Business News of Thursday, 7 December 2017
The Minister of Defense, Dominic Nitiwul, has attributed the current deplorable state of the Kumasi Shoe Factory, on the ineffective management of the company.
Formerly known as the Ghana Industrial Holding Footwear Company Limited (GIHOC), the Kumasi Shoe Factory was revived in 2012 through a joint partnership between a Czech company, Knight Ghana Limited, and Defence Industries Holding Company Limited (DIHOC), which is owned by the Ghana Armed Forces (GAF).
The company was tasked with solely producing boots for purchase by the Armed Forces and other security agencies, and footwear for students locally and for export.
However, since then, the factory has been on the verge of collapse, with a tour by government officials in August revealing that only 49 workers were currently employed there.
The factory has reportedly trained over 200 workers, but because of irregular orders, only one-third of them are currently working.
At full capacity, the factory could have about 800 workers, and would create an extra 200 jobs indirectly for distributors.
According to Mr. Nitiwul, the Ghana Armed Forces who are also shareholders in the business have been sidelined, with no accounts rendered to them by the private managers of the facility.
“Up until now, we haven’t been able to hold a single board meeting because for some reason, government wanted to give a grant of six million cedis from one of the funds. We then picked an individual, gave him this money and gave out, as part of the six million, a grant of four million. That individual has 60%, and the armed forces have 40%. I have paid a lot of money to this individual,” he said when he took his turn at the Meet the Press Series today [Thursday].
“Nobody is accountable to me because the individual believes the company is for him. That’s why the Kumasi Shoe Factory is having the problems it is in now. The structure was wrong. The Armed Forces has no control over the shoe factory.”
Deputy Minister of Defense, Major Derek Oduro, blamed the current state of the company on a lack of quality resources for production when he visited the facility earlier in the year.
According to him, despite the fact that the factory was stocked with the machinery it needed to operate, the absence of materials needed to manufacture the footwear, and the substandard nature of the ones which were available, had meant that operations at the facility have stalled.
“The factory has been set up and the equipment are there but where to get quality raw materials to produce quality boots and other leather works is the problem now.”