Odekro | What has your MP done for you?

Mr. Speaker

Order ! Orde r ! Correction of Votes and Proceedings, Thursday, 21st July, 2005. Pages 1, 2…..6 -- [Interruption.]

Mr. Kofi osei-Ameyaw

Mr. Boampong

Mr. Speaker, I want
to know from the hon. Minister whether the Ministry cannot assist the District Assembly to routinely operate the 60 kVA generator in terms of finances before the power supply gets there.

Mr. Botwe

Mr. Speaker, the Ministry
has not made budgetary provisions for this and that is why we are collaborating with the Bia District Assembly to see whether they can support us in doing that. But all efforts are being made to put enough pressure on the Electricity Company of Ghana to get the problem resolved.

Mr. Speaker, I am asking
whether it will be beyond the Ministry to, in the interim, provide a Bailey bridge on this river looking at the dangerous condition of the bridge.

Dr. Anane

Mr. Speaker, I am not sure
whether my hon. Colleague got what I said, if he is still referring to the Dadieso-
Adiepena-Abogu road. Mr. Speaker, I said it is not a road, it is a tract and before we can tackle anything we have to do our studies, we have to do our designs and it is out of the studies and designs that we can know what will be required to be done there.
So Mr. Speaker, I will be unable, as I stand here, to say that a Bailey bridge will be the best or any other bridge. It is out of our studies that we can know the right thing to be done. We definitely want to do the right things for the people living in the corridor. So I will want to, with the indulgence of my hon. Colleague, wait a while as we finish with the studies and the design so that we can do the best for the people living in that corridor.

Thank you, Mr. Speaker, for giving me the opportunity to make a Statement on the state of the textile industry in Ghana.
Mr. Speaker, in the immediate post- independence period, the then Govern- ment in its attempt to arrest the growing
unemployment problem and also to move the economy from subsistence level into a modern one embarked on an industralization programme. Ghana's industrial philosophy initially was import substitution, that is to manufacture locally the items that were used on daily basis and for which the raw materials were either wholly or partially available locally. Among these items were textiles.
It is a fact that most industrialized countries began their process of industrialization with the establishment of textile mills. Technology in this sector is easy to master, the industry offers mass employment and the products are easily sold. In England, the industrial revolution was propelled by the textile mills of Manchester whilst the Asian tigers made their debut into the industrial world through textile manufacturing. And so when Ghana decided to embark on industrialization, it was natural that textile manufacturing, milling and printing became the first industries to be established.
Thus in the mid-1960s and early 1970s, a number of companies producing textiles sprang up -- Ghana Textile Manu-facturing Company (GTMC), GTP, Juapong Textiles, Akosombo Textiles, Freedom Textiles and many others were established. These companies offered jobs and skills to the youth. Our northern farmers were encouraged to go into cotton cultivation and cotton ginneries were established in the northern part of the country. Some of these textile companies apart from providing employment also invested in other social activities in the localities where they were. An example is Akotex Sporting Club of Akosombo Textiles.
Although not all was rosy for these industries, especially during the mid 1970s and early 1980s when there was scarcity
of foreign exchange and thus foreign inputs were not easily available, the industries managed to survive. Even after the liberalization of the economy and the elimination of the import licensing system, the textiles companies continued to hold their own against imported goods until recently when our markets got flooded with all manner of foreign textiles.
The local production of textiles which peaked at 130 million metres per annum in the 1970s has dropped to under 39 million metres per annum currently and the labour force consequently reduced from 25,000 to under 3000 as of now. Many of the companies have closed down and those that are in operation have reduced their activities to the barest minimum. The most recent closure is Juapong Textiles -- a company on which the very existence of the town of Juapong depends. GTP is on its way out.
Mr. Speaker, may we ask, what are the causes of these problems in the textile industry?
( 1 ) U n f a v o u r a b l e operational environment
(2) Smuggling
(3) Under-invoicing
(4) Dumping
Mr. Speaker, smuggling in the textile industry is estimated to cost the State over ¢300 billion in lost revenue. These activities are not indulged in by small timers but rather by big business people who are well connected and therefore not too difficult to identify but not too easy to touch.
The problem of under invoicing is the result of laxity in the performance of the functions of the destination inspection agencies as well as Customs, Excise and Preventive Service (CEPS) activities at

the frontiers.

