The Minister of Finance, Ken Ofori-Atta, has disclosed that the Electricity Company of Ghana (ECG) will still have a private firm to partner it despite the cancellation of the deal with the Power Distribution Services Ghana Limited (PDS).
Addressing Parliament on Wednesday, Mr Ofori-Atta said the government cannot overstate the importance of learning from past mistakes.
He said the nation’s major power-distribution company still needs a private partner in order to make it more viable.
“Mr. Speaker, considering ECG’s current distribution systems losses of 24 per cent, comprising 13 per cent commercial and 11 per cent technical losses, government is truly motivated by the urgent need to reduce these losses and improve service quality through the effective deployment of modern technology and world-class technical expertise,” he said.
He said this will be with a view to creating a financially viable power distribution sector that is sufficiently equipped to meet the current and future needs of Ghanaian households and businesses.
Government’s concession agreement with PDS in March, 2019 culminated in a sudden suspension as fundamental errors were detected with the demand guarantees.
In July when the deal was suspended, an investigation was launched into the guarantees provided by Dubai-based Al Koot Insurance & Reinsurance.
Three months later, precisely on October 19, 2019, government abrogated the deal despite warnings from the US Government.
Mr Ofori-Atta said “while restoring private sector participation in the management, operation and financing of the required investments in ECG’s distribution assets, government will make every effort to avoid the pitfalls that the PDS concession encountered and institute broad Ghanaian institutional participation, as well as democratize local equity participation, with an eventual listing on the Ghana Stock Exchange”.
He assured that government remains committed to its relationship with the Millennium Challenge Corporation (MCC).
“Indeed, Government fully respects and is committed to the essential principles underlying the relationship between the MCC and the Government of Ghana, as well as the overall bilateral relationship between Ghana and the United States.”
He said plans are far advanced “to select a new private partner for ECG in the coming months”.