We're not opposed to foreign investment - Concerned Ghanaians

Accra, Aug. 7, GNA - The group calling itself Concerned Ghanaians against the sale of Ghana Telecom and other strategic national assets to Vodafone International on Wednesday said it was not opposed to foreign investment.

It said it would support foreign investment that is just and fair and would also add real value to the country's capacity to develop, adding that it did not believe the Vodafone deal would achieve such objectives.


Dr. Nii Moi Thompson, an economist and a leading member of the group, mostly members of the Convention People's Party (CPP), made these remarks at a press conference on Wednesday.


It was organised to react to government's press conference on July 29 to explain the bid to offload 70 percent stakes of Ghana Telecom to Vodafone at 900 million dollars.


In attendance were Professor Agyeman Badu Akosah, Mr. Bright Akwetey and Mr. Kosi Dedey all leading members of the CPP. He said the group believed, as a matter of principle and of ideology, that the state should at all times maintain majority interest in strategic assets that have long-term implications for sovereignty and survival.


Any attempt therefore to involve the private sector must be restricted to minority participation from the sector. Dr. Thompson said no known independent valuation had been done of the two fibre optics assets but the sale agreement suggested that such valuation would be done only after the agreement had been completed and the assets handed over to Vodafone.

"It must be noted that in their desperate attempt to defend the indefensible, the government also confuses cost with value. Rather than providing the value of the fibre component of the Enlarged GT Group, the government presents the cost of construction, which is treated as a liability and then subtracted, along with the debt, from the gross enterprise value to obtain a net enterprise value of 767.5 million dollars."


"The government's constant display of such carelessness in financial matters again raises questions about the competence of its team in the negotiations and certainly gives cause for us to wonder what other grievous mistakes they have made in other agreements that they have signed on behalf of the people of Ghana," adding, "the infamous IFC and Barber Shop Loans come to mind."


Dr. Thompson noted that repeated claims by the government that Telecom Malaysia did not pay dividends during the six years it managed Ghana Telecom was "neither here nor there".


"In the world of business, it is often in the interest of shareholders that dividends are not paid but ploughed back into a business that is expanding and requires a lot of investment. Re-invested earnings in that case are cheaper than borrowed funds." He said the failure of the Malaysians to pay any dividends to government, therefore, should not be used to justify the reckless disposal of national assets to Vodafone.


On why government added the fibre optics to GT sale, Dr. Thompson said there appeared to be a deliberate effort by the government to starve the National Communication Backbone Project (NCBP) of finance and then sell it off cheap in its efforts to empower foreign private sector while neglecting their Ghanaian counterparts.

He stated that the government expected Vodafone to present a business plan only after the sale had been completed and "which means that we are giving these strategic assets away before we learn how they will be managed".


Dr. Thompson said contrary to statements by various government officials, there was no evidence of a pledge by Vodafone to "invest an additional 500 million dollars in five years. The only thing the company has said is that over the next five years, Vodafone expects Ghana Telecom to invest over 500 million dollars, adding this is not the same as saying that Vodafone will invest anything.


He said the group believed that instead of "development in freedom," the NPP's motto, we are edging towards "under-development in slavery".


Dr. Thompson said some of the supporters of the Sale argued, "rather shamelessly", that the Ghanaian was not yet ready to manage his own affairs.


He said the time had come for Ghanaians to stop making excuses and prove to the world that indeed, "the Black Man is capable of managing his own affairs".

He argued that the best way to grow the economy was to empower Ghanaians in general and the Ghanaian private sector in particular. Dr. Thompson called for comprehensive reforms of the state sector, including the way state-owned enterprises are managed, to free them of undue political influence and ensure that they lived up to their stated missions and ideals.


He recommended to government to recapitalise GT from 300 million dollars it was borrowing to accommodate Vodafone's "unreasonable demands" for "debt-free" assets and prosecute GT management, including the Norwegian management team, for the adverse findings of financial improprieties made against them by internal auditors. The group urged government to probe circumstances surrounding the Iroko bond of 200 million dollars, which purportedly placed undue restrictions on GT's ability to invest and to grow and depoliticise management and make it transparent.


It also challenged government to reform governance at all state-owned enterprises and open all managerial and board positions to public competition, prepare Ghana Telecom for listing on the Ghana Stock Exchange and give Ghanaians the opportunity to own part of their national assets. 7 Aug 08