Unfavourable operational environ- ment is highlighted by high taxes and high utility cost, making the products quite expensive at the end of operation. There is therefore the need for Government to take appropriate measures:

(1) To stop the smugglers, smoke them out and punish them;

(2) To remove or lower some of the undesirable taxes on imported inputs and give tax incentives for the use of local cotton and starch;

(3) Within the World Trade Organi- sation (WTO) regulations, measures must be taken to protect our textile industry from unfair competition.

Mr. Speaker, it is hoped when such measures are taken among others we may once again bring back our textile industries to their 1970s status.

Mr. H. F. Kamel (NDc -- Buem)

Thank you Mr. Speaker, for favouring me with the opportunity to associate myself with the Statement.
Mr. Speaker, the textile industry, like other local industries of rice and cotton, is seriously in danger; the poultry industry also faces similar crisis. Mr. Speaker, the problems confronting the textile industry are enormous and hydra-headed, and I think that only a strong national effort can bring operations of the textile industry back to normalcy.
Mr. Speaker, the situation prevailing
in the local textile industry in Ghana is confronting that industry in Nigeria, South Africa, Kenya, even in America
and Canada, and a lot of measures are being invoked to check the influx of cheap foreign textile prints.
Mr. Speaker, about the issue of smuggling, I think that Ghana has a strong anti-dumping case to make against our competitors because what is happening on the continent now amounts to dumping. Unfortunately, I am not very sure whether we have any contingency protection measures such as anti-dumping or countervailing safeguards. I would want to see a situation where, maybe, the Executive and this House would work together to put in safeguards so that in the event of such crises, we could invoke some of these measures to protect our industries.
Mr. Speaker, I think that recently, the sector Minister introduced new administrative policy guidelines, at least, to reduce the incidence of pirating, smuggling and others. Some of these measures include single-corridor entry point, hundred per cent physical examination and others. But Mr. Speaker, at the committee level, we interacted with stakeholders in the private sector. Their concerns are that yes, the policy guidelines are fine; everything is perfect, but what is lacking is the institutional capacity of the various institutions to be able to enforce these directives.
Do we have adequate personnel? Do we have the right infrastructure? Do we have adequate logistics? Are the personnel well motivated and well resourced to be able to enforce the directives of the Ministry? I think that this is what we should also be looking at.
Mr. Speaker, when this influx hit Nigeria, South Africa and Kenya, their Governments took the problem as a serious national one and they played a very vital role in bringing the operations of the textile industry back to normalcy.
In Nigeria, for example, a lot of

Mr. K. T. Hammond

On a point of order. Mr. Speaker, he needs an answer. He wanted to know if the “Golden Age of Business” is alive and kicking. Mr. Speaker, he is informed that it is alive, healthy and kicking. [Laughter.]

Mr. Speaker

Hon. Member for Buem, I hope you are winding up.

Mr. Kamel

Thank you, Mr. Speaker, I have got the answer. Well, as far as I am concerned, the indictment on the “Golden Age of Business” is so strong and we must collectively look at the issue very dispassionately and then try to see how we can resolve it. Because, we are not only talking about the closure of textile factories; we are also talking about the loss of people's jobs.
And when we talk about the loss of people's jobs, we are actually talking about livelihoods. When this problem hit

Mr. Joe Baidoe-Ansah (NPP -- Effia Kwesimintsim)

Mr. Speaker, it is worth examining why the collapse of the textile industries in this country. But Mr. Speaker, when examining this, the issue to really take into consideration should be looking at the real cost of production.

Mr. Speaker, it is not very good just slapping taxes as a form of protecting industry; industry must learn to be efficient and this is what we should be looking at in this country.

Mr. Speaker, one may ask why is it that people in China -- Some of the factories in China have people who are even better paid than people in Ghana and so why can they produce at a cheaper cost than industries in this country? These are the issues that we should be looking at because just slapping taxes as a form of protection does not help make our industries efficient.

