior member of GAWFA, said GAWFA is here to uplift the status of women to eradicate poverty, as women are at the bottom of the poverty pyramid.

GAWFA delivers a bouquet of corporate services to its clients including capacity building through its partners and interrelated organizations.

Finance Minister counters Sidia Jatta’s comment on agriculture

The Minister of Finance, Hon. Abdou Kolley has countered the claimed by Hon Sidia Jatta, National Assembly Member for Wuli West, who said there is no growth in the agricultural sector in 2010 because the 2011 budget statement has it that national output from crops, livestock, forestry and fishing activities is projected to grow by 4.6% in 2010 compared to a growth of 9.8% in 2009.
“To me there is no growth, there is downward trend because in 2009 agricultural growth was 9.8% and 2010 it was 4.6%, so if I understand this statistic, agriculture is going downwards, it is not going upwards,” Hon. Sidia Jatta said at the National Assembly in Banjul during the adjournment debate on the 2011 budget statement.
The Finance Minister, Hon Abdou Kolley, in response, said when you look at growth from one year to another, to say that because in the previous year you have 9.8% growth and this year you have 4.8%, so there is no growth, “I disagree with that analysis”.
“You can say yes, there is growth but at a lesser pace compared to the previous year why because if you look at agriculture from where we were coming from, we had several years of drought and low agricultural production as a result, then come 2008 and 2009 with good rain and bumper harvest, so we had a big jump in agricultural production and growth, once you have a jump in agricultural productivity and growth, the subsequent years will not be that significant because you are already at a solid base and moving forward, that those not mean there is no growth,” Hon said.
Gov’t calls for private sector participation in agriculture
The Gambia Government has called for greater participation of the private sector in agriculture saying that agriculture should not be seen as a part time business activity but a real time business venture that can generate wealth and income just like any other business.
Hon. Kolley said the private sector should invest in productive sectors of the economy like agriculture, which would eventually bring about a structural transformation of the economy given the contribution the agricultural sector makes in terms of creating employment, raising farmers’ incomes, improving food security, increasing foreign exchange earnings and tax revenue.
Hon. Kolley was responding to concerns raised by the National Assembly Members that despite many resources been devoted to the agricultural sector yet still the expected impact is not been felt.
The Finance Minister said government cannot do it all alone, the private sector should also come forward and invest in agriculture. He said provisioning of farm implements and fertilizer is among the many areas that the private sector can invest into, as the government is moving towards the commercialization of agriculture.
“We all know that the current form of agriculture, which is subsistent and rain feed agriculture will not and is not the solution to our agriculture, the Ministry of Agriculture is cognizant of this and this has been adequately highlighted in the GNAIP and the main thrust of that Program is the move towards the commercialization of agriculture and greater involvement of the private sector,” Hon. Kolley said.
He said the Gambia National Agricultural Investment Programme (GNAIP) if successfully implemented will go a long in modernizing the agricultural sector so that it will be able to contribute the desired level as expected by all. “It is also in this drive the government has decided to increase the funding to the sector to help the sector in meeting most of its requirements or objectives.”
The government has doubled the budget allocation to the agricultural sector from 3 percent in 2010 to 6 percent in 2011.

