GPGC judgment debt: Poor risk assessment on deal termination has cost us
"There should have been proper scrutiny of the situation to assess costs involved in the termination of the deal"
Prof. Ernest Kofi Abotsi, Dean of the UPSA Law Faculty has noted that a weak assessment of the risks at stake relative to the termination of the GPGC power deal has brought unto the nation the $170 million judgment debt.
He believes that there should have been proper scrutiny of the situation to assess costs involved in the termination of the deal.
Speaking on JoyFM’s Weekend Flagship political talk show, Newsfile, and monitored by DLN, Prof. Abotsi said Ghana has many lawyers who are specialized in risk assessment and could have given sound counsel to the state.
“Everything depends on the calculations of your risk liabilities. The question is who are the people who are making those assessments because those are assessments that can be done by lawyers whose skills specialize in quantum assessment,”
“Ultimately, did we have clarity on how much cost we were looking at should we breach the contract? How much cost it would entail if we don’t terminate it at all and allow it to run its full course? It appears to me that somehow, some calculations weren’t done or certain consultations weren’t complete and in the process, explains why we are here,” he added.
Prof. Abotsi bemoaned the fact that judgment debts have become a major national issue and noted that the trend needed to be stopped.
“… It happens from year to year, government to government across the political divide and spectrum, and I don’t think that frankly, it is something we should allow to go on,” he concluded.
Background
Ghana has recently been slapped with $170M judgment debt for wrongfully terminating a PPA with the Ghana Power Generation company(GPGC)
After the termination, the GPGC dragged the country to a London-based United Nations Commission on International Trade Law (UNCITRAL) Tribunal for the unlawful termination of its contract with the Republic.
A judgment of $164 million was initially awarded for the company, which the country failed to appeal.
The Attorney General, Mr.Godfred Dame has indicated his intent to get the Criminal Investigation Department to look into the cause of this judgment debt.
