Ghana to peg oil corporate tax at 35% in spite of increases globally

BY EDMUND SMITH-ASANTE

Mr. Mohammed Amin Adam

Ghana is set to fix its oil corporate tax, which is a tax on profits made by businesses, at 35% as it amends the Internal Revenue Act, despite revision of the tax upwards by many countries globally, it has been learnt.

The country currently does not have a fixed corporate tax for the burgeoning oil sector and is now set to do that in an amendment to Ghana’s Internal Revenue Act, hence the agreement by both Majority and Minority sides of Parliament to settle at 35%.

But this will not auger well for Ghana’s fiscal fortunes, says Mohammed Amin Adam, Coordinator, Extractives Programme, Ibis Ghana, who contends that Parliament is oblivious of what it bodes for the country’s finances.

In an exclusive interview after a round table meeting on the potential challenges facing recent oil and gas policy legislations in Accra Friday, organised by the Civil Society Platform on Oil and Gas in Ghana, he said “The issue of corporate tax is an issue Ghana should look into generally, because once the capital cost is recovered, what can guarantee a maximum revenue take from Ghana’s oil and gas sector is the corporate tax.”

According to Mohammed Amin Adam, although “before the cost recovery, the corporate tax may not be much because the companies may not be declaring profit, after five years, when the capital allowance would have been exceeded, the government and country can generate substantial portion of the oil revenue from corporate tax.”

He lamented that his argument notwithstanding,  “Parliament is about amending sections of the Internal Revenue Act, which at the moment doesn’t make provision for corporate tax in the petroleum sector.”

The Ibis Coordinator explained that currently the petroleum taxes are catered for in the petroleum income tax law, PNDC Law 188, which puts a maximum of 50% corporate tax that can be charged on the profits of oil companies.

He expressed his befuddlement that “what Parliament is going to do is to peg it at 35% of profits in the Internal Revenue Act, and I don’t understand why.”

Mohammed Adam intimated parliament’s assertion that though corporate tax generally is 25% and 50% maximum for the oil sector, Ghana has negotiated 35% in all the contracts, which has informed the decision to peg it at 35%.

Communicating his exasperation, he said “I think this is an injustice to Ghana because you charge lower taxes when you haven’t discovered oil because the risk profile is very high, but when you have discovered oil in the quantities that we have discovered in Ghana, the risk has gone down significantly, we should be seen to be graduating over the attractive terms that we gave when we hadn’t found oil.”

He thus questioned why Ghana will not go for the maximum 50% or even review the law to take more corporate taxes. “If the 35% we have negotiated has been the product of poor negotiation, now we want to legalise it! I don’t think this is good for the country,” he stressed.

Mohammed Amin Adam listed countries that have struck better deals as in corporate taxes as Equatorial Guinea, which has recently pegged its tax at 50% after going for 40% initially, Chad- 50% and Nigeria currently charging 50% but going for 80%.

To counteract the bad move Ghana is about to take, he urged Parliament to give the issue serious thought, discuss it dispassionately and seek the interest of the nation.

He also admonished civil society organisations to speak up against the bad move so the right thing would be done for Ghana.  

Further touching on local content regulations, the Ibis Extractives Programme Coordinator stated that until the exploration and production bill, which will provide broad provisions but is yet to go to Parliament, is passed into law that would not be plausible.

Mohammed Adam stated that although Ghana was bound to make mistakes in its nascent oil industry, the country had gotten it right with respect to legislations to govern the sector.

“We have moved faster than other countries have moved when they discovered oil, so on that positive note, I am confident that the problems and challenges we are going to face will also be addressed in the same manner as we have began passing good laws, at least for the revenue management and for the regulation of the sector,” he expressed optimism.

He further challenged that Ghana should be able to correct its mistakes in the next three to five years, so the country can become a model of oil exploitation and management for other countries.

Dirt is contrary to Islam – Central Regional Imam

BY EDMUND SMITH-ASANTE

The Regional Chief Imam delivering his address at the Cape Coast Central Mosque

 

 

 

 

 

The Regional Chief Imam of the Central Region, Alhaji Abubakari Yusif  has stated that Islam and cleanliness are inextricably intertwined as the Holy Quran teaches Muslims to be clean and live healthy lives.
He has therefore tasked Muslims to support Zoomlion’s efforts by making the teachings of Islam manifest in their everyday lives, since living in dirty surroundings means going contrary to what the Holy Prophet teaches Muslims.
The Regional Chief Imam said these at a Public Education in Islamic Communities durbar organised by Zoomlion Ghana Limited in collaboration with Sheikh Ishaak Nuamah, a renowned Islamic Educationist and Theologian.
Sheikh Ishaak  Nuamah stated that attitudinal change towards the environment is one of the main solutions to the sanitation problems in the country, admonishing that the environmental sanitation situation in the country is a shared responsibility for the government, private companies and the people of the various communities.
For his part, a Communications Officer of Zoomlion Ghana Ltd, Mr. Adams Mahama, commended Muslims in the Cape Coast municipality for partnering the company to fight filth in the country and urged them to keep on cooperating with the company to help in the attainment of the ultimate goal, which is to provide excellent waste management services to the people of Cape Coast and the nation as a whole.
He also used the platform to advise Muslim women to teach their children to imbibe good sanitary practices and not to send them to the rubbish dump to throw rubbish and also practice personal hygiene.
In a similar development, Zoomlion Ghana. Ltd, as part of its nationwide Public Education on Sanitation for the Islamic Communities, last week organised an educational and sensitisation seminar for the community of Nima  which was well-attended by the people of Nima and addressed by officials of Zoomlion as well as highly-respected leaders of the Muslim community including Sheikh Ishaak Nuamah, and Sheikh Basheer Yandoh, a Muslim leader in the Nima Community.
Addressing the people, Sheikh Nuamah touched on the need for the people to keep their communities clean, intimating that, over the years, people have had a negative perception of the ‘Zongo’ communities across the country as dirty and unwholesome and it behooves on the people residing in the ‘Zongos’ to disabuse the minds of such cynics by keeping their communities clean.
He stressed that in this modern era, people are being judged based on their religious affiliations and it is therefore imperative that the Muslim community live above reproach and live exemplary lives – including their resolve to keep their surroundings clean.
On his part, Communication Officer of Zoomlion Ghana Limited, Mr. Ernest Asiedu Caesar, reiterated his Company’s resolution to partner with the ‘Zongo’ Communities to champion the cause of sanitation because of their sense of unity. He said the perennial flooding that hits Accra annually is as a result of the dumping of solid wastes into drains.
He further stressed that, various diseases such as malaria, diarrhoea and cholera are all caused by the practice of poor sanitation in the communities and if proper sanitation is achieved by the people, money spent at the clinics and hospitals to treat such diseases can be adequately saved for other essential needs.
Mr. Asiedu Caesar also touched on the success stories of Islamic countries such as United Arab Emirates, Malaysia and Singapore, regarded as some of the most beautiful and idyllic countries in the world and hinted that Ghana can also attain such status – and  entreated the Nima community that if Ghana were to attain such status, it had to start with the Muslim communities keeping their environment clean.
He also encouraged the people to organise frequent clean-up campaigns and be watch-dogs on cleanliness for their communities.
Sheikh Basheer Yandoh emphasised on the personal hygiene of the people of the Nima community, imploring them to keep themselves clean by taking bathing, brushing of teeth and clothing seriously.

