The Root Of The Chinese Government $2billion Loan To Ghana

We heard from the government of Ghana and the media stations across the country that, China will give $2billion for the one district, one factory project. Also, the China National Building Materials and Equipment Import and Export Corporation (CNBM) will give at most 85% financing for a viable scheme under the One District One Factory secretariat. Again, CNBM will construct facilities for any company as well as provide them with the essential and necessary machines. And the Ghana Commercial Bank, Access Bank, Universal Merchant Bank and the Ghana Import and Export Bank signed to this contract. Other banks have the opportunity to join this deal in future.

According to the National Coordinator of the ‘One District, One Factory’ secretariat, Gifty Ohene-Konadu, “The most exciting part of the financing is, the Chinese will provide a huge market access for most of the export commodities, which is expected to bring $2.5b revenue to Ghana annually. This clearly shows how the NPP government is poised to make the private sector the engine for growth of the Ghanaian economy.” If she is telling the truth, then, no need to object this loan.

The root of this loan started under the previous NDC government. In 2010, President Mills government moved for $3billion loan from China to build our oil infrastructure, hospitals, schools, roads, and others. The Chinese Development Bank (CDB) agreed and gave Ghana government $1billion for a start. In 2011, CBD changed the terms and conditions of this loan and demanded our natural resources for a repayment. The NDC government declined to give our natural resources for cash, and in effect, the CDB withheld the rest of the loan ($2billion.)

In 2013, John Mahama administration tried to get this $2billion back, but the Chinese government insisted for our natural resources as payment. The government refused this offer of payment from China, so the CDB kept the $2billion again. Now NPP government went last week to China to pursue this $2billion. The Chinese government has agreed to give this money and in total reaching a possible loan deal of $15billion. So is the NPP government going to pay this loan with our resources?

The Vice President Dr. Bawumia said, "Our untapped mineral resources include 2.8bn metric tonnes of iron ore, 960million metric tonnes of Bauxite, 430m metric tonnes of manganese and 413m metric tonnes of limestone. This is excluding gold and so on. If we need just $20bn to do a major, massive Marshall Plan and we have $460 billion sitting in the ground then what we really need is to develop a financing model that leverages just a small fraction of our reserves." Why would any rational and dynamic person object this reasoning?

Honestly, I do not have a problem if the government pay with some of our resources because we have sat on this natural gift for 60 years after independence but can't use it for anything beneficial to Ghanaians. If we can exchange some of them to improve our lives, why not? Even before the Vice President made this deal, the Chinese through "galamsey" and other looters are illegally taken these natural resources. So why can't we officially accept this offer and use it to better the nation entirely?

We do not have to act like how some of our ancestors and traditional priests sat and are still sitting on an enormous sum certain of gold and other precious gifts without using them. Our natural resources should not be worship rather it should be used to better ourselves and the future generation. It is time to think of transforming ourselves to the next level, and we do so by using the gift to us by nature. This is how the deal looks like to me; the Chinese have what we desperately need to develop and become a better society. In substitute, they want our natural resources in exchange in the form of barter. So we either go for it and better ourselves, or we continue to keep these resources for the next generation. Probably, the next generation of Ghana will also keep it without using it.

When we travel to Middle East countries like UAE, Qatar and other oil producing countries, we admire their growing economy, right? They sold their natural resources like crude oil for dollars, and they used the money to develop their country. They did not sit on their crude oil and worship it; rather the used it to create UAE and Qatar today. We have to sell some of our natural resources to get what we want. In the process of selling it, we should not reach an agreement which allows them to take ALL our natural resources. Instead, they take some and give us what we need.

I have learned to understand that to develop; you give some of your resources to get what you need now and in future. This time I'm with NPP government. I'm just skeptical of them, that's all. I will bring another article on Chinese view on this loan.