Has Mills Lost Touch With Honesty?

5th January 2012

Asare Otchere-Darko

President Mills returned from New York on New Year’s Eve to say that his Christmas trip was so successful that he had “killed two birds with one stone.” He didn’t exactly manage Zita Okaikoi’s feat of “killing two stones with one bird” on her trip to New York, where she had a baby and attended to some tourism duties. Our President, essentially, took an early holiday in New York in order to work during the Christmas break in New York. Bless him!

Koku Anyidoho, reportedly, briefed journalists at the Kotoka International Airport on Christmas Eve, the day of Mills’ surprise departure, saying that the President was returning to America, a week after his last trip there, to follow-up with some US investors he met at the New York Stock Exchange (NYSE). He was expected to return on January 2, though he eventually returned early on December 31. Why the early return?

First of all, you don’t go to the NYSE to meet investors. It is like going to the Makola Market and hoping to strike a deal with the head of Finatrade. His rice may be sold there but he is not there. You don’t meet Ghanaian investors at the Ghana Stock Exchange. Like the Accra bourse, the NYSE is staffed by traders, who buy and sell shares on the instruction of investors.

Secondly, the President’s can’t-wait-must-go-now investment trip—so important to take place on the celebration of the birth of Christ—happened without any of his material ministers (trade, finance, energy, etc) in his entourage. What a competent leader we have in Mills. The presidential press corps was also excluded from the trip, reportedly.

In spite of all the urgency, the President’s first official meeting, by the Castle’s own records, was five days after he arrived in New York.

The President, per reports filed by his Communications Director Koku, had his first official engagement on December 29 with a university professor, the first of the “two birds.” This meeting, falling on a slow news day, merited a Daily Graphic banner headline ‘Prez Mills’ visit to New York... SADA gets £18m boost.’ The report was that the Savannah Accelerated Development Authority was to benefit from an £18m grant from the Department for International Development (DFID) to start a Millennium Villages Project (MVP) in 2012.

Other reports quoted $18m. The confusion may be excusable when aid from Britain is presumably secured in America, sterling and dollars struggle for blurred attention. The official release, per the Graphic report, said the DFID support for SADA was the result of President Mills’ ‘personal intervention’ through Professor Jeffrey Sachs of Columbia University.

From US with UK money

This is a very peculiar story to come from the Presidency. The President of Ghana goes to the US during the Christmas holiday to secure a grant from the British Government? For a grant already allotted to Ghana by September 2011, according to a GNA report?

Jeffrey Sachs’ Millennium Village concept has been the target of a fair amount of bashing, with Magatte Wade notably describing it with contempt as “a misguided foreign aid effort that creates zoo-like villages for Africans with the view to encourage a culture of entrepreneurship...” (But, we can spare this criticism and discussion of whether this will benefit Ghana for another column.)

The second bird the Millsian stone brought down? As the Daily Dispatch reminded us on 4th January, “On December 30, 2011, President Mills met Mr John Kemp, Chairman of the Kosmos Board of Directors in New York. He assured all investors, including Kosmos Energy, that they would be allowed to do business in Ghana without any impediments.” Wow! That alone was worth a thousand trips. Thus, the only named ‘investors’ the President met were Kosmos Energy and the university professor on projects that are evidently on the ground.

Explaining the timing of his visit, President Mills said, “I am here in the US because I know that this is the time that important decisions for next year are being taken by big corporate bodies.”

Really? Over cranberry sauce, roasted turkey, stuffing, ham, and mashed potatoes? Over the Christmas pudding? The President had just met the Kosmos bosses in Manhattan in September. And while Kosmos, of course, will spring to any request to meet His Excellency, considering the false start they had with the Mills administration over their multi-billion dollar investment at the Jubilee oil field, they surely had other plans for the quiet holiday week in the US.

Health Status of the President

Indeed, if put to the vote, it would be a first round victory for the number of Ghanaians who genuinely believe the President returned to New York for an emergency medical treatment. And, if he did, what would be so strange about that? Why has the Mills administration made such a top state secret about the President’s health when it is clear to all that all is not well? And, should all be expected to be well with any human being in his sixties when those of us a couple of decades younger are even routinely swallowing pills in the morning?