Ghana losing out on gold revenue despite new 5% royalty rate, rising gold price

BY EDMUND SMITH-ASANTE

Mr. Samuel Obiri

The Centre for Environmental Impact Analysis (CEIA), based in Cape Coast, Ghana, has lamented that Ghana as a country is losing out in revenue that should otherwise have accrued to the country in terms of royalties, in view of soaring gold prices in recent times.
At the time this report was began in August 2011, the price of gold had risen to $1,800 for an ounce on the world market and was pegged at $1,765.10 at the end of last week according to the Washington Post.
In an exclusive interview with this reporter, Mr. Samuel Obiri, Executive Director of CEIA, said Ghana had lost so much revenue and is still losing out in royalties from mining companies operating in Ghana, because despite the 3% to 6% range indicated for payment of royalties in the Minerals and Mining Act, mining companies were still paying 3% as their ceiling.
Before its amendment last year, Ghana’s Minerals and Mining Law, Act 703, stated that mining companies are expected to pay royalties ranging from 3% to 6% on the revenue realised from the ounces of gold ore mined from the bowels of the country’s earth.
“A holder of a mining lease, restricted mining lease or small scale mining license shall pay royalty that may be prescribed in respect of minerals obtained from its mining operations to the Republic, except that the rate of royalty shall not be more than 6% or less than 3% of the total revenue of minerals obtained by the holder,” the Minerals and Mining Act, 2006 (Act703) explicitly spelt out before its amendment to a flat 5% March 2010, which was assented by President John Atta Mills on March 17, 2010, and gazetted on March 19, 2010 (a fact which is still not known by many).
The amended section now reads: “25. A holder of a mining lease, restricted mining lease, or small scale mining license shall pay royalty in respect of minerals obtained from its mining operations to the Republic at the rate of 5% of the total revenue earned from minerals obtained by the holder.”
However, this provision in Ghana’s statute books seems to have been exploited by companies mining the country’s gold, to their advantage.
Proffering a reason for this trend, Mr. Obiri said “Now if you also go back to our investment code…if any investor comes in with more than about $500,000, it moves in there to negotiate its own royalty payment.”
“So for instance in 2003 when Newmont came into Ghana, as part of its investment agreement with government it pegged its payment at 3% based on the prevailing market price at that time of $300 per ounce,” he stated.
Quoting the Stability Agreement in section 48 of Ghana’s mining code, Mr. Obiri explained: “What the Stability Agreement seeks to do is that, as entered into agreement with you, you don’t have the power to change the content of the agreement to the investor’s detriment.”
“So even though as a nation the price has gone up, we cannot change it because of our own Mining Act,” he said.
Trying to quantify the amount lost to the state of Ghana by way of unclaimed royalties, he said, “Let us assume roughly that in a month Newmont is producing 100 ounces of gold…so it means that when Newmont gets the 100, out of the hundred ounces of gold, they are going to multiply it by $1,800, so if you multiply we are getting to almost about $180,000”
“But Newmont then, in paying the royalties to us, uses $300 to multiply the hundred ounces, then out of it pays 3% to government,” Obiri said, admitting that all mining companies in Ghana were guilty on that score.
He listed some of the mining companies as AngloGold Ashanti, Bogoso Goldfields Limited, Damang Mining Company, Goldfields Ghana Limited and Golden Star Resources.
“Again our law says in section 25 that by permission from the Bank of Ghana, they retain not less than 75% of this profit in offshore accounts,” Mr. Obiri said while explaining what the excess profits of the companies are used for.
Touching on a way forward for Ghana to redeem herself from the shot in her own foot, the CEIA researcher mentioned the Botswana experience. He said late in the 1970s when that country discovered its diamonds, it entered into an agreement with a company when the infrastructural system had not been developed, which stated that no royalties were going to be paid to the state but such percentage of profits must be used to develop the country.
The company said that it would take them approximately ten years to recoup their investment cost but when in four years it was realised the company had recouped its cost and developed the country they called for renegotiation, he said.
“So one of the things we have to do as a nation is to critically review or maybe expunge the stability agreement,” Obiri suggested.
He also bemoaned the non-payment of annual ground rent by the mining companies, which is pegged at 50Gp per sq km, saying with the exception of the Ghana Manganese Company, Ghana Bauxite Company and Chirano Gold Mines which paid in 2003, all the big companies such as AngloGold Ashanti among others, have defaulted payment.
That assertion was however refuted by Mr. Kofi Afenu, Manager, Sectoral Policy Planning, Minerals Commission of Ghana recently in October 2011 during the launch of a research report by CEIA in Accra.
In the interview however, Mr. Obiri stated that this non-payment could be addressed if civil society groups took up the matter, quoting section 26 of the mining law, which states that “A fee, royalty or other payment which falls due in respect of a mineral right or otherwise under this Act is a debt owed to the Republic and recoverable in the Court.”
He further pointed out a contradiction in section 109 of the Act which states; “Except otherwise provided in this Act, where a fine is imposed on a person under this Act or Regulations made under this Act and there is failure to pay the fine, the amount shall be recoverable as a civil debt owed to the State.”
One of the world’s biggest mining firms operating in Ghana, Newmont Ghana Gold Limited (NGGL), affirms the level of royalties paid by mining companies in the country. A report written on the company’s operations in Ghana titled “Socio Economic Impact of Newmont Ghana Gold”, states; “In Ghana, royalties are levied every quarter on the market value of the mining company’s gross output. In the new mining code of 2006, the maximum royalty that can be levied was reduced from 12% to 6% while the minimum remained 3%.
However, companies do not pay more than 3% and Ghana’s parliament only recently voted to increase the minimum level to 5% for those companies without stability agreements with effect from March 2011.”
The then Ghana Chamber of Mines CEO, Joyce Rosalind Aryee, confirmed that royalties payable by mining firms had indeed been fixed at 5% as of March 19, 2010, although the new rate would not immediately affect AngloGold Ashanti and Newmont Gold Ghana Limited.
An article edited by Reuters, published on miningweekly.com on May 26, 2010 and titled “Ghana says mining royalty hike has been applied” quoted  Ms. Aryee as saying; “Ghana does not have all the infrastructure in place … so the government signed such stability agreements with the mines to promote their investment and also to ensure that too many goal posts will not be changed too quickly.”
Also speaking to the same issue in his article headlined “Gov’t reduces mining royalty rate” published on allafrica.com on April 30, 2010, Steve Manteaw said the amendment in the royalty rate “does not take care of the challenges stability agreements impose on tax revenue mobilization in Ghana” as “Section 48 of the Minerals and Mining Act advances a right to stability agreement for companies that invest $500 million or more in the mining sector.”
He added that experts contend stability agreements have an undermining effect on government’s law making powers in respect of taxation.
The Bloomberg news service in a report published May 27, 2010 and titled “Ghana Changes Mining Royalty Rate to Fixed 5%, Chamber Says”, indicated that Ghana, Africa’s second-biggest gold producer, began charging a fixed 5% royalty rate to mining companies in a bid to boost government earnings from the industry.
The report states that the new rate, which took effect in March 2010, was disclosed by Dan Owiredu, then president of the Ghana Chamber of Mines, who added that AngloGold Ashanti Ltd., which operates the Obuasi gold mine, and Greenwood Village, Colorado-based Newmont Mining Corporation, have so-called stability agreements that make them exempt from the changes, at the group’s annual meeting in Accra on May 27, 2010.
“Mining companies which do not have stability agreements with the government have started paying the new rate,” Mr. Daniel Owiredu was quoted as saying.
Also attributed to Newman Kusi, an adviser to Ghana’s Finance Ministry, by phone, was a statement that AngloGold and Newmont’s agreements are capped at 3% over 15 years and that government was “negotiating” with those companies about paying the new rate.
An article published in the Economist magazine on March 31 headlined “A resource-rich government takes on foreign mining firms” reported the new royalty rate thus: “The immediate cause of the increase in royalties is a budget deficit of almost 10% of GDP. But underlying it and the increasingly strict enforcement of environmental rules is a sense that Ghana is not getting much benefit from its mineral wealth.”

