Parliament on Thursday adopted a report on a 48.1 million dollar loan agreement between Ghana and the International Development Association (IDA) to cushion the Economic Reforms Support Operations (ERSO II). The interest free loan, which has a grace period of 10 years, will be repaid within 30 years. It will attract 0.75 per cent service charge and payment will start on February 1, 2011 and end on August 1, 2040.
Commodore Steve Obimpeh, Chairman of the Finance Committee, moving for the adoption of the report said, "the terms of the facility are highly concessional.
There are no conditions precedent to the disbursement of this credit". Mr Kwame Peprah, Minister of Finance who was in the House to answer questions concerning the loan, said the facility is intended to plug holes in government's fiscal expenditure and balance of payment programmes.
He said an earlier facility of 180 million dollars approved by Parliament has not been fully utilised because of difficulties in meeting some of the conditionalities linked to it, hence the need for the additional loan to off-set the gap created by the shortfall.
He explained that five of the conditionalities were met except the one on the Ghana Commercial Bank that 30 per cent of its shares should be reserved for strategic investors.
Mr Peprah said 130 million dollars was accessed leaving 50 million dollars, which was blocked and government needed additional facility to support the budget to move the economy forward.
The Minority threatened that they would not adopt the report if the Minister did not give the assurance that Parliament would get its fair share of the loan. They said the Minister was evasive of Parliament and that he would only come to the House when he was in need.
Consequently, the Speaker, Mr Justice Daniel F. Annan, initiated a compromise deal between leaders of the two sides and the Minister. After consultations Mr Peprah was made to commit 12.5 million dollars of the facility to Parliament for the completion of the renovation work on the Tower Building for offices of MPs
