IEA projects US$2 billion energy sector loss after PDS saga

Director of Research at the Institute of Economic Affairs (IEA), Dr. John Kwakye has projected that Ghana will lose close to US$2 billion after government made the decision to terminate the concessionaire agreement for Power Distribution Services (PDS).

“Despite, the cancellation of the remaining amount of US$190 million under the Ghana Power Compact, there is also the cancellation of

Read full articlethe concessionaire which amounts to US$580 million, Ghana was also expected to benefit from a regional compact which amounts to US$400 million which has also been cancelled, and then a World Bank facility project which is related to the energy sector that amounts to US$500 million has also being cancelled. If you add all these up, we’re losing close to US$2 billion,” he explained.

According to him, the termination of the concessionaire agreement under the Ghana Power Compact demonstrates the ‘extent to which donor countries can in consent, punish a country that they consider to be recalcitrant or way-ward.’

He made this known during a presentation in Accra on November 1 when the IEA held a seminar on the theme: “China as the New Development Partner for Africa”

Dr. Kwakye said African countries must resort to choosing their own management structures for projects and their strategic industries, rather than it being imposed from donor countries.

“It is obvious that Africa especially Ghana must seek new opportunities should it foster its own development by using its own internal resources and take advantage of the opportunities offered by China under the Forum on China-Africa Cooperation (FOCAC) to forge new development corporations,” he added.

The Director of Research advised that government must take caution in the negotiations of Overseas Development Assistances (ODA’s), to avoid drawbacks that have enumerated huge losses over a period.

Ambassador Zhou Yuxiao from the Ministry of Foreign Affairs in China on his part said that the Forum on China-Africa Cooperation (FOCAC) has proven to be productive and effective in boosting China-Africa cooperation.

Yuxiao said FOCAC has generated growth capacity in Africa and upgraded China- Africa Corporation taken by both sides as the standard point for developmental growth endeavors.

“Projects have been carried out through a framework of eight main initiatives under FOCAC with actual needs to ensure growth and development across Africa.”

“China neither imposes its own will on others nor seeks its sphere of influence. The concept of extensive consultation, joint contribution, and shared benefits is upheld when China cooperates with African countries,” he added.

The Forum on China-Africa Cooperation (FOCAC)

FOCAC was founded in 2000 and its membership had grown to have China, 53 African countries having diplomatic relations with China, and the African Union Commission as of June 2018.

FOCAC has won wide support from African countries for its efficient enforcement means, clear time-bound action plans, and an effective evaluation system

Under the FOCAC framework, there are regular consultations at ministerial and senior official levels, and between the Chinese Follow-up Committee and the African Diplomatic Corps in China.

Sub-forums on business, youth, health and poverty reduction, and many others, have also been set up.