Central Bank to revoke some banking licenses

Six out of the fourteen banks in country are at risk of having their banking license been revoked by the Central Bank of The Gambia due to their inability to raise their minimum capital requirement to D150 million by December this year, as directed by the Central Bank of The Gambia
Two years ago, the Central Bank of The Gambia raised the minimum capital requirements of commercial banks to D150 million and D200 million to be observed by end December 2010 and 2012 respectively “in order to strengthen the country’s banking system”.
Hitherto, the minimum capital requirement was pegged at D60 million.
The Minister of Finance, Hon Abdou Kolley, while tabling the budget statement and economic policy financial year 2011 before the National Assembly in Banjul on Friday, said the latest assessment indicates that eight of the fourteen banks had already met the capital requirement of D150 million.
“The six banks that are yet to meet the requirements are being rigorously monitored by the Central Bank of The Gambia,” he said.
Although the Central Bank of The Gambia is optimistic that all banks would observe the capital requirement, the Finance Minister said: “The CBG is resolved not to grant request for forbearance if a bank fails to meet the requirement and to mitigate systemic risk that may arise from the revocation of a banking license, the CBG shall take the following actions: invoke section 45 of the Banking Act 2009 and take over the bank, thereafter the CBG may invoke Sections 48 and 51 of the Banking Act 2009 and place the institution in conservatorship to be sold, merged or restructured, and apply to the High Court for compulsory liquidation under Section 52 of the Banking Act as a last resort.”
While announcing the increment of the minimum capital two years ago, the Central Bank says the action has been taken in view of its desire to deepen the financial sector and "in pursuance of the Gambia’s Vision 2020 aim of transforming the country into a financial centre"
Thisday, a Nigerian newspaper has reported that the Managing Director of GTBank said the new capital base had increased the challenges of banks operating in that country.
Mr Lekan Sanusi said only the creative financial institutions were likely to survive the industry competition and deliver returns commensurate to the expanded capital base.
The Gambia, which used to be serviced by less than four commercial banks until a few years ago, has in recent times been affected by the phenomenon of an upsurge in the number of banks registered here, mainly from Nigeria.
GTBank MD said the Gambia could only take a certain number of banks.
He was quoted as saying: "But do we really need as much as 14 banks in a relatively small country like The Gambia? If you divide the number of banks in this country by the population of about 1.7 million, you have an average of 100,000 people per bank. Revenue is going down. What I know is that in the long run, people will count their numbers.
At the end of the 2009 financial year, the Gambia’s banking industry recorded total loss of about 45 million Dalasis. Ten of the banks declared losses.

GAMBIA: FDI Takes A Nosedive As Recession Hits Hard

Although the Gambian banking sector has so far escaped unhurt and has registered growth in investment and performance, investments in other sectors have been hard hit by the world economic downturn, as foreign direct investment (FDI) dropped significantly. Business Digest's Mariam Saine reports the findings on the Gambian investment climate.
Foreign direct investment into The Gambia has reduced by 60 per cent lower than forecast in 2008, even though it remains the most important form of investment in the country.
According to a recent report of a survey by the joint effort of the Gambia government, the Development Finance International (DFI) and the West African Institute for Financial and Economic Management, investment in real estate and tourism and exports of goods and services also took a nosedive, save for the banking sector which remains unhurt and has recorded "significant investment and growth" because banks in the country have not relied on borrowing from their European and United States counterparts to fund growth, but have raised capital domestically.
This drop in foreign direct investment is widely linked to the global economic crisis, which caused the country's growth to decelerate to 6 per cent in 2008.
For instance, international tourism declined by eight per cent in the first quarter of this year, prompting the United Nations World Tourism Organisation (UNWTO) to revise its forecast for the full year 2009, which now stands between -6 per cent and -4 per cent in 2009, as the pace of decline is expected to ease during the remainder of 2009. Real estate is also said to have suffered badly at the hands of the credit crunch and economic recession.
Trade sector, in particular, contracted by 12.9 per cent reflecting primarily the decline in re-exports and retail trade," said Gambia Central Bank Deputy Governor Basirou Njie, who delivered a speech by Governor Momodou Bamba Saho at the seminar, held recently at the Paradise Suites Hotel, at which the report on the findings on investment climate in The Gambia was disseminated and discussed.
Despite the rebound in agricultural output, growth in real GDP is projected at 3.6 per cent in 2009 reflecting reduced foreign direct investment, tourism and remittance flows.
In 2001, the Government of The Gambia with the support of the Development Finance International (FDI) and the West African Institute for Financial and Economic Management decided to conduct a census on foreign private capital and investor perception with the objectives of obtaining accurate data for the formulation of appropriate macroeconomic policies; improving the balance of payments (BOP) statistics as well as providing International Investment Position data ( that is, the stock of external assets and liabilities); using the information generated to promote and facilitate investment as well as assets investor confidence; and strengthening public/private sector dialogue on the investment climate in The Gambia.
Since then, two surveys have been conducted and seminars organised to share the findings with the government, the private sector and other key stakeholders. The current report draws its facts from the third and final phase of the project, whose findings state that "foreign direct investment into The Gambia was 60.0 per cent lower than forecast in 2008", and that "investment in real estate and tourism and exports of goods and services also fell".
"A fundamental business truth is that capital is a coward and shuns high-risk countries," Mr Njie said, adding that where the business environment is favourable, entrepreneurship flourishes, and overseas companies thrive, strengthening the local economic fabric, and spurring growth and economic development.
He said: "Although sound, coherent and consistent policies are needed to create the favourable conditions for investment, there is a recognition that policymaking is more effective if done in consultation with business. I, therefore, wish to use this opportunity to encourage a more robust public/private dialogue bearing in mind that what is good for business is good for the country."
The deputy bank governor commended the Department for International Development (DFID) of the United Kingdom for adequately funding the project and DFI and WAIFEM for their technical support. "We are also grateful to all those who participated in the survey," he noted.

