Ghana to renegotiate with US for $190 million for electricity

Ghana is ready to renegotiate with the United States (US) Government for possible reinstatement of $190 million under the Millennium Challenge Corporation (MCC), that had been devoted to the electricity sector.

President John Dramani Mahama disclosed this during a courtesy call on him by Mr Ousmane Diagana, the World Bank Vice President for West and Central Africa, in Accra.

Mr Diagana was in Accra to witness the inauguration of President Mahama at Independence Square, which took place on January 7. Mr Mahama reiterated that there was the need for his administration to change the systems in the energy sector to make sure that they pay down the debts and make it more efficient than it was currently.

He recalled that during his tenure as Vice President under the late President Professor John Evans Atta Mills, he on behalf of the President, signed the MCC, which was meant to improve and make Ghana the most efficient producer of electricity in Africa and become a major hub for electricity exports.

“Unfortunately, democracy has its dividends, but it also sometimes can be a curse. We left government and a new government took over and took over the Millennium Challenge Compact. Next up, the last segment of it, which was providing efficiency in distribution, billing, metering, and all that,” he stated.

“And of course, PDS is history now. But we want to look at that again because if we do not fix the Electricity Company of Ghana, we will continue to have a major problem with our whole power value chain.  “And so, going ahead with privatizing the last point of distribution of electricity to bring in private sector efficiency is something that we want to take up again.”

“I spoke to the Americans and met the Millennium Challenge Corporation, and we asked if it was possible for them to reinstate the $190 million that they had devoted to that aspect of it. And they said the door is not closed,” the President said. “And so, we need to pursue that discussion. Or, if we don’t have access to the $190 million, if the World Bank can support us to be able to finish that aspect of it, we can reduce the losses where it has to do with the independent power producers (IPPs).”

He said in the meantime, they would restore some transparency in the system, restore the cash waterfall mechanism to stabilise the situation until they were able to carry out all the reforms in that sector.  Mr Ousmane Diagana, the World Bank Vice President for West and Central Africa, underscored Bank’s commitment to support Ghana’s socioeconomic development agenda.

Source: GNA