The Government of Ghana on Monday signed a US$2.6 billion Concession Agreement with African Investment (AI) SkyTrain Consortium, a South African firm, to construct the Accra Inner-city SkyTrain project.
The deal, signed on the sidelines of the ongoing Africa Investment Forum (AIF) in Johannesburg, South Africa, will move forward the construction stage of the single largest infrastructure development in Africa.
Initialed by Ghana’s Railways Development Minister, Mr Joe Ghartey and Mr Hubert Danso, Director of AI SkyTrain Consortium Holdings, in the presence of President Nana Addo Dankwa Akufo Addo, and Dr Akinwumi Adesina, President of the African Development Bank (AfDB), the project would help ease the increasing traffic congestions in Accra.
Commenting on the deal, President Akufo-Addo said the agreement marked a critical step in Ghana’s efforts of meeting important infrastructural needs, saying, “This is a happy day for Ghana and its people”.
He said the deal was also a vivid demonstration of the value of the Africa Investment Forum in attracting the needed investment into Africa for valuable development.
The President emphasized that the project was purely commercial and had no government guarantee backing it.
“This is a purely private arrangement; the government of Ghana would not give any guarantees,” he said.
Ghana first announced the deal last year during the first edition of the Africa Investment Forum and has since moved on to the concession stage with willing investors ready to finance.
Dr. Adesina commended President Akufo-Addo for his leadership role that has led to the success of the concession agreement.
He noted that the signing was significant because it is, “Africa to Africa investment”, and this should make Accra a modern city when the project was delivered.
“We in the African Development Bank are excited about the project…we are delighted, it’s a great day for Ghana, it is a great day for the AfDB, and it will bring happy moments to Ghana,” he said.
On his part, Mr. Joe Ghartey said though the agreement had been signed, there was work to do to bring the project to fruition, through the transformation of urban areas.
He assured the Consortium that the government would work hard to ensure that the deal went through legislative approval and expressed the hope that financial closure would be reached by next year for work to commence.
Mr. Danso said the consortium would undertake detailed feasibility studies with a view of bringing financial closure within a year for the project to start.
He disclosed that the project would create some 5,000 direct jobs during the construction phase and this could rise to over 10,000 when other ancillary jobs were added.
Mr Solomon Asamoah, Chief Executive Officer, Ghana Infrastructure Investment Fund (GIIF), said the project which was an achievable one was “a landmark transaction that can be replicated in other cities in Ghana and across Africa”.
The SkyTrain project is expected to improve Accra’s public transport system through an elevated light railway system that would provide low-cost transport to Ghanaians.
The three-day second edition of the AIF, being organized by the African Development Bank (AfDB) and its partners, brings together over 2000 delegates from 109 countries.
The multi-stakeholder transactional marketplace aimed at raising capital, advancing projects to the bankable stage and accelerating financial closure of deals.
Last year, the Forum witnessed over US$38.7 billion of investment interests that were signed but this year’s edition rake in twice that amount.
