Month: August 2018

The approval follows the adoption and approval of the report of the Finance Committee on the Master Project Support Agreement (MPSA) between the Government of the Republic of Ghana and Sinohydro Corporation Limited for an amount up to US$2billion for the construction of priority infrastructure projects.

The deal which is in the form of barter will enable Ghana raise US$2billion from China’s Sinohydro Corporation Limited to undertake various infrastructure projects that are aimed at bridging the country’s infrastructure deficit estimated at US$30billion.

Sinohydro Corporation Limited would in turn, receive refined bauxite in the form of alumina or aluminum over a fifteen(15)-year period (inclusive of a three-year grace period) from the Republic of Ghana.

Per the deal, the Government through the Ghana Integrated Bauxite and Alumina Development Authority (GIBADA) (proposed) will establish a bauxite processing plant to process the raw bauxite into alumina before shipping same to service its obligations to Sinohydro Corporation Limited’s strategic partner (Offtaker).

Presenting the Finance Committee’s report to the plenary, it’s Chairman Dr Mark Assibey-Yeboah noted that under the MPSA, the Chinese state-owned hydropower engineering and construction firm is responsible for arranging the project financing for all the priority projects subject to the mutual agreement of the parties.

Sinohydro, he added, “shall be solely responsible to enter into the financing agreement with any financial institution that agrees to provide the project financing.

The objectives of the project, according to Dr. Assibey-Yeboah are to improve road infrastructure for enhanced intra-urban, regional and national road traffic flow, pursue rural electrification, affordable housing, fish landing sites, strengthen economic and regional integration and reduce the cost of doing business in the country.

The Minority members however believed the cost involve will add up to the country’s public debt stock which currently stood at US?142.3billion as at the end of 2017.

They accused the Ministry of Finance for what they described as an attempt to ‘hide the debt’ involved in the agreement.

Ranking Member on the Finance Commitee, Casiel Ato Forson, observed that the description of the agreement as barter obscures what the minority believes is a debt threatening a potential court action.

By Christian Kpesese / ghanamps.com

According to the National Democratic Congress (NDC) Minority caucus, they acted swiftly by storming out from the funeral grounds of the late Vice-President, Paa Kwesi Amissah-Arthur to Parliament in order to state their position on the new deal to prevent the Majority from smuggling the deal through for passage by the House.

Addressing Members of the Parliamentary Press Corps, the Minority contends that the new deal in its current form will rip Ghanaians off their hard earned money and called on all well-meaning citizens to speak against it.

Former Deputy Power Minister and Member of Parliament for Yapei-Kusawgu, John Jinapor who addressed the press said the erstwhile NDC government as at the time it was living office, payments to Ameri was steadily on-course.

He disclosed that letters of credit were written for it to be honoured by the incoming administration but due to the vindictiveness of the New Patriotic Party (NPP) administration led by President Nana Addo Dankwa Akufo-Addo, they failed to honour those letters of credit.

“Immediately they assumed power, they wrote to the VRA not to honour payment to Ameri”, he stressed.

The NDC Minority stated categorically that if the old deal worth US$510 million is fraud, they could confidently state that the new deal with payment which will span across fifteen years and worth US$1.1billion is “sakawa”.

Parliament, on the eve of recess after the second meeting came to a gridlock when Members failed to reach a consensus over the new Ameri deal in which the government is seeking for Mytilineos to buy out the entire deal.

For failing to reach a consensus, the new deal was deferred to next meeting with the Minority Members who are kicking against the deal calling for a secret ballot to settle the matter.

By Christian Kpesese/ ghanamps.com

Ghana’s fiscal deficit has been projected to go down to 4.5 percent in 2018, according to the International Monetary Fund, but the Minority have expressed concern to achieving the target.

“The projected deficit target of 4.5 percent would be missed due to huge deviations in revenue and expenditure and the financial sector related cost”, Ato Forson, ranking member on Finance told the gathering at a special roundtable breakfast dialogue on the Mid-year Economic Performance and Projections-the Minority’s Perspective in Accra recently.

