wpid-oil.jpgClaims by government that about $111 million of oil revenue was used for capacity building between 2011/12 cannot be accepted, the Africa Centre for Energy Policy has said.

Mohammed Amin Adam, Executive Director of ACEP?revealed on Joy FM?s Super Morning show that most of the capacity training programmes?are being done by the Jubilee partners and not government.

He is, therefore, challenging the government to publish documents to back its claims that the amount allocated to capacity building was indeed used for that purpose.

He said efforts to improve local content participation include the Jubilee Livelihood Enhancement and Enterprise Development (LEED), Jubilee Technical Training Centre (JTTC), and the Enterprise Development Centre.

?Unfortunately, all these efforts are being done by the jubilee partners, not by government, and yet we have allocated so much money for capacity building and nobody knows what this money is being used for , [it means] there is a problem; especially when the capacity building we are seeing is being done by the oil partners.

?The second issue is that the government took a loan, about 38 million dollars, from the World Bank, a concessional loan also for capacity building, that is what is being used to support capacity development in the ministries, GNPC, and other agencies that have a role to play in the oil and gas industry.?

The ACEP?Executive Director,?questioned the use of $111m government allocated for capacity building in 2011/12 in addition to what was devoted to it in 2013.

?Next year we are allocating a further amount of about 32 million dollars for capacity building. What are we going to use it for? So until I see data published on how much we have spent on capacity building realistically, what type of capacity building, I don?t think that money is going into capacity building.?

In three years of oil production, Ghana has accrued $1.7 billion from the oil sector, an industry that has beaten cocoa to become the country?s?second largest export earner.

He said while the country doing?well in terms of transparency, efficient management of the oil resources remained a challenge.

?One of the major issues in the industry around the world or natural resources generally is that many people are calling for transparency and accountability, but nobody is talking about efficiency of spending.

?So as far as transparency and accountability are concerned, we have done well as a country because we have demonstrated and shown to Ghanaians through the budget processes, how much oil we have received, how much oil we have lifted and how much we have spent and the areas we are spending the money.

?But what we have not done very well is in terms of efficiency of spending the money, and that is where I have a problem.?

For instance, Mr Amin Adam said over the past three years, 134 million oil money was allocated to 16 road projects but by the end of 2013, 40 percent of the projects are under 50 percent completion stage and another 30 percent above 50 but below 70 percent. He said only 30 percent of these roads have been completed: some of these projects were even near completion when the oil revenue was allocated to them.

He advised government to avoid time over-runs?and cost?over-runs?by concentrating on a few development projects instead of spreading the revenue thinly on many projects which will take forever to complete.

Dr. Amin also believes a?provision in the law Petroleum Revenue Management Act?which does not allow the use of the oil revenue to finance the operation of oil and gas infrastructure has not been followed by government.

He claimed about 40% of oil revenue under the 2014 budget has been allocated to oil and gas infrastructure to the detriment of four thematic ?areas such as roads, agriculture, capacity building and education.

Dutch Disease

He further noted that about 80 to 85 per cent of Foreign Direct Investment over the years have gone into the oil and gas sector.

The Minister of Finance told Parliament recently that government would in the next five years allocate 20 billion dollars to the oil and gas sector, an amount Mr Amin Adam thinks could have been used to improve the?agricultural and?other sectors of the economy.

He noted that whilst 111 million dollars was devoted to capacity building within two years, in 2012 only 4 million Ghana cedis was spent on Agriculture. He is therefore calling for more allocation to the agricultural sector to reduce poverty because majority of Ghanaians depend?on agriculture for survival.

He said the nation spending less in the agricultural sector coupled with the decline in the manufacturing sector is a clear indication that ?the Dutch disease is here?.

It is also worrying, he observed, that seasoned professionals are leaving the other sectors in droves to the oil sector.

In 2011 the manufacturing sector grew by 17%, in 2012 it grew 5%, and reduced to 2.5 as at September 2013, he noted.

He called on government to pass the Industry Competitive Bills it announced in the 2012 budget to help address the challenges facing the other sectors of the economy.

On his part, the Vice President of Imani Ghana, Kofi Bentil said the country can redeem itself from the Dutch disease but warned the situation would worsen if the current trend continues.

He said to make good use of the oil money, officials from Ghana travelled all over the world to oil rich countries to learn about the best practices, but noted that the ?way we are managing the oil money is not the way to go?.

He noted that Imani has over the years been campaigning for the nation to create a revenue fund for Ghana?s natural resources to be earmarked for a few specific things. The current situation where the renevues are kept in the consolidated fund which use is determined by politicians is not helpful, he said.

Source: Myjoyonline

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