Business News of Friday, 4 August 2017
President of the African Development Bank, Mr. Akinwumi Adesina has pledged of his outfit’s commitment to provide government with significant support to clean its energy sector debt.
He argues that the perennial challenges that have confronted the country’s power sector require robust measures to address them permanently.
Mr. Adesina made the remarks when he paid a courtesy call on the President to deepen the bilateral relationship between the AfDB and Ghana.
“We have agreed to provide significant support to the energy sector. Ghana has a particular term which has entered the dictionary today called the “Dumsor” which is about power outages. There is no way that Africa can develop without power. An economy without power really cannot go far,” he said.
He adds that the bank is willing to help improve liquidity profile of the energy companies facing severe damage issues in Ghana.
“I assure the president that the African Development Bank will play a big role with how to reschedule some of those loans and also how to help them in improving the liquidity profile of the energy companies that we have here thus, the ECG and the Volta River Authority” Mr. Adesina added.
Already some financial institutions in the country have indicated of their readiness to buy into the energy sector bond yet to be released by government later this year after Dr. Bawumia announced plans to issue a 15-year bond to clear the 2.4 billion dollars debts.
Mr. Akinwumi Adesina who promised to help the country’s energy sector back on its feet also acknowledged the President’s efforts in cleaning up the country’s debt.
“I want to salute the efforts of the government of Ghana in trying to clean up a lot of the debts that are actually in that particular sector.”
Available documents to Citi Business News state that as at the end of 2016, the net debt to banks and fuel suppliers amounted to 1.3 billion dollars.
A further breakdown also showed that the banks are owed 782 million dollars, while fuel suppliers are owed 440 million dollars.
State owned power producer, the Volta River Authority (VRA) owed the banks to the tune of 782 million dollars.
VRA also contributed 278 million dollars to the 440 million dollars owed fuel suppliers, while TOR contributed 162 million dollars.