Could you give us a brief overview of your professional background before assuming your position as Acting Director-General of SSNIT?
I have spent most of my working life here in Social Security and National Insurance Trust.I first trained as a teacher in science; mathematics and physics but I later branched off into actuarial science. Since then, I have worked mostly with the Social Security Organization in Ghana and I also did a year's practical training with the Social Security Administration in Baltimore. I spent two years of my life in politics, one year as a Deputy Minister and the other year in “protective custody”.
The new administration is now determined to assist the development of the private sector. What changes do you expect as a result of this transition?
Before the democratic transition, we had quite a bit of government interference in our affairs. There were instances where Government could even dictate the type of investment to go into. With this new Government, so far we have not had any interference in our activities. We can see that the Government is now coming to grips with what we are doing and also trying to evolve policies.
We are anticipating that the Government with enough time and professional guidance can have a National Forum where we can discuss the National Protection Schemes for this country. We need a wider forum for the people to express what they think about the Schemes. Unfortunately, we have had a few problems with respect to people's perception of the activities of this organization. We had a few media problems, which did not augur well for our organization. We are trying to get ourselves properly positioned in the eyes of the media and in the eyes of the people of Ghana. This way, we can objectively discuss the social protection needs of the people of Ghana. That is when we can claim to have a good Social Security Scheme.
What are the issues you would like to discuss in the National Dialogue that you personally would like to clarify to the public?
Before we start a formal dialogue, we would like to educate the public on the issues at hand. We would like people to know who should be protected and against what, what form of social protection is available to them, what vehicles to use to effect the social protection and how best we can administer the whole scheme.
People are normally influenced by pronouncements made by some economists, especially from international organizations because more often than not, we realize that people come with some preconceived ideas. They don't normally take the conditions of the country they are visiting into consideration. They seem to have ideas they want to impose on us. This is something we want to eliminate from our system. We want to have proper dialogue with those who come from these international agencies. We may have something to offer them, because while putting modesty aside some of us may have a little more experience in matters concerning social security than the economists. The economists sometimes fail to realize that every environment is different and one cannot just import ideas from one environment to another without having adverse effects. We are trying to make sure that they listen to us and take a better look at our condition and problems.
What are the gray points of SSNIT?
When we talk of investments, they can differ from one environment to another.For instance, in a non-inflationary or low inflationary economy, one can invest into monetary assets, but in a high inflationary economy, investing in monetary assets could be compared to the “Bible story”, where a guy hide his talents under a stone. I have always talked of investment of monetary assets in an inflationary economy and having a certain yield curved.It is such that the yield goes up very quickly and comes down very quickly and then goes below the zero mark.
On the other hand, with capital investment like commercial properly development, you start by losing. It is only at the end of your project that you start to breakeven and eventually you get positive returns. This concept is more suitable for a high-inflationary economy like Ghana. People who do not understand and see a large amount of money in monetary assets they think that it is the end of the world.I know this especially with my training as an actuary.I do not consider short-term losses. I rather consider long-term losses because soon, the euphoria of having large sums of money dies down because after sometime it yields good results. This again has to be explained to the majority of people because some of the accusations leveled against us are that we have made some bad investments. Among these so-called “bad investments” are commercial properties, which we own.However, against the background of an inflationary economy, I don't see them as bad investments. If I have an investment that cost me let's say $20 million with returns of about $1.4 to $1.5 million a year, it means that in less than 15 years I will breakeven. I will then start getting good returns.
Based on this, SSNIT is holding onto long-term funds and I would therefore prefer that type of investment to holding larger sums of money and trying to impress the public.If you take a critical look at our banks over the last 3 to 4 years their net worth has gone negative so where do we stand if we hold on to money?
In view of these criticisms, how exactly are you going to satisfy the public?
