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There are very good reasons why all well-meaning Ghanaians must not only bare their teeth at the Akufo-Addo government, but also fiercely oppose government’s ‘treacherous’ dalliance with the Chinese Company, Star Times. Beyond the technicalities in the mysterious DTT ‘enhancement’ contract the Akufo-Addo government signed with Star Times on April 5, 2018, it is important Ghanaians understand why this government has made it an article of faith to be bed mate of the Chinese firm.
When the Ghana Independent Broadcasters Association and some Minority MPs raised concerns about government’s new deal with Star Times, the understanding most us got, courtesy the Communication ministry, was that the existing DTT network platform was not fit for purpose and desperately needed to be improved. Both the Minister of Communications and her deputy have both canvassed the point that there was the need for Star Times to enhance the work done by K-Net. K-Net, a wholly owned Ghanaian company, was the company the Mahama government contracted in 2015 to build the country’s DTT network platform at a cost of $82.4m. This was after the Mahama government abrogated the same contract it signed with Star Times in 2012 at a cost of $95m of which the Chinese company could not execute bescuse it could not secure the needed funding from China’s Eximbank as it promised.
Interestingly, the deputy Communications Minister, George Andah, who is now seeking to spit on the work K-Net had done, until recently decribed the DTT network platform built by K-Net as ‘amazing’. The deputy minister , in an interview with Joy FM, could not fathom how an indigenous company like K-Net developed such a robust platform at a cost of $13m lesser than what Star Times had wanted to charge Ghana.
All players in the technology industry, save the Communications Minster, her deputy and NPP unrepentant backers, believe there is absolutely nothing to be enhanced so far as the DDT platform is concern. If there is something to be enhanced, as the Communications ministry wants Ghanaians to believe, that supposed enhancement, commonsensically, must be done by those who built the DTT platform and not a new company. But as the Communications Minister explained on newsfile yesterday, the Akufo-Addo government’s only decision to reengage Star Times to virtually do nothing but, at the end pay them for work already executed by K-Net, was to ‘romance’ and impress the Chinese government to release loans it had pledged to government. So even if we have to enter into a bad deal with Star Times, like we are presently doing, for the Chinese government to release the $2 billion Sinohydro facility, $50 billion century bond etc, we must do it without recourse to the interest of our country and the plight of Ghanaians who voted for the New Patriotic Party.
The Communications Minister, thanks to her, inadvertently let out the intention of the Akufo Addo government in bringing back Star Times which could not fulfil it’s contractural obligations in 2015. The Minister made the point that her predecessor, Dr Edward Kofi Omane Boamah’s decision to abrogate Star Times’ contract in 2015 irked the Chinese government, and that affected Ghana’s long standing relationship with the Chinese government. As a result of this, the Chinese government, Ursula Owusu Ekuful explained, decided not to continue granting loans to government. The Minister further added that the Eastern Corridor road is in a deplorable state as it is today because the government of China decided to punish Ghana by not ‘giving us money’ to fix it because we abrogated our contract with Star Times.
In essence, what the Minister is saying is that the Akufo Addo government decided to renew Ghana’s marriage with China by reengaging Star Times with mouthwatering but questionable deals since that was the only way the Chinese government will smile back at Ghana and give us more money. So this was what the NPP government did. When the 2012 contract with Star Times was cancelled for nonperformance, the Chinese company sued the government of Ghana at the High Court, claiming $200m in judgment debt. Star Times lost the case. The Company appealed the decision of which they lost again. Not satisfied, lawyers of the Chinese firm invoked the appellate jurisdiction of the Supreme Court to overturn the verdict of the Court of Appeal; unfortunately they lost again. The company then went for International Arbitration in 2015, then again the arbitration tribunal gave a partial award in favor of Ghana.
At this point, the NDC lost the 2016 election and the NPP took over. From the series of cases Star Times had lost, it was clear that Dr Omane Boamah was right in abrogating the contract. Again, it was clear that Ghana had strong defense to knock out Star Times on any day at any forum. For very strange reasons, Ursula Owusu and her NPP concluded that Ghana had no case. In August 2017, the Communications Ministry signed a memorandum of understanding with Star Times to abrogate the arbitration process in London.