The health status of the Head of State is a constitutional issue and Parliament can even compel the President, through an impeachment process, to be checked by independent medical experts if only a third of the chamber had good cause to believe that it was affecting his performance.

The growing perception is that the President is refusing to be honest about the real state of his health. The danger here is that it throws a big brick through his human wall of integrity and a radiation of uncertainty over how the nation is being governed. Argentina and Venezuela are both doing fine and praying for their respective leaders who are receiving treatment for cancer. In fact, the two leaders are rather benefiting from sympathy popularity.

The NPP-USA branch issued a statement this week, saying, “On Thursday December 15, 2011 between the hours of 8:30 and noon, President John Evans Atta Mills was seen in the company of four Caucasian security operatives on the 4th floor of the world famous Memorial Sloan Kettering Hospital, ‘the world's oldest and largest private cancer center’, located in New York. NPP-USA upon receiving this information elected to respect the president’s privacy due to the sensitivity of a cancer treatment. But in light of what appears to be a persistent practice of the NDC administration to not only lie to the Ghanaian people, but also to insult our intelligence with such impunity, we feel compelled to publish what we know.”

What is the Castle’s response to this evidential challenge? A direct challenge to the President’s own earlier categorical denial to reports that he used his vacation for medical treatment?

The NPP-USA branch points out further, “On December 17, 2011, the President returned from his month-long ‘working vacation’ and boldly stated during his comments on arrival that his trip to the United States ‘was not to seek medical attention,’ and that he worked on the quiet ‘brokering catalytic deals to accelerate the national development agenda.’ Exactly one week after his return to Ghana, the President rushed back to the United States under the pretext that he is meeting investors. Evidently the President rushed to the USA to attend to a very highly prioritized personal issue of which he tries to conceal from Ghanaians.”

Perhaps, conscious of the approaching election year, President Mills tried to explain his latest trip by saying: “In the US the 26th is not a holiday. It is rather 25th, so I used those days and which everybody will agree that the week beginning the Christmas is very slow in this country not like the US so I was able to accomplish all the assignments that I had in mind.”

… Except the 26th was an official holiday in America because Christmas fell on a Sunday. President Mills surely would have known this had he been seeking any meetings that day. Instead, he is being obtuse about whatever it is he went to New York to do.

My issue is this: why does he have to go through all the song and dance to not tell the people the truth?

More worrying for me is that Mills appears to be struggling with honesty as his presidency stumbles on. In September, The New Statesman revealed that when the IMF had refused to sign off on the $3 billion loan (sort of) from the Chinese Development Bank (because it violated a commercial loan cap that the Ghanaian government had agreed to with the IMF four months earlier), the President feigned executive ignorance. Given how heavily this president has relied on his ability to borrow, you would think he would know what his limit is. Instead, he feigned utter executive ignorance.

On his arrival from New York last September, he told the press at the airport, “I haven’t spoken to the Minister of Finance, who would be the best person to sign such an agreement. I really don’t know their source, so I cannot confirm or even deny... If there was any such development, it would have been brought to my knowledge.”

When I heard the President utter those words, I was truly aghast. Ignore the privileged information that I had that as soon as the IMF fax dropped at the Finance Ministry on September 8 (I believe), the Minister made a hasty, panicked drive to the Castle to deliver the news. So who did he report to at the Castle? Do they routinely not inform the President of vital economic information?

This $800m ceiling was contained in a document signed by both the Finance Minister and Governor of the Bank of Ghana on behalf of the Mills administration, even while the brother of the President, Cadman Mills, and Deputy Finance Minister, Seth Tepker, were busily tying up a multibillion dollar credit line that the President had himself initiated in September 2010 when he visited Beijing.

Was Mills not aware that these two decisions were in conflict? Can he not keep track of decisions vital to our financial security? Or was he not aware that the ceiling had been agreed to? Who then is in charge in Ghana?

Clearly some clean-up needed to be done. Finally, after his first December New York trip, President Mills could now say with confidence that the approval by the IMF of a new commercial borrowing limit of $3.4 billion for Ghana “has now paved the way for the government to access the Chinese loan of 3 billion for the execution of the development projects.” Ah good, we can all be relieved that Ghana will face more future loan repayments at questionable terms with mouth-watering commitment/upfront fees. We can afford to postpone Christmas!

