Dr Kwabena Duffuor - Finance Minister The Tema Oil Refinery (TOR), the only refinery in Ghana, may be slipping through the fingers very soon following advanced plans by the government for its divestiture.
Even though government officials had for several months denied the allegation of plans to offload TOR, documents chanced upon by DAILY GUIDE reveal that the state-owned property is at the verge of losing that status.
This intention was made known by the Minister for Finance and Economic Planning, Dr. Kwabena Dufuor, recently in a document sent to the President.
According to the document, dated 7th September, 2009, and which was copied to the Chief of Staff, the Office of the President, and other stakeholders, the ministry has exclusively mandated Ecobank Development Corporation and Ecobank Ghana Limited (acting as transaction advisors) to prepare the way for what it called 'the eventual privatization' of the refinery.
The Mills Administration is struggling to recapitalise TOR, as it has not been able to import a drop of petrol for the company since it came to power, over-exposing its main creditors, Ghana Commercial Bank (GCB).
TOR owes GCB over GH¢900million, in addition to other liabilities to some other banks.
Attempts to import crude from Nigeria and Libya have hit brick wall, with President Atta Mills now turning his attention to Venezuela in South America.
The President, who is currently attending the United Nations General Assembly in New York, is expected to visit the oil-rich South American country, with cup in hand to beg for crude oil from President Hugo Chavez.
Kwesi Pratt, a friend of Hugo Chavez, has taken the lead to prepare the ground for President Mills in Caracas, DAILY GUIDE has learnt.
The 'sale' comes at a time when the country is gearing up to become an oil exporter in the next couple of years.
“Pursuant to Government's decision to restructure and capitalize the Tema Oil Refinery (TOR), the Ministry of Finance and Economic Planning hereby grants Ecobank Development Corporation and Ecobank Ghana Limited (together referred to as 'Transaction Advisors) the exclusive mandate to assist MOFEP, Ministry of Energy (MOE) and TOR (the client) to undertake the assignment on the following terms and conditions and in accordance with the agreed timetable outlined in the Technical Assistance Proposal,” the letter said.
The scope of the mandate, given by the minister, include establishing and confirming the state of TOR, arrangement and syndication of $300 million to re-finance the refinery's debt, arranging for additional funds to make up for any financial gaps identified, as well as leading and managing the eventual privatization of TOR.
As part of the remuneration terms, TOR will pay Ecobank a total of $1 million in two installments, plus a success fee of 2 percent of the total amount raised.
A non-disclosure clause in the mandate letter further permits the transaction advisors not to publicly disclose whatever service or advise it provides, unless compelled by law.
TOR had been entangled in series of financial crises since 2007, for which reason the previous government reportedly contemplated privatizing it, but was shelved after the country discovered large volumes of crude oil later that year.
When the sale issue leaked into the media a couple of weeks ago, it was vehemently denied by politicians in the current administration, in spite of glaring indications that negotiations were far advanced to that effect.
The move was condemned by a number of politicians, including the NPP Member of Parliament (MP) for Asikuma Odoben Brakwa, P.C Appiah Ofori.
“TOR is the only refinery in the country, and as at now, the only legacy Ghanaians can claim to possess as the legacy of Osagefo Dr. Kwame Nkrumah's dream of establishing Ghana as an industrial giant in Africa, besides the Akosombo hydro electric dam,” he wrote to Parliament.
Currently, only the Oil Marketing Companies (OMCs) are keeping the wheels of the economy running by importing refined oil into the country.
Ecobank Development Corporation is the investment branch of a Lome-based lending company, and was co-adviser on Ghana's $750 million sovereign bond, and the lead adviser in the sale of Ghana Telecom (GT) to Vodafone.
By Bennett Akuaku
STOP CORRUPTION
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SHELL OIL CO. & CITIBANK USA ARE PARTNER IN CORRUPTION
How deep is corruption in Africa? | ||
In Nigeria, the international oil giant Shell admitted that it inadvertently fed conflict, poverty and corruption through its oil activities in the country. Nigeria contributes to about 10% of Shell's global production and is home to some of its most promising reserves, yet the country is steeped in poverty and conflict. According to Shell, it has been difficult to operate with integrity in areas of conflict like Nigeria. In some Cameroonian public hospitals, patients say they have to put some money in the doctor's consultation book before they are attended to. And in some schools, a student cannot pass examinations without bribing the teachers. In Zambia, former President Fredrick Chiluba is facing corruption charges for offences he allegedly committed during his term in office. SOURCE:BBC A US Senate inquiry in 1999 revealed that the giant Citibank held private accounts for many corrupt Third World leaders. These included Gabonese president Omar Bongo (who transferred US$100 million, allegedly including bribes from French firm Elf-Aquitaine, through his three accounts), Bhutto's husband Asif Ali Zardari ($40 million, including $10 million allegedly from kickbacks on a gold importing contract), the three sons of former Nigerian strongman Sani Abacha ($110 million in accounts, plus $39 million lent to them to deposit in Swiss accounts after the new Nigerian government began investigations) and Raul Salinas, brother of one-time Mexican President Carlos Salinas ($80-$100 million in alleged drug money). | ||
The Cost of Corruption
Corruption in Africa is costing the continent nearly $150bn a year, according to a new report.
