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General News of Sunday, 30 August 2020


Agyapa deal is like a heroin addict selling his wife’s jewelry – Dr Nii Moi Thompson

Dr Nii Moi Thompson, Economist Dr Nii Moi Thompson, Economist

Economist and former Director-General of the National Development Planning Commission (NDPC), Dr Nii Moi Thompson, has likened the Agyapa Royalties deal to a heroin addict who sells his wife’s jewelry after having squandered his own property just to support his bad habit.

In a tweet, Dr Thompson drew similarities between the Agyapa Royalties deal and the mindless actions of a drug addict in his attempt to satisfy his cravings for drugs.

“Think of the heroin addict who sells his car and fridge and microwave and other assets to support his habit. And once he has none left, he secretly begins selling his wife’s jewelry. And then think of Agyapa,” he tweeted.

He contends that the Agyapa Royalties deal is an attempt by persons involved in it to satisfy their cravings by denying others what is rightfully theirs.

The Agyapa Royalties deal has sparked much controversy since it came to light. The deal seeks to basically securitise Ghana’s mineral royalties earnings for some one billion dollars to be repaid over the long-term.

The Agyapa deal

The Parliament of Ghana on August 14, 2020, approved the Agyapa Mineral Royalty Limited agreement with the Government of Ghana. The minority which opposed the deal staged a walkout to drum home their disapproval.

In 2018, the Minerals Income Investment Fund Act 2018 which establishes the Fund to manage the equity interests of Ghana in mining companies, and receive royalties on behalf of government was passed in Parliament.

The fund is mandated to manage and invest royalties and revenue from equities for higher returns for the benefit of the country.

This law also allows the fund to establish Special Purpose Vehicles (SPVs) to use for these investments.

Government amended the act to ensure that the SPVs have unfettered and uninhabited independence from the legal systems of the country.

When this amendment is assented to by the President, it will enable the country to use a special purpose vehicle, Agyapa Royalties Limited to secure about $1 billion to finance large infrastructural projects which will be repaid within a fifteen year period.

“Agyapa, which will operate as an independent private sector entity, will be able to raise funds from the capital market, both locally and internationally, as an alternative to the conventional debt capital market transactions.

The funds, which are expected to be raised from the Ghana Stock Exchange (GSE) and the London Stock Exchange (LSE), will be a long-term capital, without a corresponding increase in Ghana’s total debt stock and hence without a public debt repayment obligation,” the agreement provides.

But many Civil Society Organizations (CSOs) have kicked against the deal, arguing that it will shortchange the country. But Government officials notably the Finance Minister have stressed that the deal is good for the country.