Mills confidently told a large group of party supporters at the airport, “We don’t want any further delays. We want to hit the ground running.” That sounds familiar… Ah yes! It was in his inaugural address on January 7, 2009 that Mills first said he would hit the ground running. The force of gravity has been exceptionally long in descending on him.

Speaking at the end-of-year party for Castle staff, the President said, “... My brothers and sisters, no one can deny that the month of December this year has been the best for our nation so far. And that gives us hope and confidence for the future.”

Chinese New Year

And, the fountain of that 2012 hope, he attributed to the $3 billion Chinese loan. Imani has come under the usual attacks from the same quarterbacks of STX for daring to say that the President should be careful about putting all his “Better Ghana” eggs into the CDB basket. So he must duly temper optimism with realism.

What did Imani say that was wrong?

Let’s examine the record of this government. Over the last three years alone, they have sent over $20 billion worth of loan agreements to Parliament for scrutiny and approval –$20 billion! Out of that some $12 billion has been approved (on my last count).

A few questions, then: (i) How much of that has been disbursed? (ii) Where are the projects? (iii) If only $7 billion has been disbursed, as claimed by a government official recently, then what is the hold up? (iv) And where is the evidence of that $7 billion – where are the projects?

I may need to revise my notes further, because the Minority Leader, in his concluding remarks on the 2012 budget debate said, “Mr Speaker, if we are to total loans approved by Parliament, accessed and not, the figure is in excess of $17 billion in three years.”

Beyond this incredible sum, there is over $4 billion of investment funds available to Ghana through development friends, including $2 billion from the World Bank and African Development Bank. These funds are apparently waiting to be utilised but are caught in the administrative traffic of incompetence.

Clause 5.5 of Section 3 (the Utilisation Section) of the $3 billion Master Facility Agreement (MFA) with China reads: “At close of business in Beijing on the last day of the Availability Period, the unutilised amount of the Tranche A [and Tranche B] Commitment shall be immediately and automatically reduced to zero.” The Availability Period is defined as “the period from and including the Execution Date [of the agreement] to and including the date falling six (6) years after the Execution Date.”

On top of that, the Chinese have made it clear that any amount requested from the $3 billion Master Facility Agreement, under a Subsidiary Agreement, must be supported by enough supply of oil. It seems our government is behind the rest of the continent on learning how to negotiate with China.

Going by our akye-kye-dea (turtle-like) pace in utilising loans and grants and the fact that access to this particular loan is strictly tied to the volumes of crude oil that Ghana must be willing or able to give to the Chinese, Imani was generous to suggest that not more than $1 billion can be expected for the 2012-13 period.

So, let me rephrase Imani’s dilemma from another point of view: if you have already contracted $17 billion dollars of loans and continue to struggle to get the bulk of development projects in motion on the ground, then is it sound expectation to invest all your hopes of a Better Ghana Agenda in a group of loans (12 subsidiary agreements) of which not a single one has received parliamentary approval?

Going by the express wording of the loan agreement, the government may even need to bring a supplementary budget before it can access any money from the loan. This is because, Schedule 1 (Conditions Precedent to First Subsidiary Agreement) makes it clear at Clause 3.3 that before any Subsidiary Agreement can be approved, the Ghanaian government must provide “evidence that the annual principal and interest payments due under the Master Facility Agreement and each Subsidiary Agreement have been included in the current annual fiscal budget for the Republic of Ghana.”

This was not expressly done in the 2012 budget because Clause 1.6 of the same Schedule demands another condition: “Certification from the Borrower confirming that borrowing the Loan to the Total Commitments would not cause any borrowing or similar limit binding on it to be exceeded.”

It is this provision that required IMF approval because of the May agreement with the IMF on an $800 million ceiling on non-concessionary borrowing. Does the government, therefore, not find it interesting that the IMF timed its decision to be given after the 2012 budget was read in November?

Well, let me take my medication and recline my hospital bed (even those of us in our mid-forties get knocked for six by ill-health now and then). But I leave you to ponder over these words and the question of why our President finds the truth increasingly inconvenient in his communications to his people. At least it is becoming clearer why President Mills’ favourite T-shirt bears the inscription ‘I Love NY’ … or is it?

The author is the Executive Director of the Danquah Institute, an Accra-based policy think tank. gabby@danquahinstitute.org