The medicines for the treatment of Tuberculosis (TB) are fast losing their efficacy, leaving TB patients vulnerable, the Director of Promoting Quality of Medicines (PQM), Mr. Patrick Lukulay, has said. “Tuberculosis is one of the prevalent diseases in developing countries currently and the medicines for its treatment are fast losing their efficacy. There are currently not enough World Health Organisation Prequalified second-line TB medicines manufacturers to supply medicines to treat the multidrug-resistant strains of Tubercul,” Mr. Lukulay said. He was speaking at a two-day regional workshop on World Health Organisation (WHO) prequalification standards held in Accra for manufacturers of Second-Line TB medicines. Second-line TB medicines are used to treat multi-drug resistant strains of tuberculosis. The workshop, which brought together pharmaceutical companies and regulatory authorities from Ghana, Kenya, Nigeria and Ethiopia, provided participants technical assistance and training to meet WHO Prequalification standards for the manufacturing of second-line TB medicines. The PQM program works to combat substandard and counterfeit medicines in developing countries and increase the availability of affordable, high-quality medicines to treat patients’ worldwide suffering from multi-drug resistant tuberculosis. Mr. Lukulay said the Prequalification workshop will support TB medicines manufacturers to meet WHO Prequalification Standards in order increase access to quality medicines for the treatment of the disease. He said the training will also help raise the bar on standards for regulatory bodies of the pharmaceutical industry who will apply the standards in their respective countries. Mr. Lorenzo Witherspoon of UNITAID, a funding partner for greater access to quality treatment and diagnostics for HIV/AIDS, malaria and tuberculosis explained that UNITAID is committed to providing market interventions to increase access to Tuberculosis treatment for developing countries. He said UNITAID has reduced the cost of Anti-retroviral drugs by 80 percent thereby putting over 400,000 children on the HIV treatment. He encouraged Pharmaceutical companies to take advantage of the PQM technical assistance to get WHO Prequalification for their medicines. This, he said, “will make them compete globally for the supply of essential medicines.” By Dominick Andoh

Ghana is aiming to benefit from a lower interest rate when it sells its second Eurobond, discussions over which are currently ongoing. The country’s first 10-year Eurobond in 2007 attracted a coupon rate of 8.5 percent, but the yield for the next one is likely to be lower because of the prevailing low international interest rates, Bank of Ghana (BoG) Governor Henry Kofi Wampah told B&FT, adding that details of the size, tenor, purpose and time of the sale will be revealed in the coming weeks. Bloomberg news service has however reported that around US$1billion will be targetted in the sale, citing people with knowledge of the transaction. “We want to take advantage of the low interest rates. We’re looking at rates that are lower than what we paid in 2007,” Dr. Wampah said on the sidelines of the launch of the International Monetary Fund (IMF)’s Regional Economic Outlook for sub-Saharan Africa in Accra yesterday. The bond is intended to restructure the public debt, reduce the interest burden on the budget and provide funds to finance critical infrastructure projects. But it is being mulled at a time of recovery from severe fiscal deterioration following the election-driven budget overruns in 2012. Dr. Wampah nevertheless insisted that the timing is right because of the lower yields in the market, which could begin to rise if the economic recovery in advanced countries firms up. “Investors don’t only look at the current situation; they also look at what policies you have for the future,” he said in an answer to whether Ghana’s present fiscal challenges would derail the bond. Government has said the budget deficit -- which became the source of much anxiety after it rocketed to 12 percent of GDP last year -- will be narrowed to 6 percent of GDP in the medium-term, after it’s been trimmed to 9 percent this year. Fitch Ratings has already cut the outlook on Ghana’s B+ sovereign rating to negative from stable on the back of the blown-out deficit and persistent wage-expenditure pressures. In 2007, Fitch rated Ghana B+ with a positive outlook ahead of floating the first Eurobond. Dr. Wampah said the credibility of policies to achieve fiscal targets and stabilise the cedi “is what investors will be looking for”. There is a need to refinance some of Government’s debts, including the 2007 Eurobond, he said, and part of the proceeds from the next sale will be used for that purpose. Seán Nolan, Deputy Director of the IMF’s African Department, said Ghana should factor in foreign exchange risks as it prepares to sell the bond, and weigh this option against other possible ways of raising funds to finance infrastructure. A sliding domestic currency has the effect of increasing the cost of servicing foreign-denominated debt such as a Eurobond, and Ghana’s cedi has taken significant exchange losses since the first half of 2012. Strong import demand and dollar flight as companies repatriate dividends to offshore shareholders have continued to weaken the cedi in 2013, triggering losses of more than 3 percent to the dollar, on top of 17.5 percent depreciation in 2012. Policies to stabilise the currency, including the tightening of interest rates and changes in how banks hold foreign currency reserves, will not be relaxed due to the pressures, Dr. Wampah said. By Leslie Dwight MENSAH

