Ghanaian government remains resolute over the termination of PDS agreement

Kojo Oppong-Nkrumah
  • The Ghanaian government has terminated the agreement between Electricity Company of Ghana and Power Distribution Services.
  • This is despite the United States' description of the termination as "unwarranted".
  • The workers of PDS will still remain staff of ECG.

The Ghanaian government has failed to change its position on its stance to terminate the agreement between the Electricity Company of Ghana (ECG) and Power Distribution Services (PDS).

At a press briefing on Wednesday (October 23, 2019), the Minister of Information, Kojo Oppong Nkrumah explained that the government will not compromise since they have found out that the concessionaire failed to meet a material and fundamental term of the concession agreement.

“The Ghanaian and American sides regret that we could not find a mutually agreeable path to have concluded the utilization of the full US$498 million. On the Ghana side, we are not able to compromise because we are advised and believe the same to be true, that the concessionaire failed as initially suspected to meet material and fundamental term of the concession agreement which was to deliver and maintain valid payment securities for the transfer of assets.”

“The two sides were not able to agree on a common path to resolve this point. The Government of Ghana consequently from 9 am this morning commenced the processes to terminate. The necessary documentations are being filed with PDS and the Energy Commission at the moment. It is expected that residual matters between EC and PDS will be resolved with dispatch. The Government of Ghana and the US Government will continue to work together on other development cooperation projects,” he added.

This is coming after the United States government said the termination was “unwarranted” and hopes the Ghana government respects contract sanctity to restructure the concession.

They added that “the US$190 million funds granted to Ghana at the March 1 transfer to the 20-year concession from ECG to PDS are no longer available.”

According to Deputy Energy Minister William Owuraku Aidoo, ECG is expected to take full control of assets after the termination of the PDS concessionaire agreement by the government.

“ECG has written to the Energy Commission informing it of the termination of the agreement between both parties and when all these things have been effected, ECG will assume full control of the assets which has previously been in possession of PDS,” he stated.

When asked what happens to the workers of PDS, the minister said that since there were no transfer and demand guarantees in place as of March 1, 2019, the workers of PDS will still remain the workers of ECG.

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