Cost Of Projects Under Sinohydro Deal Ballooned; Minority Goes Wild

The Minority in Parliament raises fresh concerns about what they call the rising cost of projects under the Sinohydro deal.

According to the Minority Spokesperson on Roads and Transport, Kwame Agbodza, the average cost of a kilometre of a road under the project has shot up from the initial sum of over 1million dollars to about 6 million Ghana cedis because of the declining value of the cedi against the dollar.

He says this could get worse if there is a continuous delay of the project due to the free fall of the cedi.

“We the Minority have always said that the government of the day needs to invest a lot more for us to upgrade our roads and I sympathize with the Roads Minister who has to answer the largest questions in this House about roads and he diligently did that. But, unfortunately, he does not get the corresponding finances to do the project. Everybody was aware government was chasing some Sinohydro money.”

“That money is about 640 million dollars to build 441 kilometres of road and two interchanges. One in Takoradi and another in Tamale. If you take the money for the two which is about 100 million out and divide the 441 by the rest of the money, a kilometre of road, none of which is really asphalt will be 1.2 million dollars.”

He said as of the time the agreement was passed in Parliament “it would have been about 5 million Ghana cedi per kilometre” but said “because of exchange rate losses, today each of these roads will be more than GHC 6 million.”

“And I am saying that the longer the project takes, the more expensive it will become…The entire Synohydro project is an issue that we need to discuss. There is no value for money. It is not part of the agreement as we are being told,” Mr. Agbodza argued.

Sinohydro deal

The government sealed an agreement with the Chinese government to sell refined bauxite to China's Sinohydro Group Limited and in return receive $2 billion to undertake infrastructure projects in the country.

The agreement among others will fund the infrastructure projects in Ghana, including roads, bridges, interchanges, hospitals, housing, railway development as well as rural electrification.

The Minority in Parliament had written to the International Monetary Fund over the issue.

According to the Minority, the $2 billion bauxite deal is a loan despite attempts by the government to make Ghanaians believe it is a barter arrangement that would not bloat the country's debt stock.

According to the Minority, the agreement is similar to the $3 billion petroleum-based China Development Bank (CDB) loan agreement the country went for when it wanted to build its gas infrastructure.

However, the World Bank in a response clarified that the facility was not a loan.

–citinewsroom