While Ghanaians have been looking forward to seeing the commencement and eventual completion of the Conti project, which is meant for the construction of a massive drainage system for Ghana’s national capital, Accra, it appears release of funds for the project have hit a snag.
In March 2012, Government of Ghana signed two memoranda of understanding (MoU) with two US companies, one for the reconstruction of drains in Accra and the other for the rehabilitation of the country’s Western rail lines. The total cost of the two projects amounted to US$795 million. US$595 million out of the figure was intended for the reconstruction of the Accra drains and the US$200 million was earmarked for the rehabilitation of the Western rail lines.
The then Finance Minister, Dr. Kwabena Duffuor and the then Deputy Minister of Transport, Ms Dzifa Attivor, initialled for Ghana, while the Managing Directors of Conti Engineering and General Electric signed for their respective companies. The signing ceremony took place at a dinner organised in honour of former President John Evan Atta Mills of blessed memory, by the Business Council for International Understanding, an umbrella body for American businesses in Washington DC.
To ensure the success of the project, the United States Embassy solicited input from American companies, with expertise in urban works and construction, which brought the EXIM bank on board, Patricia Alsup, Deputy US Ambassador to Ghana explained. She indicated that the Conti-group was brought on onboard because it has enormous experience in storm drainage and flood protection, after playing an instrumental role in the US, after Hurricane Katrina struck New Orleans.
In 2013, the Government of Ghana and the Conti Group of Companies of the United States of America signed a US$660 million agreement for the drainage and sewage project. Christened ‘Accra Sanitation, Sewer and Storm-Water Drainage Alleviation Project’, authorities say the development will control the perennial flooding, as well as the sanitation challenges facing Accra.
Consequently, Parliament approved the loan facilities, thus paving way for President John Dramani Mahama to break grounds for the commencement of work on the project in January 2013. Dr. Alfred Oko Vanderpuye, Mayor of Accra, said at the ground breaking ceremony that apart from cleaning and excavating the Odaw channel and the central business district drain, the project would also re-vitalize and dredge the Korle Lagoon, construct 20 hectares of sedimentation basins upstream for the Odaw channel.
Two years on, speculations abound that funds expected for the multi-million dollar project in Accra have been diverted to defray part of the country’s debt, leading to the recent flooding in the capital, which claimed over 150 lives. Some of the critics were of the opinion that if the funds have been used for the purpose for which it was intended, perhaps the sad debacle that rocked Accra last Wednesday could have been averted.
Finance Minister Seth Terkper has, however, denied the speculation, stressing that the funds are yet to hit government’s accounts.
Speaking on Citi FM’s news analysis programme, ‘The Big Issue’, on Saturday, Mr. Terkper explained that although the term-sheet covering the multi-million dollar loan facility on the project has received Parliamentary approval, disbursement of the funds by the US Exim Bank has stalled because of variations made to the original project plan and scope.
“In the interim, we did actually send the guarantee application that was required to US Exim [Bank]; the loan is not from Conti – Conti is the contractor but the re-scoping of the work into phases one and two… is what [has] actually delayed [the project],” he pointed out .He allayed the fears of Ghanaians, saying the project has not been abandoned, neither has the funds earmarked for it diverted.
He explained: “We did not want to do the normal dredging because the Korle Lagoon has a commercial site and if you follow our new debt management policy, it is going to be developed in such a way that the commercial site will be developed in tandem so that the tendency to put things back in the Korle Lagoon after each dredging will be removed.
Mr. Terkper observed that the variations to the scope of the project were necessary because government did not want “continued dredging of the Korle Lagoon the way we have done in the past.” The Finance Minister indicated that in the past, multiples of loans had been acquired to undertake the same project but rubbish was immediately dumped back into it drain.
According to him, since Parliament had approved the conditions and terms of the loan agreement, AMA authorized Conti Infrastructure Ghana Limited to commence work on the project, “because we were going through the guarantee stage…given the issues that we have with flooding. “Conti did actually start the work, but unfortunately, the processes could not be completed and, therefore, the work came to a standstill.”
Dysilting-of-odaw-river-2- 601x330He assured the public that the loan acquisition process has not been faulted since government has a clear debt management policy. In an answer to a question from the host of the programme, Richard Dela Sky, whether the variations to the project and funding amount will require fresh Parliamentary scrutiny before disbursement, he explained that: “if the financing is going to be done and at the terms that Parliament has approved, we don’t have to go to Parliament…”
He continued that his Ministry will “consult with the Attorney General and the leadership of Parliament” to determine the way forward. Mr. Terkper said he has been meeting with the Minister of Works and Housing, the Minister of Local Government and Rural Development and officials of AMA, as well as the Chief of Staff on the matter, and that a technical report has been prepared to guide the way forward.
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