According to Ato Forson, government is accumulating arrears and sweeping them under the carpet, there is also a prior decision by government to cut down expenditure up to an amount of GH¢850 million on already-starved key sectors of the economy purposely to make enough savings to meet the demands from specific expenditure.

He also added large fiscal slippages are being created by the government’s inability to raise the needed additional revenue to meet the unrealistic promises that are increasing expenditures.

Furthermore, the Minority also disclosed that government intends to follow through a plan of raising GH¢3.8billion from selling state assets, prepayment of license fees, and monetization of mineral royalties.

“The Public Debt is expected to increase further by GH¢3.8 billion – (1.7 billion + 1.4 billion + 0.7 billion)–should the financing plan of selling state assets, prepayment of license fees, and monetization of mineral royalties, fail to materialize.

In addition to this, the government has issued a bond worth GH¢2.2 billion to GCB in respect of its assumption of the collapse of UT and Capital Banks. This has added to the public debt and will be borne by the poor tax payer”.

Furthermore, the Government has earmarked GH¢2.3 billion as possible cost to the tax payer should Unibank collapse. This means that the Financial Sector related costs for 2018 will also increase the Public Debt by GH¢4.5 billion – (GH¢2.2 billion + GH¢2.3 billion).

The Minority also contend that, by their projections for the year 2018, government will be adding about GH¢25 billion to the Public Debt stock.

This will add to the total borrowing for 2017 of some GH¢ 26 billion. The Public Debt therefore, can be projected at about GH¢173 billion by end-December 2018, which will take our debt to GDP ratio well beyond the 70% HIPC threshold.

AtoForson also indicated that government’s decision to cap transfers to statutory funds is gradually collapsing it.

“The capping law was introduced purposely to free some revenue for government to undertake opulent expenditure but this has rather proven woefully inadequate due to the huge fiscal burden emanating from the introduction of new expenditure” he noted.

Mr. Forson also bemoaned the continuous nosedive of the Ghana cedi, which he says is showing no sign of improvement despite lofty talk from government and the Bank of Ghana.

“It is currently trading at GH¢ 4.8 to the dollar and appears almost set to reach GH¢ 5 to the dollar if the trend is not curbed immediately. This has in turn led to steep rises in the prices of goods and services leading to more hardships for the people. Fuel prices have increases astronomically as have transport fares”.

By Christian Kpesese/ ghanamps.com

This follows the approval and subsequent adoption of the report of the Finance Committee on ASHRA Export Credit Facility agreement between the Government of the Republic of Ghana and Bank of Hapoalim B. M. for an amount of up to €40,643,000.00 and a Tied Commercial facility agreement in the amount of €6,520,000.00 between the Government of the Republic of Ghana and Bank of Hapoalim B. M.
Phase II of the project which is expected to be funded under these agreements will focus on the strategic income generating services for short, medium and long-term sustainability of the hospital including a technical assistance package.

The project will also target new clinical services and medical interventions that will give the health facility a competitive edge over others in the country as well as the sub-region.

The services include a nephrology unit, facilities for cardiothoracic and neurosurgery, facilities for Assisted Reproductive Technology, additional VIP wards for Obstetrics and Gynaecology, Internal Medicine and Surgery with additional specialized medical equipment and the provision of drug and non-drug consumables.

Phase II of the project further includes; income generation items such as a commercial pharmacy, additional housing accommodation units and a commercial morgue with facilities for funerals.

The objective of the project, according to the report of the Finance Committee, is to establish a state-of-the-art training facility for medical education that will facilitate the relocation and accommodation of all institutions of the College of Health Sciences to the University of Ghana, Legon campus to serve as a nerve center of the proposed Medical Village.

The Center is to function locally as a referral hospital and operate at a specialized level to attract clientele beyond the borders of Ghana to take advantage of the specialties offered in the country which is expected to be first class in the sub-region.

Further to that, the health facility is expected to serve as a center for medical tourism for those in need of medical services within the sub-region and beyond for super tertiary care and specialties.

By Christian Kpesese/ ghanamps.com