President of the People’s Republic of China, Xi Jinping and President of the Republic of Ghana Nana Addo Dankwa Akufo-Addo in Beijing earlier this month.
IMANI Africa, a Ghana-based education and policy think tank, has grown skeptical about whether Ghana will be able to fulfill China’s request to mine and export the country’s bauxite over the next 12 years.
But Parliament’s Finance Committee Chairman, Mark Assibey-Yeboah refutes IMANI’s claims, stating that Ghana has a massive supply of untapped reserves that far exceeds what China is asking for.
“IMANI’s research is not gospel,” Assibey-Yeboah told Joy FM’s Daniel Dadzie on the Super Morning Show, Thursday. “We have reserves that far exceed what IMANI is saying.
Per the Sinohydro barter agreement, Ghana has agreed to allow China access to its bauxite in exchange for a Chinese-backed $2 billion infrastructure overhaul of Ghana’s roads, bridges and dams.
To begin the mining of bauxite, Ghanaian authorities said they would establish a refinery within the next three years and select its own contractor to refine the bauxite, which would then be given to the Chinese.
A three-year moratorium has been put in place while the refinery is established. Following the moratorium, Ghana will begin payment in the form of bauxite.
Read more: Minority expresses concern over Ghana Sinohydro deal
But IMANI research shows that it is highly unlikely the refinery can be built in three years, Founding President, Franklin Cudjoe said on the Show.
“The time needed to finance and execute a bauxite mine – alumina refinery complex – shall most certainly exceed the three-year horizon, which constitutes the grace period, after which repayments are expected to commence,” a detailed IMANI document reveals.
The think tank further raises questions about how bauxite refining can be a solid source of financial capacity to pay back the $2 billion project.
“Considering how many similar deals since 2006 have fallen through the cracks, including some with very competent partners, such as Alcoa, Alara, and Vimetco, the likelihood of smooth sailing arrangements within the grace period is almost nil.”
However, Assibey-Yeboah ascertains that the Chinese would not have signed on to the deal if they did not think Ghana could not supply the resources.
“What are the fears here? We have done the same with cocoa and crude oil.”
He continued: “Our roads are bad. Our bridges are in deplorable conditions. So here is a deal where we can get Sinohydro to fix our infrastructure. It benefits all of us. What is the problem here?