Ghana’s Finance Minister says the cancellation of the deal with the power distribution service was to protect some $3 billion assets of the country’s electricity company

Ghana’s Finance Minister, Ken Ofori-Atta has explained that the government cancelled the power concession agreement with Power Distribution Services (PDS) to protect the $3 billion assets of the Electricity Company of Ghana (ECG).

Finance Minister Ken Ofori-Atta

According to him, there was no need pursuing the matter since some partners in the deal breached some agreements that were fundamental to the sustainability of the takeover.

“We had a 3 billion dollars of a national asset in play. We’ve gone through the procurement but when a mistake is made or a partner is seen not to have the capacity to do it, you do what you must do,” he said.

Mr Ofori-Atta said this while he spoke in an interview with Accra based Citi FM.

He noted that government had little time to take a strategic decision to rescue the assets of ECG, hence the need to go ahead with the abrogation of the PDS deal even after the USA cautioned the government of Ghana against it.

Responding on implications of the decision by the government to cancel the deal, the Minister argued that Ghana is currently in a position to manage its power sector prudently to avoid any form of crisis.

“Your contention is that without America, Ghana cannot do anything?” he questioned, adding that a sovereign country like Ghana should always have an alternative plan."

Independent Power Producers concerns

On concerns raised by the Independent Power Producers to clear a 1.5 billion dollars debt owe them, the Finance Minister explained that there is the need for the power producers to come to the negotiation table to restructure the Take or Pay contract agreement to Take and Pay to avert a situation where government keeps paying for energy not consumed.

“We want these IPPs to be our partners into the future, and they should participate in what we want to do,” he stressed.

He stated that the current status quo where the government is made to pay over a billion dollars every year for power not used is unsustainable.

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