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Mining firms set to embark on mass layoffs

Mining firms in the country are set to embark on massive downsizing in view rising cost of production coupled with a steady drop in the price of gold on the international market.

The price of gold has dropped by about 15 percent over the past weeks. It sank to $1,180 an ounce on June 27 - its lowest value in nearly three years - before rising again slightly to $1,229 when markets closed on June 28.

The dramatic plunge is in contrast to the commodity's record price of $1,895 an ounce in 2011. Analysts now believe the mineral is losing its shine for investors and could continue to weaken.

Newmont Ghana on Wednesday September, 25, announced that its ongoing work to streamline its cost structure and improve business efficiency will affect some programmes and activities as well as the workforce size.

According to Dave Schummer, Regional Senior Vice President – Africa Operations, the employee reduction reflects the company’s work to improve its increasing costs while creating value for all its stakeholders. It is anticipated that about 300 employees will be affected by the end of the fourth quarter of 2013.

The company has notified the Chief Labour Officer and begun discussions with the Ghana Mine Workers Union on a Memorandum of Understanding which will outline the pay-out package for the affected employees.

“Ongoing price volatility and steadily rising costs create intense pressure for us to continuously improve our efficiency and effectiveness to ensure our operations are profitable and sustainable.

"We face some very difficult decisions in streamlining our organization and are committed to treating people fairly throughout this process,” said Dave Schummer.

Unconfirmed reports say Anglogol Ashanti is also contemplating taking similar decision and the company is expected to make an announcement to that effect.

Merchant Bank launches Merban Fund

Merchant Bank Ghana Limited on Wednesday launched a mutual fund christened the Merban Fund.

The Fund is an open-ended collective investment scheme. This means that the fund can issue an unlimited number of shares and can redeem such shares at anytime.

According to the bank, the Fund's objective is to invest in money market instruments, listed equities and other regulated financial instruments in the country on behalf of shareholders.

The initial price offer is valued at GH¢0.10 per share and with a minimum of GH¢10 translating into 100 shares, interested persons can be part of the fund in the next 21 days.

The fund which will be managed by Merban Investment Holdings Limited (MIHL); a wholly owned subsidiary of Merchant Bank is targeted at individuals, pension and provident funds, and other corporate institutions.

Launching the fund, General Manager Consumer Banking of Merchant Bank, Henry Baye said the fund is in line with the bank’s objective to deepen long term investments in Ghana.

According to him, it is also to help its client add more value to their monies and to inculcate in them the idea of saving for the future.

Mr. Baye promised that the Fund would adhere to the regulations that govern the activities of mutual fund.

He called on existing and prospective customers of Merchant Bank to take advantage of the fund for a secured future.

On his part, Head of Merban Investment Holdings Limited, Manfred Kafui Bressey said the fund is not susceptible to downturns in the Ghanaian economy.

"The structure of the fund is such that the manager has the opportunity to play in both the equity and the money markets with experienced hands".

He noted that as fund managers, they will concentrate on the best stocks in emerging markets on the African continent where they have strong research information.

The MIHL boss said as pioneers with 37 years experience in fund management in the country they will ensure investors get value for their money.

"Our highly trained staffs are ready to offer professional and advanced portfolio management services to all shareholders," he stated.