So I have been reading and hearing some analyses which are not just misleading but also very inaccurate.
Never was it part of the narrative last year after the China trip that government was seeking to enter into a $15 or $20 billion joint venture agreement only for infrastructure for bauxite. And how people juggle between the two figures leaves much to be desired.
For the purposes of education let me state what was the narrative. The entire $15 billion facility was in categories:
1. $2 billion facility between Association of Ghana Industries (AGI) and their sister partner in China called the CNBM,
2. About $6 to $8 billion facility for integrated aluminium industry focusing on bauxite mine and refinery through a joint venture agreement between GoG and any potential off-taker, and other related projects
3. $2 billion infrastructure for bauxite barter facility between GoG and any potential partner. At that time even sinohydro was not in the picture because we didn't know which company was going to be selected,
4. $1 billion facility for other projects, and lastly
5. Freeing up of the locked $2 billion CDB loan contracted under the previous government.
All these constituted the bigger $15 billion package. We never said anywhere that the entire $15 billion was for infrastructure for bauxite barter and anyone who paid attention to details knew this. I am a bit baffled why people choose to rely on online portal news some of which are themselves defective in terms of accuracy, but not seek to get the actual facts.
Fast forward in 2018, AGI and CNBM have successfully signed their pacts and started disbursing the $2 billion. $10 million of which has been advanced to a sugar factory last month.
The parliament of Ghana has also given approval for the $2 billion infrastructure for bauxite facility and the agreement signed for works to begin.
Works on the bauxite mines and refinery have far advanced. Government has established a holding company backed by an act of parliament this year which will enter into the joint venture agreement for the bauxite mine and refinery. In the next few weeks or months request for proposals will be issued for prospective companies to bid. If we are lucky the cost of the mining and refinery may even come less than the value originally envisaged.
Just this week, as part of the President’s tour to China $400 million of the locked up $2 billion CDB loan has been signed for release for the construction of the fishing landing sites and others.
What this means is that hopefully by the end of 2018, about 95% of the whole $15 billion package announced by the erudite and hardworking Vice President after his visit to China would be realized. And this will mean a high success rate for the biggest deal the nation Ghana has gotten from any official trip by any Vice President for so long a time.
This is remarkable and must be applauded and, if not, should be scrutinised from a more informed position than just lazily seeking to criticise.
The other good thing to note is that Sinohydro is only playing a role to provide infrastructure at the discretion of the government and people of Ghana and not at their discretion.
Government is not going to pay them anything until after 3 years by which time they should have completed the projects. Sinohydro is not a company that is going to mine the bauxite and in other words sinohydro is not a mining company.
Again, what differentiates this from the extant arrangements in the gold and oil sectors is that, here, government is not going to just export raw bauxite but rather add value to it through refining. The $2 billion that will be paid at the end of the day is just a small fraction of the total export value of refined bauxite we have as a country, which is estimated to be around $400 billion.
Source: Dr. Gideon Boako, Spokesperson for VEEP, Dr Mahamadu Bawumia
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It seems you still do not understand the words borrow and batter trade, we are not borrowing ooo people get this straight. Besides did Bawumia say he would not borrow, I CHALLENGE EVERYONE TO PROVE TO ME WITH A VIDEO WHEN HE SAID WHEN HE COMES TO POWER HE WOULD NOT BORROW...He was lambasted the previous govt on borrowing because YES he knew we have bauxite, we have the minerals being looted by some powerful individuals only siphoning our resources only to enrich themselves. So he says why dont we trade with our minerals in exchange for services and cash from those who have it and have a need for it...LET'S wake up as people and stop the attacks and insults and think for the future and not how to fill our pockets now. IF our forefathers had done same we wouldn't be suffering now. WOULD YOU PREFER A GOVT THAT BORROW and you use the money to buy cars for your galfriends, houses in dubai and just use just a small portion of it to build some 2 kilometres of road and over inflated building structures TO THE ONE WHO WOULD SEE TO THE BUILDING OF BRIDGES, ROADS, HOSPITALS, STRUCTURES in moderated cost... then its up to you....
The current NPP government, when in opposition, lambasted the government for going in for borrowing too much. Now you are in government and you are telling us to applaud you for going in for the biggest loan in the history of the Country within a short time. Respect Ghanaians.
..."About $6 to $8 billion facility for integrated aluminium industry focusing on bauxite mine and refinery through a joint venture agreement between GoG and any potential off-taker, and other related projects " 6 to 8 billion ? come again sir . 2 billion is no joke money . Please be more specific
A good piece to read and informative too, what needs to be done is more information for Ghanaians to appreciate what is going on around them, my beef is how best to ensure that there is value for money in all these transactions and state officials do not connive to take advantage to line up their pockets and all Ghanaians benefit from these massive investments, do dual carriage roads, railways, power supply, water supply and hospitals for all to see and you vote is more secured than your talking.
Its only in Ghana that we will go get the the asians to come and loot from us. After 20 years of digging this bauxtie and gold in that forest, they will be okay and start calling the bluff. Borrowmia told us the money is here with us but see, all the way to china to borrow. When can we have a visionary president like Kwame Nkrumah or Paul Kagame. You are appauding your vice president because you are in his office. Wait for 2020
Hmm! are we sure our bauxite is not worth far more than we are getting from the chinese company? I have a feeling they will make probably ten times of the 2bn dollars they are giving us.
Well said Ishmael USA.
We have a president who’s there, but he is not capable of doing the job or living up to the responsibilities.
I am a responsible Ghanaian who lives in America. I am also an NPP sympathizer. I am happy that this government has a plan and policy direction. The Vice President following formal Vice President(now ex-president) Mahaman as the leader of the economic team is transforming the office of the Vice President forever. It shall no longer be a lazy post given as gratitude for political cronies. However, I have entertained some fears when I hear about these huge borrowings. I was angry and upset initially. But let's think through this. If you get huge money right now and invest in building companies and refineries, you build your economy once and for all, and can pay back easily. The challenge comes when we borrow and use it in acquiring unproductive ventures. In that case, the burden of paying back falls on the poor taxpayer. But if you use the loans to expand your economy, then you make a profit and you will not feel the payback. So the government seems to be on course for investing these resources not just buying cars which gives you no means to pay back. Again, the Western world and America is worried about our relationship with China. Yet the country that owes China most in the world is the USA. It is believed that China owes about 10% of all the assets in America. Another reason we fail to realize is that the world has moved on very fast and we Ghana has no time to crawl! So everything must happen fast without delays. That is why borrowing to invest in building refineries to process raw material is a good idea. The problem of this government is that it does not explain much to the ordinary Ghanaian. The government has a very bad communication program. It leaves huge gaps for the opposition to fill in their propaganda. You should not blame anyone who broadcast what they think. It is the government communication team failing to do their job. We watch and wait with fear. My only prayer is that the money does not go into people's pockets this time, else, wherever Prez Akufu Addo is, we will go get our money. The people have so much faith in this government that if it fails, the repercussions will be terrible not only for the NPP but for the Ghanaian politics in general. I also believe the grounds are hard and the people are enduring too much. Despite governments good plans for the future of Ghana, it should loosen up a bit and let some money flow in the economy. Pay some more contractors, release school feeding program money, etc, etc. Jack do something for the people to feel your good works. Otherwise, I fear coming next election. God bless our homeland Ghana, God bless the opposition for checks and balances, God bless Dr. Bawumia, God bless Prez Nana Addo.
When something is too good to be true, call it lies because you can't comprehend it. Interesting people. We elect and pay people to think and these guys are busy thinking and planning for the future. Kudos