Government backs out of IFC loan
27 – 11 – 2002: - Government backs out of IFC loan
27 – 11 – 2002: - MPs express varied views about loan
Government backs out of IFC loan
Accra (Greater Accra)
27 November 2002 - "Government has come to the conclusion that it will be
in the national interest not to pursue further discussions and negotiations in
respect of the International Financial Consortium loan approved by Parliament
on 12 July 2002".
Yaw Osafo-Maafo, Minister
of Finance said this on Tuesday when he presented a statement in Parliament on
the loan of one billion dollars in three trenches of $350m from the IFC.
The Minister said it
was relevant to state that no payment was made in advance in anticipation of
the loan, and that the sovereign guarantee has neither been issued to the
Consortium nor to any member of the Consortium by the government and that the
honour of the country has not in any way been compromised.
Osafo-Maafo said the
implication of the decision was that the additional resources the Government
sought to find to assist with quick improvement of infrastructural development
is no more available to the country under the terms of the loan.
He said the
government's priorities was prominently on infrastructural development and the
pursuance of vigorous development agenda that would result in growth and
significant poverty reduction, would need additional financial resources.
"Such monies would have to be over and above the financial resources that
are normally available to us through our traditional sources" and this was
what informed the pursuit of the Consortium loan for the development of our
infrastructure, he added.
Osafo-Maafo said the
concerns expressed by some of the Finance Committee included the "timing
of the issuance of the Sovereign Guarantee", the role to be played by the
"Trust" and the proposed joint Company and the "modalities for
the payment of a transaction fee of 3,5 per cent and the transparency in procurement
and contracts".
The Finance Minister
there has, however been a systematic campaign against the loan under all kinds
of pretexts involving statement, some completely false, some completely
ignorant of the realities of international business, others deliberately
vicious and others well meaning and constructive.
He said this campaign
obviously sent signals to the development partners, who subsequently expressed
unease about the loan during discussions with the government.
Osafo-Maafo said
Government has not received any information from any source, that provides
evidence against the credibility of the consortium, the loan source or known
members associated with the facility and yet the campaign against the loan has
persisted.
He said the
implication of the decision was that the additional resources the government
sought to find to assist with quick improvement of the infrastructure was no
more available to the country under the terms of the particular loan.
The Minister said the
building of roads and ports, the communication network and provision of energy
to fuel the modernisation process and thus alleviate the suffering of the
people at a rapid rate has been the driving force towards the pursuit of the
loan facility.
Osafo-Maafo said what this
means was that Government has to look inward and raise additional resources
domestically to tackle these problems and also requests the donor groups, both
multi-lateral and bi-lateral to consider finding additional resources to carry
out the vigorous development of the infrastructure.
GRi…/
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MPs express varied views about loan
Accra (Greater Accra)
27 November 2002 - Moses Asaga, Minority Spokesman on Finance on Tuesday said
it was gratifying that the Ministry of Finance has now found it necessary to
release the country from three months of suspension and a hope for what he
termed "a non-existent loan facility".
He said if the
Government had listened to the complaints, discussions at the Finance Committee
and the subsequent debate at the House concerning the one billion-loan facility
from the International Financial Consortium (IFC), it would not have assigned
the reasons for its withdrawal now.
Asaga said this in
reaction to the statement made by the Minister of Finance on Government's
discontinuation of the further discussions and negotiations of the loan from
the IFC. The Member said as an experienced banker, he felt it was necessary
that the right advice was given but unfortunately the Minister refused to
listen to advice when it was apparent that the loan was non-existent.
He said he was
surprised that even the Governor of Bank of Ghana could not see through the
deceit of the IFC and allowed to be taken for a ride, adding that the Governor
could have rejected the offer as was done in the past.
Asaga said if the
government wants to take credible loan facilities, there were many sources that
the IMF would not be against, provided there was transparency in the
transactions.
He said, he was ready
to provide free consultancy as to how to access foreign loans and mentioned
such organisations as the Professional Investment Bankers, Infrastructural
Financial Facility and Departmental Financing that are all recognizable bodies
and could come to the support of the country.
Ms Hawa Yakubu, NPP-
Bawku Central said the stand of the Minister was a clear testimony of the
transparency and forthrightness of the government in taking bold decisions to
salvage the economy.
She said it was
government's plan to source for funding that would result in not only the
socio-economic development of the country but also significantly achieving
poverty reduction.
Doe Korbly Adjaho,
NDC- Avenor, said the worry of the minority side was that there was no due
diligence concerning the whole transaction of the IFC loan by the Bank of Ghana
and the Ministry of Finance.
He said this was a
clear case that the Parliamentary Committee of Finance was deceived and it was
not enough for the Minister to state that he was discontinuing with the loan
but he should be bold to go ahead and tender in his resignation as well as the
Governor of Bank of Ghana.
Kwadwo Adjei-Darko, NPP-
Sunyani West and Minister of Mines said the Minister of Finance needs
commendation for been bold to withdraw the loan facility instead of hiding it
from parliament and the public.
Dr Kwabena Adjei, NDC-
Biakoye said it is now clear that the minority was not always wrong and that
the majority was not always right, adding that the Minority were only waiting
for the right time that has now come, following the testimony of defeat by the
Minister.
He said there would be
more confessions to be made by the Majority side and government but cautioned
that care should be taken so that it does not come at a huge cost to the
nation.
Dr Adjei said with the
trend of affairs now, he was worried about the national credibility and image
of the country, the perceptions of the global world about the calibre of people
managing the economic affairs of the country who could differentiate frauds as
well as the image of Parliament and the current government.
In summing up, the
Minister of Finance, Yaw Osafo- Maafo said all the suggestions, especially from
the Minority side were very useful and led to the government taking such a bold
decision. Osafo-Maafo said he would have been the first to resign if he found
out that he had misconducted himself, misled, compromised the integrity of the
country or diverted any money into his private account.
GRi…/
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