Socialist Forum On Sale of Ghana Telecom

SOCIALIST FORUM OF GHANA (SFG)

P. O. Box NT 272 Accra-Newtown Accra

Tel: 0244254590

17th July, 2008

Sale of Ghana Telecom

The NPP Government has sold 70% of Ghana Telecom – 100% owned by Ghana - to Vodafone International Holdings B.V. for $900 million. This has been done through a secretive and fraudulent process, superintended by the Ministry of Finance.

Government is in haste to close the sale to cover Ghana Telecom’s debt of $400 million. If the sale goes through, it will also contribute to balancing the budget. Among other giveaways, the NPP Government has committed to contribute up to $40 million to cover lay-offs. The debt has arisen from the corrupt self-dealing connected with reversal of the 30% sale to the Malaysians, and the incompetent management of Telenor. If allowed, the sale will bury this disaster; and any crimes of commission or omission that occurred in our name.

Coercion and Manipulation of Parliament to Approve Sale The NPP Government has now gone to Parliament to get the Sale and Purchase Agreement (SPA) covering this audacious and bizarre transaction approved. It intends to secure approval under a certificate of urgency. On this occasion as on others, it is certain that Parliament under NPP control will oblige. NPP MPs will once again abuse their majority and rubber stamp their Government‘s betrayal of the national interest..

We note that in other locations, Vodafone and its proxies have used well connected persons, their relations, friends and underhand means to clinch deals. Kenya is an example in point. Is it possible that this is the case in Ghana? Will it explain the manipulation and coercion of Parliament, and the indecent haste?

Deception and Fraud In informing the public of its recklessness, the NPP Government was economical with the truth. It only told part of the story. What the NPP has done is to sell Ghana Telecom in addition to other public telecommunications assets that the Sales & Purchase Agreement (SPA) describes as ‘the Enlarged Ghana Telecom Group’

The assets of ‘The Enlarged Ghana Telecom Group’ are: Ghana Telecom - made up of: a. Ghana Telecom’s fixed network comprising i. Land lines ii. Carrier services iii. SAT 3 – the international submarine fibre-optic gateway b. Onetouch Mobile Services c. exZeed Call Services the National Fibre-optic Backbone (financed by a Chinese loan and yet to be completed) VRA’s Fibre-optic Network (Voltacom)

Such is the scale of the deception and fraud by the NPP, that the Chairman of the Board of Directors of Onetouch (who among others are required by law to know and to approve) could say on Metro TV that he did not know the full details of what was being sold. He himself had to go onto the website of the buyer, Vodafone to find out precisely what was going on! He claimed that Vodafone was going to inject $500 into the operations of Ghana Telecom. When it was pointed out that this was not in the Sale and Purchase Agreement, his response was that this had been stated on Vodafone’s website! He went on to say nevertheless, that he found no problem with the process. To him, ‘haven given the NPP our mandate, Ghanaians also gave them the right to decide our destiny anyway they chose – and without further consultation.’ Such are the men and women of straw in whom we have trusted our destinies.

Flawed and Fraudulent Process The document that the NPP government has submitted to Parliament claims that all provisions of the Public Procurement Act have been complied with. All evidence to date suggests the contrary. The telecommunications sector is subject to public regulation though the National Communications Authority (NCA). There is no public evidence that the approval of the NCA was in fact sought and then granted. Any such process of approval will publish the GoG’s intentions and then subject these to comments by stakeholders in the industry and the general public. This has not been done

Recklessness and Subversion of the Public Interest Such is the recklessness of our Government, in its subversion of the public interest that it has offered Vodafone terms that bind the VRA, although the VRA is not a party to the agreement. These relate to VRA’s fibre-optic assets included in the sale, The NPP Government has committed VRA to satisfy Vodafone’s operating concerns first. And this comes ahead of VRA’s main obligations in the transmission of power.

Some commentators have spoken of Vodafone’s size, reputation and record. None of these are of primary importance in the matter. Our first concern is Ghana’s interest. The key questions are in what ways will this benefit Ghanaians?, Who will lose and who will gain.

The sale of Ghana Telecom is one more example of the wanton recklessness and arrogant self-dealing that we have come to know of the NPP. It is driven above all by greed, private profiteering and possibly corruption. It is these motives that explain the apparent ‘naivety indeed ‘foolishness’; that is displayed at every turn by our Government in the Sale and Purchase Agreement.

Monopoly and the Public Interest A private monopoly in any essential service is always injurious to the public interest. The public then, is held ransom, and subject to blackmail. It is far worse if an existing public monopoly is privatised.

Telecommunications is an essential public service. Ghana Telecom’s fixed network, VRA’s fibre-optic system (Voltacom), and the yet to be completed National Fibre-optic Backbone, together constitute a monopoly. Their sale in the so-called Enlarged Ghana Telecom Group’ will convert a public monopoly into a private monopoly. The sale of Ghana Telecom will allow Vodafone - a foreign private interest - to hold the Ghanaian public and industry to ransom. In this as in all others (eg, water), monopolies must remain public, subject to democratic control and accountability

Vodafone and its local agents are particularly interested in obtaining monopoly in Ghana’s Fibre-optic networks included in the sale.

In schedule 16 of the Sale and Purchase Agreement, on ‘FIBRE TRANSFER’ Vodafone has demanded, and the NPP has agreed that ‘fibre permits’ necessary to own control, operate and otherwise enjoy the benefit of the fibre assets shall remain ‘in full force and effect for a period of not less than 999 years.

Selling Ghana Telecom will retard development of the entire Telecommunications sector. It will hold back progress in the rest of our economy. The sale must be opposed and stopped

The Ghana Telecom Sale – One More Step In Our Continuing Re-colonisation It is time to draw clear conclusions from the process of national retrogression that started with the overthrow of Nkrumah in 1966. Since then Ghana has seen unending national decline, and the loss of our self-confidence, and control of our economy. In Ghana, each privatisation equals re-colonisation, each time, always. The Ghana Telecom sale represents one more step in our continuing re-colonisation under the various guises of ‘Structural Adjustment’; the creation of an ‘Enabling Environment’ and ‘Private Sector As The Engine Of Growth’. Under the tutelage and supervision of the IMF & World Bank, all our governments have declared that we cannot set our own agenda. We cannot control and manage our own affairs. It is time to stop, to think and to reverse our decline

Stop the Sale We call on all Ghanaian patriots to raise their voices against this latest crime against the public interest. We demand of our Parliament that they for once rise up to their duty and reject the subversive actions of the Executive. We give notice to Vodafone and its local agents that we will do everything in our power to prevent this rape of the Ghanaian people.

Overcoming the Comprador Ideology and National Subservience Beyond stopping the sale we need to answer the question and it is this. Why, repeatedly and in relation to foreign interests, our Governments and public authorities act against our collective interests? Why are we regularly willing to part with the majority of what is ours, in exchange for crumbs? Why is it that our leaders and governments put the interests of others before ours? And, how come Ghanaians see and tolerate this? Why for example, in the area of our mineral resources, or even in relation to the recent oil finds – are we willing to accept terms that leaves us with a tiny fraction of what is ours? What kind of thinking or mentality is it that allows us to be short-changed each and every time?

Ladies and gentlemen, the answer lies in the dominant mentality that was fashioned under slavery and colonisation. In exchange for sacrificing the interests of the many, a few of us acting as agents for foreigners, became wealthy and powerful on the crumbs. It is the ideology of the AGENT – the COMPRADOR mentality or ideology that accounts for this. It is this that shapes the actions of our leaders. It is the ideology that constantly allows us to put the foreign interests above our own. To progress we must expose and overcome it.