Govt To Take Over Tema Shipyard

The run-down Tema ShipyardThe government has decided to take over ownership and management of the Tema Shipyard and Drydock, by December, this year.

Consequently, the government has mandated a negotiating committee, under an oversight committee chaired by the Chief of Staff, to conclude all relevant details of that framework and ensure a smooth transfer of the shipyard to it.

Speaking at a news conference in Accra yesterday to announce the government’s decision, the Minister of Transport, Alhaji Collins Dauda, said the decision became necessary due to the inability of Penang, which government considered as a strategic investor, to meet the targets for divesting the corporation.

He said in 1996, the government divested 60 per cent of its interest in the Tema Shipyard and Drydock Corporation (TSDC) as part of measures aimed at improving the standards of operations at the shipyard.

He said in divesting its 60 per cent shares, the government’s intention was to acquire a strategic partner to help transform the shipyard into a modern, well-equipped facility to meet the nation’s strategic objectives.

Alhaji Dauda said it was against that background that the government settled on the divestiture option and executed an agreement with Penang Shipbuilding and Construction SDN BHD as its partner.

He said the aims and objectives of the government were clearly stated in the joint venture agreement signed on November 8, 1996 between the government and Penang.

He said essentially, the government and Penang agreed that pursuant to the SPA, Penang would rehabilitate the shipyard and also procure such funding as was reasonably required by the company to meet costs in connection with the rehabilitation and completion of the refurbishment of the shipyard.

Alhaji Dauda said unfortunately, after 13 years, that important vision had not been achieved and the goals of the JVA had not been met.

He said following expressions of concern from various quarters on the state of the shipyard, a committee of inquiry was set up in 2009 to investigate its operations and make recommendations that would lead to an improvement in performance.

He said among other things, the committee affirmed the shipyard’s strategic importance and recommended that the government should initiate action to regain control of the shipyard.

Alhaji Dauda said the government then initiated a process which would conclude arrangements for the ownership of the shipyard to return to the Republic of Ghana.

He said after much deliberation, during which the government took into consideration Ghana’s good relationship with Malaysia, the spirit of South-South co-operation and the intervention of the Prime Minister of Malaysia, the government decided to take a majority stake in the shipyard in order to determine its future direction.

He said the government subsequently set up a negotiating committee to explore an amicable resolution of the issues including increasing the government’s equity stake to at least 60 per cent of the company.

Alhaji Dauda said after numerous and lengthy sessions, the negotiations reached a deadlock, principally over matters related to shareholding structure and management control.

He said in order to move the process forward and to fully clarify the government’s position, the President, Prof. John Atta Mills, in response to an earlier representation to the Prime Minister of Malaysia, sent a delegation, led by the Foreign Minister and including the Minister of Transport, to deliver a message on the subject to the Prime Minister of Malaysia.

He said on August 18, 2011, the delegation met with the Prime Minister and conveyed the President’s response to the Malaysian Prime Minister’s earlier letter and the deadlocked state of the negotiations.

Alhaji Dauda said as a result of those exchanges, it had been recognised by both sides that it was in their mutual interests for the future ownership and management of the yard to revert to the Republic of Ghana.

He said accordingly and in the spirit of South-South co-operation, the parties had agreed to negotiate an outline framework for a structured and well-organised transfer to the Republic of Ghana of the entire 60 per cent on the shares in PSCT held by Penang.

He said that arrangement would then make Ghana the sole shareholder of the shipyard.

The TSDC was built in the 1960s during the construction of the Tema Harbour as part of the overall infrastructure requirement for the country’s maritime industry and socio-economic development.

The shipyard has two graving docks and a slipway and is strategically placed to take advantage of dry-docking and repair needs of ships of up to 100,000 deadweight plying the western shoreline of Africa.