Komenda Sugar Factory: NPP government conspiring with WAATCO to cause huge financial loss

I would like to draw the attention of the good people of Ghana to a shady contract orchestrated and executed by the immediate past Minister of Trade and Industry, the Akufo-Addo-led NPP Government, and the Board of Directors of the Komenda Sugar Development Company Limited (KSDCL).

The government, through the Board of Directors of the Komenda Sugar Development Company Limited (KSDCL) has entered into a ten (10) year management contract agreement with West Africa Agro-Tech Company Ghana Limited (WAATCO), a foreign company based in Ghana.

In the intercepted contract documents, one would wonder why a company should be paid huge sums of money with no work done.

The West Africa Agro-Tech Company Ghana Limited (WAATCO) has already been paid about Gh¢30 million to carry out paintings and sandblasting at the sugar factory. WAATCO brought in some Indian expatriates who were also paid huge sums of dollars without any work done, but have been repatriated to India. Their managerial staff is still around doing nothing, but receiving salaries and allowances aside from the US$50,000 being paid every month as management service fee.

The Komenda Sugar Factory is not in operation despite the countless promises and timelines given by Mr. Alan Kyerematen and President Akufo Addo. Meanwhile, their collaborators (WAATCO) are comfortably taking their remuneration. But they have failed to pay the Ghanaian labourers at the factory as well as some of the sugarcane farmers whose canes were bought for the test run in July 2022.

Excerpts of the contract documents are provided below;

5. REMUNERATION TO WAATCO

As remuneration for the services to be provided, the Company agrees to pay WAATCO the following Management Fees:

5.1 Professional Fees

5.1.1 Management Services Fee: WAATCO shall be paid a monthly professional Management Service Fee of US$50,000 for the management and coordination of all the technical and administrative functions of the Company.

5.1.2 Performance-based Profit Sharing Incentive: As an incentive to optimise the profitability of the Company, WAATCO shall be paid a performance-based profit sharing incentive, equivalent to 20% of the net profits of the Company per annum.

5.2 The payments above do not include the payments made to the expatriate Hiring Consultant for expatriates’ monthly charges, hiring fee and other amenities provided to the expatriates based on their contract with the expatriates’ Hiring Consultant. For the purpose of clarification, the respective monthly charges for the expatriates are indicated in Schedule E (Factory Admin and Administrative expenses.)

5.3 The charges mentioned in the expenses are indicative and may be subject to variation to be consensually reached by the parties where the circumstances so demand.

5.4 All payments to suppliers, contractors or service providers will be done as per their respective contracts.

5.5 All payments shall be subject to annual management and financial audits by the external auditors appointed by the Board.

6. OBLIGATIONS OF THE COMPANY

6.1 General Obligations

(a) The Company shall hand over the Factory to WAATCO on the effective date.

(b) An initial technical audit and assessment of the Factory shall be conducted jointly by representatives of the Company and WAATCO in respect of the state of the Factory before the effective date.

(c) The Company shall not grant any rights or interests to any third party that may interfere with the exclusivity of this Agreement and the performance of WAATCO’s obligations under it.

(d) The Company shall not take any actions or decisions to impede WAATCO in the performance of its obligations under this Agreement.

(e) Upon the signing of this Agreement, the Company shall not have the right to dispose of, either by way of sale, mortgage, loan, or otherwise, any part of the Plant and Equipment without the written consent of WAATCO.

6.2 Permits

(a) The Company shall assist WAATCO to obtain the necessary permits and licenses that may be required to be obtained by WAATCO for the performance of its obligations under this Agreement. This obligation includes issuing letters of recommendation for obtaining any immigration clearances and work permits for any foreign personnel engaged or employed by WAATCO in connection with the Project.

(b) The Company shall ensure that approvals and consents sought by WAATCO for the execution of this Project are promptly granted to WAATCO.

The facts provided above would inform the well-meaning Ghanaians to ask Mr. Alan Kyerematen why he failed to operationalise the factory after uninterrupted six (6) years of administration.

The only achievements of Mr. Alan Kyerematen at the Komenda Sugar Factory were to sell sugarcanes on the 125-acre nursery farm to akpeteshie distillers in 2018 and turn around to develop only a 3-acre sugarcane nursery which has not seen the light of the day. And also to sign a management contract with WAATCO to draw monies from the idling company.

The NPP Government has proven to be insensitive to the plight of the people of Ghana.

I shall return with the other parts of the management contract agreement.