Report reveals mixed results for MDGs, PRSP

The Gambia's efforts towards attaining the Millennium Development Goals and the Poverty Reduction Strategy Paper objectives have so far produced mixed results.
The country made a modest achievement of only 3% from 2003 to 2008 in reducing overall poverty. Unemployment, particularly among the youths, and the quality of social services remain a great challenge to development and poverty reduction efforts.
The biggest challenge lies with income poverty and food security, for which agriculture is the only solution for a greater proportion of the population, said Alieu Ngum, chairman of the National Planning Commission (NPC) at a just concluded two-day donor roundtable conference on the Gambia National Agricultural Investment Programme (GNAIP) held at the Kairaba Beach Hotel in Senegambia.
The conference brought together development partners, potential institutions and stakeholders who are actively involved in agriculture to discuss the GNAIP to secure the required financial support for the implementation of the investment programme, estimated at $266 million for a period of five years, to revitalise the agricultural sector.
“Despite the challenges, the country achieved an annual average growth rate of 6% from 2003 to 2008 above the 5.5% target in the PRSP," Mr Ngum also said. "Considerable progress has been made in the social sectors such as high level of enrolment at primary education - more girls than boys at the primary levels, 85% of population has access to water supply and some positive achievements in infant mortality.
"Cognizant of the important role agriculture has in enhancing economic growth and poverty, the Government of The Gambia did not hesitate to respond to the AU/NEPAD formulated CAADP by developing a well elaborated national programme for agricultural growth and investment to reduce poverty in the country.”
Despite the rebound in agricultural output, growth in real GDP is projected at 3.6 per cent in 2009 reflecting reduced foreign direct investment, tourism and remittance flows.
In Africa increased agricultural growth will play a key role in addressing the current food crisis, in contributing to overall economic growth and in helping to achieve the MDG1of halving the proportion of the poor and hungry people by 2015, the Minister of Trade, Industry and Employment said while delivering his speech on the occasion.
Hon. Yusupha Kah, the newly appointed Trade Minister, said the challenge of meeting the MDG1 under the current circumstances is “considerable”, especially in sub-Saharan Africa.
He expatiated: “Investing in agriculture is the key to reducing poverty and hunger in developing countries like The Gambia and it’s an essential element in addressing the current food crisis. Importantly, investing in agriculture also means investing in the rural population to enhance the human capital foundations of development.”
Modernizing agriculture is crucial to development, industrialization and food security in Africa and it also supports sustained poverty reduction and integration of Africa into the global economy.
Hon. Kah described agriculture as the “beacon of hope in Africa”, saying the sector provides 25 to 30% of Africa’s gross domestic income in rural areas.
"In The Gambia, the agricultural sector employs over 70% of the population and contributes about 26% of the GDP," the Trade Minister said. "This indicates that agriculture remains the backbone of our economy, and should in no way be left behind in the national agenda."
The importance of the agricultural sector in reducing poverty and serving as an engine of growth was demonstrated throughout the green revolution in Asia, particularly in India and China. Africa therefore cannot bypass this development pathway, as the majority of the African population lives in the rural areas. Despite this reality, the agricultural sector in Africa continues to be neglected. The ECOWAP/CAADP programme, however, has been designed to address agriculture as a priority for development.