According to the article, gold accounted for 40% of exports in 2008, with a value of $2.2 billion, whereas the government received only $116m in taxes and royalties from mining firms, which is less than 4% of the country’s total tax take.
Chiding the mining companies in the same article, Ghana’s Minister of Environment, Science and Technology, Sherry Ayittey was quoted as saying, “When you come here as an investor, don’t come to mine and pollute the water bodies, repatriate your profits and leave our people suffering.”
According to The Economist, mining firms, predictably, are unenthusiastic and say a new royalty regime could deter future investment and, in some cases, violate existing agreements, while the government, in turn, is trying to renegotiate those agreements.
Billy Mawasha, Managing Director of AngloGold Ashanti’s Iduapriem mine, is also on record as saying his firm is not dogmatic, but had hoped that “the investment agreement would stay in place as it is.”
Examples of several other African countries that have revised royalties in recent years to reflect changing world prices include Tanzania and Zambia.
Newmont’s argument against increase in royalties:
In the 64-page socio economic impact report, Newmont opposes any increase in royalties paid by mining companies and notes that “The life of a mining project is a function of the price of the commodity on the one hand and the cost of production on the other.”
The company argues that as the commodity rises in price, the life of the project increases as, for example, it becomes profitable to mine lower grades of ore or higher cost ore, cautioning; “But in this context it is important to recall that commodity prices are volatile: they go up, but they also come down. When they fall below the cost of production the project is, of course, no longer viable.”
The miner specifically states “If we suppose that the operating cost (which does not include capital expenditure, exploration and other non-operating costs) of the Ahafo mine is in the neighbourhood of $500 – $600 per ounce then the mine would not have been profitable before 2006. However, production costs prior to 2006 were much lower too,” adding, “In any event, it took 16 years from the first gold discovery at Ahafo to the first gold production in 2006.”
“When seen from this perspective, an increase in royalty payments, for example, effectively acts to decrease the life of the mine (and therefore its benefits). In setting royalties, governments must, therefore, consider the influence of their policies on the life-span of the mine,” Newmont Ghana Gold chides.
The cumulative expenditures on the Ahafo project made by Normandy prior to it being acquired by Newmont have been estimated at $135 million and by extrapolating the 2009 results, the estimated break-even point of Newmont’s investment in the Ahafo project is 13 years.
Further increases of the (already record-high) gold price would shorten the time to break-even whereas a decrease would obviously increase it, the report states, adding that by the time it breaks even, Newmont’s extrapolated cumulative capital investment in Ahafo will stand at approximately $1,500 million.
On the whole though, Newmont’s overall mining license covers 774 square kilometres.
Revenue from Gold mining:

