Mr Speaker, I beg to move, that this Honourable House adopts the Report of the Finance Committee on the Request for waiver of Import Duties, Import VAT, ECOWAS Levy, EXIM Levy, Special Import Levy amounting to the Ghana Cedi equivalent of six million, four hundred and twenty-one thousand, nine hundred and nine euros (€6,421,909.00) [equivalent to GH¢33,575,665.52] on project materials and equipment in respect of the Construction of Bridges in Northern Ghana.
Mr Speaker, in doing so, I present your Committee's Report.
Introduction
Export Credit Facility Agreement between the Government of the Republic of Ghana and the Danske Bank A/S Denmark through the DANIDA Business Finance (DBF) for an amount of sixty- two million, seven hundred and eighty-one thousand, four hundred and eighty-three euros and thirty cents (€62,781,483.30) for the construction of bridges in Northern Ghana Request for waiver of Import Duties, Import VAT, ECOWAS Levy, EXIM
Levy, Special Import Levy amounting to the Ghana cedi equivalent of six million, four hundred and twenty-one thousand, nine hundred and nine euros (€6,421,909.00) [equivalent to thirty-three million, five hundred and seventy-five thousand, six hundred and sixty-five Ghana cedis and fifty-two pesewas (GH¢33,575,665.52)] on project materials and equipment in respect of the construction of bridges in northern Ghana, were presented to the House on Wednesday, 25th July, 2018, by the Honourable Deputy Minister for Finance, Mrs Abena Osei- Asare on behalf of the Minister for Finance.
Pursuant to article 103 of the 1992 Constitution and Orders 169 and 171 of the Standing Orders of the House, the Agreement and the Request were referred to the Committee on Finance for consideration and report.
The Committee subsequently met and discussed the Agreement and the Request with the Deputy Minister for Energy, Hon William Owuraku Aidoo, a Deputy Minister for Finance, Hon Kwaku Kwarteng, as well as officials from the Ministries of Finance and Energy and the Ghana Revenue Authority.
The Committee hereby submits this Report to the House, pursuant to Order 161(1) of the Standing Orders of the House.
The Committee is grateful to the Deputy Minister for Energy, Deputy Minister for Finance and the officials for attending upon the Committee.
References
The Committee referred to and was guided by the following “documents inter alia during its deliberations on the Agreement:
The 1992 Constitution of the Republic of Ghana;
The Standing Orders of the Parliament of Ghana;
The Public Financial Management Act of 2016 (Act 921).
Background
In September 2007, heavy rains caused significant damage to a number of bridges and cross drainage structures. As a result, the routes to most farming communities were cut off, severely hampering travel to and from these areas.
As a temporary response, the Government of Ghana, with assistance from DANIDA undertook emergency repair works by installing Bailey Bridges and other temporary structures at the affected crossings until such time that permanent bridges could be provided.
In April 2009, the Government of Ghana, acting through the Ministry of Roads and Highways (MRH) and the Ghana Highway Authority (GHA), requested for financial support from the Danish Government through DANIDA for a credit facility to construct permanent bridges at six (6) selected locations of the affected areas which are of critical importance to the development of the Upper East and Upper West Regions of the country.
The current transport bottlenecks at the bridge locations do not only hamper potentially vibrant economic activities but also affect access to schools, hospitals, market centres et cetera resulting in low educational standard and greater incidence of poverty in the rural areas.
Government desires to enhance the standard of living of the rural people and to properly support the socio-economic development of rural areas by removing bottlenecks. It is in response to this that the Danske Bank, through DBF has agreed to provide a credit facility to finance the construction of the proposed bridges in northern Ghana.
Project Objectives
The objectives of the project include:
i. To open up the Upper East and Upper West Regions for enhanced integration;
ii. to reduce travel time and make movement of people from place to place less perilous;
iii. to satisfy the basic human needs by increasing accessibility to hospitals, schools and other social/cultural facilities which are greatly hampered due to lack of bridges at river crossing points;
iv. to remove traffic bottlenecks at river crossings and improve the movement of goods and people within the beneficiary areas;
v. to contribute to agricultural growth, overall economic development and alleviation of poverty.
Terms and conditions of the loan
The terms and conditions of the Loan are as follows:
Facility Amount -- €62,781,483.30
Grant Amount -- €11,145,217.00
Grace Period -- 4 years
Repayment Period -- 10 years (20 equal semi-annual consecutive instalments)
Interest rate -- Euribor + 1.35 per cent p.a. (Cost of Funds) + 0.2 per cent p.a. (% per annum) (Bank Margin payable with DANIDA GRANT)
Commitment Fee -- 0.25 per cent per annum
Management Fee -- 0.375 per cent
Grant Element -- 41.38 per cent
Project Components and Description
Particulars of the bridges to be financed from the Credit Facility from DANSKE BANK are as shown in the table below:
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