Madam Speaker,
I beg to move, that this Honourable House adopts the Report of the Finance Committee on the Concessionary Credit Line Agreement between the Republic of Ghana and Exim Bank of India for an amount of US$21.72 million to Finance Improved Fish Harvesting and Fish Processing Project and Waste Manage- ment Equipment and Management Support Project.
Madam Speaker, in doing so, I present your Committee's Report.
1.0 Introduction
The Concessionary Credit Line Agreement between the Government of the Republic of Ghana and Export- Import Bank of India for an amount of twenty-one million, seven hundred and twenty thousand United States dollars (US$21.72) to finance Improved Fish Harvesting and Fish Processing Project and Waste Management Equipment and Management Support Project was laid in the House on Thursday, November 19, 2009 in accordance with article 181 of the Constitution.
Pursuant to article 103 of the Cons- titution and Order 171(1) of the Standing Orders of the House, the Agreement was referred to the Finance Committee for consideration and report.
The Committee met and considered the Agreement with the Minister for Local
Government and Rural Development, Hon Joseph Yieleh Chireh, Deputy Minister for Finance and Economic Planning, Hon Seth Terkpeh, officials from the Ministry of Finance and Economic Planning, Ministry of Local Government and Rural Development and Ministry of Food and Agriculture and hereby, presents this Report.
2.0 Background
In March, 2004, a Memorandum of Understanding (MoU) was signed at the Techno-Economic Approach for Africa- India Movement (TEAM-9) Ministerial meeting in New Delhi, India. The Indian Government, under the terms of the MoU, made a sum of US$500 million credit financing available on concessional terms to eight West African countries including Ghana. This concessional financing is meant to finance projects which impacted on national development, poverty alleviation, food security, infrastructure and regional integration.
The Government of Ghana, in pursuit of this memorandum submitted a request for financial assistance totalling US$728 million from the Indian Government. Out of this request, the Indian Government has offered US$21.72 million to the Government of Ghana through the Exim Bank of India.
Out of the total of US$21.72 million, US$11 million is to used to finance improved fish harvesting and fish processing project while the remaining US$10.72 million would be used for waste management equipment and waste management support.
3.0 Purpose of the Loan
The purpose of the facility is to finance Improved Fish Harvesting and Fish Processing Project to be implemented by the Ministry of Food and Agriculture and
to acquire Waste Management Equipment and provide Waste Management Support to Metropolitan and Municipal Assemblies under the auspices of the Ministry of Local Government and Rural Development.
4.0 Terms and Conditions
The terms and conditions of the facility are as follows:
Credit Amount -- US$21.72 million
Interest Rate -- 1.75 per cent
Grace Period -- 5 years
Repayment Period -- 15 years
Maturity Period -- 20 years
Commitment Fee -- 0.50 per cent p . a . o n the unutilized amount
Grant Element -- 40.53 per cent
5.0 Observations
The Committee observed that currently, government policy requires District Assemblies to take care of at least, 20 per cent of waste collection and disposal while the private sector takes care of the remaining 80 per cent. District Assemblies are therefore required to have some minimum equipment to deal with the 20 per cent requirement and also to stand in a good stead to step in when the private sector is unable to perform its contract.
The Committee was informed that the last time waste management equipment were acquired for District Assemblies was in 1996. Most of these equipment were said to be in a very bad condition currently
due to the many years of wear and tear.
The Committee was further informed by the technical team from the Ministry of Local Government and Rural Development that there are currently 40 metropolises/ municipalities which are facing huge sanitation problems, many of whom do not have private sector involvement in waste management. These Assemblies need to be assisted to acquire capital intensive equipment to enable them deal effectively with sanitation.
Hon Members urged the Ministry of Local Government and Rural Development to provide incentives to encourage the private sector to go into waste manage- ment since it appears unsustainable for the Assemblies to single-handedly deal effectively with the collection, treatment and disposal of waste.
The Minister for Local Government and Rural Development, Hon Joseph Yieleh Chireh assured the Committee that Cabinet is currently considering a draft national policy on waste management to provide a holistic and comprehensive approach to sanitation and waste management in the country.
On the US$11 million allocated to fisheries, officials from the Fisheries Commission under the Ministry of Food and Agriculture informed the Committee that a fish processing plant would be established for the processing of tuna so as to ensure enhanced foreign exchange earnings from the export of processed tuna instead of the raw exports. This plant would be a privately owned facility supported by Government to provide jobs and obtain foreign exchange for the country.
The Committee was also informed that part of the facility would be applied to provide fibre lining for canoes of fishermen to make the canoes more durable. Members however suggested
that complete fibre glass canoes be built for fishermen so as to reduce the pressure on our forests for canoe-making lumber.
5.1 Taxes
The Committee observed that in accordance with clause D of the Schedule to the Agreement, no deduction shall be made from the credit facility for taxes, fees and levies, otherwise repayments to India EXIM Bank shall be increased to cater for these taxes, duties and levies.
The Committee recommends to the Ministry of Finance and Economic Planning to endeavour to bring to the House, a formal request for the waiver of taxes and duties associated with the execution of the project.
6.0 Conclusion
The Committee respectfully recom- mends to the House to adopt this Report and approve by Resolution, the Con-cessionary Credit Line Agreement between the Government of the Republic of Ghana and Export-Import Bank of India for an amount of twenty-one million, seven hundred and twenty thousand United States dollars (US$21.72 million) to finance Improved Fish Harvesting and Fish Processing Project and Waste Management Equipment and Management Support Project in accordance with article 181 of the Constitution, sections 3 and 7 of the Loans Act, 1970 (Act 335) and the Standing Orders of the House.
Respectfully submitted.