An ounce of gold nugget

Gold mining is a significant activity for Ghana, stresses the report, which is the product of over six months of research by a study team composed of Professor Ethan B. Kapstein of INSEAD and Dr. Rene Kim, Willem Ruster and Hedda Eggeling of Steward Redqueen, a strategic consulting firm based in the Netherlands, from January 2010 – May 2011 and published by Stratcomm Africa based in Ghana.
It states that in 2009 alone, Ghana’s Internal Revenue Service (IRS) collected $243 million in taxes from the mining sector, equivalent to almost 20% of total tax collections.
Aside employing more than 17,000 workers while averaging job growth to over 4% per year since 2002, overall, the mining sector contributed 6.3% to Ghana’s 2009 Gross Domestic Product (GDP) and 43% of its exports.
The contribution of the mining sector to Ghana’s GDP, according to the report, has tripled from slightly less than 2% in 1991 to 6.3% in 2009 (5.9% in 2008). With a value of $2,551 million in 2009, gold represented 97.4% of Ghana’s mineral exports and 43.4% of Ghana’s total exports.
Meanwhile, in 2009, Newmont alone produced 531,470 ounces of gold (about 15 tonnes), equivalent to 17.0% of Ghana’s total production, while corresponding revenues were $528 million or 20.7% of Ghana’s gold exports. Ahafo’s proven and probable gold reserves, as of 31 December, 2009, were estimated at 9.1 million ounces.
Newmont’s $528 million of gold exports represented 9% of Ghana’s total exports in 2009. Of this, $196 million remained in the Ghanaian economy and was spent on local procurement, payments to government, and salaries.
The payments to the government (i.e. taxes and royalties) amounted to nearly $40 million, which is equal to nearly 1% of the government’s domestic revenues. The $75 million of capital investments made by Newmont are equal to about 4.5% of the $1.67 billion in direct investments in Ghana recorded in 2009 by the Bank of Ghana.
This report examines Newmont’s gold mining activities in the Brong-Ahafo Region of Ghana and attempts to answer questions relating to the benefits of those activities to Ghana’s socio-economic development, whether Ghana is making good use of its gold wealth to aid in the process of development and if Newmont is a good partner in that endeavour among many others.
Newmont is fully owned by Newmont Mining Corporation (NMC), a publicly traded company with headquarters in Denver, Colorado and one of the largest gold producers in the world with assets in the United States, Australia, Peru, Indonesia, Ghana, Canada, New Zealand, and Mexico.
Newmont’s Ghana operations are very significant to NMC, because its gold reserves are estimated to comprise almost 20% of the corporation’s assets worldwide.

Let’s have commercial toilets at all fuel stations – Sanitation expert

BY EDMUND SMITH-ASANTE, BACK FROM MUMBAI, INDIA

Dr. Albert Wright

Ghanaian engineer and technologist, Dr. Albert M. Wright, who introduced the Kumasi Ventilated Improved Pit (KVIP), has prescribed the mandatory construction of toilets at the country’s many fuel stations, to help curb the high incidence of open defecation in the country.
He said such a move would in the short term make improved sanitation facilities available, not only to motorists, but many more Ghanaians who do not have access and thus make them refrain from defecating in open spaces.
A cursory survey at fuel stations dotted across the country, shows that averagely they have two toilets – one for males and one for females (mostly for staff), while some only have make shift urinals for motorists who may want to empty their bladder.
Speaking to ghanabusinessnews.com in an exclusive interview at the just-ended Global Forum on Sanitation and Hygiene held in Mumbai, India, Dr. Wright said “the incidence of open defecation in urban areas is because we do not have sanitation systems at the household level or in the public places.”
“If you want to stop open defecation, then we must provide an alternative place for people to do it and I think the short term approach is, one, to have a public toilet which works well, which means they must be managed by private people who make money from this – They must be at affordable rates.”
“The second alternative – we have many petrol stations. Government should encourage petrol stations to build toilets and charge moderate rates – Maybe four or five per petrol station and charge for their use – because there are so many of them, it will go very far in solving the problem,” he proffered.
According to him, as things stand now in Ghana, when people are in town and have to respond to the call of nature, they have nowhere to go other than the open spaces.
Available statistics show that as much as 20% of Ghanaians in all the 10 regions of Ghana still practice open defecation, due to the lack of toilet facilities.
Leading the table in open defecation is the Upper East Region with 81.9%, followed by Upper West, 78.7%, Northern, 72.9%; Central, 18.1% and Volta Region, 13.8%.
The others are Western, 12.8%; Greater Accra, 8.1%; Brong Ahafo, 6.4%; Eastern Region with 5.5%, and Ashanti Region, 3.4%.
This notwithstanding, Ghana’s revised Environmental Sanitation Policy (September 2010) in section 3.1.2. (e) says “Every individual, establishment or institution shall be responsible for ‘Hygienically disposing of all wastes they generate in public areas by use of an authorised public toilet or solid waste container as appropriate.”
It adds that “Where individuals, establishments or institutions fail to discharge these responsibilities, the competent authorities shall take any necessary remedial action at the expense of those in default. The competent authorities shall also assume responsibility for the maintenance of specified public areas in a sanitary condition and charge fees for the use of such areas.”
Again in section 3.1.3 (g), the Sanitation Policy states, “Every community shall: Take the necessary steps to develop appropriate environmental sanitation infrastructure such as domestic and public toilets and waste disposal sites.”
The policy also states in section 3.2.1 that the functions of the lead sector agency, Ministry of Local Government and Rural Development (MLGRD) shall include “Promulgation of national legislation and model bye-laws.”
Dr. Albert Wright however believes that all is not lost for Ghana, as the country has made some progress in sanitation since starting with technology without a process.
“I see the CLTS as a process which does not necessarily involve any one technology. It can involve a number of technologies which the communities can afford – The focus should be on what the community can afford ,” he said, referring to the Community-Led Total Sanitation model that has been adapted by Ghana to deal with sanitation issues.
Divulging that hitherto Ghana was focusing on Community Based Sanitation Systems, he said with CLTS, the focus shifted to the household phase or home-based sanitation system.

