The government of Ghana started the process here on Wednesday to cancel the private sector participation (PSP) agreement with Power Distribution Services (PDS), the private sector partner which took over electricity distribution in southern Ghana, last March, Minister for Information Kojo Oppong-Nkrumah has said.
This announcement came soon after the American embassy announced the cancellation of the 190 million US dollars grants earmarked for the operations of the PSP.
The minister explained that the cancelation had become necessary as the government and the PSP partners could not find common ground to resolve their differences arising out of an alleged forged insurance guarantee.
The government had announced the suspension of the contract in July, explaining that it had discovered some anomalies in the guarantee presented by PDS.
Under its second compact with Ghana, the US government agency Millennium Challenge Corporation (MCC) was to provide nearly half a billion dollars for the West African country to reform its energy sector. As part of the agreement, Ghana was to allow private sector participation in the management of power distribution.
The cancelation of the PDS deal and the subsequent action by the MCC means Ghana loses 190 million dollars from the total grant.
Meanwhile, former Ghanaian president John Dramani Mahama, under whose tenure the second compact was designed and agreed to, has expressed disappointment at the turn of events.
“Fellow Ghanaians, we are all deeply disappointed because of the self-serving decisions, and the deliberate acts perpetrated …in the electricity company of Ghana concessionaire agreement that has led us to where we are today,” Mahama posted on his social media page. Enditem