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16.10.2005 Business & Finance

Where is United Rail?

By Ghana Palaver
Where is United Rail?
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...As Ameyaw-Ekumfi appears totally confused Under the headline “Moves to remove GRC from divestiture list”, the following extract from an innocuous-sounding story was tucked away at page 31 of the 'Daily Graphic' of Thursday October 6, 2005:

“The Minister of Harbours and Railways has initiated moves to temporarily remove the distressed Ghana Railway Company (GRC) from the divestiture list.

The move is aimed, among others, at reverting the company back to the status of a government subvented organisation and also to allow it to source loans to improve and rehabilitate its dilapidated facilities.

He discounted claims that United Rail had withdrawn from participating in the revamping of the company and said his contact with the company indicated that it was still interested in the deal.

Professor Ameyaw-Akumfi said there were many issues that needed to be resolved to get the deal finalised.

He mentioned, for instance, the payment of retrenchment fees to the workers to be laid off, among others, and noted that until those issues had been ironed out, the consortium could not take over”

The story also mentioned that the Minister had made a proposal to the Ministry of Finance to factor into the 2006 budget an amount of $27 million to enable the company carry out its retrenchment exercise and had also requested for ¢20 billion in the budget to undertake routine maintenance in 2006, in addition to ¢9 billion already released from the HIPC funds for similar exercises this year.

Here are a few questions for Professor Ameyaw-Ekumfi: How much investment from United Rail is he expecting in the GRC for him to think that a $27 million expenditure on retrenchment alone is a viable economic proposition?

What outputs and outcomes is he expecting from a 2006 ¢20 billion investment in routine maintenance?

If he knew that all these outstanding matters were yet to be cleared, why did he assemble the distinguished negotiating team comprising legal academics and investment consultants to waste their time negotiating with United Rail?

The last time the talks with United Rail were adjourned, the excuse Professor Ameyaw-Ekumfi gave was that they had been asked to go and incorporate the Kyebi-Tema railway line designed for the Integrated Aluminium Project into their technical and financial proposals. Why is he now shifting to non-payment of retrenchment entitlements as the reason for the United Rail consortium not taking over the GRC?

How can the Professor be talking about taking GRC off the divestiture list and maintaining at the same time that United Rail is still interested in having GRC divested to it?

Ghana Palaver, Radio Gold and other media houses have raised issues about the bona fides of United Rail and the members of the consortium allegedly constituting the company. At the last check the company named by United Rail's lead negotiator Mathew Bruce Burrows, as the lead financier of the consortium, Trackbed Foundation of the Isle of Man, was found to be worth only £2. Has Professor Ameyaw-Ekumfi found out anything to the contrary? We will stop here for now. We will come back after Professor Ameyaw-Ekumfi has provided some responses to these preliminary questions.