FOREX RATE

15 BILLION DOLLAR CHINESE FACILITY NOT A LOAN – VENTURE CAPITALIST

A Venture Capitalist, Michael Essel-Mills has debunked the assertion that the 15 billion dollar Chinese facility that Ghana is about to access to boost the realisation of the campaign promises of the Nana Akufo-Addo led NPP government, is a loan facility which will attract interest.

Mr Michael Essel Mills says government is giving out its natural resource [bauxite] for the 15 billion dollars which it urgently needs to address the infrastructure deficit of the economy but does not readily have in its coffers, hence the need to leverage the facility with the natural resource of the country. He explained that no interest is going to be paid on the facility because per the arrangement, government of Ghana is mortgaging its untapped natural resources to the Chinese for the money.

It would be recalled that a high powered government delegation led by the Vice President, Dr. Mahamudu Bawumia, together with Executive Members of the Association of Ghana Industries (AGI) went to China a few days ago to woo investors into the country. Whilst in China, the Vice President succeeded in signing a Memorandum of Understanding (MOU) with the Chinese to pump 15 billion dollars into the Ghanaian economy to get its infrastructure deficit corrected. A section of Ghanaians have raised concerns about the agreement, saying the 15 billion dollar facility when accessed could ground the economy, which is a little over 40 billion dollars, to a halt.

But Mr. Michael Essel Mills in an exclusive interview with Samuel Kojo Brace, Host of the Jolly Breakfast Show on Skyy Power FM in Takoradi, Wednesday, said what went on between the Vice President and the Chinese is “just an expression of interest” on the part of the Chinese to give out money to the government of Ghana in exchange of a natural resource. He said per the agreement, the Government of Ghana would not pay any interest on the facility.

Mr. Michael Essel Mills stressed that: “we have manganese and bauxite totalling about 480 billion dollars sitting under ground, so, the point is that the negotiation is going to be centred on the fact that how much are you sinking in and how much can we also give you as part of our natural resources. It’s not a matter of we are giving you everything.”

Speaking on the need to seek parliamentary approval for the transaction, he said “the interest needs to be expressed before, so, it’s just a primary step that the government has taken with the assurance that if we’re able to tie the loose ends; the loose ends meaning that China needs natural resources, Ghana needs money, so, let it be established that if China needs natural resources and Ghana needs money, then it means that the two of them need something from each other. So, we’ve agreed in principle to work it out and see that how much of your component will be appropriate for you to be given in exchange of my resources.

”That’s why I’m saying that it’s just at the nascent stage of the arrangement; I don’t know why the opposition is trying to blow it out of proportion to make it look as if Ghana has actually contracted itself into a loan or something. It’s just an expression of interest and the interest is that the two sovereign states have agreed that each of them needs something from each other, so, it’s a primary step and we’re going to take it from here. When we get into the details that’s where we’ll be able to quantify how much of our natural resources that’ll be equivalent to the money that we’re taking” he observed.

Mr. Michael Essel Mills allayed the fears that Ghanaians are harbouring about this facility, saying the Akufo-Addo led NPP administration would not enter into any international treaty or agreement that would be counter-productive to the country’s already reeling economy.

 

 

Story: Isaac Ossam/Skyy News/Takoradi

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