We are trying to involve people more into what we are doing here. To begin with, we are waiting for the Board of Directors or Board of Trustees, which will be put in place very soon. We are thinking of instituting an Investment Committee, which will include some technical staff, those in high positions of organizations and some members of the SSNIT Board, which will be a National Investment Board for SSNIT. This is aimed at creating a more transparent set up (with majority of the board from outside). Then, every investment idea will be discussed by members of the executive and will also be given to the management and of course we would normally work by consensus before it even goes to the Investment Committee.I trust that we have competent staff, in our Investment Department who are well qualified to do all the necessary analysis before we start implementing the investment idea. | We also intend to intensify our public education, so that people can understand exactly what we are doing. Again, most of the problems we encounter come from the wrong perceptions that people get of what this institution is all about. The type of funds that we hold and how we manage the funds, etc. They wouldn't criticize us so much if they understood what we were doing. I would attribute a lot of these problems to ignorance. Mr. Bimpong and his team who will be leading the public education will have a lot of work to do.
Do you invest domestically or into some foreign markets?
So far, we have invested mostly domestically. We have shares in Ghana International Bank in the UK, which is a foreign investment, but we have not gone deeply into foreign investment. We need money to develop our country so when we invest outside it does not help us. We keep the value of our money when we invest in a non-inflationary economy, with a strong currency, but the money ends up sitting out there whilst we look for investors for our country. I believe that there is a lot we can do internally. We call ourselves a developing country and it takes money to develop.If we should mobilize funds and use it wisely, it will go a long way to help in the development of our country. We do not intend going into social investment as such, but for example, if I am able to put buildings up, these foreign companies that will come to set up businesses will need offices, factories and all kinds of infrastructure. At least, to have the foothold, foreign investors may need an office where they can operate from and if these offices are available to them, that is a step ahead for them and for us.We might be able to look into other areas with time, especially with the Investment Committee in place, a good investment department backed by a good investment policy.I believe we can do a lot.
How will SSNIT contribute to the Ghana Vision 2020 policy?
I would like to put aside the Vision 2020 for the time being because I would like government to review it. I think the government is looking at where to position itself within the framework. They may need to revise it because I personally believe any vision should be a shared vision in itself. It should be the vision of a country and not the vision of a particular sector. Generally, we believe we can do so many things, in this country. First of all, our own vision is to provide social security for workers so that if they know that the future is secured, they can improve productivity. It can also reduce malfeasance because if the worker is not secure and he or she knows they are about to retire, they panic and then involve in all sorts of acts, which can create a lot of problems for themselves and the society. Therefore, strictly according to our mission of providing social security protection, we are trying to improve productivity, and in trying to do so, we make sure that we properly manage our funds, i.e. the funds that come in through contributions and investment income. We hope to have spiral effects due to job creation and consequently more contributions into the fund and keep the cycle going. There could however be a few problems if the administration is not properly set up, but it is a question of knowing when to invest, where to invest, and how to invest.
How is SSNIT attracting private investors into the country?
I would say SSNIT is positioned in a way that when private companies come into this country, in a lot of cases they want to talk to us. They want to do so because they want partners they can rely on, and we happen to be a potential partner with quite a bit of resources. Another important reason is because of our building projects. For example, “BOEING” has taken up accommodation in the building next door to us. If we had not put up such a building at such a location I don't know whether BOEING would have been attracted to this place at all. Generally, there are things that would attract one to a place. The first thing is normally to find office space. Once you have that, it is a big step forward.Secondly, we are into the tourism industry. We have provided hotels, so that investors can have comfortable lodging places to do their businesses. We are moving into constructing high quality residential accommodation for variety of purposes. This is how we are helping to support the inflow of private businesses into Ghana.
What final message would you address to our readers?
I believe that the business atmosphere here is very congenial especially with the coming in of the new government. We invite investors to come and taste a few things like the hospitality of our people and the freedom that exists in this country for business. One very important aspect is that, we have a team of highly qualified people in this country. An example of such people is the current Secretary General of the United Nations. He has colleagues and other equally qualified people in this country who are good and who can be partners for investors when they come. |
