Opinions Sun, 31 Aug 2014
Kofi Ata, Cambridge, UK August 28, 2014
Thank God, Ghana has not yet adopted IEA’s proposed all inclusive coalition government of proportional representation and therefore the citizenry are occasionally informed by the Minority in Parliament of how the government elected to represent them and protect their interests sign agreements with foreign countries and companies that are not only against the national interests but threaten the very survival and sovereignty of the nation state. I am referring to the five MPs who have sued the government for an agreement with a British multinational company, Lonrho to build a Freeport at Atuabo in the Western Region (see, “5 MPs sue government over Takoradi Port expansion”, Myjoyonline/Ghanaweb, August 27, 2014). It is the suit and the nature of foreign agreements that Ghana governments, especially, the NDC led government/s that are discussed in this article.
The above mentioned media report on Ghanweb received over hundred comments from readers with majority in support of the suit whilst minority considered the MPs as saboteurs. My view is that, if the two reasons for which they have been compelled to institute the court action are accurate as reported, then, they are patriots.
According to the details of the suit, Parliament approved an agreement between Ghana Government and Lonrho Ports on July 17, 2014 for the development of an oil and gas Freeport in the Western Region. Clause 7 of the approved agreement, “bars Takoradi Port from further expanding its facilities for oil and gas until Lonrho has built its Freeport, recovered all its cost, and made enough profit. The agreement also bars all persons or companies from building any oil and gas port facilities in the entire Western Region until Lonrho has recovered its investment and made its profit.”
Clause 7, if accurate is not only inimical to the operations and survival of the Ghana Ports and Harbours Authority (GPHA) but also an attack on Ghana’s sovereignty as an independent country. It denies Western Region any further development in the area of harbours and ports as well as the related gas and oil services. The clause is also in breach of the Ghana Ports and Harbours Authority Act 1986 (also known as PNDCL. 160), which states among others, “the Authority shall plan, build, develop, manage, maintain, operate and control ports and in particular shall…maintain port facilities and extend and enlarge the facilities as the Authority considers fit; and regulate the use of a port and port facilities."
Many questions arise from Clause 7 of the approved Lonrho agreement and the whole of Clause 5 of PNDCL. 160. That is, the functions of GPHA, particularly, its regulatory role. It appears Lonrho’s Freeport will not operate under Ghanaian laws since the very agreement for its birth, existence and operations violates Ghana’s Ports and Harbours law/s.
It is clear from the Clause 7 that Ghana has given Lonrho licence to act as it pleases and an open signed cheque to insert any amount and draw on Bank of Ghana. The questions begging for answers from the Executive and the Legislative arms of governance are: Were they aware that PNDCL. 160 is still on the statute books of Ghana? Who determines the total cost to Lonrho of the Freeport? How long would it take Lonrho to recover all its cost/investment? What would be enough profit for Lonrho and who determines the word “enough”?
Again, what is mind bogging or perhaps, sheer stupidity, is the revelation in the suit that the same Parliament recently approved a loan of €197 million for GPHA for the expansion of the oil and gas facilities at the Takoradi Port, and that the GPHA is in the process of securing another $400 million to support the expansion programme. It is not clear from the suit which of the two agreements was first approved. Nonetheless, the two agreements are in contradiction with each other so either both the Executive and Legislature are deceiving Lohrho, fooling Ghanaians or themselves or all.
More often than not, agreements sent to the Legislature by the Executive for approval contain contradictions and errors but despite such obvious mistakes, they are subsequently approved by the Legislature with the contradictions and errors. It makes one to wonder whether the two arms of governance have legal experts who cross check such agreements to ensure that all the “tees” are crossed and the “iis” are dotted. Failure to undertake such elementary exercise has resulted in the approval of agreements that violate existing laws of the country. The question I am sure many Ghanaians would want to ask is, what are the MPs paid for and what do they go to Parliament to do?
Another question is, what did the five MPs do in the house on July 17, 2014 when the agreement was approved? Were they in parliament and did they notice Clause 7 in the Lonrho Agreement? If not, when did they notice that it was against the interest of Ghana? I pose these questions not because I want to apportion blame to the five gallant MPs but rather to prove a point that the Legislature as a collective have failed in their duty to hold the Executive accountable. After all, they are only five so even if they had pointed out the danger prior to the approval, the usual “minority will have their say and majority will have their way would have been the order of the day.
All governments since independence, including Nkrumah have signed agreements with foreign governments and companies that were detrimental to the interests of Ghana but the trend under the Mills/Mahama governments is very disturbing. For example, the first time I became aware of the terms and conditions of the Akosombo Dam Agreement with Kaiser, I was saddened by the price at which electricity was sold to VALCO. It was virtually a give-away but Nkrumah agreed to those terms because that was the only means to get the dam constructed for his industrial development plan for Ghana. Moreover, he had other plans to develop a complete aluminium industry from mining raw bauxite into finished aluminium products for home consumption and exports as well as iron industry. Sadly, with his overthrow those plans were shelved and VALCO continued to enjoy ridiculously cheap electricity for many more years.
It is important that the current government learnt lessons from poorly negotiated agreements in the past for the general good of Ghana and all Ghanaians and also to avoid disagreements over such agreements that lead to litigations against the state and huge sums of money in judgement debts payments. One would have expected that because of the fiasco with the STX project, the problems with the Chinese $3 billion loans and others such as SUBA and GYEEDA, the government would have strengthened its legal advisory team to avoid these elementary shortcomings. The Lonrho Agreement (Clause 7) and the approval of a loan for the Takoradi Port expansion is a potential judgement in waiting because Lonhro has every right to sue Ghana government for breach of agreement and to stop the Takoradi Port expansion and the usual failure by the Attorney General’s Department to defend the state would definitely lead to millions of dollars in judgement debt against Ghana.
It is high time the Executive and the Legislature put Ghana’s interests above their party political and personal interests. This agreement as stated will kill Ghanaian jobs rather create jobs for Ghanaians. As with the projects being undertaken with the Chinese loans, most of the initial construction jobs would go to foreigners. I also suspect that because Lonrho has been given a free hand to construct and manage the port, most of the long term jobs at the port after construction would go foreigners because Lonrho would want to ensure that they bring in expatriate staff to manage the port in order to ensure that they recover their cost and make more profits over a longer period by any means necessary.
The prohibition of GPHA from improving the Takoradi Port as stipulated in the Clause 7 of the agreement will directly kill jobs because it would starve the port of future investments. That will lead to poor infrastructure, poor performance and ultimately, divestiture. Perhaps, the next government will sell Takoradi Port to Lonrho for non performance.
The five MPs should be commended for the bold action in challenging the Executive over its illegal and unconstitutional acts. There is too much indiscipline and lawlessness in Ghana. It’s only the Judiciary that can hold both the Executive and the Legislative arms of governance accountable for their actions and omissions after the Legislature abrogated their responsibilities. Judges have powers to rule and strike out agreements and laws as illegal, unconstitutional and therefore null and void. For these reasons and the reasons given by the five MPs, their action is necessary, right and appropriate. It is also a contribution to developing and enhancing democracy, rule of law, good governance and accountability in Ghana and should be welcomed and supported by all right thinking Ghanaians.
They are my heroine and heroes, deserve the highest honour for Probity and Accountability under the Order of the Volta and I recommend them for it.
Kofi Ata, Cambridge, UK
Columnist: Ata, Kofi