Some of the issues, Mr. Speaker, should be looking at the origins of the raw materials. We have situations in this country where other people within the textiles industries are doing very well. New industries are springing up. Quite recently, I was at one of the places called Virgins Textiles, and they have a lot of orders and they are making it. So why is it that those that we used to have are going down? Is it because they have high cost

of production? Is it because they have not identified new areas of bringing cost to the barest minimum?

Or is it because they are not training their staff enough to meet the challenges that are in the industry? Mr. Speaker, these are the things that we should be looking at than just slapping mere taxes which would in turn affect consumption in the country.

Mr. Speaker, with this, I am done.

Mr. Francis A. Agbotse (NDc -- Ho West)

Mr. Speaker, in supporting the Statement on the floor of the House, let me bring it to my region. The only government-sponsored factory in the Volta Region is the Juapong Textiles Limited; and this factory has been closed down. It is because of this factory that other industries are developed in the Juapong township. For example, it was from the factory product (cotton) that the pillow industry in Juapong was established and this has helped the people to sustain themselves; they got their incomes from it. With the closure of the factory, this industry too would die.
Mr. Speaker, I have heard the hon. Minister for Trade and Industry telling us that those who are importing textiles to Ghana should pass through the Takoradi Harbour. In the same vein, they are saying that the textiles are being smuggled. Would the smuggler take his smuggled goods to Takoradi Harbour to be assessed? The answer is no; the problem is still there.
It has happened in the European Union (EU) countries, it has happened in America, Canada, Nigeria. The governments of these countries took action to resolve the problem. What are we doing in Ghana? I am calling on the Minister for Private Sector Development and President's Special Initiative (PSI) to come to this

Mr. Kwamena Bartels

On a point of order. Mr. Speaker, I think we need to clear one point before the hon. Member who has just spoken gets too far. Mr. Speaker, this is a sectoral responsibility which is with the Ministry of Trade and Industry.

Mr. Speaker

Member for Ho West, over to you.

Mr. Agbotse

Mr. Speaker, I am not calling on all the sectors to come and brief us. I am calling on the hon. Minister for Private Sector Development and PSI to take the information from all the sectors to come to this House to brief us on what he is doing so that these private companies would come back to life to employ the thousands of people that are being laid off everyday.
Mr. Speaker, with that, I support the Statement.

Hon. Member for Chiana-Paga, do you have a point of order to raise?

Hon. Members, I will take the hon. Member for Keta, and then take the hon. Deputy Minister for Trade and Industry.

Mr. Daniel K. Abodakpi (NDc -- Keta)

Thank you very much, Mr. Speaker, for the opportunity to contribute to this very important Statement.
Clearly, the problem of the textile industry in this country must be seen and treated as a national problem. The textile industry, if it is thriving well, is a major employment generator. This includes the multiplying effects that it has on the other sub-sectors within the economy. That is why the problems affecting the industry must receive total national attention and support given.
I am aware of the latest efforts that the Ministry of Trade and Industry has made to address the problems of the textile industry. But I would want to believe that these measures are inadequate to meet the challenges that confront the industries when one takes into account the environment that the Ghanaian textile industry operates in vis-à-vis what happens in our subregion.
When we make a comparison between the pricing of the textile industry in Ghana in relation to Nigeria and the opportunities offered between the two countries, we can find out easily why the Ghanaian textile industry is not competitive and cannot be competitive under those circumstances. For example, we know that the Nigerian Government provides an expansion grant to the textile industry in that country; we do not have that one. We also know that the Nigerian Government provides what they
call an export grant to the textile industry but we do not have that one.
We know that the Nigerian Govern- ment does not charge VAT on the textile industry but we do. We know that the Nigerian Government does not have a National Health Insurance Levy on its textile industry but we have. All these lead to cost build-ups.
When we relate the fiscal regime within which our industry operates to that of China, there the differences are even more glaring. Even though we have achieved macro economic stability to a large extent now, and interest rates have come down, it is known that lending rates in China are about five per cent but our lending rates are quite higher. Inventory carrying costs in China are quite minimal, whilst in Ghana it is very high.

