Chinese loan refusal: MP suspects diplomatic row over StarTimes Contract abrogation

New Patriotic Party Member of Parliament for Okaikoi Central, Patrick Boamah, says a simmering diplomatic row between Ghana and China appears to have led to that country’s refusal to grant a loan to Ghana for major road projects.

This row the MP suspects may have come about as a result of Ghana’s cancellation of the Digital Terrestrial Television migration contract with Chinese firm, StarTimes. 

The Ministry of Communications which announced the abrogation of the StarTimes Contract last week; also announced a new deal with a wholly Ghanaian owned company K-NET, which will cost a $82.4 million.

According to the ministry, the new deal is cheaper and will help government save $13 million dollars from the US$95 million it would have paid to StarTimes.

According to government, StarTimes had breached the contract by delaying in securing funding although the deadline for the migration is fast approaching.

But StarTimes among other things, is alleging that the cancellation may have been manipulated by the Deputy Communications Minister, Ato Sarpong, who once worked for K-NET before his recent appointment as a deputy minister.

StarTimes has since served notice it would be seeking the intervention of international arbiters to sue Ghana for 200 million dollars for wrongful termination of contract.

China has in a letter written to Ghana’s Finance Minister, Seth Terkper, refused to fund a loan application for three major roads across the country.

The three road projects were the Accra Outer ring road project; the Mankessim-Agona Swedru-Nsawam Road Re-construction project and the Dodowa-Kpong & Somanya Akuse Junction Road Re-Construction project.

But the Chinese concluded that these projects for which the loan was being contracted were not viable enough to repay the loan by themselves.

They pointed out that granting that loan application will only worsen Ghana’s debt crisis. The Project Manager at the Chinese Bank advised the Ghana government to explore other funding opportunities if it still wants to go ahead with the projects.

But in an interview on News 360 on Wednesday,  MP for Okaikoi Central, Patrick Boahmah, said although the reasons outlined by China for the rejection of the loan may be reasonable, they are also questionable.

Without any concrete evidence however, the MP conjectured that the recent abrogation of the digital migration contract, could be the underpinning factor.

According to him, consequences for diplomatic rows come in different forms and this could be one of the ways China is employing to show their displeasure about the manner in which a company which Chinese interest may have been treated.

The MP also suggested that there could be merit in the claim by StarTimes that the Deputy Commutations Minister, Ato Sarpong, may have manipulated the award of the contract to K-NET, a company he once worked for before his appointment.

The MP expressed concern about the refusal of the loan which he said Government was looking forward to it for major road projects.

He has thus advised government to investigate the possible diplomatic row and tackle it head-on.

By: Ebenezer Afanyi Dadzie/

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