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20.05.2004 Feature Article

Much Ado About A Loan

Much Ado About A Loan
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Governments exist mainly to carry out its domestic agenda and to make good on its campaign promises. True.

The role of the opposition in a democracy among others is to hold government accountable to the people by scrutinizing government policies and placing them under the microscope. True.

Most Ghanaians would agree with me that both the government and the opposition are doing a great job and deserve to be congratulated.

While the NPP is living no stone unturned to make good on its campaign promise to improve upon the lifestyle of Ghanaians, the NDC is also making the most of its present political circumstances by engaging itself in very helpful and positive critiquing of government policies.

The campaign by the NDC to raise public awareness to the Kufuor administration's recent flirtation with controversy as animated in the CNTI loan situation gives me a lot to be happy about in terms of the future of our democracy.

This administration would be the first to admit that the NDC is giving it a good run for its money in the battle to win the hearts and minds of Ghanaians. In spite of its present political circumstances as the minority party, the NDC has always been ahead of the curve in the propaganda war with the NPP even though the latter controls the major media organizations in the country. This is a recent phenomenon in our political cycle which I believe historians would take note of.

It was the NDC together with independent media organizations that led the crusade against the $1billion International Financial Consortium (IFC) and refused to hunker down till the government withdrew from the agreement. At a 2002 press conference, the NDC placed the government on the spot when it exposed the link between the IFC and the New Jersey based Chemac Inc and questioned the bona fides of the IFC.

This forced the government which hitherto had held most of the information close to its chest to make some of them public. The complexion of the Kufuor administration's public relations binge changed completely as more and more ministers and parliamentarians were “released” to make public statements in defense of the loan.

The NDC has great talent among its ranks and that is a fact only a rip van winkle would fail to realize.

This country has come full cycle since the last General Elections and it would be plain foolhardiness on the part of the Kufuor administration to attempt to take advantage of the credibility woes of the NDC to pull a wool over the eyes of Ghanaians.

But is this CNTI really an attempt by the Kufuor Administration to scam Ghanaians or is the administration been scammed itself?

Well these were genuine, legitimate queries Ghanaians raised in the aftermath of the $1billion IFC loan agreement. Unfortunately these questions are being asked again because it appears the government failed to learn any lessons from the IFC debacle and like it is said “one who fails to learn from his mistakes is bound to repeat them.”

CAMPAIGN PROMISES In order to fully understand the “inordinate rush” by the government to forge ahead with the CNTI loan by disregarding the lessons of hindsight let me attempt to place the whole scenario in perspective.

Every government requires money to execute a myriad of programmes aimed at improving upon the lifestyle of its people and also in keeping with its campaign promises.

One of the mainstays of the NPP campaign during the last electioneering period was a pledge to develop the nation's road infrastructure. The Kumasi road, the Winneba-Capecoast road and the Ho-Aflao road which were mostly in bad condition were penciled down for major reconstruction work. The NDC also had plans to tackle these very strategically important road networks had it won the 2000 elections.

This is what the chairman of the NPP said during an interview with the Concord about the IFC loan.

“My interest is in ensuring that my party is able to fulfil the promises that we have given Ghanaians and most of these promises can be fulfilled through the use of money.”

“So if some money is coming in, at what I can say is a concessionary loan, because they had given this loan at Libor rate of interest, it is a very cheap rate.

My wish is that there would not be any entanglements, that this money is coming to us without any encumbrances; and then we can use it and not put it in our pockets, but put it to work in the interest of Ghanaians.”

While these comments were made by Mr. Esseku in 2002, it still represents the official position of the NPP.

The party has a domestic agenda and that is to develop the infrastructural base of the country by building and expanding on social services and making our country a tourism hub. PARALLELS WITH IFC One of the reasons most Ghanaians are taking the news of the CNTI loan with a certain degree of mistrust is because of the inherent similarities with the IFC debacle. The parallel between the two in terms of the approach (Government officials) and the modus operandi of the company are so glaringly obvious no serious observer would miss it.

From what the media is reporting back home we have no business dealing with CNTI.

I wouldn't be quick to take this administration to the cleaners yet because we have been told by the Finance Minister to give them some more time as they try to make more documents available.

However I must say the approach of the Kufuor administration to this whole CNTI situation has been very unfortunate to say the least.

We expect our government to be on top of things. We expect them to use our time and money to do a more diligent work for us. We need to know whether adequate due diligence was done before we signed on the dotted lines.

What emerged from the IFC debacle was the failure of the government through the Bank of Ghana to perform due diligence on the bonafides of the company.

As at the time Parliament was going to recess, Ghanaians were told that the Bank of Ghana was still making frantic efforts to obtain relevant information about the bonafides of IFC from Dun and Bradstreet, a United States firm reputed for its due diligence work.

Dun and Bradstreet like all other companies in the due diligence business operate on a timely fashion and are able to furnish their clients with a detailed report in less than 48 hours.

A whole two months elapsed and the BOG hadn't confirmed whether the check had been completed. At least that was what its representative told our Concord Reporter on that beat.

We also gathered that at the time the loan agreement was passed by Parliament in July of 2002 after initial clearance by the Finance Committee of Parliament, the Bank of Ghana had not completed its due diligence check on the IFC.

The only information that was made available to Parliament was the Curriculum Vitae of two of its board members.

The way things are going with the CNTI loan situation it would be heart wrenching if it turns out that in our haste to get this loan our government failed to see the red flags. I wish some lessons had been learnt from the embarrassing IFC debacle.

This government can do much more than this.

My congratulations go to the NDC for standing up to the plate and making a studious defense of democracy and due process. Views expressed by the author(s) do not necessarily reflect those of GhanaHomePage.

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