It’s embarrassing, but government is working to pay – Owusu Ankomah on Trafigura judgment debt
Ghana’s High Commissioner to the United Kingdom, Papa Owusu Ankomah, has said he’s embarrassed by the turn of events regarding Ghana’s judgment debt payment to a Singaporean multinational commodities-trading company, Trafigura, which is threatening the seizure and auctioning of the country’s assets in the UK to defray the debt.
Trafigura, the majority owner of GPGC, a power company secured the award in January 2021 after an arbitral tribunal found that Ghana had unlawfully terminated a contract for the installation and operation of two power plants.
Ghana High Commission’s building in the UK which provides visa and other services, the commissioner’s residence, the Ghana International Bank building, and other properties are at risk of being sold to defray a $140 million judgment debt awarded to Trafigura.
A Deputy Attorney General, Alfred Tuah-Yeboah, says the government has already asked the Finance Ministry to take steps to liquidate the debt.
According to him, the Finance Ministry entered into an agreement with the judgment creditors as to how the state was going to pay the debt of about $140 million.
Although part payment was made, the Deputy Attorney General admitted that the state reneged on its promise to go by the instalment agreement.
“Having failed to do so, the judgment creditor decided to execute the judgment. They attached property belonging to the Republic in the UK, and then they sought to serve us with that process. We then filed a motion trying to set aside the process through which we were served but the High Court in England said no, and that the service on us [state] was properly made. So now, the Ministry of Finance has been advised to once again approach the judgment creditors and make every effort to pay that money,” he explained.
Speaking on Top Story on JoyNews, Ghana’s rep in the United Kingdom, Papa Owusu Ankomah, confirmed that so far, only one building, known as Regina House has been attached.
“As far as I am aware, it’s only Regina House which is used for commercial purposes because it’s been rented by the Ghana International Bank, two other banks and another commercial entity. That is the one that has been attached. All other properties are diplomatic properties and covered by immunity. I heard you talk about the High Commissioner’s residence, but that’s being used for diplomatic purposes, likewise, the other building you’re talking about, that’s the chancery, has not been attached. But I am sure the government is taking steps to liquidate that debt.”
He added, “It’s unfortunate that we’ve come to this stage. It appears our financial circumstances as a country probably, are not holding brief for the finance minister, and that may have constrained the Finance Ministry from honouring the obligation to pay the debt by instalment. But, I am aware that the Finance Ministry is presently engaged in negotiations with lawyers for the judgment creditor to liquidate this debt.
It’s embarrassing; I am embarrassed as High Commissioner for this thing to appear on the internet and everything, and be a subject matter of discussion in Ghana and in the Ghanaian media here. It’s serious, but even for those in private business, it gets to a stage you have to prioritize payments when you don’t have access to credit and monies being generated do not meet your obligations. Of course I am sure government could have said that we will pay this debt, and not pay some workers.”
Despite being alarmed by the situation, the former Minister of state explained that Ghana was not merely going to lose its assets due to the order of the court. He believes the creditors are only taking these initial steps to pile pressure on the government.
“This is just the beginning. It’s quite a process. It’s not as if it can be done either today or tomorrow because Regina House for instance is on a lease. Even though it’s for a long time, it’s got about five or six years to run, and there are negotiations to extend the lease.”
But I can assure you and Ghanaians that the Ministry of Finance has things well in hand. The creditors are interested in their money and it’s not going to be easy selling these properties, so it’s not as if tomorrow they are going to evict the Ghana High Commission and its staff from its premises, or the High Commissioner from his residence or tenants in Regina House are going to be evicted, no. They are going to manage it somehow till they recover the money, so it’s just a way of pressurizing government to pay the judgment debt which I am sure the arrangements are being done” he reiterated.
When the host of Top Story, Evans Mensah asked about what happens to the operations of the Ghana International Bank, the former Sekondi legislator said, “The Bank is a separate entity from the government of Ghana even though the shareholders are agencies of the government. They have access; they are still working, nobody has been evicted including the other tenants in the building. I can confirm that. I was briefed by the Bank even before the order itself was sent to our office, and I know we forwarded it to the Ministry of Finance and I have had some discussions with some members of government about it.
It’s in the interest of even the judgment creditor to get a settlement of bills because executing this by attaching certain properties of the government will not let you easily get your money “he argued.
While avoiding detailed commentary on the decision to terminate a contract that brought about this mess, the former Attorney General blamed this situation on the financial challenges the country is faced with.
“The fact is that we are under serious financial strain, and that is what has occasioned this unfortunate situation. Part [Of the money] was paid, then up to a certain stage because of the financial crunch, I am sure we couldn’t have the means.
I don’t think that we would have deliberately overlooked this liability. When you are financially challenged you prioritize payments. I have been a member of government before so I know what I am saying. Will you stop importing oil because of this debt? Do you stop paying salaries? So, understandably I am sure it’s because of these financial challenges that we’re faced with this situation.
Background
On the 26th of January 2021, Trafigura obtained the final award in its favour against the government of Ghana in arbitral proceedings in England.
A written agreement for the installation and operation of two power plants gave rise to the award, which was roughly $140 million. However, Ghana illegally terminated the agreement before the terms were provided.
On the 4th of November 2021, the Court granted Trafigura leave to enforce the award in the same manner as a judgment of the High Court.
According to sources, service was effected and the deadline for challenging the order was two months and 22 days after service. The deadline date was 1st August 2022, and later it was made by Ghana.
On 17th May 2022, Trafigura issued an application for charging orders in relation to the five London properties and which Ghana had a freehold or leasehold interest.
On the same day, the company also issued an application for alternative service. On 28 April, 2023 an order was made permitting alternative service upon Ghana.
So Trafigura served the ICOs the order and other related documents on 5th May, 2023 by a post by email.
In response to one of the emails, a legal counsel in the Ministry of Finance, whose email address was one of those listed in the appendix to the order, in particular, sent an email on 5th May, 2023, specifically acknowledging receipt of the documents.
On 24 May 2023, Trafigura received an email from White and K stating that it expected to receive instructions to act for Ghana and seeking to agree on a revised timetable in relation to Trafigura’s applications.
However, on 30th May 2023, the hearing was subsequently vacated consents.
On 23rd June, 2003, Ghana issued an application to set aside the order. The order was subsequently dismissed, but a substantial basis for the application was that Trafigura had been obliged to serve not only the order but also the application for the charging orders and the ICO themselves by diplomatic procedure.
Ghana then filed the objections on the 21st of July, 2003 in relation to making the ICOs final but on the 2nd of August, 2023, Trafigura made an application for a receivership order in relation to Ghana’s leasehold interest in one of the London properties.
Source: Ghana News
