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08.09.2004 Business & Finance

Fate of GBC, GRC workers in danger

By Chronicle

… As tariff negotiations end in stalemate ... Government urged to intervene immediately The fate of the workers of both the Ghana Bauxite Company (GBC) and Ghana Railway Company (GRC) appears to be in danger following the failure of the two leading companies to reach a compromise after hectic negotiations for tariff adjustment.

As a result of this stalemate, a section of the GRC workers are reported to be putting severe pressure on their management to put a halt to the haulage of the bauxite mineral from Awaso to the Takoradi seaport, which is a distance of 241km.

A source that spoke to The Chronicle said though the workers were aware of the disastrous consequences should management heed their call as some of them might be sent home, they were adamant after realizing that GBC was cheating them.

The Minister for Ports, Harbours and Railways, Prof. Christopher Ameyaw Akumfi, at a point in time joined the negotiation for the amicable settlement of the tariff war but his presence failed to convince GBC that is owned by Alcan International to soften their stance against increasing the tariff.

The Chronicle's own investigations into the issue uncovered that in 1991, GBC, after months of negotiations, agreed to pay the GRC $9.35 per tonne of bauxite the latter would haul from Awaso in the northern part of the western region to the Takoradi port.

The Chronicle gathered that after the new tariff had been in operation for almost eight years, GRC called for fresh negotiations in 1999 to review the tariff to reflect the economic situation in the country after realizing that their cost of operation was going up without any corresponding increase in the tariff.

The paper further established that since that time to date, GBC had refused to increase the tariff from the current $9.35 to $10.43 per tonne being demanded by the GRC even though the former may collapse should the latter pull out of the business.

GBC is reported to have argued over the negotiation table that the figure they were paying GRC was nowhere near what Alcan International, the parent company was paying in similar operations in Guinea and other West African countries.

To rub salt into injury, GBC is also reported to have come out with the condition that it would pay the GRC only $6.40 per tonne of any haulage the latter would make beyond the stipulated 450,000 tonnes per year.

Having set this condition and also refused to adjust the tariff, GBC went ahead to increase haulage price for cargo vehicles from $11.8 to $12 just a few months ago.

This is said to have infuriated the management of GRC who thought GBC was up to something.

GRC revenue is already said to have slumped drastically because of GBC's refusal to increase the tariff.

This is reportedly making it very difficult for the GRC to meet most of its statutory requirements.

The plight of the GRC has also been worsened by the high cost of operations. Currently, fixing a wooden slipper at the rail line cost the company ¢125,000.

Each mile of the railway line is fixed with 2003 of these wooden slippers. This means that billions of cedis are being spent on the maintenance of the rail line to make the haulage of the bauxite very smooth.

Fuel price has also gone up several times since the present tariff was fixed in 1991.

Investigations further established that though GRC made all these factors available at the various negotiations, GBC would simply not listen to state the low tariff they claimed to be paying at similar operations in Guinea.

The Chronicle gathered, however, that in Guinea where Alcan International, the parent company of GBC with the headquarters in Canada was reported to be paying low tariff, the company itself bought the haulage trucks for the Railway Company and the latter only used its locomotives to haul the mineral.

The same could, however, not be said of Ghana where the GRC owns and maintains all the haulage trucks in addition to the locomotives.

Some of the GRC workers who were interviewed in the course of the investigation said it was about time the government intervened and called for an all stakeholders' meeting to find solution to the problem.

They argued that should their management stop the haulage of the bauxite which was their major source of revenue, both the GRC and GBC would collapse and this would have adverse effects on the economy, considering the large employees on the payrol of the two companies.

Other stakeholders are also arguing that using road network to haul the bauxite as GBC was currently doing would not help to maintain the life span of the roads apart from the dangers these haulage trucks posed to other road users.

Mr. Joe Nsiah, the financial controller of GBC, refused to make any comment about the tariff and the looming danger when he was contacted on phone in Accra.

He, instead, directed the reporter to contact Mr. Ben Aidoo, the Managing Director.

When he was asked to transfer the call to the MD, he asked the reporter to hold on.

He came back in a few minutes' time to say that the MD was holding a board meeting.

A management source contacted at the GRC confirmed the tariff controversy but was not prepared to go into details.

Attempts to get the position of the sector ministry also on the impasse was not successful as the Chief Director, Alhaji Mohammed D.N. Jawula, cut off his line when the reporter tried to reach him on his cell phone.

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