A US Senator is demanding answers to why the International Finance Corporation (IFC) of the World Bank Group approved a loan of $26 million for the Saudi Prince Alwaleed bin Talal Alsaud to build a luxury hotel in Ghana.
Sen. Patrick J. Leahy, according to a Washington Post report argues that the approval of the loan for the construction of a five-star hotel in Ghana a country he says where 40 percent of people live in poverty was “not an appropriate use of public funds” and should not have received US government support.
Senator Leahy who heads the Senate Appropriations subcommittee on the State Department and foreign operations says he wants to know how the Prince won approval for the loan under an IFC programme to encourage private development in developing nations. The United States is the largest shareholder in the IFC.
The publication quoted him as saying “The Treasury Department should review the IFC’s lending strategy in Africa and other areas where the focus should instead be on development priorities like agriculture, education and health, and on employment-generating opportunities that are commensurate with the size of the investment.”
The Washington Post citing Forbes Magazine, says Prince Alwaleed — a nephew of Saudi Arabian King Abdullah bin Abdul-Aziz has a net worth of $19.6 billion, and is the 26th richest person in the world.
The IFC approved the nine-year loan in December to KHI Ghana Ltd., a wholly owned subsidiary of Prince Alwaleed’s company, Kingdom Hotel Investments (KHI), for development of the Movenpick Ambassador Hotel in Accra. The US voted to support the loan and the formal loan commitment papers were signed in February, records show. The loan has not yet been disbursed, according to the IFC’s website, the report said.
The Movenpick Hotel worth $103 million was recently opened in Accra. It has 259 rooms. Situated in the centre of the Business District of Accra, it used to be one of Ghana’s state-owned hotels – it was called The Ambassador Hotel.
The remaining $78 million financing for the hotel will come from KHI and other investors that have not been named in the report.
The vice president and group treasurer of KHI, Lourie Kruger however defended the project saying it would result in “an important resource for businesses and travelers in Ghana.” He said it would “create many local jobs” during its construction and operation, according to the publication.
The report says the project expects to create 300 new direct jobs and temporary employment for 1,000 laborers.
By Emmanuel K. Dogbevi
God save us! Are these guys leaving their radicalism behind in their countries as they move to build hotels in Ghana. The owner of the hotel may not necessarily have some dangerous ideas but as they build hotels, so will the trouble makers follow. Whoever thinks that the problems of terrorism belong to US and Europe and East Africa must consider what he/she believes!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
I vehemently disagree with the position taken by Senator Leahy. IFC is investing in the hotel which will generate jobs. And the Senator ought to have known that job creation is the surest way to combat poverty in every economy. It is baffling that he sees the IFC investment is sort of a waste of money. He is dead wrong! The 300 people who are now working at the hotel will laugh off his position on the IFC investment!
Senator Leahy, I do agree with you on the development of Ghana’s education, health and the agricultural sectors. However, Ghana is developing very fast. Foreign investments in Ghana is still low. While similar investments in hotels like the Movenpick exist, they cannot accomodate the numerous foreign visitors and investors in Ghana. With recent oil find, there is a rise in the number of European, US and Asian investors in the mining sector (gold, industrial diamonds, bauxite and manganese) and the agricultural sectors.
The investment of Movenpick Ambassador hotel is a wise investment for the country. Ghana deserves such investments where returns on such projects are much higher than in the US.