'NIGERIAN BANKS IN THE GAMBIA ARE SAFE'

The Governor of the Central Bank of the Federal Republic Nigeria, Lamido Sanusi, has given a clean bill of health to Nigerian banks in The Gambia, saying they are all safe, sound and strong, as the institutions are working within the ambits of the law and are not operating contrary to rules and regulations.
The problems with some of the Nigerian banks in Nigeria did not affect their subsidiaries, Mr Sanusi said while speaking to a large crowd of high-profile bankers and other business moguls in The Gambia at the Sheraton Hotel and Spa in Brufut during a one-day visit to the country. "We have not allowed any bank in Nigeria to repatriate money from their subsidiary banks,” the CBN Governor said.
“Our message to the Nigerian banks operating in The Gambia is that they should consider themselves Gambian banks, they should operate under the regulations of the Central Bank of The Gambia, they should train and employ Gambians, they should try and share the partnership with Gambians and they should show a clear commitment to the growth and development of the Gambian economy.”
Governor Sanusi said this is the role Nigeria wants to play in integrating and serving as an agent of change of the development in Africa to ensure the capital that is available in Nigeria is used for the betterment of the African people.
Sharing with stakeholders in the country’s banking sector the details of what is happening in Nigeria to reassure Gambians that banks in Nigeria are safe and strong, Governor Sanusi said: “The actions we took were geared towards averting a major crisis."
He continued: “We are here to discuss among other things ways and means of building some form of cross boarder supervision and comparison of notes to increase the level of communication and information so that together we can ensure that the financial system in our various countries are protected.”
Despite the rebound in agricultural output, growth in real GDP is projected at 3.6 per cent in 2009 reflecting reduced foreign direct investment, tourism and remittance flows.
He reaffirmed the commitment of the Nigerian parent banks to operating professionally in The Gambia and to working with the Governor of the Central Bank of The Gambia for cross-border solutions in support of growth and development in the country.
Hon. Yusupha Kah, the newly appointed Trade Minister, said the challenge of meeting the MDG1 under the current circumstances is “considerable”, especially in sub-Saharan Africa.
The sister country bank governor also assured the Government and people of The Gambia that there is no illegal activity being undertaken by banks operating in The Gambia, with Nigerian ties.
“We have brought down the management of eight banks in Nigeria," he remarked. "We have disclosed that they did not have enough capital but not a single depositor has lost a single penny, not a single bank defaulted to a creditor and not a single correspondent bank has shut its licence in Nigeria,” Governor Sanusi clarified.
He explained further: “It is the determination of the Government of Nigeria that any one found guilty of any act of corruption or fraud, must face the full consequences of the law.
We have reached a stage as a country where it is no longer about banking; it is about sending clear signal that we are ready to hold people accountable for not doing things the right way and we expect our bankers to regulate themselves and to understand that if they break the rules, the day they are found out they will face the consequences of the law.”
The governor also mentioned the illegal banking transactions that were taking place in different banking institutions which, as reported, was costing the Federal Republic of Nigeria huge sums of money consisting billions of US Dollars, as well as that nation’s credibility and integrity.
Lamido Sanusi took the decision to prevent banks from collapsing and thereby rescued tens of thousands of Nigerians and other employees from suffering job losses.