African countries need to improve their regulatory frameworks in order to ensure the successful launch of African infrastructure project bonds, says a new report launched by the African Development Bank. Africa is ready for the launch of such infrastructure bonds provided some conditions are met, says the report, titled “Structured Finance -- Conditions for infrastructure project bonds in African markets”. With Africa now having no other option than to tap into its own internal resources, the book “points in the right direction”, said Donald Kaberuka, President of the African Development Bank in the foreword. “I hope it will be useful for all Africans who are involved in infrastructure development.” The report is of the view that domestic capital markets can contribute to funding some of the most important local and regional infrastructure projects. Given the limited ability of local banks to provide long-term funding and the shrinking international assistance, the report encourages project sponsors to turn to domestic institutional investors by issuing infrastructure project bonds. The legal and regulatory framework for bond issuance exists in many countries which are active issuers of bonds for their own funding needs. However, competition between the sovereign and other issuers is a potential issue in all markets. Many of the ingredients for infrastructure project bond issuance are present, but more needs to be done to make it attractive for sponsors to tap local markets. From a sponsor’s perspective, issuing an infrastructure project bond must offer the optimal tenor and pricing compared to other options. It is therefore essential that Governments do more to reduce local market rates and lengthen the yield curve. According to the report, a crucial barrier in African markets is the enabling environment for infrastructure. The regulatory and tariff framework in many sectors is incomplete. Many countries have established public-private partnership (PPP) laws and institutions, but often they lack the resources and capacity to prepare bankable projects for the market. As important, there is often a lack of advocacy and political support for driving concessions and PPP projects through Government -- and too few are coming to market, although it remains early days in many countries. There is a crucial role for Governments in promoting infrastructure project bonds. Governments can play a greater role in supporting stable economic conditions, developing local capital markets and strengthening institutions. Those actions will encourage all issuers to come to market, particularly corporations for which bond issuance have been limited to date. Promoting reform and corporatisation of utilities and parastatals, including professional management and a clear regulatory environment, are preconditions for such entities to issue in the local bond markets -- an important landmark in the development of local capital markets and the emergence of infrastructure project bonds. “The African Development Bank can play various roles in that regard,” said Cedric Mbeng Mezui, the report’s lead author. “It can provide technical assistance in infrastructure, capital markets and domestic issuance, and work with intermediaries. For specific projects, it can use instruments such as the partial credit guarantee as well as any new tailored instruments to enhance bond issuance and catalyse the market. Direct funding for projects in early-stage preparation and through debt and equity investments at financial close will help promote the overall market. Finally, the AfDB can play a role in unblocking the political bottlenecks that obstruct projects from being developed and implemented,” he added. For Moono Mupotola, Regional Integration Manager, AfDB, “The book was prepared with a number of objectives in mind: firstly, to highlight the opportunity for project bonds; secondly, to elaborate on the conditions for efficient capital markets; thirdly, to explain the crucial role of constructive Government policies; and finally to highlight lessons learned in other markets that might be useful for Africa.” The report was launched during the IMF and World Bank Spring Meetings in April 2013 by Charles Boamah, AfDB Finance Vice-President.

