Raise money elsewhere if US won’t give us remaining $190m – IES Boss to gov’t
Even though Ghana is not getting the remaining $190 million from the US government due to the termination of the PDS deal, Executive Secretary of the Institute of Energy Security (IES) believes Ghana is capable of moving on.
In an interview, Paa Kwesi Anamuah Sakyi said if Ghana could find the money to clean up the banking sector, it should be able to deal with its electricity needs without the second tranche of the MCC compact.
“The $190 million is enough to also do something. In as much as we could find US$4 billion to retool the banking sector, it means we could find some money off-shore to do a similar thing. We have lost US$190 million as a result of our own making but life must go on and so we should find other ways of getting money and pay.”
Private sector participation in order
Moving forward, Mr. Paa Kwesi Ananuah Sekyi underscored the need for private participation in ECG as compared to the interference of politicians to make it much more viable.
“The private participation is still key so that it takes us out of the political cycle where the politician will decide who the manager and boss should be, which becomes quite a becomes a problem. The government will not have to pay its own debt on distribution and utility and it will be a problem. I’m sure if we have private participation; we will move out of the political cycle and find a management team to get CSOs and Ghanaians to buy shares in it to shore the money up,” he said.
Termination of PDS deal was unwarranted, $190m withdrawn – US
The United States of America has described the termination of the concession agreement with the Power Distribution Services (PDS) as unwarranted.
Despite the government’s claims of fraud in the deal, the US in a statement from its Embassy in Ghana insists that the agreement was valid.
“Based upon the conclusions of the independent forensic investigation, the U.S. position is that the transfer of operations, maintenance, and management of the Southern Distribution Network to the private concessionaire on March 1, 2019, was valid, and therefore the termination is unwarranted,” the US said in a statement read.
The termination of the deal means Ghana will be losing out on $190 million.
The statement noted that, following the termination of the deal, the Millennium Challenge Corporation (MCC) has confirmed that “the $190 million funds granted to Ghana at the March 1 [2019] transfer to the 20-year concession from ECG to PDS are no longer available.”
The US, however, says it will “continue to implement the Tranche I funds of $308 million with the Millennium Development Authority (MiDA). ”
“This funding will continue to support important improvements to the infrastructure of Ghana’s southern distribution network, increase reliability and power access to key markets, and advance energy efficiency programs directly benefiting the people of Ghana.”
The Compact comprised of two tranches of funding; the first being $308 million which was made available upon the official start of the current Compact, and the second tranche of $190 million, which was contingent on a successful concession agreement.
The agreement for a 20-year concession was approved on July 24, 2018, by Parliament leading to the private-sector participation in Ghana’s power distribution.