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AGI calls on gov’t to stop VRA from implementing Electricity Regulation

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VRAThe Association of Ghana Industries (AGI) has called on the Government to intervene to stop the Volta River Authority (VRA) from pursuing its intended implementation of Regulation Five, Subsection Two of LI 1937 of 2008 on Electricity Regulation.

According to the AGI, the implementation of the said regulation could adversely affect the interest of manufacturing industries and increase the per unit (KWH) energy cost by more than 75 per cent for some Special Load Tariff-High Voltage consumers, and must therefore be stopped.

This was contained in a proposal for the 2013 Interim National Budget submitted to Mr Seth Tekper, Minister of Finance and Economic Planning, and made available to the Ghana News Agency on Wednesday in Accra.

Regulation Five, Subsection Two of the Electricity Regulation 2008 LI 1937 states: “electricity generated from Akosombo and Kpong hydro dams shall not be subjects of a bilateral contract”.

The AGI, however, stressed in the proposal that “until the Ghana gas comes on stream to power our thermal plants, energy costs will be unbearable for Industry, if the regulation comes into force”.

On strengthening the capacity of local construction firms, the Association proposed a partnership programme between the Association of Road Contractors and the Government to support in the procurement of road construction equipment from overseas road equipment manufacturers.

It also proposed that a loan should be sourced from the China Exim bank to build the capacity of local road contractors to enable the contractors to secure more contracts.

On exportation of scrap, AGI proposed that the Government’s task force needed to liaise with steel manufacturers and regulatory bodies to strengthen the enforcement of the ban.

The Association stated that until the ban was enforced, the local steel manufacturing industry would be starved of the ferrous scrap raw materials needed for their production process.

The AGI observed with dissatisfaction that the influx of foreign products to Ghana was a big threat to the survival of the country’s manufacturing industries.“Some of the imports are smuggled into the country” it said.

“The imports which range from food items, drinks, textiles and fabrics, clothes, foot wears, furniture, mobile phones, aluminium products to paper, are often under-declared and misrepresented, evade tax and are therefore able to sell at half price or less, further destroying our weak manufacturing base”, the AGI said.

It proposed that the Government’s task force needed to liaise with textile manufacturers and regulatory bodies responsible for imports and specific aspects of consumer protection to strengthen the enforcement of their mandates.

It noted that copyright infringement of local textile manufacturers such as copying of local designs, logos and brand names was still a major setback to the development of the local textile industry.

On the agriculture sector, AGI proposed that the Government should set aside a fund to subsidise the farming of soya beans to feed the agro-processing industries.

The subsidies could be recovered from value addition and income taxes along the value chain, it said.

The Association expressed optimism that if the agriculture mechanisation unit of the Ministry of Food and Agriculture was privatised, it would ensure the efficient management of the unit.

The AGI called for a policy that would ensure that local contractors were given a reservation of at least 30 per cent of contracts being executed by foreigners.

According to the AGI’s Business Barometer report, currently, local contractors felt displaced by their foreign counterparts who had usurped the industry because the foreigners were better resourced.

“AGI would like to see the margin of preference as stipulated in the Procurement Act enforced for which reason local manufacturers and contractors have been losing out on tenders to foreign bidders” it added.

The AGI further proposed that foreign road contractors operating in the country should belong to the Association of Road Contractors to qualify for contracts.

Source: GNA

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