Dr. Albert Wright being interviewed by Edmund Smith-Asante

“This is big progress, because when you are suffering from diarrhoea or cholera, in the night when it is raining, you have a call of nature, you can’t go to the public place, you need to go to a place within the house. So having sanitation system within the house is a major progress, which we hope the CLTS approach will bring,” Dr, Wright opined.
He said what the country needs to understand is that CLTS is an approach and there could be other approaches, cautioning however, “It is new and Ghana has absorbed it, which is good but we have to monitor it to make sure that any inherent problems are caught early and corrected.”
Explaining that the reason Ghana is off track in meeting the sanitation MDG is the cost of sanitation, the Engineer expressed optimism thus: “With the CLTS which is not based on subsidy, it means the institutions are going to have a means of keeping it going. It also means that when people are to pay things for themselves, they are more realistic in what they choose – they will choose what they can afford. But when others are paying for them they will like to choose the Rolls Royces.”
To Dr. Albert Wright, the change from subsidy to no subsidy approach augurs very well for the future, stating his belief that by 2015, as far as rural sanitation is concerned, Ghana should be very close to meeting the deadline or target for the MDGs.
“It is a different story in the urban areas – we have to work harder in the urban areas and develop a parallel approach similar to the CLTS approach, which is applicable to urban areas rather than the rural areas for which the CLTS is most suitable and applicable,” he however warned.
Dr. Wright, who is currently serving as a member of the Advisory Committee on the Global Sanitation Fund for WSSCC and was at Global Forum in that capacity, elucidated that the approach that has been used for the urban areas in the past is the Strategic Sanitation Approach, but has unfortunately not been well understood and implemented.
“We need to re-examine it again and see it in the light of the CLTS where we can have a parallel approach similar to the CLTS, which we can apply, particularly in the small towns, and then from there move to the urban slum areas and finally to the rest of the urban areas,” he recommended.
A man donning many hats, Dr. Albert M. Wright worked on the KVIP technology from 1977 – 1984 in Ghana and other West African countries whilst at KNUST and in 1984 worked with the World Bank to carry it to other African countries, working in both rural and urban areas. He also developed the Strategic Sanitation Approach for urban areas and retired from the World Bank about 15 years ago (1996).
This is after he had worked for over eleven years with the Bretton Woods institution, most recently as senior sanitary engineer, and was a member of the Technology Advisory Group at the World Bank that conducted a two-year study on low-cost technologies for excreta disposal.
He also worked on former UN Secretary General Kofi Annan’s MDG programme as co-Chair for the taskforce on Water Supply and Sanitation, is member of the Technical Committee of the Global Water Partnership, and consults for several developing countries on urban sanitation policy.
Dr. Wright has served for twenty years on the WHO Expert Advisory Panel on Environmental Health, in that capacity serving on various Expert Committees of the WHO, including the Expert Committees on Filariasis and Solid Waste Disposal.
He also served as the Joint Rapporteur in 1982 for the Final Task Group on the WHO Guidelines for Drinking Water Quality. During his time at the WHO he taught at the Kwame Nkrumah University of Science and Technology at Kumasi, Ghana, where he served as Head of Civil Engineering and set up the Institute of Mining and Mineral Engineering.
In addition, Dr. Wright was Chairman of the International Management Board of the International Reference Centre (IRC) for Community Water Supply at Rijkwik, the Netherlands and received a Ph.D. in civil engineering from the University of California at Berkely.

$100b annual climate change fund hits barrier

BY EDMUND SMITH-ASANTE

Plans for a multi-billion dollar fund to help developing countries deal with climate change hit a big barrier this week when countries could not agree on the design of the fund, a press release from the International Institute for Environment and Development (IIED), has announced.
The inability to reach a consensus happened on Tuesday, October 18, 2011 at a meeting of an international committee tasked with designing the fund in time for governments to approve the design at next month’s UN Climate Change Conference in Durban, South Africa.
This was a follow up on a decision by 194 nations last year, to create the “Green Climate Fund” to channel up to US$100 billion a year by 2020 to developing countries and parties to the convention also set up the fund’s Transitional Committee to design how the fund would operate.
It was at the sixteenth Conference of Parties (COP16) to the UN Framework Convention on Climate Change in Cancun in December 2010, that the developed countries agreed to set a new Green Climate Fund (GCF) to channel up to US$100 billion a year starting from 2020.
However, the final decision on the design hit a snag, when the developing countries warned that control of the fund by the donor nations – and the burden of bureaucracy that it entails, would limit their ability to make good use of it.
The Least Developed Countries made up of 48 of the poorest nations in Africa and Asia that are particularly vulnerable to climate change – were represented on the committee by Bangladesh and Zambia, whose negotiators have called from the outset for a radically new approach.
They argued that national climate-change trust funds in developing nations should be able to access the Green Climate Fund directly, rather than going through a third party such as the World Bank – which entails long delays and excessive paperwork.
“Direct access would empower the recipients of support to take their destiny into their own hands, without having to have their plans and projects approved by external entities,” advanced Dr. Saleemul Huq of the International Institute for Environment and Development (IIED), which has provided technical support to the Least Developed Countries for several years.
For his part, Pa Ousman Jarju, chair of the Least Developed Countries negotiating block at the UN climate change talks said: “Direct access would allow more devolved decision-making to reflect local and national concerns and it would enable countries to integrate the funding into their national plans and strategies for dealing with climate change.”
He argued that “Without direct access, poor countries will struggle to adapt to climate change, as they would face immense delays to access the funding and would not have the freedom to decide how and when to spend the money.”
Although after six months of tense negotiations, the Least Developed Countries seemed to have succeeded in their demand for provisions for direct access to be included in the final text, the United States and Saudi Arabia withdrew their support for the overall design, supported by all other countries because of concerns about other aspects of the text in the committee’s final meeting held on 18 October, 2011.
Trevor Manuel, former finance minister of South Africa, who co-chaired the meeting with Kjetil Lund of Norway, called the outcome “sub-optimal”.
Germany for her part, expressed frustration and disappointment, and said that the committee’s failure to agree a design “will likely result in not having the Green Climate Fund this year or the next”.

