Ghana’s power sector, for years, has been managed in a manner that has dwindled the financial fortunes of the companies that have been involved in the production, distribution and selling of electricity to consumers within and outside the shores of the country.
Questions have been asked about why we have failed to effectively manage this sector. It is more like a riddle wrapped up in an enigma. These power companies have been bleeding financially as a result of the country’s inability to manage the sector efficiently.
This sad state of affairs parachuted in the American Government under the Millennium Development Authority (MiDA). If Ghana would agree to allow private but foreign partners in to help manage the sector, an amount of $500 million would be pumped into the sector to help it function effectively. The foreigners were to manage the sector for 25 years. Over $200 million has since been given to Ghana by the American Government out of this amount.
The Government of Ghana, under the Mahama regime, agreed to allow just 20% local participation, a policy that many a Ghanaian objected to. The Akufo-Addo administration decided to alter the terms of the agreement to allow more local participation. 51% local partners and 49% foreign participation became the order of the day. The 25 years were whittled down to 20 years.
The negotiations had gone on for years without a lasting agreement. Time was of the essence and the country looked set to lose in the end as timelines had been missed many times. The country had up to March 2019 to wrap up the deal. What became sticky was the need for PDS which had won the agreement to provide bank guarantees which were conditions precedent. Unable to provide them as a result of the limited time frame they had, the bank guarantees were changed to insurance guarantees.
The insurance guarantees which were provided were later discovered, by the same government that supervised the final sessions of the agreement, to be unfit for purpose. There were material breaches in the insurance guarantees, a situation that led to the Akufo-Addo administration suspending the deal pending further investigations.
There is evidence to show that the PDS deal has been cancelled by the Akufo-Addo Government. The opposition National Democratic Congress is making a case of massive corruption with respect to the abrogated deal by this administration. The chronology provided in this piece cannot find any corrupt deal.
The NDC should not just throw words out about huge corruption with respect to this deal. They should come out with clear, factual and unambiguous evidence to prove that some corrupt deals have been perpetuated. Failure to do this would be interpreted to mean that their corruption mantra is empty.
Source: ABC Newspaper