Finance Ministry moves to settle outstanding debt to Trafigura

Elizabeth Naana Benjamin Sep - 25 - 2024 , 13:58

The Ministry of Finance has assured that it is making arrangements to settle its outstanding debt to Trafigura, following concerns raised over delays in finalising the payment.

This comes after a letter circulated on social media on Tuesday, raising concerns about the government’s overdue settlement with Trafigura’s Ghana Power Generation Company (GPGC).

On September 24, GPGC petitioned the Minister of Finance, Dr. Mohammed Amin Adam, seeking payment of the $111 million in arrears owed by the government.

In a letter addressed to the Minister and dated September 23, 2024, Trafigura urged the government to finalise the settlement this week to avoid further legal action, emphasising their preference for an amicable resolution.

In response, the Ministry of Finance released a statement on September 24, confirming that the necessary steps had been taken to address the claims. "We have made the necessary arrangements to pay off the outstanding claims agreed with Trafigura after several rounds of negotiations," the statement read, reassuring the public that the government remains committed to honoring its obligations.

Trafigura has warned that if the debt is not settled promptly, it may seize Ghana's properties in South Africa and the United States. This would follow similar action taken in August 2024 when Trafigura briefly seized Ghana’s Regina House in the United Kingdom after a payment default.

The dispute originates from a decision by a UK tribunal on January 26, 2021, which ruled that the Ghanaian government breached a power purchase agreement with GPGC.

The tribunal awarded GPGC $134 million after Ghana unilaterally terminated the contract in February 2018. Although the government made an initial payment of $23 million, $111 million remains outstanding.