STX CEO: Korean Gov't To Fund Housing Deal

Speaking to Joy FM's Kojo Oppon-Nkrumah during Monday's morning show, the STX CEO said that for the next five years the Korean government has agreed to provide $400 million per year, totalling $2 billion.

When the morning show host probed further, Mr Asamoah said, "We have applied for the money, our applications has been accepted by the Korean government and the money is already available to us."

According to him, there is a “Global Infra Fund,” put at the disposal of Korean companies abroad by the Korean government which STX has been allowed to access.

Mr Asamoah was pushed to disclose the actual cost per housing unit. His answer was that the houses and their locations vary and that there will be amenities such as schools to be constructed as well so to say an average unit cost is $50,000 is not accurate.

Pushed further he said, "the price per unit will range from $15,000 to $30,000."

But, in the afternoon, Mr Asamoah told Joy FM's sister station, Asempa FM that unit price ranges from "$13,000 to $30,000."

Mr. Asamoah also noted that there is going to be enough local participation as “it is not possible” for STX alone to execute the project. He said local content could be "as much as 40-50%."

Dr. Opoku-Prempeh, MP for Manhyia and a member of the governing board of the Danquah Institute was not convinced.

He said arguments that the Korean government was fully backing STX and therefore there was no cause for alarm were hollow and untenable.

“STX is a big enough company to raise its own financing and besides it can even do it because government of Ghana is giving a sovereign guarantee, so you can read from the letter of the Korean government that they are actually not supporting this deal with anything,” he said.

Dr. Opoku-Prempeh said the Finance Committee of Parliament should have done a better job than what they did by recomending the deal for parliamentary resolution.

“If they (Finance Committee) had done a cursory check they would have realized that in five years when the moratorium of the principal expires, Ghana will be paying almost equally the amount of money that took us into HIPC in 2001,” he stated, adding that this deal is not sustainable.

“Never in the history of the developing world has a developing country funded a large country or a developed country as Ghana is going to fund South Korea,” he emphasized.

Parliament is scheduled to consider the passage of a $1.5 billion agreement, being the first part of the deal which will lead to the construction of 30,000 units of houses.

He said the deal is a complete rip-off given that GREDA, the local construction outfit in Ghana has pledged to build the same number of unit houses at a relatively cheaper cost.

He adds that GREDA has built a solid track record in construction in Ghana, as compared to STX who only started construction in 2007.

“If Ghana Parliament passes the bill, we would have sold Ghana to a foreign entity,” he noted, accusing some members of the Finance Committee of succumbing to the whims and caprices of the powers that be in exchange for favours.

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