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Business News Tue, 15 Nov 2016

Review clauses in ECG deal – TUC to Mahama

The Trades Union Congress (TUC) has appealed to President John Dramani Mahama to consider certain clauses in the Millennium Challenge Compact agreement that seeks to cede the management of part of the Electricity Company of Ghana (ECG) to a private firm.

Workers of ECG are against moves by government to privatise the energy distribution company, fearing they may lose their jobs. They also argue that ceding part of ECG’s operations and management to a private firm for 25 years under a concession deal will not inure to the country’s benefit.

The TUC has backed the ECG workers’ stand.

But speaking at a meeting with the president and leaders of various labour unions at the Flagstaff House in Accra on Tuesday 15 November, the Secretary General of the TUC, Dr Anthony Yaw Baah, said the Union was not against the privatisation deal in principle but against certain clauses in the agreement.

He, therefore, appealed to Mr Mahama to consider certain proposals they have made to the agreement.

“...We will like to assure you that in principle, we are not against the compact because there are very good things in there for Ghana. We are, however, concerned about some of the clauses in the compact including article 7(1), which states: ‘The parties understand that this compact and the project implementation agreement upon entry into force will prevail over domestic laws of Ghana,’” he stated.

“We have sought legal opinions on this and other articles in the compact. We understand that this particular article may have very serious implications for our sovereignty. We are also worried about renting out ECG to a private company for a generation that is 25 years. On behalf of ECG workers, our affiliates, other utility workers unions have proposed various alternatives to the concession arrangement [that] we will like to appeal to you to consider…”

It is recalled that the governments of Ghana and the United States signed an agreement for the release of the $498,200,000 grant for the improvement of power distribution in the West African country under the second compact of the Millennium Challenge Account.

Under the four-year compact deal, Ghana must cede ECG’s management to a private company.

The compact is the largest U.S. government transaction to date, under Power Africa, and is expected to serve as an anchor for increased American engagement in Ghana.

The Ghana Power Compact programme consists of six major projects each, with a set of activities aimed at contributing to support the transformation of Ghana’s power sector. The six are ECG Financial and Operational Turnaround (EFOT), Northern Electricity Distribution Company (NEDCo) Financial Turnaround Project, Access Project, Regulatory Strengthening and Capacity Building Project, Energy Efficiency and Demand Side Management Project, and the Power Generation and Improvement Project.
Source: Class FM
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