Posted: Saturday 24th May 2014 at 7:14 am

‘Go To China Now’ – Minority Urge Mahama To Renegotiate $3billion China Loan

e8bd240x mg oseiakoto ‘Go To China Now’ – Minority Urge Mahama To Renegotiate $3billion China Loan


Dr. Anthony Osei Akoto
Minority spokesperson on Finance has urged President Mahama to fly to China as a matter of urgency, to re-negotiate the $3 billion Chinese loan the Minority said is troublesome.

Dr. Anthony Osei Akoto told Joy News, Ghana has had to cough up $54 million in commitment fees after receiving about $600 million dollars so far.

On December 8, 2009, the China Development Bank (CDB) agreed to provide Ghana with a loan of 3 billion USD for a package of projects, the majority of which are related to infrastructural development. The loan was signed by CDB and Ghana on December 16, 2011. In February 2012, Parliament approved the agreement at the recommendation of the then deputy Speaker of parliament, Edward Doe Adjaho.

The minority called it a ‘bad agreement..from day one’.

According to government officials’ projections of oil prices, Ghana will end up paying 6.4 billion USD to China for the 3 billion USD loan or will give away 750 million barrels of the nation’s crude oil to a Chinese company for more than 15 years. The loan agreement stipulates that 60% of all contracts under the loan go to Chinese companies.

There is an upfront fee of 0.25% of the loan and a commitment fee of 1% per year on the undrawn and un-cancelled balance of the loan.

Principal and interest payments will be made to CDB every six months after an agreed grace period expires – and it has.

Despite delays in the disbursement, government is still paying commitment fees on the loan, he claimed.

The Minority spokesperson and NPP MP  for Old Tafo wants President John Mahama to travel to China immediately to re-negotiate the agreement.

He specifically called on the President to get the 1% commitment fee taken out.

‘Once we have gone for it, we should  take out what is not inuring to our interest. 1% commitment fee is one of them.’

‘How can you pay for something you have not received?’ the disappointed former deptuty minister for Finance  wondered.

He argued none a person less than the President should go because the initial agreement was signed by the late President John Evans Atta Mills.

Source: Myjoyonline.com

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