|
Ghana needs a restructuring law –
GARIA
Accra, March 25, Ghanadot/GNA – Mr Felix Addo, President of
Ghana Association of Restructuring and Insolvency Advisors (GARIA),
an association that ensures effective and efficient insolvency
law, on Wednesday said Ghana needed a restructuring law to help
companies grow economically, especially in this time of the
global financial crisis.
Restructuring a company means that one put in place certain
measures that positions the company to make more profit, while
companies that are insolvent means they are near collapse and
cannot even pay the salaries of workers, among other necessary
expenditure.
Mr. Addo at a forum held by GARIA as part of the organization’s
week long celebration said the current company law in the
country does not allow restructuring, therefore companies that
do not do well are mostly liquidated.
The forum, which brought together professionals from the
banking, legal, judiciary and accounting sectors also discussed
examples in restructuring in other countries and how Ghana could
adopt best practices in insolvency and restructuring.
Mr Addo said the company law in Ghana was currently being
reviewed and said a draft report was submitted to the previous
government, expressing hope that the new government will take it
up to ensure that the law was reviewed to the benefit of the
larger public.
He said: “A recent survey of banking institutions published by
PricewaterhouseCoopers and the Ghana Association of bankers
indicated that between 1998 and 2003 the loan reverse of the
banks as a ratio of the gross value of the loan increased from
10.7 percent to 15.7 percent.”
He further said that in such an environment it was imperative
that effective insolvency laws and institutions were
established.
“I hope that the new law will encompass some elements of
restructuring, since companies that do not do well are usually
liquidated without an option of restructuring.”
Mr Addo advised companies facing difficulties to contact the
GARIA for professional advice and pointed out that a company
does not need to face difficulty before it employs a
professional service it can do so even when things are not too
bad.
GNA |