Sanitation is politics, politics is sanitation

BY EDMUND SMITH-ASANTE, BACK FROM MUMBAI, INDIA

A female public toilet in Ghana

News Flash! Some foot soldiers belonging to Ghana’s leading political parties have become notoriously popular for their proclivity to seize public toilets.
Reports say the foot soldiers have largely done the seizure, because they feel they have been neglected by their parties on their ascension to power.
They have also seized toilets being managed by opposition parties, to express their grievance and also stake their claim for a part in the national cake.
Indeed, this phenomenon has not only been frowned upon but also made fun of in several quarters, whenever it has happened.

Why would people want to seize toilets of all facilities in the world, many are wont to ask.

While that may not have been intended, the answer perhaps lies in a statement made by Jon Lane, Executive Director, Water Supply and Sanitation Collaborative Council (WSSCC), at a Global Forum on Sanitation and Hygiene in Mumbai, India, that “the people who lack sanitation are those with no political voice.”

It does certainly look like they have resorted to toilet seizures in their attempt to find a political voice which has eluded them and may have attained a measure of success, as there have always been reactions to their action.
Although the monetary gains to be made from such facilities in view of the high patronage have always been identified as a major reason for Ghana’s toilet war, many have lost sight of the fact that sanitation cannot be devoid of politics and vice versa – a fact that has not been lost on the foot soldiers engaged in the toilet war.
The issue of the symbiotic relationship that exists between sanitation and politics came up strongly at the just ended first ever Global Forum on Sanitation and Hygiene held in Mumbai in the Maharashtra state of India.
Political will and commitment is needed to increase sanitation coverage in all countries of the world, so the 2.6 billion currently without access to improved sanitation will get that access – this was the thrust of the six-day conference which attracted about 450 people from 70 countries from October 9 – October 14, 2011.
Summing it all up on the need for political involvement in sanitation at the closing plenary of the conference, Jon Lane, Executive Director, WSSCC, said “The International Year of Sanitation in 2008 succeeded in raising the political profile of the subject. Global meetings, regional sanitation conferences, numerous campaigns and events at national and local level all contributed to this political momentum.”
He maintained that messages that were developed during those conferences, such as; “sanitation is important for health”, “sanitation generates economic benefit”, “sanitation contributes to social development”, “sanitation helps the environment”, “sanitation for all is achievable”, are all “powerful political messages based on our own experience.”
“Politicians make new policies if they are convinced by the arguments of people advocating for them. That calls for hard evidence to back up arguments, plus sustained political-level presence. Our work on sanitation needs to take these factors into account. Of course water will become more prominent in political debate around the world. Our task is to ensure that sanitation also does. We are making progress but there is a long way to go until sanitation becomes as prominent as, say, vaccination,” Jon Lane stated.
Accentuating one of WSSCC’s key messages that sanitation generates economic benefits, he said ultimately for all professional concerns about health or the environment, the economic arguments are the most powerful, both with householders themselves and with political leaders.
While admitting there are still some tough problems, he noted that peoples’ access to improved sanitation has to be sustained indefinitely, cautioning however that the sanitation problems of urban slums are growing rapidly.
Emphasising that most of the next three billion people adding to the world’s population will live in urban areas in developing countries, he said “Some people seek technical solutions for these problems, while I believe we should be spending more energy on finding political and social solutions.”
“We need to work harder to persuade others – politicians, the media, thought leaders – that sanitation is important to them. It is no use just talking among ourselves as sanitation professionals,” WSSCC’s Executive Director charged participants.
Quoting Nelson Mandela, he told the gathering, “Judge the importance of an issue, not by how glamorous or attractive it is but by how much good it does for how many people,” adding, “On that basis, sanitation is one of the most important issues in the world.”
Optimism:
Expressing optimism for the sanitation sector, Jon Lane adduced that although historically, sanitation and hygiene have been neglected and underfunded topics characterised by inconsistent approaches, policies, fragmentation and unclear responsibilities, this has started to change in recent years.
He listed some of the positives in sanitation as the formal recognition by the United Nations of access to safe drinking water and sanitation as a human right, engagement of more organisations in sanitation and hygiene, start of new networks and initiatives and the understanding of media and political decision-makers of the huge benefits of improved sanitation.
“We are starting to look beyond the MDG target to a future target which must be accessible, safe, affordable sanitation for all – this universal goal ties in well with the recently-declared human right to sanitation, and with the concepts of equity and inclusion applied to sanitation,” he stressed.
Mr. Jon Lane encouraged the stakeholders not be disheartened that sanitation for all will take time.”The world’s first civil society movement, the campaign to abolish the slave trade, took decades to achieve its objective. I know we have a big task ahead of us to achieve sanitation for everybody. But I believe we can do it,” he said:
Suggesting four key ways to accomplish that feat, he mentioned hard work saying there is no substitute for hard work as well as plain speaking. “We must speak out about the subject using plain language that everybody can understand. This will bring sanitation and toilets and shit into regular professional and policy dialogue,” he recommended.
Thirdly, strong leadership: from Mahatma Gandhi in 1925 saying that sanitation is more important than independence to the UN Secretary-General this year saying “It is time to put sanitation and access to proper toilets at the centre of our development discussions”, we need strong direction from global leaders, he added.
Lastly, he impressed on the participants on the need to focus more on growing the ideas and concepts that work than to grow their organisations.
The way forward:
Elucidating on the way forward, Jon Lane said during the next few years, WSSCC’s members and staff will continue to concentrate their energies and resources on sanitation and hygiene; work in long-term development not disaster relief; continue doing much of their work in rural areas, while making specific efforts to become more involved in urban work.
He also divulged that WSSCC will emphasise its commitment to equity for poor and neglected people, ensure that their global, regional and national level work are fully integrated with each other and prioritise those countries that have high sanitation and hygiene needs and in which it can achieve a useful impact.
The WSSCC Executive Director envisaged that all this will lead to four main outcomes.
These, he catalogued as helping millions of people to access and use improved sanitation through the financial support of the Global Sanitation Fund, advocacy, and knowledge sharing and giving special attention to people who are normally left behind: the poor, marginalised and neglected individuals and groups in society.
Also, encourage hundreds more people and organisations to become involved in sanitation and hygiene and help thousands of people to learn new knowledge and skills and hence do their work on sanitation better.
“Our work here is part of our mission to transform sanitation from a minor, neglected, charitable development sector into a major, thriving area of human economic activity. This transformation is happening because people understand that sanitation improves their health, generates economic benefit, and contributes to their social development,” he stated.

