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31.01.2011 Feature Article

STX Korea is a bloody stinking deal!

President John Atta Mills (left), Mr. Alban Bagbin, Minister for Water Resources, Works & Housing (right)President John Atta Mills (left), Mr. Alban Bagbin, Minister for Water Resources, Works & Housing (right)
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In the year 2001, I was given a guided tour of the residential facilities at the Accra Central Police Station. It followed an incident in which a civilian, who was said to be a regular visitor to the barracks, commandeered a vehicle parked in the yard without lawful authority, and took his girl-friend through driving lessons in the night.

Unfortunately, at that point in time, a police officer who had just got back to the barracks after a night patrol, decided to sleep in the yard, apparently, because it was not very convenient on a humid night to sleep in a hall packed with 150 police personnel all snoring at the same time.

Our young officer friend was snoring his problems away, when the civilian, who had hijacked someone's vehicle, returned with his girlfriend at the wheels. Before anybody could say Jack, all the four wheels of the hijacked vehicle had rammed into the sleeping officer.

The young officer died on the spot. When I got to the scene, the body had just been removed. But blood was spilled all over the floor. It told the story of a very horrible 'accident.' It also told a lot about the very horrible conditions under which our men and women in uniform live.

When I toured the residential quarters of the station, I was appalled by what I saw. The squalour under which our security officers live, from where they rise to the defence of the citizens of this nation, is beyond description. All over the country, our security services have no roofs over their heads. They definitely deserve better than the structures built to accommodate a few colonial police officers before independence in 1957, at a time the population of the entire country was well below four million.

Tomorrow, Dr. Grace Bediako will formally announce the results of the 2010 Housing and Population Census figures. Ghanaians should brace themselves for one of the roof-top advertisements extolling the so-called 'Better Agenda,' even though the project was poorly handled, with many Ghanaians not captured during the exercise.

All the same, I expect this nation to grow its population to nearly 25 million. Surely, the security services catering for such a massive explosion in population could not be accommodated in facilities meant for the few men and women who formed the colonial security services, under Her Majesty Queen Elizabeth's colonial administration.

That is why properly housing the security services is of essence to the Republic. Evidence is available too to indicate that the security services aside, the ordinary population of this country has a housing deficit of about one million units, according to statistics from the Ministry of Water Resources, Works and Housing.

The Government of Prof. John Evans Atta Mills believes it has taken a giant step towards reducing the deficit with the STX Korea deal, under which the Korean Engineering and Construction Company is mandated to provide 200,000 housing units, at a cost of $10 billion. On Thursday, January 27, President John Evans Atta Mills cut the sod for work to begin on 30,000 of the housing units for the security services, at a cost of $1.5 billion.

Listening to the President extolling the virtues in the STX Korea deal, one might be tempted to believe that the NDC in government has solved multiple problems with just one deal. On the contrary, there are several reasons to infer that this is not only a bogus deal, it is daylight robbery, using the pathetic accommodation problems of the security services as reason to rip this nation off.

According to the Head of State, 'This is not about scoring cheap political points. It is about providing acceptable and durable accommodation for hard-working Ghanaians. The Ghanaian tax-payer is working too hard, and we dare not abuse and waste the nation's scarce resources.'

Unfortunately, this government has not only wasted scarce resources, it has ripped off the Ghanaian in daylight. By simple arithmetic, the average unit cost of the houses - and they range from one-bed flat to four bedroom apartments – is $50,000. At the latest forex bureau rate, the unit cost is in excess of GH¢75,000.

When the Ghana Real Estate Development Association (GREDA) got wind that the Government of Ghana intended to provide 200,000 housing units for the good people of this country, the association thought it could get a slice of the deal. It wrote to the Minister of Water Resources, Works and Housing with its own proposals.

The association intimated that its members could construct the 200,000 housing units at less than the $10 billion the government was negotiating with Korea. For the first 30,000 units for the security services, GREDA said it could complete the project at a cost of just about $750 million.

As you read this piece, GREDA-constructed houses range from $15,000 for a one-bed unit house, to $49,000 for a four-bedroom house. It is interesting to note that GREDA is responsible for acquiring its own lots of land. They provide all amenities like streets, pavements, electricity, water and all other items necessary to make any dwelling places comfortable for the customer.

Under the STX Korea agreement, this country would provide land free of charge to the Koreans. The government has guaranteed to waive away all taxes in connection with the importation of their machinery and materials for the project. While Korean workers are in this country, they would not pay income taxes; they are not subject to Value Added Tax (VAT) for any item they purchase in respect of the project. In addition, this country has provided a sovereign guarantee to enable STX Korea Engineering and Construction firm raise the needed capital on the international market.

I am not an expert in these things. But, I am told that what this amounts to is that in case the Government of Ghana is unable to pay back the loan, the company could apply to sell any property or asset in this land of our birth to offset it.

Under normal circumstances, a sovereign guarantee is as good as money, especially, when the deal is collateralised by the proceeds from the new oil find. Certainly, not this arrangement. Under a very strange combination of factors, this nation has agreed to provide insurance cover of $270 million to be paid by me and you.

Amid all these strange happenings, President Atta Mills and his ministers are ramming it down our throats that this deal is value for money. Read his lips: 'In this action year, today's action speaks volumes about government resolve to reduce the housing deficit, and give decent accommodation to Ghanaian workers.'

I can state with all the authority under my command that at $50,000 per unit, this housing deal is priced way above the means of the average Ghanaian worker. Evidence abounds that even GREDA housing, priced from $15,000 per one-bed flat to $49,000 for a four-bedroom house, are unable to entice the average Ghanaian worker, simply because he or she has simply not got the means. How then would the Ghanaian worker afford the STX Korea deal, priced at the average of $50,000 for bedrooms ranging from one to four?

When President Atta Mills referred to the project in these terms: 'We are taking a very important first step today, and when in five years, we have been able to complete the 200,000 housing units, it will be a significant milestone in our over half a century of nationhood,' he obviously had his ministers and party gurus in mind.

There are not many Ghanaian workers out there who would be able to afford any of the units the Koreans are going to provide.

Like many things this administration has done, since assuming power in January 2009, the beneficiaries could never be ordinary Ghanaians.

With free and developed land, tax waivers and the likes, the STX Korea houses should have cost less than half the asking price. In any case, why are the people of Ghana going to pay for an insurance cover, when our whole sovereignty has been put on the line?

This deal is not, and cannot be value for money. I get the impression that there is something that the good people of Ghana have not been told about this project. When an otherwise decent person like Vice-President John Dramani Mahama stood at the former Ideological Institute at Winneba, and labeled those of us opposed to the wishy-washy deal as 'foolish and baloney,' he might have been irked by something more than the idea of providing housing for the people.

Can I, in the absence of any meaningful explanation for the tax-payers' money being needlessly lavished on the Koreans, infer that the NDC administration is up to something else.

I am beginning to get the true meaning of the 'several ways of killing a cat' pronouncement from the party chairman.

The STX Korea Deal stinks.  It is rotten right from the head! Read me again tomorrow!

Ghanaian Chronicle
Ghanaian Chronicle, © 2011

The author has 1023 publications published on Modern Ghana.Column: GhanaianChronicle

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