Business News of 2014-07-18

‘Cancellation of Chinese loan won’t affect port project’

The Ghana Ports and Harbours Authority (GPHA) has stated that the cancellation of the second tranche of the $3 billion China Development Bank (CDB) loan will not affect the ongoing Takoradi Port expansion project.

According to the Director of the Takoradi Port, Captain James Owusu-Koranteng, the GPHA could look for financial resources on account of its own balance sheet to complete the project.

“The project will not come to an end or be halted as a result of the cancellation of the loan. The GPHA has an alternative arrangement which will ensure that the project is delivered,” he said.

The assurance by the authority comes on the heels of a supplementary budget presented by the Minister of Finance to Parliament on Wednesday which indicated that the GPHA would not receive $176 million from the second tranche of the Chinese loan to complete the second phase of the expansion project.

The authority was expected to receive $176 million out of the second tranche to complete the port expansion project. Speaking to the Daily Graphic on the impact of the cancellation of the loan on the expansion project, Capt. Owusu-Koranteng said the GPHA was aware of the termination of the loan.

He explained that as a special purpose vehicle (SPV), the GPHA could borrow on its own balance sheet to complete the project. He said the project was progressing steadily and that on completion it would position the port as a destination of choice for importers and exporters.

He said when completed, the Takoradi Port would become the petroleum hub that would provide services for offshore operations in Ghana and the West African sub-region.

The CDB loan

The Takoradi Port expansion project was one of the 12 projects that were to be financed with the CDB loan. Projects such as the Western corridor gas infrastructure project and Information and Communications Technology (ICT) enhanced surveillance project for the Western corridor oil and gas enclave were also earmarked to be financed by the loan.

Port project

The port project, among others, involves the construction of bulk terminals, oil and gas services terminal and the reclamation of a land area of more than 53,000 hectares.

It also involves the creation of an open storage area for oil pipes, plants and other heavy-duty equipment to service the needs of the new oil and gas industry. The second phase of the project will ensure physical infrastructure development within the port, good road network in and out of the port and the construction of a container terminal in Sekondi.

Currently, the extension of the breakwater, which is one of the critical parts of the expansion project, is almost completed. It will pave the way for other aspects of the project to begin.

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