Gov’t Should Abrogate STX Housing Project Contract - John Jinapor

John Jinapor, Special Aide to the Vice President, John Dramani Mahama, has urged his own government, the ruling National Democratic Congress (NDC), to abrogate the STX Housing Project contract or seek a new supplier for the project if necessary.

According to him, government should not be embarrassed to shelve the project if the persistent problems associated with its take-off keeps rearing its ugly head.

John Jinapor opines that it will be in the interest of the country to sever links with the partners since “it is practically impossible to work with partners who are always fighting among themselves and dragging each other to court”.

The STX deal is for the construction of 200,000 houses in Ghana within a period of five years, but almost a year after the contract was signed, the project is yet to take off.

Last month, STX Construction Company Limited, Korea, the parent company of STX Ghana, initiated legal action at a Fast Track High Court in Accra against six respondents including Bernard Kwabena Asamoah, the man believed to have introduced the deal to the NDC government.

The suit, which was filed on July 26, 2011, cites G.K. Airports Company Limited; Joseph Bardolph Asafo-Boakye, a Director of STX Ghana; George Padi; the Registrar-General as well as STX Engineering & Construction Company Ghana Limited as the 1st, 3rd, 4th, 5th and 6th respondents respectively, with B.K. Asamoah as the 2nd respondent.

In the notice of motion, STX is seeking several reliefs including a declaration that the special resolution ‘purportedly’ dated February 25, 2011 and filed at the Registrar General’s Department by B.K. Asamoah, seeking to increase the stated capital in STX Engineering & Construction Company Ghana Limited without the consent and knowledge of the plaintiff, is null and void and of no effect.

The New Statesman newspaper on Tuesday August 1, reported that seven months after the flamboyant sod-cutting ceremony by President Mills for the commencement of the proposed construction of 30,000 housing units for security personnel in the country and coupled with the prediction by the Minister of Water Resources, Works and Housing, Alban Bagbin, that physical houses will be seen sprawling at the various sites by July, not even a single block has been laid on the site for the STX housing project to take off.

The signing of the STX Housing Project contract triggered a lot of criticisms from the opposition NPP and civil society groups.

IMANI (a policy think-tank), Ghana Real Estates Developers Association (GREDA) and The Danquah Institute (a centre-right policy think tank) raised red flags about the project right from its inception.

DI for instance questioned why the Mills administration was allowing the commercial interest of a foreign company to dictate Ghana’s development priorities and at a cost that is potentially detrimental to the nation’s development. This was so because STX appeared to be rather the provider of the motherboard for the infrastructural expenditure priorities of the Ghana Government for the medium term, especially, when there was no indication of anything remotely similar in the 2008 manifesto of the governing party.

The NPP, for instance accused government of seeking to use the country’s oil reserves as collateral to fund the controversial STX Korean housing deal. The accusation prompted Deputy Finance Minister Fiifi Kwetey to come out to say critics have got it all wrong.

He explained that government intends to use revenue from the oil exploration as collateral for loans and not the oil reserves. But the National Coordinator for Civil Society Platform on Oil and Gas, Amin Adams, countered that any such attempt will not inure to the benefit of the nation.

Contributing to discussions on Peace FM’s Kokrokoo Morning show, John Jinapor said he does not see the reason why government should be abashed if the project becomes a white elephant since its intentions throughout had been noble.

“If the project does not see the light of day, I don’t see anything wrong with government coming out to say that they did their best to see to its success. But the level it has reached, we believe it is not in the interest of Ghana to even tag along with the partners because you can’t deal with partners who are fighting among themselves and dragging each other to court,” he said.

According to him, a new project which to be given to Ghanaian contractors to execute can be prepared and sent to parliament for approval even though it may not necessarily be as huge as the STX. To him, the NDC government cannot be held responsible for the impasse between the directors of the company and how things had panned out.

“I think that this project will benefit all of us if it comes on but if you look at what is going on, clearly there are some problems which is not from government or Ghana because we have done our part as far as this project is concerned. The project is not being executed by government alone so if the parties who are supposed to do it have problems, you can’t blame government and clearly you can see that the shareholders have problem in terms of how to execute it,” he noted.

He disclosed that President Mills has requested for proper appraisal of current happenings regarding the STX Housing Project and will definitely decide on it shortly.