Bright Simons, Vice President of IMANI Africa, has called for a comprehensive overhaul of the framework guiding Ghanaian officials when entering into international contracts, particularly those with high-performance standards. He emphasized the need for independent reviews of technical analyses concerning commercial risks in government legal engagements to prevent costly judgment debts.
Simons’ comments come in the wake of a $111,493,828.82 judgment debt awarded against Ghana by a District of Columbia Court in favor of the Ghana Power Generation Company (GPGC). This judgment was issued following Ghana’s failure to comply fully with an earlier tribunal decision from the United Kingdom. The court also mandated Ghana to pay post-judgment interest.
In a post on his X platform, Simons pointed out the compounding effects of Ghana’s decision to make partial payments outside of an agreed payment plan, noting that despite nearly $100 million already paid, the original debt has hardly decreased. “That’s the sheer power of compound interest!” he remarked.
Simons further highlighted ongoing negotiations to prevent Trafigura from seizing Ghana’s government properties in the UK. However, he revealed that Regina House, Ghana’s largest property in Central London, is already under receivership, with all rent payments now directed to Trafigura.
He criticized the Energy Commission’s advice to the government, which suggested that terminating the GPGC deal would cost Ghana only $18 million—significantly lower than the ~$100 million cost over the four-year contract term for power that Ghana allegedly did not need. Simons questioned the basis of this analysis, noting that the investor’s costs had not been fully assessed.
To address these issues, Simons proposed minimizing interagency chaos by establishing an interagency committee to oversee contracts involving multiple government bodies. He warned that officials exploiting interagency disarray have consistently compounded the country’s risks, leading to numerous arbitral awards against Ghana, dating back to the late 1980s.
Simons also stressed the importance of independent technical analysis and greater transparency in government contracts. He argued that when it is clear a government agency is at fault, there should be a mechanism within the Presidency to expedite settlement, regardless of the agency involved. He questioned why the government continues to delay payments, allowing interest to accumulate, even when it is no longer defending the case.
Meanwhile, Ghana’s High Commissioner to the United Kingdom, Papa Owusu-Ankomah, has clarified that Regina House remains the property of the Government of Ghana, though it is currently under receivership due to the judgment debt. He noted that while the rent from the property does not go to the government, the building has not been sold, and there are no immediate plans to sell it to defray the debt. Negotiations between Ghana and GPGC are ongoing to resolve the issue.
In a country where accountability is taken very seriously by the citizens, the latest Trafigura judgment debt instalment would be the subject of a major inquiry.
But how many know that:
1. Because of a decision to pay in bits, outside an agreed payment plan, Ghana had paid…
— Bright Simons (@BBSimons) August 22, 2024
