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Why Ghana’s $2b Resource Deal With China Is Not as Risky as Critics Charge

News coverage and social media commentary about the recent deal signed between the Ghanaian government and the Chinese state-owned construction conglomerate Sinohydro is almost universally negative.

According to deal, Ghana would exchange 5% of its bauxite reserves for $2 billion of infrastructure. But critics in Ghana and internationally contend the deal doesn’t make sense and is just too risky both financially and environmentally. If bauxite prices fall then Accra would be on the hook to make up the difference, potentially costing the country millions of dollars. Equally concerning is the fact that the mines are located in the Atewa Forest Preserve, one of West Africa’s most important ecological zones and also a critical source for an estimated 5 million people.

“Despite the government’s assertions, bauxite mining would forever destroy the Atewa forest, leaving extinct species and dried up water sources in its wake,”

Daryl Bosu, Deputy National Director of A Rocha Ghana

The government, for its part, has struggled to challenge critics and present counter-arguments as to why this deal is in the best of the country and will not jeopardize fragile ecosystems. Ghana, they argue, has been responsibly mining bauxite for years so why all of a sudden is everyone so worried that this deal, in particular, is so risky?

Henry Kyeremeh is the Head of the Bank Accounts, Reserves and Interventions Unit at the Treasury and Debt Management Division in the Ghanaian Ministry of Finance. He’s a strong advocate for this deal as he believes it’s the most efficient way for the government to leverage natural resources to build badly-needed infrastructure without taking new loans.

Henry joins Eric & Cobus to provide a different perspective on the Ghana-Sinohydrop deal than what has been portrayed in the news media and online.

IMPORTANT DISCLAIMER:

It’s important to note that although Henry is a senior official in the finance ministry, in this interview he’s not speaking in any official capacity on behalf of the Ghanaian government and only sharing his personal views on this issue.

Show Notes:

About Henry Kyeremeh:

Henry Kyeremeh is a writer, a business development consultant and Public Policy Designer. He currently is an Economics Officer with the Treasury and Debt Management Division (TDMD) of Ghana’s Finance Ministry. Before joining TDMD, Henry worked primarily on the mobilization of external bilateral resources from Ghana’s development Partners. Henry holds master’s degrees from the University of Tokyo and the National Graduate Institute for Policy Studies (GRIPS), Japan. He also holds a B.A. in Economics from the University of Cape Coast. Henry is a fellow of the Mandela Washington Fellowship Program (MWFP), a flagship program by President Obama for young African Leaders. Henry has been a career coach for some undergraduate students and frequently organizes free lectures on topical national economic issues for final-year economics students at selected universities of Ghana. He is also a co-founder of iwatch Africa, a Not-for-Profit making Organisation (www.iwatchafric.org) which uses data statistics techniques to assess the performance of the Government of Ghana in the critical areas of; Health, Education, Corruption, and job creation.

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