WSSCC, others on mission to rescue 2.6 billion people

BY EDMUND SMITH-ASANTE

In India, for every 1,000 children, 87 die before they reach age five (5), while national water coverage is 87% but sanitation trails at 30% nationally in the country, according to reports from UNICEF.

For Nigeria in Africa, the United Nations agency says out of a 1,000 children, 198 die before they celebrate their 5^th birthday, the national coverage for water is 60%, while for sanitation it is 38%.

In Ethiopia, children who die before they are five are 169 for every 1,000, while the coverage figures for water and sanitation are 22% and 6% respectively, according to the same UNICEF source.

Thirty-seven (37) out of 1,000 of China’s children also die before their fifth birthday, while national water coverage is 77% and sanitation 44%.

For Ghana as well, the number of child deaths before age five (5) per every 1,000 as at 2009 was 50, while national coverage for drinking water was 82% and 13% for improved sanitation as at 2008 (UNICEF).

Also, 125 of every 1,000 of Iraq’s infants die before age five (5), whereas water coverage is at 81% and sanitation 80%, a rare occurrence in water and sanitation ratio, according to short profiles that include a summary of the water and sanitation status in 37 countries where UNICEF works.

Most of the children who die before attaining age five, statistics show, die mostly out of diseases caused by the lack of proper hygiene in handling food, nutrition, potable water, and improved sanitation.

Annual child mortality in a host of countries globally, add up to about 9 million of all children who die  each year, from preventable and treatable illnesses before reaching their fifth birthday, and constitute a portion of the 2.6 billion peoples of the world who daily go without improved sanitation and proper hygiene observation and education.

Diarrhoea’s contribution to child mortality

According to rehydrate.org, a rehydration project embarked upon by the Water Supply and Sanitation Collaborative Council and other partners, 2.2 million children will die from diarrhoea and related diseases this year.

It continues that 80% of them will die in the first two years of their life; 42,000 a week, 6,000 a day, four every minute and one every fourteen seconds.

The site continues that Diarrhoea is the passage of loose or watery stools occurring three or more times in a 24-hour period, listing the three types of diarrhoea as acute diarrhoea, persistent diarrhoea and dysentery.

If an episode of diarrhoea lasts less than 14 days, it is acute diarrhoea, which causes dehydration and contributes to malnutrition, whereas the death of a child with acute diarrhoea is usually due to dehydration, the site states.

If the diarrhoea lasts 14 days or more, it is persistent diarrhoea. Up to 20% of episodes of diarrhoea become persistent and often causes nutritional problems, creating the risk of malnutrition and serious non-intestinal infection as well as dehydration, it continues.

Diarrhoea with blood in the stool – with or without mucus – is called dysentery and is very dangerous because of its ability to lead to anorexia, rapid weight loss, and damage to the intestinal mucosa and sepsis, according to information gathered by the project.


The project states further that although the global under-five mortality from acute diarrhoea has decreased from 4.5 million to 1.8 million annually, acute diarrhoea continues to take a huge toll on children's health in developing countries (WHO 2006). Diarrhoea again represents a significant burden on the health system, the household, and the nutritional status of children (Bateman and McGahey 2001).

Diarrhoea is the second leading killer of children under the age of five, accounting for approximately 15% of under-five child deaths worldwide, or almost two million deaths annually (WHO 2003).

However, though the means to prevent diarrhoea through water supply, sanitation, and hygiene have been well documented, each year roughly one and one half billion episodes of acute diarrhoea occur among children under the age of five, the Rehydration Project has also documented.

Further, according to WaterAid, an international Non-Governmental Organisation, “1.4 million children die every year from diarrhoea caused by unclean water and poor sanitation - 4,000 child deaths a day or one child every 20 seconds.”

These children need a future

Available statistics also indicate that 65% of all child deaths are from three causes, which are Acute Respiratory Tract  infections which now kill 3.6 million children each year, Diarrhoeal diseases which are responsible for about 2.2 million child deaths every year and preventable diseases: measles, tuberculosis, tetanus, diphtheria, polio, and  pertussis, also responsible for some 2.1 million child deaths every year. Of all these, almost 1 million are attributed to measles.