Export subsidies exist in China; we do not provide that. So if we take these in their totality, it would be most unfair to say that the Ghanaian textile industry should operate on the same keel with those from other countries. We have blamed to a very large extent the problem of the collapse of some critical industries on the World Trade Organisation (WTO) rules and procedures. I do not share in that understanding. I do believe that the WTO, as a rules- based organization, does provide some safeguards which, if we take advantage of, can create a relatively level playing field for our industries, especially the fact that if caps, ceiling bindings for industries in this country are about 90 per cent.

Unfortunately, that cap that we ourselves have negotiated and achieved, we are not able to take advantage of because of the cross-conditionalities that the Bretton Woods Institutions impose upon us. Unfortunately, also, we are not

like our neighbour, Nigeria where we have oil power and therefore can tell the Bretton Woods guys in the face that, we would not mind them and go ahead to ban imports as they have done to protect their industries. But we would need a total examination of the entire fiscal regime in this country in other to create the opportunities that we need to create for the textile industry to survive.

The situation of our textile industry has even become worse off with the lapsing last year of the multi-fibre agreement which gave us some leeway to operate. So we are in a free-for-all kind of situation. If one is in a free-for-all kind of situation and conditions are uniformed across country then one can expect that all the players in that particular industry would have a level playing field but it is not the same.

We have tried to create conditions within the Free Zone programme which has allowed for the establishment of the President's Initiatives (PSI) but the conditions we offer in the Free Zone programme do not pertain to conditions that factories outside the Free Zone operate from, so we consciously did create a discriminatory arrangement to promote export. But should we be examining that right now to see whether we can offer some of those opportunities to those outside the Free Zones? I do know that perhaps some of our industries can improve their cost structures; but what counts first?

Should we insist that they should do industry audit, re-examine their cost before we put in place some of the measures that would enable them to achieve a level playing field with others? These are critical issues that as a country we should be examining and until we do that some of the measures that our colleagues have currently put in place might not give us the kind of results that we intend having.

The maker of the Statement stated that

Mr. Mahama Ayariga

On a point of order. Mr. Speaker, every hon. Member of this House has a pigeonhole downstairs; he might as well put what he is reading here in there for us to read later on -- [Interruption.] Mr. Speaker, he is reading.

Mr. Speaker

Hon. Member, this is not a point of order.

Mr. osei-Ameyaw

Mr. Speaker, the introduction of the Structural Adjustment Programme accelerated the demise and the closure of a number of factories because under the liberalized monetary and fiscal regime these factories could not compete favourably. The accompanying drastic exchange rate percentage jump also affected a number of industries including the textile industry. That is not to say, Mr. Speaker, that the Structural Adjustment Programme did not have its positive impact.
Currently, Ghana has only four main textile manufacturing companies, namely Textile Company Limited, formerly known as GTP, Akosombo Textile Limited, Printex Limited and Ghana Textile Manufacturing Limited. The total output of the textile mills in Ghana fell from a peak of 130 million metres in 1975 to less than 60 million metres in 2004. The local mills satisfy about 50 per cent of the demand in the textile market.
Mr. Speaker, the local manufacturers cannot currently satisfy all the local demand -- hence the importation of textiles in accordance with existing regulations regarding such imports. It would therefore be inexpedient, Mr. Speaker, to propose a ban on importation

Mr. Speaker

Hon. Member for North Tongu, do you have a point of order to raise?