A US$10million trade finance facility agreement has been signed between the International Finance Corporation (IFC), a member of the World Bank Group and the HFC Bank to finance international trade by SMEs. The facility, signed in Accra, is expected to help the bank establish partnerships with a large number of major international and regional confirming banks under the Global Trade Finance Programme (GTFP), to broaden access to finance in Ghana and grow the economy. The GTFP complements the capacity of banks to deliver trade finance by providing risk mitigation on a per-transaction basis in challenging markets where trade lines may be limited. “What is driving this partnership is we want to support SMEs in Ghana, and trade finance is an instrument we can use to help SMEs grow their businesses and be able to import goods supported by banks -- and HFC is the bank that we have always wanted to work with. “We therefore see the trade finance facility as establishing a partnership so we can do more in future,” Mary-Jean Moyo, Country Manager, IFC for sub-Saharan Africa Department said. She added that as for the ordinary Ghanaian businessman, he can go to the bank and import goods knowing that the bank can issue a letter of credit to him and the person delivering the goods will be comfortable delivering the goods to Ghana -- having in mind that he is not relying on the ordinary businessman to pay him in the UK or US, but the bank backed by the IFC facility. Dr. Jean Philippe Prosper, IFC Vice President for sub-Saharan Africa and Latin America and the Caribbean, said: “IFC is committed to providing competitive financial products, especially to intermediaries like HFC Bank that can reach smaller and medium-sized businesses. “Ghana’s increasing trade requires banks that can expand services to a wider range of clients and play a bigger role in the country’s rapid economic development.” Mr. Asare Akuffo, Managing Director of HFC Bank, expressed optimism that the partnership with IFC will enable the bank to meet the needs of its clients and support their trade activities. “This is purely to support the international trade business of our customers. It is going to expand our capacity in terms of available foreign exchange to finance their import needs, especially goods and services. I want to emphasise that this facility will help SMEs that want to retool and maybe get new plants and machinery, and so on. “I am optimistic that opportunities exist for further collaborations with IFC in such areas as mortgage finance, equity investment, and technical assistance. We at HFC Bank remain committed to exploring these possibilities by working together with IFC to ensure that value creation is maximised in the best interest of all stakeholders.” IFC aims at helping developing countries to achieve sustainable growth by financing investment, mobilising capital in international financial markets, and providing advisory services to businesses and Governments. By Bernard Yaw ASHIADEY

Local manufacturing companies should be supported to manufacture essential pharmaceutical products locally in order to combat the menace of counterfeit and sub-standard pharmaceutical products in sub-Saharan Africa, Dr. Patrick Lukulay, Vice President of United States Pharmaceutical Convention has said. It is estimated that about 70 percent of medicine used in Africa is imported and 25-30 percent of medicines imported into sub-Saharan Africa is counterfeit – constituting an about-US$431billion market. Out of the amount US$359billion, representing 83 percent, had direct public health impact. He was speaking at the launch of the Centre for Pharmaceutical Advancement and Training (CePAT) in Accra. The centre aims to equip national and local regulatory authorities and officers, manufacturers and operators in the pharmaceutical industry with knowledge and skills to promote access to good quality medicines. He said it is high time leaders on the continent built the capacity of local pharmaceutical companies so that procurement of goods and essential medicine can be manufactured on the continent instead of importing them. Dr. Lukulay said in the interests of sustainability the continent should be able to manufacture and produce medicine internally. “Serious public health issues related to poor quality medicines have been linked to lack of trained human resources in countries with limited resources,” he said. According to 2013 United States Agency for International Development (USAID)-USP report on promoting the quality of medicines programme in Ghana found that over 90 percent of samples tested failed either the test for the active ingredient or sterility, and only three of the 26 products tested were officially registered with the Food and Drug Authority (FDA). This report according to Dr. Lukulay underscores the seriousness of the issue and the need for trained professionals to improve access to quality medicines. Minster of Health Ms Sherry Ayitey said the centre came at an opportune time when the country is experiencing an upsurge in the occurrence of sub-standard spurious, falsely labelled, falsified counterfeits (SSFFCs). “Counterfeit and sub-standard pharmaceuticals have been a serious problem across the globe, but capacity to deal with it is limited as counterfeiters are becoming more sophisticated in vulnerable markets. “It is also coming at a time when as a country we are focusing on local production as a tool for increasing access to pharmaceuticals,” she said. She said the FDA has intensified its monitory systems to identify SSFFCs on the market, adding that regulatory interventions have been undertaken by it to address the problems. This, she said, includes withdrawal of products and communication to providers and general public. She asked CePAT to work in close collaboration with the FDA and other regulatory agencies in the sub-region to support and strengthen the quality assurance systems in a sustainable way. By Benson AFFUL