Amidu investigates Agyapa over “suspected commission of corruption”

On September 12, 2020, 12:10 PM

Special Prosecutor, Martin Amidu, has begun a probe into the Agyapa Royalties deal expected to generate some $1bn in equity for the government.

Mr Amidu, in a letter dated September 10, made a formal request to parliament to provide all the information regarding the approval of the deal by the House.

The agreement concerning Agyapa Royalties, a Special Purpose Vehicle (SPV) company, was approved on August 14, 2020, by parliament in line with the Minerals Income Investment Fund (MIIF) Act, 2018 (Act 978). This is aimed at using the state firm to raise about $1 billion through prudent management of mineral resources.

Addressed to the Clerk of Parliament, the letter indicated that the Office of the Special Prosecutor has taken up the probe specifically to determine “any potential of the said transaction to promote and facilitate the suspected commission of corruption and corruption-related offences and advise government accordingly”.

Mr Amidu entreated Parliament to attach urgency to the request and “produce the required documents to this office on or before Tuesday, September 17, 2020”.

“Your timeous compliance with this statutory notice of request will enable the office to present to government and relevant agencies of government any finding and recommendation on the said transaction or its processes which may be inconsistent with the provisions of articles 257 (6) and 268 of the 1992 Constitution and the existing laws on ownership of all the mineral resources in Ghana and the fiduciary responsibilities entrusted to the President of Ghana as the trustee holding all such mineral resources of the Republic of Ghana in trust for and on behalf of the people of Ghana,” the letter added.

About the deal

Government is looking for cash to finance capital expenditure and wants to leverage the country’s mineral resources to raise $1bn.

In the deal, 75.6% of royalties of at least 16 gold mining companies will go into Agyapa Royalties Ltd.

The company will list on the London Stock Exchange and the Ghana Stock Exchange and float 49% shares valued at $1bn.

It hopes to get investors to buy shares while Agyapa Ltd collects gold royalties from future mineral resources to pay as dividend to shareholders.

Agyapa Royalties Ltd is also incorporated in a tax haven, British channel island, Jersey, where companies don’t pay corporate tax. It means the company will enjoy considerable tax reliefs.

The Finance Ministry has touted the deal as an opportunity for Ghanaians to own a share of the country’s mineral resources and also an inventive way to raise money for development.

CSOs meet government

At a meeting, leading CSOs interacted with the Finance Minister, Ken Ofori-Atta and requested further documents to allay their concerns.

The Finance Minister obliged.

The statement stressed the deal nonetheless was not shrouded in secrecy and that was done in “the full glare of parliament in the spirit and letter of transparency.”

Referring to the discussion with CSOs, the Finance Ministry statement quoted the minister’s words to the pro-good governance group.

“I want to assure you that the integrity of the Minerals Income and Investment Fund and Agyapa Royalties and what the government intends to have them do are all above board.”

The Finance Ministry also confirmed some of the concerns raised by the CSOs.

They included “the registration of Agyapa in a ‘tax haven’. Other concerns centred on the payment of royalties and how the government arrived at the CSOs understanding of the fair value of US$1 billion as the transaction value.”

The Finance Ministry revealed that later in the meeting, the spokesperson for the coalition of CSOs, Dr. Steve Manteaw, expressed satisfaction that government was “clearly working within the MIIF law.”

The statement also praised the CSOs and called their work one that “cannot be exaggerated”

“You are able to draw citizens and government to our blind spots through your research, policy analysis and advocacy.”

“No democracy can survive in the absence of an active civil society,” the statement reads.

This particular commendation would be music to the ears of the CSOs after a ranking member of the government, Elizabeth Ohene criticized them as “all-knowing.”

The Finance Ministry also rejected claims that the deal amounted to cronyism. Explaining it, the statement said the minister referred to section 4 of the MIIF Act which states that Agyapa Royalties Ltd would not provide “credit” to any government entity or private individual.

This law, he said is “clearly against any attempt to abuse the funds. It can, therefore, not be a vehicle for cronyism.”

Gov’t Agrees To Broaden Consultations

Meanwhile, the government has indicated it would be consulting broadly over the controversial Agyapa deal.

The decision follows government engagement with the civil society organisations.

In a 15-point statement issued by the Finance Ministry, the government said it would be meeting faith-based organisations, traditional leaders, academia and organised labour in the coming days.

The move to consult broadly on the Agyapa Royalties deal comes less than four weeks after the bill creating the deal was passed in Parliament – without Minority support.