Ghana Pulls Out Of MoU with CRCC-Nigeria

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China Railway Construction Corporation
China Railway Construction Corporation

Less than three months after it signed Memorandum of Understanding (MoU) with the China Railway Construction Corporation (international) Nigeria Limited, the Ghanaian Ministry of Railways Development has pulled out of the deal.

Straightnews reported on Sunday, June 2 that Nigeria and Ghana had entered into a pact with China Railways Construction Corporation (CRCC) for the building of railways in their countries at $2 billion for 560 kilometres and 156 kilometres respectively.

Announcing the development in Accra, the Ghanaian capital, the ministry cited alleged breach of confidentiality as reason for the action.

The Nation reported that the withdrawal was triggered by a report entitled: “CRCC to construct 560km railway line for $2 billion – same cost as 156 Klm Lagos-Ibadan rail.”

Infuriated with the report because it has not signed any contract with CRCC-Nigeria on rail project, the Ghanaian authority called off the MoU it signed with company in March.

In a letter addressed to the Managing Director of CRCC-Nigeria, Mr. Joe Ghartey, Ghana’s Minister of Railways Development, decried the purported, which he noted contained “a lot of factual inaccuracies”.

For these infractions, Ghartey said the Ghanaian authority did not want to proceed with the relationship between the parties as established by the non-binding MoU.

The MoU was signed by both the officials of Ghanaian’s Ministry of Railway Departments and Messrs CRCC.

While disproving the publication, Ghartey said it was true that Messrs CRCC-Nigeria expressed interest in supporting the ministry to develop and modernize Ghana’s railway network, particularly the Trans-ECOWAS line, which runs along the coast between Aflao, on the border with Togo, and Elubo on the border with Cote d’Ivoire.

According to the minister, the purpose of the MoU was for CRCC-Nigeria to undertake feasibility studies through the use of independent consultants, adding that the company was responsible for verifying the project cost as estimated by the feasibility studies and also raised capital to finance the project.

Up till now, the minister said that CRCC-Nigeria has not submitted any report not to talk of stating the project cost.

He said: “CRCC-Nigeria has not submitted any report of the feasibility studies to the Ministry of Railways Development, let alone the project cost estimate. The ministry has not received any offer from CRCC-Nigeria for the construction of the proposed Aflao-Elubo railway line and that it is yet to respond to a proposal by CRCC to establish assembly plants for the building of locomotive coaches and wagons.

The minister alleged that the CRCC-Nigeria has failed to act in good faith, having breached the confidentiality clause as spelt out by the MOU.

In the confidentiality clause, he said:  “Each party agrees that the terms of MoU and all previous and subsequent discussions, documents and information exchanged pursuant to or otherwise related hereto will be treated in confidence and will not be disclosed except as required by law and otherwise.

“The Ministry of Railways Department, therefore, does not intend to proceed with the relationship between the two parties as established by the non-binding MoU.”

(The Nation)