[ 2014-10-01 ]

'Blows' at IMF meeting over government's debt owed BDCs
Ghana's Finance Minister, Mr. Seth Terkper on
Thursday September 18, allegedly attacked the
Chief Executive of the Ghana Chamber of Bulk Oil
Distributors (CBOD), Senyo Hosi, at a meeting
between government and the International Monetary
Fund (IMF) representatives currently in the
country.

The New Independent newspaper reported that
government sources told them the debate between
the two at a point got worse while IMF officials
and other members of the government delegation
looked on in utter disbelief.

One IMF official was said to have expressed shock
and outrage at the development describing the
Minister's conduct as uncalled for, The New
Independent reported.

The seeming drama of disagreement between the two,
which resulted in an open attack, began when the
issue of forex loss differentials came up for
discussion.

The leader of the IMF team wanted to find out the
quantum of forex losses owed the BDCs by the
government and whether the BDCs were going to
claim forex losses from the government for the
year 2014.

The New Independent learnt that, the response to
this IMF request from the BDC team at the meeting,
led by Senyo Hosi, was that, there would be a
claim of forex losses from government for the year
2014.

At this juncture, the Finance Minister is said to
have flared up and said, the government was not
going to pick forex losses, explaining that, forex
losses are covered by accounting standards as tax
deductible and that, the best thing for the BDCs
to do was to file their returns with the Ghana
Revenue Authority and then make deductions for
forex losses.

According to our sources, the Finance Minister at
a point angrily told Senyo Hosi that, the BDCs
could go to hell and that, they had a diabolic
agenda to hold the entire country to ransom and
telling them in the face that, “if they thought
the kitchen was too hot for them, they could get
out.”

Mr. Terpker is reported to have told the BDCs boss
at the IMF arranged meeting that, he could advise
his members to opt out of the business.

This resulted in hot exchanges between the Finance
Minister and SenyoHosi, the Boss of the BDCs, with
the latter questioning the current position of the
Minister that, the government was not going to pay
any forex losses to the BDCs, indicating that, the
Minister was going against the position adopted by
the government on the matter under the directive
of President John Dramani Mahama.

He exposed the Minister's inconsistency, which
runs counter to government's official position
after the latter had paid an amount of US $ 150
million to the BDCs in respect of forex losses
this year, explaining that, it is the government
that regulates the forex rate at which the BDCs
sell their products, stating that, on June 16,
2014 the forex rate that was applied was 2.9 while
the Bank of Ghana published the rate of 3.0, and
wondered how the government would expect the BDCs
to sell at the government's determined rate
without taking responsibility.

According to our sources at the meeting, Senyo
Hosi pointed out to members of both teams at the
meeting the inconsistencies in the conduct of the
Finance Minister, who at times advises the
government to accept the payment of forex losses,
but at times makes a 'U' turn when same issues are
raised.

At this point, The New Independent learnt that,
the meeting degenerated into a banta of give and
take between the Minister and the boss of the
BDCs, with the latter telling the Minister in the
face that, the forex losses would not have arisen
if the government had not intervened to dictate
how to price their products.

Fuming with rage, Mr. Seth Terkper is said to have
told the BDCs that, they have the option to leave
the industry if they feel cheated under the
circumstance, but in a sharp response, Mr. Hosi
also told the Minister that, he (Minister) also
had the option to get away from the responsibility
if he did not want any liability.

But The New Independent has learnt that, Mr.
Terkper told the BDCs that, they had a clear
option, so they should not arrogate the cost to
him and urged the BDCs team at the IMF meeting to
go back and advise their members to opt out of the
business and to tell them that, nobody was holding
anybody's hands or forcing anybody to be a BDC,
and wondered why the BDCs think that, they were
shouldering an unbearable burden yet should
continue to be in the industry, indicating angrily
to them that, the BDCs were not indispensable.

The New Independent further learnt that, in a
sharp response to this query by the Finance
Minister, SenyoHosi indicated that, the BDCs were
still in business because since 2012 the
government had accepted the responsibility of
paying up the forex losses, else they would have
stopped operations.

He also indicated at the meeting that, BDC
business activity is only dependent on funding
support from the banks, adding that, the banks
since 2012 upon realizing the forex loss situation
continued to fund the BDCs because government
through the NPA wrote letters to affirm government
liability on forex losses, he told the IMF team.

“Stop the business, I say stop the business, it
is voluntary,” the Minister retorted angrily to
the bewilderment of the IMF team, insisting that,
the current policy was that, they would not
shoulder any forex losses and stated that, “if
it is a burden and it is a problem, leave the
industry, it is as simple as that,” Mr. Seth
Terkper told SenyoHosi and his BDC team at the IMF
meeting, pointing his hands angrily towards the
direction where the BDC Boss and his team were
seated.

The New Independent was hinted that, feeling
embarrassed about the development, the leader of
the IMF team, in a move to stop the confrontation
between the two, veered off from the forex losses
that had caused the tension and raised the tempo
at the meeting and shifted his attention to the
Boss of the BDCs wanting to know if the BDCs had
cedi liquidity if they were to be provided US $ 1
billion.

This finally did the trick of bringing the tension
down to enable the meeting, which had been marred
by the Minister's conduct, to be brought back on
track, government sources at the meeting hinted
The New Independent.

When contacted, Senyo Hosi, initially declined
comment but upon insistence agreed to make an
input but refused to either confirm or deny
whether there were some hot exchanges between him
and the Finance Minister at the IMF meeting on the
said day.

Mr. Seth Terkper could not be reached for his
comments as his phones were still off as at press
time yesterday, but The New Independent is still
making frantic efforts to reach him for his
comments and will in subsequent editions bring
this to the attention of readers.

Source - The New Independent

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