In the wake of the Agyapa Royalties Agreement brouhaha, the main opposition party, National Democratic Congress (NDC) has indicated that, its next Government will abrogate the agreement.
According to the Minority Leader Mr Haruna Iddrisu, the NDC Minority would put the London Stock Exchange and the Financial Conduct Authority on notice that the Agyapa Agreement did not meet the required due diligence and transparency.
Adding that, a substantial level of conflict of interest ran through the structuring of the agreement.
Haruna Oddrisu made these statements at the party’s 12th Weekly Press Briefing at its headquarters, Accra.
Explaining further, he pointed out that, the Agreement in question did not meet the minimum requirement of Ghana’s Constitution hence do have a lot of things shrouded in secrecy.
Such act he emphasizes is tainted with some corrupt acts and needs to be looked at again to safeguard the interest of the ordinary Ghanaian.
On August 14, the Minority Leader recalled that on that faithful Friday, the last day of the second meeting of the fourth session of the seventh Parliament, President Nana Addo Dankwa Akufo-Addo caused seven agreements relating to the Minerals Income Investment Fund (MIIF) to be laid before Parliament for approval.
These agreements he said sought to mortgage Ghana’s future mineral royalties and long term national assets in perpetuity without any regard to its implication on future national revenue streams.
“Through this transaction, the Akufo-Addo Government intends to use a Special Purpose Vehicle (SPV), Agyapa Royalties, incorporated as an offshore company in Jersey, in the Channel Islands, a known tax haven, in exchange for an upfront amount of $500 million, under the Mineral Development Fund Act, 2018 (Act 978) and its amendment Act”.
Revealing that, these Acts was yet to be assented to by the President in accordance with Article 106 of the 1992 Constitution to make it law.
“The Government of Ghana will own 51 per cent of the shares of the Company and remaining 49 per cent floated on the London Stock Exchange”, he stressed.
Members of Parliament he noted had less than four hours to scrutinize these agreements, and ascertain the extent to which they would enhance the welfare of the people of Ghana and in particular its ramifications on national revenue into the future.
“Paradoxically, the Akufo-Addo Government claims to have used two years to prepare these agreements and yet, the people’s representatives in Parliament were required to peruse and approve same in less than four hours”, he lamented.
Due to that, the NDC Minority in Parliament, took a strong position in the national interest that the indecent haste with which these high-stakes agreements were being rushed through the parliamentary approval process did not augur well for such an important exercise.
Adding that as representatives of the people of Ghana, it is their duty to ensure that, such agreements met key legal legal and constitutional requirements before approval.
In that regard, the Minority therefore, requested for the full complement of requisite documents to guide and facilitate a thorough scrutiny and due diligence of the proposed deal in accordance with article 185 of the 1992 constitution.
The key amongst these requisite documents were the prospectus for the eventual sale of shares in Agyapa through an Initial Public Offering (IPO) on the London Stock Exchange and the prospectus which contain more important details of the deal such as projected cash flows, underlying assumptions and the dividend policy.
Others were; incorporation details for the SPV, Agyapa Royalties, detailed justification for the choice of Jersey, a known tax haven and fiscal impact assessment.
Mr Iddrisu however said, to their utter dismay, the Government refused to make these key documents available to them on the excuse that they were in draft form and for reasons of confidentiality, could not be shared even with the elected representatives of the people of Ghana.
This decision of the Government he emphasized was in clear violation of Article 181(5) of the Constitution which required that such documents together with the agreements be laid before Parliament for approval.
“As a direct consequence of this concealment of vital information from the people of Ghana, the debate on the floor of Parliament was extremely acrimonious, and eventually, the Members of the Minority in Parliament were compelled to stage a walk out as a clear statement of our intent to protect the national interest at all cost”, he recalled.
On this grounds, the Minority leader categorically said “Minority in Parliament would like to state unequivocally that a future NDC Government would not honour the terms of “this unconscionable agreement.”
The NDC Mr. Iddrisu said strongly believes that, the decision to mortgage Ghana’s future mineral royalties in perpetuity was grossly inimical to the interest of the people of Ghana and runs contrary to the constitutional imperative that governmental power be exercised for the welfare of the people of Ghana.
Therefore the deal failed to enhance public welfare, adding that their analysis shows clearly that, Ghana stands to lose billions of United States dollars in revenue as annual gold royalties from the mining sector amounted to about $200 Million on the average.
Hence this does not make no economic sense as well enhance development and welfare of the ordinary people of Ghana.
Mr Iddrisu said the incorporation of Agyapa as an offshore company in Jersey, in the Channel Islands, a known tax haven, was worrying because tax havens are generally known for their lack of transparency in matters of corporate governance such as disclosure of the beneficial ownership of the shares of companies.
“Tax havens are susceptible to money-laundering and thus elevate the risk of Ghana being listed as a money-laundering jurisdiction by international bodies such as the European Union and the United Nations”, he said.
Ghanaians would recall that in May 2020, the European Union placed Ghana on its Anti-Money Laundering List (AML) but deferred the implementation date to October 1, 2020 due to the Covid-19 pandemic.
Setting up a sovereign wealth fund in a tax haven, the New Patriotic Party (NPP) Government he acclaimed is significantly elevating the risk of Ghana to be considered as a money-laundering jurisdiction.
This was because individuals and businesses used tax havens such as Jersey to hide their income and wealth so as to avoid payment of taxes and general regulatory scrutiny of their business deals.
The European Union, the OECD and the United Nations Mr. Haruna Iddrisu pointed out that, uses evidence of these offshore deals to rate countries on the effectiveness of their anti-money laundering regimes, including laws, regulations, policies, and other governmental actions.
With regards to the Minority’s concerns on off-budget transaction, the deal was intended to monetize gold royalties to fund the Budget and ought to have been reflected in the Budget Statement tabled for approval and subsequently enacted in the various Appropriation Acts for the 2020 Fiscal Year, which did not reflect in the Budget Statement for the 2020 Fiscal Year. Mr. Haruna Iddrisu aacknowledged.