What The NPP Ought To Do About The US$300 Million VTB Capital Loan

The response of the minority New Patriotic Party (NPP) side to the majority National Democratic Congress (NDC) side's insistence that they intend voting for Parliament to approve the US$300 million loan from VTB Capital - the UK investment banking arm of the Russian bank, JSC VTB Bank - is most unfortunate.

To say that they are washing their hands of a loan they believe to be fraudulent, is tantamount to betraying Ghana and its people - particularly at a time of extreme hardship: when high-level corruption ought to be fought by all patriotic citizens. Alas, their response illustrates perfectly the lack of creative thinking amongst a large section of  our nation's political class.

 In principle it is a good idea to borrow money to equip our UN  peacekeeping forces, and lease the equipment  out to the UN at a profit (US$100 million in this instance, apparently) - and be given back that selfsame equipment at the end of their peacekeeping mission.

It was Ambassador Kabral Blay-Amihere who first alerted Ghana to a similar  opportunity when he was Ghana's high commissioner to Sierra Leone during the Kufuor-era. The important thing is to ensure that no fraud is involved in  the VTB Capital loan.

For some pundits,  Russia is a byword for corruption, but fortunately for Ghana, the UK has strict laws against fraud and corruption - particularly in the financial services sector: whose reputation matters a great deal to the UK  authorities because of its contribution to the British economy.

As it happens, the Bank of England (BoE) recently had issues with JSC VTB Bank, the Russian bank that owns VTB Capital - and in April 2014  demanded  an increase in its reserves. It  also ordered JST VTB Bank to undergo additional stress tests.

In complaining about what he said was BoE meddling for political reasons (to do with the West's imposition of sanctions against Russia for its annexation of the Crimea),  VTB Capital's chief executive, Andrei Kostin, threatened to close down the London operation of VTB Capital.

Indeed JSC VTB Bank has reduced the size of VTB Capital's London operation - to focus on retail banking, it says. One wonders what will happen if VTB Capital actually leaves the jurisdiction of the UK. So the NPP is right to urge caution in this matter - especially when the government's own law officers have asked the finance ministry to consult its debt department on aspects of the loan.

The question is: Since Britain isn't a banana republic, why does the leadership of the NPP's parliamentary caucus not write directly to the regulatory bodies for the financial services sector in the UK - and lodge an official complaint with the Economic Crime Command of the UK's National Crime Agency (NCA), about their suspicions that Ghana is being ripped off in a loan deal they believe is fraudulent?

That would ensure that if any Ghanaian officials have indeed pocketed money in exchange for agreeing to those outrageous terms VTB Capital is insisting on, they will be exposed to the world. The NPP MPs need to be a tad more creative in such instances - if they are to be successful in protecting the public purse when such loan agreements are laid before Parliament for approval. A word to the wise...