First tranche of $3 Billion Chinese loan facility ready - Veep

Vice President John Dramani Mahama on Wednesday said the first tranche of the $3 Billion Chinese loan from the China Development Bank (CDB) was ready for immediate draw-down by the Government.

“With regard to the $1 Billion facility; draw-down can start immediately, actually the day after the signing, there was a meeting between our Deputy Minister of Finance and the CDB to agree on the schedules for the draw-down, there’s nothing obstructing it” he stated.

Vice President Mahama announced this on arrival at the KIA from China where he led a Ghanaian delegation to sign the initial subsidiary agreement for the release of the first part of the facility amounting to one billion dollars.

The larger part of the amount, he said would go to the Ghana Gas Company for the establishment of the Gas Processing Plant in the Western Region.

Vice President Mahama described the project as a critical component in moving Ghana’s transformation to the next level, and would enable the contractor, Sinopec to carry on with the project including laying pipes that would bring the gas on-shore.

“This is a particularly important project for Ghana because it would enable us to achieve full utilisation of the gas being produced from the Jubilee Oil Field and create infrastructure to interconnect future gas production.

” The project is on schedule as Sinopec has started work in advance on the plant that would earn Ghana an estimated $1 billion per year."

Vice President Mahama said the other subsidiary agreements would focus on areas with the capacity of generating income to service the loan including the Takoradi Harbour Extension Project, Railway Rehabilitation Project, Eastern Corridor Multi-Modal Project and Accra Plains Irrigation Project expected to increase food production.

The delegation held a meeting with the China Exim Bank (CEB) to discuss the second facility which involves two billion dollars in two million tranches and the Chairman of CEB gave the assurance that they were ready to begin negotiations on that facility.

This would go into the establishment of social infrastructure such as schools, hospitals, water and electricity supply.

They also met China’s Ministry of Commerce to discuss various issues including release of the remaining installment for completion of the Bui Dam and received assurance that, that would be done.

The credit facility was one of the two extended by the Chinese Government to Ghana when President John Evans Atta Mills visited China during the 50th anniversary celebration of diplomatic relations between both countries in 2010.

The other facility which would be from the China Exim Bank (CEB) is yet to be processed.

However, between 2010 and when Parliament rose, the master facility agreement had been signed and nine other subsidiary agreements under it approved.

Vice President Mahama said various Metropolitan, Municipal and District Assemblies (MDAs) handling project under the second tranche were currently going through the procurement process with the companies selected expected to be finished by end of April, after, an application would be put in to the CDB for signing of the remaining subsidiary agreements and establishment of a schedule for draw-down of the second tranche.

Ghana’s Ambassador to China has been given the power of attorney to sign the agreement on behalf of the Minister of Finance when ready.

Vice President Mahama was met on arrival by some Ministers of State and some Service Personnel.**