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Don't privatise ADB - Speakers at a
roundtable
Accra, July 19, GNA- Speakers at a roundtable discussion on
the implications of privatising public enterprises with
particular reference to the Agriculture Development Bank (ADB)
on Thursday, have noted that it would not be in the interest
of the nation to put the running of the bank into the hands
of a private investor.
They contended that ADB was doing very well and carrying out
its mandate of supporting the agricultural sector in a
competitive way and with solid and liquid assets.
The speakers, mostly economists, politicians, members of the
academia and civil society groupings emphasised that after
the bank had surmounted its difficulties the appropriate
thing to do was to re-equip it to operate at its optimal
capacity.
Professor Wayo Seini, Senior Fellow, Institute of Economic
Affairs (IEA), which organised the roundtable, said ADB
should not be privatised because of its business portfolio.
"The agricultural portfolio has been growing consistently
over the past two decades and its share in total loans and
advances portfolio has averaged 600 billion cedis in the
period 2001 to 2005", he stated.
He noted that in spite of the daunting challenges including
high provisions for bad and doubtful debt, ADB approved
525.40 billion cedis in 2006 representing 35 per cent of its
total direct loans and advances.
"Between 2005 and 2006 ADB increased its profit from 74.67
billion to 107.65 billion cedis, an increase of 44.17 per
cent".
Prof Seini noted that the implication of privatising a
strategic asset like the ADB could compromise national
security since its management would be in the hands of a
private operator.
"It may also threaten the confidentiality of private
information since the ADB is the major outlet for public and
development partner's support to the agricultural sector",
he intimated.
The IEA Senior Fellow revealed that the move could result in
loss of jobs, particularly skilled managerial ones if the
new owners were multinationals.
"This can lead to the movement of profit abroad rather than
investing in the country especially when the new owners are
foreign investors", he stated.
Prof. Seini suggested that if privatisation should be
considered then public stock sales should be opened to
Ghanaians both at home and abroad to ensure that the bank's
security was maintained as well as local investment among
other things.
"Open sales to foreign bidders can not be allowed neither
encouraged to avoid multinationals taking over the bank", he
stressed.
The Government Spokesman on Economic and Finance Affairs, Mr
Kweku Kwarteng, pointed out that the government had not
taken any decision on the sale of ADB and said discussions
were still going on.
Mr Ernest Debrah, Minister for Food and Agriculture,
commended ADB for the giant strides in its operations but
stressed that in spite of its gains it was not wrong to
privatise the Bank to make it more efficient.
He noted that as part of global business practice there was
nothing wrong for a private bank to express interest in
another bank saying transfers bids were done everywhere in
the world.
Mr Debrah said that the appropriate step that had to be
taken to make the Bank efficient to support the sector and
provide credit to farmers to ensure food security was what
had to be critically examined.
Mr Asiedu Nketiah, NDC General Secretary, wanted to know who
wanted to privatise ADB whether, it's was a government
initiative, the Bank of Ghana or Stanbic Bank.
He said the reasons for the privatisation had to be clearly
spelt out to engender constructive discussion for the best
way out.
Other speakers held the view that the agricultural sector
entailed enormous risk and expressed doubts if a private
bank would curtail its core business and invest in a sector,
which did not promise outright returns.
They called on the government to be circumspect in taking a
decision on the only national asset that directly invested
in agriculture to ensure food security for Ghanaians.
GNA
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