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28.03.2011 General News

Where is STX?

By The Statesman
Where is STX?
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THREE months after the flamboyant sod-cutting ceremony by President Mills for the commencement of the proposed construction of 30,000 housing units for security personnel in the country, not even Asiedu Nketsiah's block factory has been able to provide a single block for the project to take off.

A visit by the New Statesman to the proposed site for the project at the Tesano Police barracks revealed there was no physical effort underway for actual construction work to start, as we were only met with weeds blossoming freely on the land.

    Information reaching this paper indicates that STX Korea is finding it extremely difficult raising the money required for the construction of the housing units, not even after US$265 million has been paid upfront as insurance premium covering the loan facility.

    Concerns were raised across the country with regards to the source of funding for the STX deal. There was no clear indication in the agreement as to the source of funding for the project.

The revised STX agreement, which was criticized as being too expensive, maintained the financing cost to Government for the 30,000 housing-unit barracks was US$1,525,443,468. Out of that, $1.3 billion is stipulated as representing construction, cost (or the EPC contract amount), with the rest, impliedly but not arithmetically, covering the insurance premium and other specified fees, namely management and arrangement (which is now termed as 'facility fee' in the revised agreement).

Chairman of the New Patriotic Party, Jake Obestebi-Lamptey, says he is not surprised that STX is finding it extremely difficult to raise the money required to finance the housing project.

  While he welcomes the intention of Government to undertake this huge project to deal significantly with the gross housing deficit in Ghana, the NPP Chairman agrees with other Ghanaians who consider the deal as “an agenda for a better Korea than a better Ghana.”

  “When a project, such as the STX housing deal, is fraught with monumental fraud and seen as a conspiracy to fleece this poor country of hundreds of millions of dollars, I am not surprised that they haven't gotten anyone to support and finance this level of fraud”, Jake told the New Statesman at the weekend.

He maintained that the cost of $50,000 per house is inordinately high, considering the fact that the Government of Ghana is providing the land, permits, tax exemptions on imported materials and machinery, corporate tax exemptions, as well as paying for expenses of STX.

“With these incentives it is clear that these houses can be constructed for a fraction of the cost, as proposed by the Ghana Real Estate Developers Association”, he added.

It can be recalled that GREDA presented a petition to the Joint Committee of Finance and Works & Housing that it could build 30,000 housing units for Government at a total cost of $540 million.

“God must be on the side of Ghana and Ghanaians as there are certainly much cheaper alternatives to building 30,000 houses as opposed to the one chosen by the Mills-Mahama NDC led administration”, Jake noted.

As revealed in our Wednesday, March 23, 2011 edition, it is clear the Mills-Mahama administration is determined to rip-off Ghanaians in what appears to be shady and fraudulent loan agreements being entered into on behalf of the state.

According to a document sighted by The New Statesman, the Mills-Mahama administration has also entered into a US$800 million agreement with the Industrial and Commercial Bank of China for the financing and implementation of the eastern corridor road network.

With the eastern corridor road network being the least utilized in the country, it appears the NDC administration has lost focus on what it's priorities in the country are.

  With the central corridor road network being the most patronized in the country, one would have thought the Mills administration would complete this road network which connects Ghana to Burkina Faso, Mali and Niger rather than focusing on a road network that is less utilized.

There are fears among many Ghanaians that the NDC administration is implementing a grand design to saddle the nation with huge debts which has the potential to take the nation back to HIPC.

To others, what the ruling party is doing is driven by the fear of defeat that stares it in the face ahead the 2012 elections, making appointees of the government think that the best way to prepare is to prepare for their exit from government is to grab whatever they can in four years, enriching themselves and leaving Ghana bankrupt

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