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10.07.2002 General News

Loan agreement is a scam -NDC

By GNA /GRi
Loan agreement is a scam -NDC
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Loan is genuine - Gov't The National Democratic Congress (NDC) on Monday described as fraudulent a proposed loan transaction of eight trillion cedis that the New Patriotic Party (NPP) Government was seeking to borrow from International Finance Consortium (IFC). It said, "the NDC makes bold to predict that Ghana would lose millions of dollars if NPP government makes the mistake of entering into an agreement with the so-called IFC, and it would turn out to nothing more than fake men who would vanish with the transaction fee". Dr Josiah Aryeh, General Secretary of NDC said at a press conference in Accra to throw more light on the consequences of the loan agreement, which has been sent to Parliament for approval. The government should be held liable if it allowed the so-called IFC fraudsters to dupe the people of Ghana, Dr. Aryeh said and called on parliament not to approve the loan. According to him an analysis of the loan agreement in support of the objectives showed that it was a carefully orchestrated plan by faceless international fraudsters and crooks and some Ghanaian collaborators to defraud the nation. He explained that the NDC supported the objectives of the loan, which sort to enhance rural and infrastructure development, but that the loan would rip the country of millions of dollars. Dr Aryeh said the loan contraction was a "scam" by international fraudsters and crooks to loot the nation of its scarce resources. "We intend to sound the 'red alert' to the government that they are taking the country's finances down the drain, and possibly taken key members of the NPP government itself and the people of this country with them into the plug hole". The General Secretary described the transaction as ridiculous in its tracks and asked for its immediate withdrawal from Parliament to save the country from humiliation and embarrassment. He deplored the naiveté of the NPP government to be played on by such a "419 Scam" by entering into agreement with them. Dr. Aryeh explained that the lender allegedly chose the "IFC" as a name or initials carefully to make it seem as the International Finance Corporation "IFC" of the World Bank, which in true terms, have no relationship with the Bank. He said it was difficult to believe that the investment capital of one billion dollars repayable over 25 years has an annual interest rate of 2.5 percent while the rates in the USA were hovering around 3 to 6 percent. He noted that the government was also required to issue an unconditional sovereign guarantee to repay the loans in favour of the "IFC" after three years of contracting the loan adding that "The government risks full exposure if the " IFC" discontinues the guarantee, takes the monies and fails to transfer any monies to Ghana." Dr. Aryeh expressed concern that neither the IMF nor the World Bank resident representatives in the country has been seen commenting on the loan agreement. This, he said, has a very great implication on the two Bretton-Woods Institutions. He said the NDC government must not be misunderstood to be seeking to thwart the effort of the NPP government to secure a loan for infrastructure and development projects. The NDC was rather seeking through this exposure, to protect the sovereign interest of the country from schemes and scams of international fraudsters and crooks, he added. He also called on the Institute of Economic Affairs (IEA), the Centre for Policy Analysis (CEPA), and the economics department of the universities and other research institutions to organise seminars and workshops to debate on the merits and demerits of the loan agreement.
IFC Loan is genuine - Gov't The Government has described the NDC's condemnation of its attempt to secure a one billion dollar loan as a surprise. It said that "the International Finance Consortium (IFC) is a credible and well known institution, recognized by the IMF, World Bank, the UN and various governments of the world". A statement issued in Accra on Monday by the Ministry of Information and Presidential Affairs in reaction to the NDC's allegation, said that it was difficult to understand why the NDC had resorted to holding a Press conference to create confusion in the minds of the people. The statement said that if the NDC had any problem with the proposed loan, it could register its disapproval through its representatives in Parliament instead of deliberately creating the impression that the entire arrangement for the loan was a dishonest scheme. "Clearly, the NDC is in a desperate mood to cause mischief and deceive the people of Ghana, but the government will not be distracted by such means," it said. The statement said that the government would remain focused on its programme of rebuilding the economy. In another development, Mr. Kwabena Agyepong, Government Spokesman has accused the NDC of playing politics with the loan issue. He said if the NDC had any grievances with the proposed loan agreement it should petition the Finance Committee of Parliament where all issues relating to the loan would be discussed. Speaking on PEACE FM this morning, monitored by Ghana Review International in Accra, the Government Spokesman said since the government had not come out to announce the loan to the public it was intriguing that the NDC has come out with the entire matter solely to score political point. He advised the NDC not to cause any disaffection among Ghanaians but to lay their grievances before state institutions instead of organising press conferences. On another radio station, LOVE FM, in Kumasi Mr. Agyepong said that the NDC party should stop the smear campaign calculated to erode public confidence in the government. An NPP Member of Parliament, Mr. Osei Prempeh, who is a member of the Finance Committee of Parliament also spoke on the same issue on PEACE FM. He debunked the notion held by the NDC that the consortium was not known saying that the World Bank could attest to the genuineness and existence of the consortium. According to him the Minister of Finance, Hon. Osafo Maafo and the Governor of the Bank of Ghana Dr. Paul Acquah were before the Finance Committee of Parliament to explain salient portions of the loan which some members in the minority, wanted clarification. He said the Governor of the Bank of Ghana had done due diligence on the loan and the consortium and was satisfied that the loan was not fraudulent. According to him, Dr. Acquah brought a diskette to show the genuineness and existence of the consortium and told the committee that members could verify or access from the Internet. Ghana Review International also monitored another interview on JOY FM. A Reporter on the station, Kwamena Ato Dadzie called the consortium in the US using the telephone number the NDC had given to journalists at Monday's press conference. A male voice, which identified himself as Mr. Horst Schneider, a board member of the consortium responded and said the opposition NDC party did not know what they were talking about. He claimed that he and his team had fruitful discussions with the Ghanaian Government and had showed documents to the government officials they dealt with and wondered that if their operations were scam how could they have gone that far. Mr. Schneider said the consortium had dealings with high profile bankers as well as reputable and credible institutions. According to him the consortium had a social responsibility to assist Ghana and was well positioned to carry it out. .Kwasi Nantwi, GRi Correspondent

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