The African regional body, the African Union (AU) has drawn up a convention to stamp out malpractices which the study says are hitting the poorest the hardest.
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From the bottle of whisky slipped under the counter to speed a traveller's way through customs, to the presidents and ex-presidents living way beyond their declared means, it results in an assumption that no business will ever get done without a present changing hands.
The report before this week's meeting of the African Union in the Ethiopian capital, Addis Ababa, makes no attempt to excuse these "gratifications" as part of the culture.
It says that corruption is costing Africa more than $148bn dollars a year, increasing the cost of goods by as much as 20%, deterring investment and holding back development.In Uganda, often held up by the IMF and World Bank as a model of the success of their policies, the government has set about privatising 142 state-owned enterprises since 1992, the sales of which was expected to net US$500 million. However, by 1998 the process had been halted twice by parliament because of corruption: at the end of that year, the government account set up to hold the proceeds of privatisation was empty.The cross-border flow of the global proceeds from criminal activities, corruption, and tax evasion is estimated at between $1 trillion and $1.6 trillion per year.
· 25 percent of the GDP of African states lost to corruption every year, amounting to $148 billion, but the problem is seen in all continents.
· Corrupt money associated with bribes received by public officials from developing and transition countries is conservatively estimated at $20 billion to $40 billion per year—a figure equivalent to 20 to 40 percent of flows of official development assistance (ODA).
(Please see Stolen Asset Recovery Initiative: Challenges, Opportunities, and Action Plan, p. 11)
Development benefits of asset recovery (see p. 11)
Every $100 million recovered could fund:
· First-line treatment for over 600,000 people with HIV/AIDS for a full year; or
· 50–100 million in drugs for the treatment of malaria; or
· Some 250,000 water connections for households.
Country cases:
· After an 18 year saga which ended in January 2004, the Philippines were able to repatriate $624 million of Ferdinand Marcos money held in Swiss Bank accounts.
· Between August 2001 and 2004, Peru recovered nearly over $180 million stolen by Vladimiro Montesinos from several jurisdictions such as Switzerland, Cayman Islands and the United States.
· Between September 2005 and early 2006, Nigeria recovered $505 million of the Sani Abacha money frozen and forfeiture by Swiss authorities.
· In July 2006, British authorities returned $1.9 million of the allegedly illicit gains of Diepreye Alamieyeseigha, governor of the oil-rich Bayelsa state in Nigeria.
· In May 2007, an agreement between the governments of the United States, Switzerland and Kazakhstan allowed for the repatriation of $84 million.
· While the recent experiences of Nigeria and Peru have taken an average of five years to achieve positive results, asset recovery is a time consuming process which can impose a huge toll on the credibility and sustainability of the efforts, not to mention seriously undermine the political will to endure this task.
Ratification of the UN Convention Against Corruption (see page 15)
· Half G8 countries have ratified UNCAC. Canada, Germany, Italy and Japan have not.
· Half of OECD countries have ratified UNCAC.
· 13 of the 54 jurisdictions classified by the IMF as offshore financial centers (OFCs) have ratified UNCAC. Source: World Bank
SWISS BANKING SECRECY UNDER FIRE
BANKING SECRECY
Banking secrecy is far from being a simply Swiss phenomenon. The European Commission is also targeting Belgium, Luxembourg and Austria. The Organisation for Economic Cooperation and Development also considers that Andorra and Monaco are non-cooperative tax havens, whereas Liechtenstein has cooperated with the EU since last year.
Banking secrecy is limited in Britain and the US but the two countries do have territories where it is less restrictive. Singapore has drafted plans in the general direction of the OECD. But when it comes to Hong Kong, China is deaf to EU demands for more transparency.
It must be noted that development has evaded Africa and most of third world countries due to the existence of banking secrecy which allow corrupt politicians to loot the coffers of their countries.Swiss banks have been accused of accepting money from people like Sani Abacha, Mobutu, Eyadema, Arap Moi, Omar Bongo, Obiang Nguema, Blaise Campore, Denis Sassou Ngueso, Eduardo dos Santos, Sadam Hussein, Ferdinand Marcos without questioning the source of their wealth.
The former dictator's estate near Lausanne (Keystone)
A buyer has finally been found for the Swiss retreat of the former Zairean dictator, Mobutu Sese Seko.
The villa in Savigny, canton Vaux, went to a Swiss buyer for SFr3.1 million during an auction on Thursday.
Local authorities had previously received written offers to the value of SFr2.5 million, the minimum price set at a previous auction, although the property is estimated to be worth considerably more at SFr4.25 million.
The villa of the former president of the Congo, who died in Morocco in 1997, was impounded in May 1997 at the request of judicial authorities in Mobotu’s homeland.
Cars and furniture inside the house were sold off in June, raising SFr270,000.
It is not yet clear whether the proceedings of the sale will go the Democratic Republic of Congo or to Mobutu’s estate.
swissinfo with agencies
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