WSSCC’s rescue plan

It is to deal with this global albatross that the Water Supply and Sanitation Collaborative Council (WSSCC), together with a host of partners, including the Government of India, Government of Maharashtra, SHARE (Sanitation and Hygiene Applied Research for Equity), Sulabh, Unilever, WaterAid, UNICEF South Asia, Plan International, Freshwater Action Network/FAN-South Asia, ANEW, The CLTS Foundation, Public Private Partnership for Handwashing with Soap (PPPHW), WIN (Water Integrity Network), CREPA, Arghyam, EAWAG, IDE, IDS, International Water Association, WASH United, and WSP are holding a Global Forum on Sanitation and Hygiene in the Indian city of Mumbai (Bombay) from October 9, 2011 to October 14, 2011.

The event, according to the organisers,  offers a prime opportunity to share ideas on leadership, skills, knowledge, behaviour change and actions that can improve the lives of the 2.6 billion people in the world without safe sanitation and hygiene. 

They opine that the forum will not be a talk shop but will instead, facilitate learning and sharing between practitioners, policymakers and other experts inside and outside of the sanitation sector, and will energize professional communities by focusing exclusively on sanitation and hygiene.

It is also expected to showcase knowledge, investment, communications, advocacy, partnership and networking approaches, as well as strengthen national, regional, South-South, and global dialogue and collaboration and includes the plenary, break-out and workshop sessions, each with dynamic speakers and presentations.

Some topics for the plenary sessions are: Inspire to Act; Breaking the Mould; What Changes Behaviour; Getting from Small to Big; Looking at Sanitation from the Lens of the Vulnerable; What Success Would Look Like with an Equity Lens; Sharing Across the Regional Sanitation Conferences; Regional Reports on Key Actions; Closing Plenary: Where Do We Go From Here?

Patrons at a public toilet in Ghana

For Break-out sessions some of the topics will be: Exploring Private Sector Partnerships in Behaviour Change; Rewards, Sanctions and Benchmarking as Tools for Behaviour Change; WASH Advocacy: How to Win Minds and Hearts; Total Sanitation: Reaching Many Millions; The CLTS Debate; Communications for Change; Urban Sanitation at Scale; Designing for the Human Life Cycle; Governance for Equity; Monitoring for Equity; Financing for Equity; Knowledge and Network Partnerships.

There will also be training sessions on Communications for Behavioural Impact (COMBI); CLTS 101: An Introduction; Sanitation Marketing; Equitable Service Delivery; Using Dev Info to Monitor Equity in Human Development; Monitoring Behaviour Change as well as urban and rural sanitation field visits.

Commenting on the forum, Anna Tibaijuka, Chair, Water Supply and Sanitation Collaborative Council, said “What is needed, today, is serious engagement around the sorts of programmes and policies that are going to help us reach beyond 2015 – to a world where all people have access to decent sanitation and hygiene. As a global community we need to agree what is needed, how to get there, and what skills we need to achieve results.”

Launch of Global Community of Practice 

A special feature of this year’s Global Forum will be the launch of a “Global Community of Practice for Sanitation and Hygiene.” WSSCC is launching the initiative in response to sector demand for collaborative learning in sanitation and hygiene and it will be a space for honest and frank debate across sanitation and hygiene thematic areas, to share experiences, lessons learned, successes and failures and identify best practices through national-international and South-South exchange.

Although over 40 sector professionals discussed this concept at the World Water Week in Stockholm 2011, the organizers believe the real conversation will start when the global gathering of participants at WSSCC’s Global Forum identify pressing questions and learning opportunities that will determine the focus of the “Community of Practice” for the coming year.

Top-level Speakers:

Top-level speakers for the forum include professionals in government and business including Sri Jayaram Ramesh, the Minister of Rural Development, Government of India; Prithviraj Chavan, Chief Minister of Maharashtra (TBC); Bindheshwar Pathak, Sulabh; and Rohini Nilekani, Founder-Chairperson of Arghyam.

Dr. Robert Aunger, a leading researcher in Evolutionary Public Health with the Hygiene Center at the London School of Hygiene and Tropical Medicine, will also give a keynote speech on the science of behavior change.

From the BBC World Service Trust will be Siddharta Swarup, who will present how “Communications does its magic” in fostering social and economic development. There will be in-depth reflections led by speakers from Unilever, IDE Cambodia and BRAC on the private sector’s participation and supply chains in providing latrines, soap and sanitary napkins in “Exploring private sector partnerships in behavior change.” Social entrepreneurs David Kuria of Ecotact in Kenya, and Anshu Gupta of Goonj – both distinguished ASHOKA Fellows – will for their part, present inspiring stories of change : be it from franchising public toilets in Africa or the ”production of sanitary napkins from recycled cloth.”

Global Participation

WSSCC has taken into consideration every aspect of the conference which is attracting hundreds of people, including participants at the six-day forum, and has therefore made sure 90% of the participants are coming from the places where the 2.6 billion people in the world without safe sanitation and hygiene live, mainly from sub-Saharan Africa, South Asia and China. According to them, “this will foster a dynamic and interactive atmosphere for South-South knowledge exchange and partnership building.”

WSSCC itself is sponsoring a large number of participants from many developing countries through its Bursary Fund process with support from SHARE and UNICEF. These include Angola, Bangladesh, Benin, Burkina Faso, Burundi, Cameroon, Central African Republic, Democratic Republic of Congo, Eritrea, Ethiopia, Gambia, Ghana, Guinea-Bissau, India, Iran, Kenya, Kyrgyzstan, Lesotho, Liberia, Madagascar, Malawi, Mongolia, Nepal, Nigeria, Pakistan, Rwanda, Senegal, Sierra Leone, Somalia, Sri Lanka, Sudan, Tanzania, Togo, Uganda, Vietnam and Zimbabwe.