View Full Version : Ghana Surrenders Oil To China?

31st March 2011, 06:59 PM
As officials of the ruling National Democratic Congress (NDC) continue to boast of the Mills administration’s ability to contract billions of dollars as loans from China, it would be mindboggling if Ghanaians were told the cost or negative effect of the amounts being sought from the world’s most populous country.

Daily Guide has seen a memorandum presented to Parliament seeking to mortgage Ghana’s oil for a loan of $1.8 billion to construct roads in the Eastern corridor of the country.

The loan agreement, which is currently before Parliament, apart from seeking to tie up the proceeds from the sale of oil for 15 years, also goes further to surrender all the concession rights and intellectual property of the Ghana National Petroleum Corporation (GNPC) including the seismic surveys and maps as well as exploration, development and production assets of the country to the Industrial and Commercial Bank of China.

Joe Gidisu and Dr. Kwabena Duffuor, Ministers of Roads and Highways, and Finance and Economic Planning respectively, signed the agreement with the Chinese Bank.

The money would be used for financing the Eastern Corridor (N2) and other roads projects by the China State Construction and Engineering Corporation Limited.

The same document, if approved, Daily Guide learnt, would also contravene the recently passed Petroleum Revenue Management Act as all the oil proceeds would now be paid directly to the Chinese and not through the Annual Budget Funding process as required by the Act.

It would be recalled that the passing of the Petroleum Revenue Management bill was delayed due to serious contention about the collateralization of the country’s oil for loans, with the Minority group in Parliament strongly opposing the use of the oil resources as collateral for credit.

Joseph Kofi Adda and Dr. Anthony Akoto Osei, Ranking Members for Mines and Energy, and Finance Committees respectively, were worried over the agreement, pointing out that the agreement would be tantamount to fleecing the country if approved by Parliament.

Speaking to Daily Guide, Kofi Adda, the MP for Navrongo Central, said the whole deal was as good as surrendering the nation’s sovereignty to the Chinese Bank. Ghana, he noted, had done well in servicing its debts over the years without defaulting, although it was forced to go HIPIC in 2001.

“If we have done so well and have such a good record, why should we not simply use the additional inflows from oil to pay this loan but rather have to give up control in everything including survey maps and seismic data for the loan. “Also, the partnership arrangements that go into development and production will be jeopardized with the terms of this facility.”

He questioned why even with the additional security, the country would have to “procure all materials, equipment and services from China. “The services imply that even labour would have to come from China. The project is good but the terms of the facility are not good for Ghana. They need to be renegotiated and the idea of collateralization should be revisited,” Hon. Adda suggested.

Expressing similar sentiments, Dr.Akoto Osei, MP for Old Tafo, said the deal would be bad news for Ghana if approved by Parliament.

According to him, the relevant Parliamentary Committees were scheduled to meet the associated Ministries for the Minority group to point out the serious implications of the facility.

He said it was because of those challenges that the Minority was opposed to the collateralization of the nation’s oil for loans. Kwabena Owusu-Aduomi, MP for Ejisu-Juaben, also indicated that there were some technical shortcomings in the road projects to be executed, adding that there was no adequate information in the memorandum to justify the costs initially presented.

Mr. Owusu-Aduomi, a civil engineer, was of the view that a number of details in the document were inaccurate and that some of the roads which were supposed to be constructed with the loan had already been done.

Hon. Owusu-Aduomi, a member of the Parliamentary Committee on Roads and Transport, said another beneficiary road from Salaga-Bimbilla was captured in the memorandum as 146km when, in fact, it was only 72km, adding that the huge difference could have astronomically increased the estimated cost of the project.

Source: d-G