The Hon. Minister
Minister of Finance & Economic Planning
Ministries, Accra

Attn: Dr. Kwabena Duffour

This is in response to your letter dated 12th April, 2009.

In that letter, you stated that Austro-Invest by its letter dated 16th February 2010 indicated that it is prepared to accept one percent (1%) of the total value of the project as compensation and that Austro-Invest had agreed with Mr. Alfred Woyome for the amount to be divided between them.

You also stated that you have a copy of a petition by Mr. Woyome in which be makes a claim for two percent (2%) of the total value of the project, to be shared between Mr. Woyome and Austro-Invest.

Furthermore, you indicated that your Accounts Office require clarity and evidence on the supporting documentation with regard to whether the claim is being made by the consortium that won the bid to conduct the financial engineering led by Mr. Woyome, jointly or separately.

Further to a Ministry of Finance letter dated 4th May 2005, Mr. Woyome made arrangements for the grant of concessional loans for the rehabilitation of the Ohene Djan and Baba Yara stadia and the construction of three others for the Ghana 2008 football tournament, the construction of six (6) hospitals and the Cobait to Irradiation Plant among others.

Mr. Woyome’s role in project financial engineering is further evidenced by the letter from the Ministry of Education and Sports dated 5th July 2005 and an earlier letter from the then Minister for Environment and Science, Prof. Kasim Kasanga dated 28th October 2004. In addition, Mr. Woyome together with Waterville set up offices in Vienna, Austria and Washington D. C. Italy and Switzerland as part of the project financial engineering work for the projects in Ghana (copies of letters attached). It can be seen from the available documentation that Mr. Woyome, as Alternate Director of M-Powapak at the time, acted as the principal party in discussions with government officials to facilitate the financial engineering of the projects.

Mr. Woyome then entered into an agreement with Austro-Invest on 1st September 2005 (copy attached) in which the Parties agreed to formalize their collaboration into a working business relationship for their mutual and common benefit. The agreement provided that Austro-Invest shall offer service relating to syndication of funds from financial institutions as part of the financial structuring and acquisition of projects by Mr. Woyome. The Parties also agreed that Mr. Woyome will pay Austro-Invest up to 15% of the total amount syndicated. This figure was subsequently negotiated downwards to 1% for Austro-Invest in the 16th February 2010 agreement.

Mr. Woyome’s role, as district from Austro-Invest’s role which was mainly for the syndication of funds, is further evidenced by correspondences with international financial institutions such as the Export-Import Bank of the United States and the Final Demand Letter of J. Michael Farrell, a Washington-based lawyer, who worked on Mr. Woyome’s instructions in respect of a contract involving Austro-Invest (copy of Demand Letter attached).

Mr. Michael Farrell has recently threatened to institute legal action against Mr. Woyome and the Government of Ghana for non-payment of legal fees relating to his work for Mr. Woyome (copy attached). Mr. Woyome has on 19th April 2010 also instituted a civil action against the Attorney-General and the Ministry of Finance to compel the Government of Ghana to pay him GH¢41,811,480. 59 being the cost of financial engineering owed to him, interest on the said sum from September 2006 till date of payment and genera damages for the inconvenience suffered by him for the delay in paying the financial engineering fees.

I wish to state therefore that the claim for the payment of two percent (2%) of the total value of the project was made by Mr. Alfred Woyome and Austro-Invest jointly and severally. Mr. Woyome’s claim is for one percent (1%) of the total value of the project engineering fees whilst the claim for Austro-Invest is also for compensation of one percent (1%) of the total value of the project financial engineering fees.

I wish to repeat here that the two percent (2%) that I recommended should be paid Mr. Woyome and Austro-Invest jointly and severally, but in the name of Mr. Woyome in accordance with their agreement of 16th February 2010, was arrived at through negotiations with Mr. Woyome. It is hoped that settlement of this matter through negotiations will forestall the legal action and the huge financial costs that will be incurred as a result of the payment of interest and damages.

Mr. Woyome, by his petition dated 18th February had indicated that the normal percentage charged for such project financial engineering is four percent (4%), but it was negotiated down to two percent (2%) by Government. I requested for the input of the Building Industry Consultants Limited, Mr. Magnus Rex Danquah and the Ministry of Finance to enable me make an informed decision with regard to what should be paid as compensation. It was based on the information received that I gave the opinion dated 31st March 2010 and the subsequent opinion dated 11th April 2010.

It will be recalled that the claim is for project financial engineering fees by Mr. Woyome and Austro-Invest. The financial arrangements were made in respect of the concurrent approval given by the Central Tender Review Board for the award of contract to Vamed Engineering, who transferred its rights in the project to Waterville Holdings (copies of letter of transfer and acceptance attached) and (copy of letter of Central Tender Review Board dated 5th August 2005 attached). It was in these circumstances that the then Government terminated the entire process.
It is my opinion that this letter dated 5th August 2005 formed the basis of a binding agreement between Vamed and the government of Ghana and the process having been terminated wrongfully by the government, the claimants were entitled to compensation for services rendered.

The claim for two percent (2%) of the total value of the project that Mr. Woyome and Austro-Invest financially engineered, which they have agreed should be paid to Mr. Woyome is therefore in order, hence my recommendation that you authorize payment of the amount due. Your Ministry may, however, negotiate with Mr. Woyome regarding the modalities for the payments of the amount due him.

Finally, I am making available to you the enclosed documentation from the Solicitor for Mr. Woyome for your records. I hope the documents will be of some relevance to you.

Betty Mould Iddrisu (Mrs)
Minister for Justice
29th April, 2010


The Chief of Staff
Office of the President
The Castle –Osu

The Deputy Ministers
Ministry of Finance & Economic Planning

The Ag. Chief Director
Ministry of Finance & Economic Planning

The Director, Legal
Ministry of Finance & Economic Planning

Source: The New Crusading Guide


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