Ghana government contracts $1b loans to improve oil and gas sectors

A $150 million loan agreement to finance an ICT-enhanced surveillance and monitoring facility for the oil and gas enclave project in Ghana is to come before Parliaament for scrutiny.

Another subsidiary loan agreement involving $850 million to finance the Western Corridor Gas infrastructure development project is also expected before the House for consideration before approval.

The two financial facilities, expected to develop the oil and gas sectors and boost production, is part of a Master Facility Agreement between Ghana and the China Development Bank Corporation.

In a related development, the Deputy Finance Minister, Fiifi Kwettey, has told Parliament that two main factors contributed to the under performance of the targets set for the 2009 domestic tax revenue.

He said even though LPG, Premix fuel and marine gas oil witnessed higher delivery volumes, there was a drastic reduction of about 90 percent in excise duties on these products in 2009, leading to a substantial shortfall in petroleum tax revenue during the period.

The Deputy Minister, who was in the House to respond to a question on why tax revenue recorded a shortfall in total domestic revenue for the 2009 financial year, said the domestic tax revenue recorded a shortfall of 1.6 per cent in 2009.

He said the target set was GH¢4,705.66 million and the actual was GH¢4,628.66 million and two main factors contributed to this under-performance.

The Minister said one reason for this was the drastic reduction in excise duties on oil and gas products and the second was that import duties also registered a shortfall of 9.8 percent because of the non-restoration of import duty on rice, yellow maize, wheat and vegetable oil.

“Madam Speaker, in spite of the fact that there was a shortfall relative to the target, the growth in total tax revenue in 2009 was significant at 17.5 percent,” he added.

By Eunice Menka