The Honourable Members of Ghana's House had to suspend a motion for the approval of a loan of US$18.1 million from the African Development Bank (ADB) due to failure on the part of the government to disclose the full and complete facts about the conditionalities attached to the loan
In the course of the debate it transpired that some of the conditions included the implementation of VAT in Ghana, the establishment of Tax Identification Numbering System,.the sale of the Produce Buying Company, Tema Oil Refinery, and Ghana Oil Company which should be carried out before the loan is released.
The US$18.1 million economic reform support loan is to finance part of the foreign exchange support of the Economic Reform Support Operation (ERSO) to be disbursed in two tranches of 10 million and 3.6 million Units of Accounts (UA).
Commodore Steve Obimpeh, chairman of the Finance Committee moving the motion for approval, said the government had already implemented conditions for the first part of the loan which included the promulgation of the Value Added Tax and the establishment of Tax Identification Numbering System.
The government has further adopted a medium-term expenditure framework which includes a three-year rolling plan for the allocation of resources.
He said the committee felt that in such a transaction, the country's interest must be supreme notwithstanding the privatisation process since the three companies are of strategic importance to the country.
"To this end the committee requests that Parliament be apprised of the guidelines for the sale of these companies."
Alhaji Malik Al-Hassan Yakubu, NPP-Yendi, seconding the motion, urged the government to be cautious with the sale of the affected companies.
At the juncture the ever sharp J.H. Mensah, Minority Leader, then suggested to the House that the debate be suspended until the House has been provided with guidelines for the sale of the companies.
This led to a heated debate in which Mr Moses Asaga, Deputy Minister of Finance, promised to provide the House with all relevant documents on the loan agreement, including the guidelines.
Mr Freddie Blay, Second Deputy Speaker who was in the chair, ruled that the debate be continued.
Mr Stephen Kwaku Manu Balado, NPP-Ahafo Ano South, said the companies are crucial to the economy of the country and should not be sold because of a "paltry loan of US$18.1 million, which cannot put up Tema Oil Refinery."
He said crisis in the petroleum sector can cripple the economy so the refinery should not be privatised, adding that privatisation is acceptable but in the quest of this the government should not create "crony capitalism".
"The sale of these recently refurbished companies means the sale of Ghana, the fact that we are poor does not mean we should sell our rights, we must seek the interest of the nation first and I am prepared to fight it even in the law courts."
Major Samuel Kwame Amponsah, NDC-Mpohor Wassa East, agreed with the Minority Leader's suggestions that the House should be apprised with the guidelines for the sale of the companies before approving the loans.
He said certain organisations including the military, sometimes buy oil for their operations on credit in times of special operations and this will not be possible if the oil companies are sold.
"The conditions are not very favourable for acceptance of this loan, why is the ADB interested in only cocoa and petroleum? We need to have all the information before we approve this loan."
Mr Doe Adjaho, Majority Chief Whip, on his part urged the House to approve the loan since the Ministry of Finance will bring guidelines for the sale of these companies later for approval.
Mr Edward Osei-Kwaku, NPP-Asokwa West, said the conditions attached to the loan are draconian and unacceptable.
He said the nation's economy revolves around cocoa and petroleum, and for the ADB to call for the sale of these companies is "going too far."
Mr Joe Donkor, NPP-Tano North, said from the conditions attached, the government will be under pressure to sell these companies within three months.
Mr Moses Asaga explained that the ministry and the ADB have a compromise understanding for the offer for sale. He said the offer means government should prepare these companies for future privatisation and this does not mean immediate sale.
Dr Matthew Kwaku Antwi, NPP-Atwima Kwanwoma, said the government is desperate for the loan and suggested that it goes back to re-negotiate with the ADB under better conditions for the House to approve.
"What happens if for the next loan they ask us to sell VRA, what will be the consequence? Parliament must not endorse the sale of these companies.
Mr Kobina Fosu, NDC-Asikuma-Odoben-Brakwa, Mr Mahama Adam, NDC-Damongo/Daboya and Mr Kosi Kedem, NDC-Hohoe South, all expressed their dissatisfaction with the condition calling for the sale of the strategic companies and asked the committee and the Ministry of Finance to take a second look at it.
Mr Adam said the government should learn from Cote d'Ivoire, whose cocoa industry is suffering after privatisation, and now has to buy cocoa from Ghana to mix with theirs to meet their quality control standards before export.
The leadership of the House in consultation with the Speaker, suspended voting on the issue and agreed that the House should defer further discussions for the committee and the ministry to review the loan package.
The loan is repayable in 40 years after a 10-year moratorium.
It carries 0.5 per cent commitment charges per annum and a service charge of 0.75 per cent per annum. GRi