Mr. Speaker, I rise to second the motion moved by the Vice Chairman of the Finance Committee that we should approve the tax and duty exemptions that are being requested by the Livestock
Development Project.
In concluding, I wish to state that the Chairman of the Finance Committee is here but I do not know whether she is sick and that is why she could not move the motion.
Question put and motion agreed to.
Nemene contradicente.
RESoLUTIoNS
Tax and Duty Exemptions in Respect of the Implementation of the Livestock
Development Project (LDP)
Deputy Minister for Finance and Economic Planning) Dr. Anthony Akoto osei) (on behalf of Minister for Finance and Economic Planning): Mr. Speaker, I beg to move, that this honourable House
is respectfully requested to adopt the following resolution:
WHEREAS by the provisions of article 174 (2) of the Constitution, Parliament is empowered to confer power on any person or authority to waive or vary a tax imposed by an Act of Parliament;
THE ExERCISE of any power conferred on any person or authority to waive or vary a tax in favour of any person or authority is by the said provisions made subject to the prior approval of Parliament by resolution;
BY THE combined operation of the provisions of section 26 (2) of the Customs, Excise and Preventive Service (Management) Law, 1993 (PNDCL 330), the Export and Import Act, 1995 (Act 503), the Export Development and Investment Fund Act, 2000 (Act 582), the Value Added Tax Act, 1998 (Act 546), the Value Added Tax (Amendment) Act, 2000 (Act 579) and other existing Laws and Regulations applicable to the collection of customs duties and other taxes on the importation of goods into Ghana, the Minister for Finance may exempt any statutory corporation, institution or individual from the payment of duties and taxes otherwise payable under the said Laws and Regulations or waive or vary the requirement of such statutory corporation, institution or individual to pay such duties and taxes;
IN ACCORDANCE with the provisions of the Constitution and at the request of the Government of Ghana acting through the Minister responsible for Finance, there

Mr. Abuga Pele

Mr. Speaker, I beg to second the motion.
Question put and motion agreed to.
Resolved accordingly.
Agreement between the Government of Ghana and KHI 01 Ghana Limited in Relation to the Ambassador Hotel,
Accra
Deputy Minister for Tourism and Modernization of the capital city (Mr. Steven Asamoah-Boateng) (on behalf of Minister for Tourism and Modernization of the capital city): Mr. Speaker, I beg to move, that
WHEREAS by the provisions of article 181 of the Constitution the terms and conditions of any international business or economic transaction to which the Government of Ghana is a party shall not come into operation unless the said terms and conditions have been laid before Parliament and approved by Parliament by a Resolution supported by the votes of a majority of all Members of Parliament;
PURSUANT to the provisions of the said article 181 of the Constitution, and at the request of the Government of Ghana acting through the Minister responsible for Tourism and Modernization of Capital City, there has been laid before Parliament the terms and conditions of a Support Agreement between the Government of Ghana and KHI 01 Ghana Limited in relation to the Ambassador Hotel, Accra and the Sub-lease Agreement between the Ghana Tourist Board and the KHI 01 Ghana Limited;

Debates of 22 Jul 2005

PRAYERS 10 a.m.

Mr. Speaker 10 a.m.

Mr. Kofi osei-Ameyaw 10 a.m.

Mr. Speaker 10 a.m.

Majority Leader (Mr. F. K. owusu- Adjapong) 10 a.m.

Dr. Kwame Ampofo 10:10 a.m.

Mr. Speaker 10:10 a.m.

Mr. owusu-Adjapong 10:10 a.m.

Mr. Speaker 10:10 a.m.

Mr. owusu-Adjapong 10:10 a.m.

Mr. Speaker 10:10 a.m.

MINISTRY OF INFORMATION 10:10 a.m.

Minister for Information (Mr. Dan Botwe) 10:10 a.m.

Mr. Boampong 10:10 a.m.

Mr. Botwe 10:10 a.m.

Mr. G. K. Arthur 10:10 a.m.

Mr. Speaker 10:10 a.m.

Mr. osei-Adjei 10:10 a.m.

Mr. Botwe 10:10 a.m.

Mr. Kojo Armah 10:10 a.m.

Mr. Botwe 10:10 a.m.

Mr. Moses Asaga 10:10 a.m.

Mr. Botwe 10:10 a.m.

Mr. M. A. Asaga 10:10 a.m.

Mr. Botwe 10:20 a.m.

Mr. Dan Botwe 10:20 a.m.

Mr. J. K. Gidisu 10:20 a.m.

Mr. Botwe 10:20 a.m.

Mr. G. K. B. Gbediame 10:20 a.m.

Mr. Botwe 10:20 a.m.

Mr. J. K. Gidisu 10:20 a.m.

Mr. Botwe 10:20 a.m.

Mr. Botwe 10:20 a.m.

Mr. John Ndebugre 10:20 a.m.

Mr. Botwe 10:20 a.m.

Mr. Botwe 10:20 a.m.

Mr. Kunsu 10:20 a.m.

