NDC in another dubious housing deal


NDC in another dubious housing deal

10 September 2012

-IMANI says $77.3m deal is worse than STX

Policy think tank IMANI-Ghana has raised alarm over what it says is another “shady deal” between the Mahama-Ammisah-Arthur-led National Democratic Congress Government and Snecou Group of Companies, of Nigeria, for the construction 1000 houses for the police and military costing $77.3 million.




According to IMANI, the deal which puts the average cost of a housing unit at $77,000 is worse than the aborted STX deal championed by then Vice President John Dramani Mahama.

“Clearly, the average cost of unit ($77,000) is exorbitant in this scheme of things. In cost terms, the deal is worse than the STX one,” IMANI said of the $77.3 million housing deal, also being spearheaded by caretaker President Mahama.

A release signed by Franklin Cudjo, Founding President of IMANI, has therefore cautioned Members of Parliament to put the nation’s interest above any other consideration and disapprove of the deal which is currently seeking the approval of Parliament.

IMANI is particularly worried about the fact that the company “purporting to raise the funds for the project and to partner the State Housing Company has been the subject of numerous corruption-related controversies and inquiries in Nigeria.”

According to the policy think tank, in October 2010, the Economic & Financial Crimes Commission of the Republic of Nigeria indicted the Chairman of the company, Prince Nicholas Ukachukwu, of using four of his companies “to loot $40 million of public funds belonging to the State of Nasarawa.”

“The 171-count charge (charge sheet – FHC/LF/CR/8/2010) preferred against Prince Ukachukwu in the Federal High Court in Lafia contains several references to Snecou. The EFCC accused Snecou and its Chairman of collecting huge sums of money from the state for various projects and failing to execute. In total, $80 million of embezzled funds were evidenced in the report,” IMANI’s release added.

According to the release, similar concerns have also been raised about the Nigerian company in respect of billions of Naira in construction contracts in Bayelsa state.

“In one case, Snecou won a contract to build a hospital valued at $120 million in the state. After huge payments had been made to the company, the project was finally abandoned,” the release stressed.

IMANI is therefore calling for the report laid for adoption before Parliament in respect of the deal to be returned to the joint committee on finance and works and housing or the respective ministry for the appropriate investigations to be conducted into the background and track record of Snecou and its Chairman, Prince Ukachukwu.

The report refers to a Supplier’s Credit Agreement between the Government of Ghana and the Snecou Group of Companies, which is partnering the State Housing Company on the project in question.

It is recalled that a ‘supplier’s credit agreement’ was the same instrument used to design the STX deal.

According to the terms of the deal, Snecou will raise $77.3 million for the construction of 1000 houses for the police and military, with the Government of Ghana taking responsibility for the settlement of the debt.

In a related development, IMANI-Ghana has raised another concern about a Buyer’s Credit Agreement between the Republic of Ghana and Italconstruct Limited, a Ghanaian real estate company, for the supply of 4000 houses at the cost of $200 million.

The policy think tank is worried about the fact that the terms of the Italconstruct offer does not improve on the one made by STX.

“At $50,000 base cost per unit, it is likely that the final price per unit will hit $60,000 or more. This is considerably above the ministry’s own threshold of $10,000 for affordable housing in Ghana.

Italconstruct offers two-bedroom houses for sale on its website at just a little above $25,000. We cannot understand why the company should be quoting more than $50,000 per unit for a large-scale project whose capital costs are being fully underwritten by the state,” the release stated.

Source: thestatesmanonline.com



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