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28.09.2005 General News

Why Rawlings is bitter

By Statesman
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UNTIL John Agyekum Kufuor trounced the National Democratic Congress in 2000 to succeed Jerry John Rawlings, the feud between Edward Heath and Margaret Thatcher, which lasted 30 years, was the international standard. But, even that was civil.

Until his recent death, former British prime minister Sir Ted Heath never forgave Baroness Thatcher for ousting him in 1975, expressing his bitterness with savage attacks on everything that she did or said.

Similarly, our own former President is finding the compulsion of his fate, out of office, bitter. While it is taken for granted that former President Rawlings does not want to forgive President Kufuor for sending the NDC into opposition, the intensity of the hostility made many people wonder if there was more to it. After several checks and discussions with several people, The Statesman can reveal one of the major issues fuelling the flames of JJ's pique.

Remorse is supposed to sleep during prosperity but awakes bitter consciousness during adversity. Part of Mr Rawlings' problem, our checks with officials and people close to him suggest, is all about money. The amount involved is nearly $10 million.

After 19 years in power, the Constitution of the Republic of Ghana was to ensure that Ghana's longest serving head of state went into retirement. As part of his retirement package, $2m was spent to renovate Australia House as a parting gift. This never materialised because the Kufuor administration decided to hold on to it as a state guest house. In fact, that is where UN General Secretary Kofi Annan stayed on his last home trip, when he tried to reconcile Messrs Kufuor and Rawlings.

But, a major source of the former President's grievance is the $10 million cocoa processing factory at Tema. This factory, according to our findings, is allegedly owned by Mr and Mrs Rawlings, with an NGO fronting for the former first couple. A close friend of the Rawlingses has alleged that the factory was built to serve as a “legitimate” constant source of domestic income for the “couple who sacrificed so much of their years in service for the country they love so much.”

The source accuses the NPP government of “vindictiveness.”

Another close source to NDC Founder says Mr Rawlings is “bitter and mad” because he is very convinced that “Kufuor, Nana Akufo-Addo, Francis Poku, Poku Kyei and Dua Agyemang have been trying dirty tricks since day one to deny his wife the use of this factory.”

The source says Mr Rawlings cannot understand why the Ministry of Finance is refusing to release the last disbursement of about $1.8m, “so that the factory can start running and create jobs.”

Two years before the NDC handed over power, Government obtained from the Chinese government a loan equivalent to about $18 million, through the Chinese Exim Bank. This was a concessionary project loan for on-lending to finance industries in Ghana.

The NDC selected three projects involving gold mining, fishing ropes and nets and cocoa processing.

Ghana had been woefully negligent in not adding value to its major export product, cocoa and this was seen as a major way of tackling that. But, like many government-guaranteed loans under the NDC that fell victim to crony capitalism, almost half of the total amount, $8.8m, was allocated to Calf Cocoa International Company. This company is a jointly owned by Caridem Development Company and Chinese investors (who control 55%). Caridem is 100% owned by a charity organisation controlled by Mrs Agyeman Konadu Rawlings, 31st December Women's Movement.

Between April 2000 and March 2003, records available show that a total of $6.9m had been disbursed to Calf Cocoa International through their bankers, the National Investment bank, Accra.

While a fraction of this amount is allegedly unaccounted for, the bulk was used in acquiring the building, machinery plant and equipment for the cocoa processing factory.

This leaves an undrawn balance of $1.8m, which a source at the Finance Ministry says, is still with the Exim Bank of China.

This outstanding balance is the source of Mr Rawlings' grievance, a source says. However, a Finance Ministry has countered that saying, “while we are not comfortable with the kind of favouritism extended to a company controlled by the First Lady at the time, we continued with disbursement. We cannot release any more funds as we have not been satisfied by the capacity of Caridem to pay off the loan. And no proper mechanisms were put in place to ensure that a floating charge secured Government's investment in this major project. Not even the insurance covering the plant and equipment. In any case,” the source added, “all that is left for them is working capital to buy cocoa seeds. And nobody is stopping them from finding money elsewhere to continue.”

In the view of this high-placed official source, “Caridem and Co are just interested in cheap money. They have already gained access to nearly $7m of such cheap money from Government and they want more. But, we want to make sure that we are being prudent with state resources. Nobody is stopping them from operating the plant.”

Government is investigating how the 31st December Women's Movement came about the nearly $600,000 initial equity investment made into the company, since the amount is not supported by the NGO's statement of accounts.

The factory is completed and, indeed, sources close to Mr Rawlings have confirmed to The Statesman that “dry test runs” have been done on the plant. Mr Rawlings has complained bitterly to friends and visitors, at both home and abroad, about the removal of his courtesies and the “frustration” that his wife has gone through in getting the cocoa processing factory off the ground. But, as the 19th century French author observed, “Strong and bitter words indicate a weak cause.”

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