Parliament approves loan agreements

Accra, Nov. 18, GNA - Parliament on Thursday approved two loan agreements between the Government and the African Development Fund (ADF) for the financing of a sustainable tsetse fly and trypanosomiasis free areas in East and West Africa and the second Poverty Reduction Support Loan (PRSL II).

The first loan agreement approved was for 6,640,000 Units of Account (UA) and a grant of UA 240,000 for the financing of a sustainable tsetse fly and trypanosomiasis control, which seeks to support Ghana and sub-Saharan Africa by integrating suppression, control and eradication technology while ensuring that reclaimed areas are equitably, sustainable and economically exploited.

Presenting the report, Mrs Grace Coleman, Chairman of the Finance Committee, said the committee observed that the social economic consequences of the disease area were serious.

"Apart from the serious constraint trypanosomiasis has been to livestock production, the tsetse fly is the transmitter of the usually fatal disease of sleeping sickness to humans."

Mrs Coleman said the committee further observed that the creation of a sustainable tsetse fly and trypanosomiasis free area in East and West Africa was expected to contribute to poverty reduction and food security improvement in Ghana.

She said the committee noted that apart from approving the loan agreement, the House was also being requested to grant tax and duty exemptions amounting to 1,316,003 US dollars for the purchase and importation of equipment for the project. The loan has a 40-year repayment period with a 10-year grace period and without any interest.

It is expected that the first phase of the project, which is expected to begin this year, would be completed within six years from the effective date after which the second and third phases would start.

The second loan of 44 million UA meant for the second Poverty Reduction Support Loan (PRSL II) seeks to support the government's economic reform efforts as outlined in the Ghana Poverty Reduction Strategy (GPRS).

Mrs Coleman said the ADF in collaboration with other development partners would provide support to the Government to facilitate the implementation of the reforms and contribute towards Ghana's external financing requirements.

The project would involve improving service delivery for human resource development, improve the investment climate and strengthen governance and public sector management.

She said the Finance Committee in considering the loan observed that the first component of the programme should focus on ensuring progress on micro-economic stability, measures to reduce public domestic debts, increase credit to the private sector, measures to strengthen the business environment and the removal of administrative barriers for business.

The Committee noted that the discussion between the ADF and Ghana's investment development partners led to the agreement to provide budget support under economic framework called Multi Donor Budgetary Support Programme (MDBS).

It also agreed with the objectives of the MDBS of harmonising development partner's policies and procedures in order to minimise transaction costs for the government.

The loan has a repayment period of 40 years with a 10-year grace period with no interest.