Economist urges caution in oil contract reviews

Economist, Dr. Eric Osei-Assibey, has warned that continuous calls for the renegotiation of oil contracts can send wrong signals to international investors.

Dr. Osei-Assibey, however, admitted that Ghana is not getting enough revenue from the current contracts, and would be justified if it goes back to renegotiate for more.

The Institute of Economic Affairs (IEA) has asserted that past governments did not negotiate oil contracts in the best interest of the country because the country did not have the appropriate laws governing the industry at the time.

Speaking to Citi Business News at the sidelines of an IEA forum dubbed “A Decade after Oil Discovery in Ghana”, Dr. Osei-Assibey said Ghana must be circumspect on calls for a renegotiation of oil contracts.

“What we’re getting from the oil is not enough, therefore we should go back to renegotiate our oil contracts. But we must also be careful in terms of the sentiments we put out there. When we repeatedly call for contracts to be renegotiated, we might send the wrong signal to potential investors looking at investing in Ghana.”

The NPP government earlier this year set up a 17-member committee chaired by Lawyer Philip Addison to investigate the AMERI contract signed under the erstwhile John Mahama administration.

The committee recommended that the deal be renegotiated or abrogated on grounds of fraud.

The committee stated that AMERI, in its agreement with government, charged Ghana significantly higher than what it was charged by the Turkish registered company – PPR, which financed and executed the project.

Policy think tank IMANI Ghana, meanwhile disclosed that renegotiating the AMERI deal will save the country 2 million dollars monthly, translating into 24 million dollars a year.

According to the group, it is imperative for government to renegotiate the agreement to maintain value for money.

New Patriotic Party (NPP) Member of Parliament for Adansi Asokwa, K.T Hammond, also revealed that Ghana stands to lose $150 million to AMERI in the deal.

Dr. Osei-Assibey in his submission suggested Ghana should perhaps amend its laws and make sure it gets value for money from contracts going forward.”

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By: Bobbie Osei/citibusinessnews.com/Ghana

The post Economist urges caution in oil contract reviews appeared first on Ghana News.

Economist, Dr. Eric Osei-Assibey, has warned that continuous calls for the renegotiation of oil contracts can send wrong signals to international investors. Dr. Osei-Assibey, however, admitted that Ghana is not getting enough revenue from the current contracts, and would be justified if it goes back to renegotiate for more. The Institute of Economic Affairs (IEA) has ...

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