Blue Skies Chairman and Founder Anthony Pile gives his outlook for 2015
Blue Skies has managed to come through to the end of the year sound and in good condition. There have been many difficulties throughout the last 12 months, but the Blue Skies approach is always to depend as little as possible on others, and to deal with our problems ourselves.
A good example of this is in the agricultural sector. In spite of Ghana enjoying a rich legacy of agricultural potential, society no longer regards farming as either respectable or lucrative. With 3000 employees, Blue Skies has employed short, medium and long-term solutions to deal with the malaise. We have started a competition among schoolchildren to produce fruits and vegetables, we have helped to finance the recovery of some farms (nobody could afford 35% interest!) and Blue Skies has set up some farms itself. All 3 of these actions take time to put in place and Blue Skies has been obliged to procure fruit from other countries in the meantime.
Ghana operates an import economy. By artificially supporting the Cedi at a consistent 3.8 to the Dollar, the inflation rate should come down, which is presumably the objective of the government. However this costs money (depleting reserves) and persuades consumers to import goods which are apparently cheaper than they might be. An import economy can only be of short-term value to the country. An artificially strong Cedi will discourage export and therefore the development of industry for export. Blue Skies, for example, imports much of its food for its staff from China even though the food, like rice and chicken, could be easily produced in Ghana. Crazily it is far cheaper to import. If the country is to thrive in the long-term, on a sustainable basis, we need to build factories and develop home-grown businesses that export value-added goods.
Blue Skies will overcome the problems of the failing energy supply to industry by introducing its own solar electricity. A simple, but expensive, solution. It has been much more difficult to solve the problem associated with the chaos surrounding land tenure. Blue Skies has lost over 250 acres of good arable land to housing. This was land that was legitimately owned by Blue Skies but which was stolen back by the vendors and resold. Such activity, blatantly illegal as it is, is a huge switch off to investors. Without investors the economy is not going to get the boost it desperately needs to produce products which could be exported.
Ghana proudly boasts the maxim Justice and Freedom. Freedom is alive and well, but justice has been under pressure from so many quarters. Blue Skies has promised at the time of the original investment that the free zone company would pay, once the first 10 years had expired, no more than 8% corporation tax. This was a guarantee. No one questions the right of Parliament to make laws and to change laws, but the short notice introduction of a 15% corporation tax on free zone companies, whose 10 year tax holiday has lapsed, from 1 January 2016, seems unjust.
Looking ahead to 2016, Blue Skies will undoubtedly face more situations which will draw upon our resourcefulness. We shall determinedly overcome all hurdles placed before us. But we know that we can do so much more for Ghana, earning so much more hard currency and employ so many more good Ghanaians, if only we had a more wholehearted support for agriculture, for exports and for industry. If only there was the courage to let the Ghana Cedi float and find its natural level. At a stroke this would restore profitability and send a huge message out to would-be investors that Ghana was really open for business.
