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Mills withdraws STX housing deal from Parliament

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The President, John Evans Atta Mills has directed that the multi-billion dollar STX housing deal before Parliament for deliberation should be withdrawn for a review.

Parliament met to discuss the Supplier’s Credit Financing Agreement Thursday July 15, 2010, but the subject drew so much controversy as the debate dragged on. The President has asked that the agreement should be withdrawn and be sent to a Joint Ministerial Committee for a second look.

Alban Sumani, Minister of Water Resources, Works and Housing announced the directive in Parliament saying President Mills took the decision because he has taken note of the concerns raised by the Minority. The Minority were unhappy with the off-taker agreement and other documents, which they said were shrouded in secrecy. They said these documents were not made available to them.

The Minority also expressed dissatisfaction with the fact that the Ministry of Finance alone was handling the loan agreement, and suggested that the Ministry of Water Resources Works and Housing and the Attorney-General and the Ministry of Justice should be involved for proper due diligence to be done on the agreement.

News broke in December 2009 that the government of Ghana, the South Korean government and STX Group of South Korea have signed a deal for a $10 billion housing deal. Information emailed to ghanabusinessnews.com from South Korea confirmed that the deal which was signed Tuesday December 8, 2009.  The former Minister of Works and Housing, Albert Abongo signed on behalf of Ghana.

Earlier, the Bloomberg news carried a story which said the government of Ghana had agreed with a South Korean company, STX Group to build units of housing in the country in a deal worth $10 billion.

The report citing the South Korean Land Ministry said South Korea is seeking to win more construction contracts from sub-Sahara Africa, which accounted for 2.4 percent of orders by value as of the end of November 2009.

The deal however generated lots of controversy in the country. Dr. Paa Kwesi Nduom, criticized it. And the Ghana Real Estate Developers also raised objections to the deal, suggesting that the group could provide the same number of housing at half the cost.

In a press statement, GREDA, while commending the government for its good intentions and commitment to significantly tackle the country’s huge housing deficit, it said the STX deal does “not at all represent value-for money.”

The estate developers said they are able to construct any type of building required in Ghana, pointing out that “Ghanaians built Dansoman, Sakumono and other estates, and all the barracks we have today, Ghanaians built the city of Tema, State House (Job 600), and Cedi House, local private estate developers have built world Class residential properties.”

But a few days after petitioning Parliament over the matter, GREDA withdrew its concerns saying its “initial fears had been allayed.”

By Emmanuel K. Dogbevi

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