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WASHINGTON PUSHES TO SEAL MILLENNIUM CHALLENGE COMPACT II DEAL WITH PDS AS ACCRA URGES PATIENCE

General News

Information seen by the Daily Statesman shows that the Millennium Challenge Corporation (MCC) of the United States government is determined to secure Compact II of the Millennium Challenge Account (MCA) programme with Ghana.

Information seen by the Daily Statesman shows that the Millennium Challenge Corporation (MCC) of the United States government is determined to secure Compact II of the Millennium Challenge Account (MCA) programme with Ghana.

 

This compact is what led to the concession agreement between Electricity Company of Ghana (ECG) and Power Distribution Services Ltd.

On Tuesday July 30 2019 the Government of Ghana announced the suspension of the concession agreement following what it said was the “detection of fundamental and material breaches of PDS’s obligation in the provision of payment securities for the transaction which were discovered upon further due diligence”.

The government subsequently caused investigations to be carried out into the matter.

No wrong?

Signals picked up by the Daily Statesman suggest that the Americans do not see any wrongdoing on PDS’s part and therefore think the deal should be allowed to remain.

According to an initial report by FTI Consulting, a US-based firm, PDS duly won the contract to manage ECG’s assets and insurance guarantees were paid to back its takeover of the assets and operations of ECG.

FTI Consulting was commissioned by the Millennium Development Authority (MiDA) to probe the deal.

The leaked 32-page report, submitted by FTI to MiDA, is dated September 3 2019 and signed by Pat Pericak and David Okhumal, officials of the consulting firm.

FTI said it had not seen any document which would suggest that, as of March 1 2019, PDS, CAL Bank, Donewell Insurance Ltd and/or personnel from MiDA should have questioned the validity of the payment securities.

Reshape or cancel

The Daily Statesman has learned that at the same time, the Government of Ghana wants the whole deal to be either restructured or cancelled outright.

Our source says if there should be restructuring, it will involve bringing in “certain state-owned entities such as SSNIT [the Social Security and National Insurance Trust] to take a big chunk of the equity”.

According to our source, “The issue now will be how the government can get the Americans to agree to its position.”

Misleading leak

Meanwhile, Ghanaians have been asked to wait patiently for the full report on the investigation into the suspended concession deal.

According to the Minister of Information, Kojo Oppong Nkrumah, stories emanating from the leaked report by FTI Consulting are misleading, and so the public should draw no conclusions yet but wait for the full report, which will be put together by various parties.

“To create an impression that it is the full embodiment of the government position on the PDS enquiry … we find that very unfortunate, because that is not the case,” he said in an encounter with the media.

The Minister explained that the FTI report represents one part of the probe, involving a trip to the United States of America for engagements with the Millennium Challenge Compact.

Meta-report

The Minister said the second team carried out part of its investigation in Qatar, and that the report on this part of the investigation will provide the full picture.

“When that final embodiment is put into a government position statement, they will be formally engaging the country on the position of Ghana.
“That entire document must be read together with the other reports and a certain common position arrived at.
“It is that common position that becomes the embodiment of the Government of Ghana and MCC position moving forward,” he said.