Veep on collaterisation: Was the Cabinet foolish?

With I.K. Gyasi

Vice President John Mahama put himself into all kinds of difficulties with his speech on the collaterisation of our oil, and the letter he wrote to a Chinese company holding out the promise of the pledging some of our commodities against work by that company.

Mr. Abdulmalik Kweku Baako, one of our finest brains (to me, anyway), did his usual combative best to sanitise the comments of the Vice President, and to downplay the import of the contents of the Vice President’s letter. As far as I am concerned, Mr. Baako failed to convince me. What did the Vice President say?

When Mr. Mahama addressed a gathering of the Tertiary Education Institutional Network (TEIN) of the National Democratic Congress (NDC), he commented on the raging controversy over whether we should use our oil as collateral, in order to secure loans for the country’s development. He spoke at Winneba.

Whatever good things he might have told the students, what hit the headlines was his description of the opposition to collaterisation.

He stated that it would be “foolish” not use the oil for collaterisation, and that opposition to collaterisation was ‘’baloney.” His irritation showed when he uttered the expression, “What the hell!”

He tried to soften the impact of his use of the word ‘baloney,’ by initially attributing it to ex-president George Walker Bush of the United States.

Mr. Baako said on Joy FM’s programme, NEWSFILE, of Saturday December 4, 2010, that he saw nothing wrong with the Vice President’s use of the word ‘baloney’ (also spelt ‘boloney’), because it was a word he (Mr. Baako) himself used often.

What Mr. Baako overlooked, deliberately or inadvertently, was that legally and constitutionally, he and the Vice President are not on the same level of importance.

Mr. Baako is an ordinary citizen, while the Vice President is the Second Citizen or Gentlemen of Ghana. When the President of the Republic is unable to carry out his duties for one constitutionally spelt reason or another, it will not be Mr. Baako, but Mr. Mahama who will take over.

Consequently, the behaviour or utterances of Mr. Baako cannot be the yardstick by which the Vice President can be measured. His self-confessed, regular use of the word ‘baloney’ does not confer any respectability to its use.

As the Second Gentleman, Mr. Mahama is expected to show decorum, whether in word or deed. In fact, he himself, must have felt uncomfortable using that word, hence his hesitation and attribution to the former American President.

Whenever I have had the opportunity, I have always described Mr. Baako as literally, politically, intellectually and journalistically big-eyed. This time, I think he dozed a bit.

You see, Mr. Mahama was talking to students (presumably) in an open forum, and he needed to choose his words carefully.

As to not dwelling too much on “what the hell”, “baloney” and “foolish”, Mr. Baako knows very well that in journalism, the bottom line is that news of a man biting a dog will attract greater interest than the news of a dog biting a man!!!

Apart from the Vice President’s language, there was also the substance. He had said that it would be foolish not to pledge our oil for loans to develop the country.

The question to ask is whether Mr. Mahama was criticising his own government as much as he was castigating others on the opposition to collaterisation?

The Petroleum Revenue Management Bill, currently before our Parliament, presumably came from the Cabinet of which the Vice President is a member.

The much debated Clause 5 of the Bill states follows: Clause 5 (1): “the assets of the petroleum shall not be used (a) to provide credit to the government, public enterprises, private sector entities or any other person or entity: (b) as collateral for debts, guarantees, commitments or other liabilities of any other entity.”

Clause 5(2) states “In order to preserve revenue streams from petroleum and ensure the object of this Act, there shall not be any borrowing against the petroleum reserves.”

For the above quotation, I am indebted to Mr. Sydney Casely-Hayford’s article entitled OIL MANAGEMENT, Clause 5, and published in the NEW PUNCH newspaper of Tuesday, December 7, 2010. Any mistake is mine.

Where was the Vice President when the Cabinet of which he is a member, and which he reportedly sometimes chairs, when that very Cabinet tied the hands of the government to stop it from dipping its hands into the oil money coffers? Was the Cabinet foolish (God forbid) when it inserted that clause into the Bill?
I do not mind if the government has grown wiser, changed its mind, and now wants to do something about clauses. But, Mr. Mahama should not talk and behave as if it was the Minority that inserted that clause into the Bill. He should apologise to the Cabinet, the government at large, and his party for the insult, before he apologises to others opposed to collaterisation.

In my own untutored mind (as for as oil matters are concerned), I find nothing wrong with collaterisation per se.

The practice is neither an invention, nor a discovery by the NDC government led by President Evans Atta Mils. For as long as anybody can remember, individuals and nations have offered pledges in return for loans and other benefits.

Should you starve to death or die of illness when there is money available? The Ashanti’s say that you do not allow a dog to attack you when you have a stick to defend yourself.

However, the same Ashanti’s also say that as you eat all your eggs today, you are also eating all the chickens that could have come out of those eggs. Again, they say that no wise person sells his egg-laying hen without good reason. It must be a real emergency.
Of course, we should not overlook the dangers in collaterisation. The pledger or pledgor, whether an individual or a nation, could lose the collateral to the pledgee for one reason or another, mainly, the inability to repay the loan.

Already, some well-meaning people have raised concerns about the untrustworthiness of politicians of whatever colour, and are asking for cast-iron guarantees against profligacy and plain theft.

Let us not oppose collaterisation, whether the collateral pledged is oil, cocoa, gold, bauxite or whatever. But, let us also have adequate guarantees, so that in the long run, we do not come out losers. The worlds of politics and business are full of crooks, even as we have those who play by the rules. We must be careful.

Mr. Vice President, was the President aware that you had written that letter to the Chinese company, Pierson Capital Group?

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