General News of Saturday, 16 June 2012
Parliament Friday approved a $67 million loan from the China Development Bank (CDB) to finance the Sekondi Free Zone Shared Infrastructure and Utility Services project.
The loan was approved as a subsidiary to the Master Facility Agreement (MFA) between the government and the CBD under which Ghana is sourcing $3 billion to finance a number of projects.
The project entails the development of a privately financed and owned Export Processing Zone (EPZ), with both on-site and off-site infrastructure of international standard.
The government, through the Ghana Free Zones Board (GFZB), has designated a 2,500 acre land in Sekondi to be developed into an industrial estate, with a potential developer, Hassan Investment Limited, as the strategic developer.
State-of-the-art, world-class infrastructure to be provided for the Sekondi Free Zone includes a district cooling system, a sewerage treatment plant, a power plant, a water desalination plant, roads, lighting, water network, gas network, telecommunication network, an irrigation system network and landscape.
According to the report of the Joint Committee of Finance and Trade and Industry on the loan, the committee members were informed that the successful implementation of the project and the operation of the zone were expected to generate over 60,000 direct manufacturing jobs and another 800 to 1,000 supporting jobs.
“It is noted that Hasan, the strategic developer, is envisaged to bring in approximately $8 billion worth of investments by reputable industrialists. Hasan itself is envisaged to invest about $800 million to $1 billion in a residential estate, logistic clusters and specialised industrial and infrastructure operation,” it said.
That revelation, however, seemed not to have gone down well with some members on the Minority side, as they doubted the credibility of the strategic investor.
According to the Minority Spokesperson on Finance, Dr Anthony Akoto Osei, “it is unthinkable that the strategic investor, which is prepared to invest between $800 million and $1 billion, wants to wait until the government has borrowed $67 million, with interest, to develop the zone before coming in to invest to make profit”.
“The whole MFA covered $3 billion. If Hassan is envisaged to bring approximately $8 billion worth of investments by reputable industrialists, then we should go to Hassan rather than the CBD for such a facility,” he argued.
He, therefore, called on the committee to go back to do its homework well to save the country from being faced with another STX in the future.
Meanwhile, a $9 million loan facility being contracted by the government from the International Fund for Agricultural Development (IFAD) to finance the Rural and Agriculture Finance Programme generated controversy in Parliament Friday.
Some MPs wondered why the government was contracting such a loan to build the capacity of the ARB Apex Bank, rural and community banks and rural microfinance institutions, instead of the money going directly to the farmers.
One of the critics of the loan, Mr Dan Botwe, called for the rejection of the loan, arguing that it was an insult to the integrity of the House to sanction the loan for that purpose.
“It is not right for the House to approve a loan to build the capacity of people to buy suits and ties, at the expense of poor farmers,” he said.
His assertion was supported by the NPP MP for Sekondi, Papa Owusu Ankoma, who drew hilarious laughter in the chamber when he asked: “Why do we contract money for ‘suit and tie wearing’ staff of financial institutions to be trained to facilitate the financing of ‘charlie wote’ wearing farmers?”
In deferring the debate on the loan for further consultations, the First Deputy Speaker, Mr Edward Doe Adjaho, referred the House to a similar facility that was approved in 2001 by Parliament to finance a project to determine the level of poverty when the poverty level was obvious to determine.**