Ghana Link Services Limited, the company that signed a 10-year sole sourced contract with the Ministry of Trade to take over Ghana’s National Single Window operation at the various ports, has just been sacked from Sierra Leone for failing to offer the same service in that country.
The Sierra Leone government terminated its appointment with Ghana Link Services because since April 2012 when the country signed a contract with the Ghanaian company to build, set up and operate a single window and end to end system there, Ghana Link has woefully failed to do.
Ghana Link used its subsidiary company, African Link Inspection Company Limited (ALIC), in fronting for the Sierra Leone single window contract.
Certified true copies of reports from an audit conducted by Sierra Leone’s Ministry of Finance concluded that Ghana Link’s company in Sierra Leone has also been involved in massive financial malpractices, tax evasion and a huge revenue loss to the Sierra Leone government.
The Sierra Leone government subsequently froze the company’s accounts because of detected financial malpractices after the audit.
A letter dated January 30th 2020 from the Office of the Chief Minister, State House, to the Minister of Trade and Industry in Sierra Leone said: “I have been directed to inform you to terminate the agreement between the government Sierra Leone and African Link Inspections Company with immediate effect”.
Why the contract was cancelled
The rationale for the directive, the letter said, was that: “As part of the inspection agreement, ALIC was to develop the single window concept. This Trade net messaging software allows End Users, Declarants, Ministrys, Departments and Agencies (MDAs) to exchange data to and from the system. This aspect of the agreement was not complied with or implemented”.
It further stated: “ALIC is 100 percent owned by Ghana Link. ALIC Financial Statement shows a loan of US$4million from its parent company, Ghana Link. This is however at variance with the amount shown in the balance sheet of Le 6 billion as at 31st December 2017.
“ALIC’s US dollar loan from Ghana Link carries an interest rate of 30 percent. When converted into Leones, the interest rate translates to 45 percent which is extremely higher than the commercial rate. There is nowhere in the Global Financial Markets that a parent company lends to the subsidiary company a US denominated loan at a rate of 30 percent. The high interest charge is suspiciously premeditated to evade tax payment, as interest payment is deducted before dividend payment.
“There is no evidence that the company has paid corporate tax to government. A recent audit conducted by the National Revenue Authority reveals that the company tax liability is about Le 45 billion. The NRA also discovered a lot of anomalies in their books.
“ALIC has repaid loan and interest amounting to Le 19 billion to Ghana Link.”
Lastly, it said: “ALIC has not been fully complying with section 4.3 of the agreement in respect of training programmes dealing with local and overseas training courses in the areas of computerised Risk Management System, Transaction Price data and other areas of inspection”.
The Solicitor General, Law Officers department of Sierra Leone, in a letter to the Financial Secretary, Minister of Finance, said review and audit conducted by the Ministry of Finance concluded that there are materially substantial breaches of pertinent provision in the agreement, loss of revenue to government, and non-payment of taxes up to Le 45 billion that gives grounds for termination of the agreement.
The Sierra Leone government has subsequently abrogated its contract with Ghana Link’s subsidiary African Link Inspection Company.
Concerns over Ghana Link/UNIPASS
The Coalition of Civil Society Organisations (CSOs), together with other port stakeholders have called on President Nana Akuffo-Addo to as a matter of urgency terminate the 10-year sole sourced Ghana Link/UNIPASS contract agreement with the Ministry of Trade and Industry.
According to the group, the controversial deal is a total rip-off and could lead to revenue losses, administrative corruption and depletion of government holdings in the port systems.
This, they said, is because Ghana Link and its overseas partner CUPIA Korea have not demonstrated and piloted any new system to takeover over single window operations at the country’s ports.
They added that the 10-year sole sourced contract is problematic, urging government to take a second look at it.