DAWURO - Ghana News - Undiluted! - 'Government cannot abrogate GAFCO contract'

'Government cannot abrogate GAFCO contract'

The government says it does not have the power, as a minority shareholder, in Ghana Agro-Food Company (GAFCO) to terminate the company’s management agreement with the German firm IBN as being demanded by some workers of the company. Workers of the company have been protesting against their management and insisting the government must take over the day-to-day activities of company.

But a statement signed Deputy Information Minister James Agyenim Boateng, said a review or termination of the management contract can only be done by a resolution at the meeting of the board of directors of the company.

The statement said the government of Ghana is a minority shareholder with only 25% stake while IBN AG has 30% and 40% majority shares by the Social Security and National Insurance Trust (SSNIT).

Reacting to claims by some workers of GAFCO that the government and the Minister for Trade and Industry, Ms. Hanna Tetteh, has shown little concern for the future of the company, which they say is being run down.

Mr. Agyenim-Boateng said “the government will continue to respect the rules of corporate governance".

The statement noted that while as a shareholder the government is desirous of a highly profitable business entity, the management contract is between the company, represented by the board of directors, and IBN AG, who incidentally are also shareholders.

“Following representations made by the workers, the Minister for Trade and Industry met with a delegation from the Industrial and Commercial Workers Union (ICU)… including its deputy general secretary Solomon Kotey and explained that given the fact that the government was a minority shareholder, this was a matter that first should be taken up at the level of the board.”

The nine-member board has representatives from the three shareholders. The government says it understands from its contacts with the Ghanaian representatives that the board is reviewing GAFCO’s management contract with IBN AG in an effort to prioritise the company’s interest.

“It is therefore not true that the minister has shown no interest in the issue following the workers’ petition.”

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