US Senator questions $26m IFC loan for Saudi Prince’s Ghana hotel

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A US Senator is demanding answers to why the International Finance Corporation (IFC) of the World Bank Group approved a loan of $26 million for the Saudi Prince Alwaleed bin Talal Alsaud to build a luxury hotel in Ghana.

Sen. Patrick J. Leahy, according to a Washington Post report argues that the approval of the loan for the construction of a five-star hotel in Ghana a country he says where 40 percent of people live in poverty was “not an appropriate use of public funds” and should not have received US government support.

Senator Leahy who heads the Senate Appropriations subcommittee on the State Department and foreign operations says he wants to know how the Prince won approval for the loan under an IFC programme to encourage private development in developing nations. The United States is the largest shareholder in the IFC.

The publication quoted him as saying “The Treasury Department should review the IFC’s lending strategy in Africa and other areas where the focus should instead be on development priorities like agriculture, education and health, and on employment-generating opportunities that are commensurate with the size of the investment.”

The Washington Post citing Forbes Magazine, says Prince Alwaleed — a nephew of Saudi Arabian King Abdullah bin Abdul-Aziz has a net worth of $19.6 billion, and is the 26th richest person in the world.

The IFC approved the nine-year loan in December to KHI Ghana Ltd., a wholly owned subsidiary of Prince Alwaleed’s company, Kingdom Hotel Investments (KHI), for development of the Movenpick Ambassador Hotel in Accra. The US voted to support the loan and the formal loan commitment papers were signed in February, records show. The loan has not yet been disbursed, according to the IFC’s website, the report said.

The Movenpick Hotel worth $103 million was recently opened in Accra. It has 259 rooms. Situated in the centre of the Business District of Accra, it used to be one of Ghana’s state-owned hotels – it was called The Ambassador Hotel.

The remaining $78 million financing for the hotel will come from KHI and other investors that have not been named in the report.

The vice president and group treasurer of KHI, Lourie Kruger however defended the project saying it would result in “an important resource for businesses and travelers in Ghana.” He said it would “create many local jobs” during its construction and operation, according to the publication.

The report says the project expects to create 300 new direct jobs and temporary employment for 1,000 laborers.

By Emmanuel K. Dogbevi

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