After doing this great disservice to Ghana, Ursula Owusu and her ministry then engaged Star Times to assess the DTT network platform with hopes of finding fault with it so the ministry could establish grounds on which to reaward the contract to Star Times to please the Chinese government. Unfortunately, Star Times after their assessment concluded that K-Net delivered beyond expectation. At this stage there was nothing the Ministry could do. But they finally found flimsy alibi that the DTT platform needed to be ‘enhanced’. Industry players including sources at K-Net have rejected this ‘enhancement’ argument. While at this, the Communications Ministry awarded another contract to Star Times in what has become known as the 300 villages satellite TV project with some “juicy” tax waivers. This project will be launched in Ursula Owusu’s constituency.
As it stands, Star Times has been awarded two juicy contracts by Ursula Owusu’s ministry. The DTT ‘enhancement’ contract which the Minister signed on April 5, 2018 needs to be explained further. According to the Minister, the contract states in parts, that the DTT enhancement project will be financed by a loan agreement between China Eximbank and Ghana. Mind you, it was this same Eximbank facility ‘thing’ that led to the abrogation of the first contract because Star Times could not raise the money. The Minister again explained that the April 5, 2018, contract she committed Ghana to would only take effect after the loan has been secured.
All China Eximbank -Ghana loan agreements are governed by framework agreements. The Communications Minister in her own words stated that, the existing frame work agreement to source funds from Eximbank for the DTT project has expired and that the Minister of Finance has applied for one which is yet to be approved. This is very worrying! Why was the Minister in a hurry to sign a contract when the terms of the loan to be used to execute that contract has not be discussed and agreed upon by all parties?
The Eximbank facility is an international agreement, therefore it will end up in Parliament for approval inline with article 181 of the 1992 constitution. What the Minister and the NPP government have done is to give the Chinese government superior bargaining power when negotiating the facility. In effect, what will eventually happen is that the deperate Akufo Addo government will have no option than to accept whatever terms the Chinese will bring to the negotation table. At the end, the NPP will use it’s numbers in Parliament to approve the loan agreement flowing from the negotiation however bad or detrimental it is to the interest of Ghana.
These are the reasons why the Burundi and Zambian experience being canvassed by Samuel George Nartey must be considered seriously. In Zambia, for instance, Star Times entered into an agreement with them not to manage or control their DTT but to only build it for them. Then in the loan agreement, the Chinese government managed to insert a term that in the event Zambia defaults, Star Times will manage and control the DTT for some years. The experience on the African continent shows that Star Times will come with the intention of building the DTT, then they will cleverly use their government to woo the country involved to agree with the terms in the loan agreement that Star Times will manage the DTT when the country defaults.
That is exactly the route Star Times is using again. The Minister says Star Times will only enhance the DTT and leave. The management and control of the DTT will be done by the Central Digital Migration Company which is yet to be formed. Curiously, the Minister herself does not know the terms the Chinese will introduce in respect of the loan agreement to finance the April 5, 2018 contract she signed without engaging key stakeholders. This is where we find ourselves where our Minister of Communications, a lawyer, signs a contract without knowing when it will take effect simply because we have to please China in order to access more loans.
What is so surprising is that Star Times is not a state owned company. The Chinese government has no shares in Star Times but it is using it as a bargaining chip to push it’s interest. And instead of our Communications Minister to raise objection to this unfair treatment, she is going round justifying what the Chinese government has done. I would be surprised if the government of Ghana would muster courage and tell China or any other country in the face that because they have abrogated a contract they have with a private firm from our country, we will not honor any obligation to them.
It is sad that the Akufo-Addo government is comfortably fighting to protect the interest of Chinese firms and awarding them undeserved contracts while indigenous companies suffer. And when they raise legitimate concerns, the Minister and her deputy say they are making ‘ugly noise.
By Amorse B Amos