US embassy awaits MiDA’s forensic audit on PDS to take decision

The Embassy of the United States of America in Accra, says it is eagerly awaiting the findings of an independent forensic audit of the Power Distribution Service’s (PDS) concession deal to take a decision on the matter on behalf of the American government under whose auspices the agreement was arranged in the first place.

However, its official statement suggests that it expects PDS to remain a part of Ghana’s ongoing power sector restructuring through the Second Compact which it is financing.

Instructively the statement says that the US government expects that PDS, MiDA and the Government of Ghana will continue to work together to implement the solutions and partnership of the MCC Compact that have been fostered to enhance the reliability of the country’s power network and improve the lives of Ghanaians.

According to the embassy, “the House White strongly supports the decision, which it says is needed before any action is taken on the alleged fundamental and material breaches of PDS’s obligations to Ghana.

Only then can all relevant parties make a transparent and evidence-based decision that is in the interest of all Ghanaian citizens”, the Embassy said in response to queries.

The queries, among others, concern the role of the Embassy and the Millennium Challenge Corporation (which is the Compact’s implementing vehicle) in possibly resolving the matter; potential actions if government cancels the deal; and the American government’s thoughts on alleged fraud in the deal.

Meanwhile, the Embassy had assured that the US favours a transparent, well-run transaction that meets international standards for private sector participation, investment and operations.

The deal was authorized by the board of directors of the Millennium Development Authority, a US government agency purposely established to provide support to structural change in the economies of selected emerging market countries in Africa which have been assessed as deserving of such support to unleash strong latent economic potential. The concession agreement is part of a wider compact with Ghana to restructure its power sector under which the US government is to provide nearly US$500 million in funding. It is still unclear how the ongoing controversy over the concession deal will affect the implementation of the wider Compact, with the US government, through its embassy now saying it is awaiting the results of the ongoing investigations.

PDS took over the power distribution business from the ECG on March 1, 2019, after winning a bid to do so as part of the MCA Compact which was signed in 2014.

However, barely five months of operations, the Government of Ghana, in a statement, announced the PDS’s suspension as a result of what it described as “fundamental and material breaches of PDS’ obligation in the provision of payment securities for the transaction which had been discovered upon further due diligence.



The statement said a full-scale investigation into the agreement and the concession would be finalized in 30 days, with the 30 days expected to be due in first week of September.