Mr. Botwe 10:30 a.m.

Mr. Kunsu 10:30 a.m.

Mr. Botwe 10:30 a.m.

Mr. J. K. Arthur 10:30 a.m.

Mr. Botwe 10:30 a.m.

Mr. Speaker 10:30 a.m.

MINISTRY OF ROAD TRANSPORT 10:30 a.m.

Minister for Road Transport (Dr. R. W. Anane) 10:40 a.m.

Minister for Road Transport (Dr. R. W. Anane) 10:40 a.m.

Mr. Ackah 10:40 a.m.

Dr. Anane 10:40 a.m.

Mr. Ackah 10:40 a.m.

Dr. Anane 10:40 a.m.

Mr. Ackah 10:40 a.m.

Dr. Anane 10:40 a.m.

Mr. Ackah 10:40 a.m.

Dr. Anane 10:40 a.m.

Mr. Ackah 10:40 a.m.

Mr. Speaker 10:40 a.m.

Mr. Ackah 10:40 a.m.

Dr. Anane 10:40 a.m.

Mr. Sampson Ahi 10:40 a.m.

Dr. Anane 10:40 a.m.

Dr. Anane 10:50 a.m.

Mr. Kyei-Mensah-Bonsu 10:50 a.m.

Mr. Speaker 10:50 a.m.

Dr. Anane 10:50 a.m.

Dr. Anane 10:50 a.m.

Mr. Amoah 10:50 a.m.

Dr. Anane 10:50 a.m.

Dr. Anane 10:50 a.m.

Dr. Anane 10:50 a.m.

Mr. Herod cobbina 11 a.m.

Dr. Anane 11 a.m.

Mr. cobbina 11 a.m.

Mr. Speaker 11 a.m.

Mr. cobbina 11 a.m.

Mr. Speaker 11 a.m.

Mr. cobbina 11 a.m.

Mr. Speaker 11 a.m.

Mr. cobbina 11 a.m.

Dr. Anane 11 a.m.

PRAYERS

Mr. Speaker

Mr. Kofi osei-Ameyaw

Mr. Speaker

Majority Leader (Mr. F. K. owusu- Adjapong)

Dr. Kwame Ampofo

Mr. Speaker

Mr. owusu-Adjapong

Mr. Speaker

Mr. owusu-Adjapong

Mr. Speaker

MINISTRY OF INFORMATION

Minister for Information (Mr. Dan Botwe)

Mr. Boampong

Mr. Botwe

Mr. G. K. Arthur

Mr. Speaker

Mr. osei-Adjei

Mr. Botwe

Mr. Kojo Armah

Mr. Botwe

Mr. Moses Asaga

Mr. Botwe

Mr. M. A. Asaga

Mr. Botwe

Mr. Dan Botwe

Mr. J. K. Gidisu

Mr. Botwe

Mr. G. K. B. Gbediame

Mr. Botwe

Mr. J. K. Gidisu

Mr. Botwe

Mr. Botwe

Mr. John Ndebugre

Mr. Botwe

Mr. Botwe

Mr. Kunsu

Mr. Botwe

Mr. Kunsu

Mr. Botwe

Mr. J. K. Arthur

Mr. Botwe

Mr. Speaker

MINISTRY OF ROAD TRANSPORT

Minister for Road Transport (Dr. R. W. Anane)

Minister for Road Transport (Dr. R. W. Anane)

Mr. Ackah

Dr. Anane

Mr. Ackah

Dr. Anane

Mr. Ackah

Dr. Anane

Mr. Ackah

Dr. Anane

Mr. Ackah

Mr. Speaker

Mr. Ackah

Dr. Anane

Mr. Sampson Ahi

Dr. Anane

Dr. Anane

Mr. Kyei-Mensah-Bonsu

Mr. Speaker

Dr. Anane

Dr. Anane

Mr. Amoah

Dr. Anane

Dr. Anane

Dr. Anane

Mr. Herod cobbina

Dr. Anane

Mr. cobbina

Mr. Speaker

Mr. cobbina

Mr. Speaker

Mr. cobbina

Mr. Speaker

Mr. cobbina

Dr. Anane

Dr. Anane