Ghana telcos and gov’t in talks to reduce data costs amid Covid-19 crisis

Ursula Owusu-Ekuful
Ursula Owusu-Ekuful, communications minister

The Government of Ghana is holding talks with telcos to reduce cost of data as the deadly Covid-19 outbreak surges.

Subscribers have begun to bear the brunt as data usage generally increase due to the impact of the novel Coronavirus.

Ghana shutdown all schools and banned public gatherings including religious activities, while several organizations have asked their staff to work from home to observe the social distancing practice to prevent the spread of the virus.

The latest action is a 14-day partial lockdown in Tema, Accra, Kasoa and Kumasi, which has forced more people to stay home or work from home.

Addressing Parliament on Monday on fiscal measures being taken by government to lessen the pressure of the pandemic on people and businesses, the Finance Minister said “Government is engaging the Telcos to reduce the cost of data and telecommunication services to households and small businesses”.

Meanwhile, MTN Ghana CEO had previously hinted that reducing the cost of data to boost communication amidst the coronavirus pandemic, could increase traffic that will affect internet speed.

Other fiscal measures

The other fiscal measures being pursued by government to mitigate the impact of the coronavirus pandemic include the preparation and implementation of a Coronavirus Alleviation Programme (CAP) to be funded with an initial amount of GHȼ1 billion as directed by the President.

The President has also established a COVID-19 Fund to be managed by an independent board of trustees, chaired by former Chief Justice, Sophia Akuffo, to receive contributions and donations from the public to support the CAP and to assist in the welfare of the needy and the vulnerable.

Government is also ensuring a realignment of Statutory Funds towards expenditures that tend to mitigate the impact of the coronavirus pandemic (sanitation and health related expenditures), and limiting the award of new contracts; whiles focusing on the payment of arrears.

There’s also a plan to amend the Bank of Ghana Act to allow for government borrowing from BOG up to 10% of previous year’s tax revenue in the event of tight domestic financing market conditions.

The Bank of Ghana and the Ministry of Finance have also engaged commercial banks to discuss their support to the private sector to mitigate the impact of the Coronavirus pandemic. The support includes a syndication facility of GHȼ3 billion to support industry especially in the pharmaceutical, hospitality, service and manufacturing sectors, as mentioned by the President; granting of six-month moratorium of principal repayments for selected businesses; and reduction of interest rates priced-off the Ghana Reference Rate (GRR) by 200 basis points (2% per annum).

Government is also calling on pension funds and other assets managers and investors to follow the lead of the Banks to support by accepting a 200 bps reduction on short term instruments including T-bills and 364-day paper.

This should reduce government expenditure on interest expense by over GHS300 million to help close the fiscal gap.

According to government, the Ghana Revenue Authority will also provide some reliefs to businesses and households including extension of due dates for filling of taxes from 4 months to 6 months after the end of the basis year; tax payers are encouraged to pay their taxes by bank transfers; grant a remission of penalties on principal debts to Tax payers who redeem, their outstanding debts due GRA up to 30th June 2020; and wave VAT on donations of stock of equipment and goods for fighting the Covid-19 Pandemic.

The GRA will also grant tax waivers on selected Third-Tier Pension withdrawals and permit the deduction of contributions and donations towards COVID-19 as allowable expense for tax purposes.

Ghana’s Covid-19 cases have now risen to 204 with five deaths.

Source: Daily Mail GH with additional files from CNR

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