The Vice-President, Department of Compact Operations at the Millennium Challenge Corporation (MCC), Mr Kamran M. Khan, announced this to some selected media at the United States Embassy in Accra on May 15, when he briefed them on the status of the MCC Compact II.
He also said the funds would be disbursed from December, this year.
This is a shift from the earlier expectations that the funds would be released from May this year.
Although Mr Khan would not say, it was clear that the change in date had to do with the inability of the government to meet undisclosed obligations under the compact.
However, he noted that the MCC was satisfied with the progress made so far by the government and expressed the hope that by December, everything would fall in place.
“There are certain steps that the government has to take. These are steps that I will not define as complicated but are things that take some time to go through,” he said.
According to him, the MCC is keen on having the government embark on institutional changes so there are certain steps and analysis that have to be completed that basically will make both sides feel comfortable for money to start coming.
Mr Khan explained that under the terms of the compact, funds are to be released according to the projects to be executed and strictly based on the fulfilment of all requirements that will ensure efficient use of the money.
On whether local companies will be allowed to benefit from the compact in anyway, he said there was a possibility of some joint ventures, because if it is a foreign company that wins to run the concession, it will require local companies to be able to assist in executing the project successfully.
Mr Khan disclosed that the MCC had received communication from the government to the effect that the Electricity Company of Ghana (ECG) would be released on concession to a private company yet to be determined.
“We think it is a good option,” he said, adding: “We do not have any technical issues with the decision of the government. We think it is a very reasonable option to apply.”
According to him, countries around the world have tried it effectively. He gave an assurance that ‘this can be done here in Ghana to achieve the right results to transform ECG to deliver the kind of services required to improve its efficiency.’
Mr Khan said there were experienced companies around the world to write these contracts and to structure them in such a way that “the public interest is protected; the interest of the government is fully protected and the asset remains within the ownership of the government.”
He noted that it was the intention of the government to provide efficiency in the distribution of power in Ghana.
“That’s the objective of the government so how do you make ECG more efficient, empower the staff to be more efficient and be able to accomplish things that they want to accomplish. So there were a lot of options reviewed and the one selected and communicated to us was a concession.”