By Maxwell Nkansah
Standard Chartered announces the signing of a €280 million Social Loan financing for the Ministry of Finance, Ghana (MoF Ghana) to develop a section of vital highway, the Eastern Corridor that will transform the country’s transport infrastructure.
The financing is backed by Euler Hermes, the German Export Credit Agency, and INZAG Germany GmbH, a client of the Bank, is the chosen Engineering, Procurement and Construction contractor. Standard Chartered is acting as Book runner, Mandated Lead Arranger, Structuring Bank, Social Loan Co-coordinator, Original Lender and Agent.
In an industry first, Standard Chartered structured the financing to fully comply with the recently published Social Loan Principles (SLPs). This is the first time a Social Loan has been structured not only in Ghana but on the wider African continent. The project is eligible because of its objective to improve basic transport network, which is categorized as affordable basic infrastructure.
The project will also contribute towards meeting the United Nations’ Sustainable Development Goal 9, which relates to industry, innovation and infrastructure. Desislava Radeva , Director, Structured Export Finance, Standard Chartered Bank, said, “We are proud to build on our strong relationship with the Ministry of Finance, Ghana to deliver a bespoke ECA-backed solution to enable the development of this critical infrastructure project. We are equally excited to have signed the first Social Loan in Sub-Saharan Africa.”
The Ghana Eastern Corridor is the National Road N2 that starts at the Tema roundabout and ends in Kalungugu, the northeastern border with Burkina Faso. Standard Chartered’s financing will fund a particular intersection of the road, otherwise known as Lot 1, which includes two flyovers and interchanges, 11 pedestrian bridges and three mixed bridges in dual carriageway.
It stretches from the Ashaiman roundabout and ends at the Akosombo Junction, Madina; a distance of 64km. When completed, the Ministry of Roads and Highways expects the upgraded, tolled route to positively impact the lives of around 500,000 local residents from underserved populations.
It will drive employment opportunities and trade, providing shorter access to the port of Tema and will link regions within Ghana, and also to neighboring countries. Additionally, the intersection will improve road safety and better access to healthcare and other essential services.
Xorse Godzi, Head of Corporate, Commercial and Institutional Banking, Standard Chartered Bank Ghana Plc, said their involvement in the project is a prime example of Standard Chartered living up to its brand promise, here for good, and supporting our communities.
According to him, they have operated in Ghana for over 125 years, are able to advise and play a leading role in tapping liquidity around the world for major sustainable infrastructure projects in the country to help Ghana achieve the United Nations’ Sustainable Development Goals.
Naim Danji, Head of Export Finance, INZAG Germany GmbH, said, INZAG is delighted to execute this project and looking forward to the successful development and construction of this flagship infrastructure for the country of Ghana.
The transaction is the sixth ECA-supported deal in Ghana arranged by Standard Chartered Bank in the past 12 months, bringing the total amount of financing to over €560 million delivering a wide range of transport and healthcare infrastructure for government.
The Governor of the Bank of Ghana, Dr. Ernest Addison, has stated that corporate governance plays an important role in the financial sector. He identified corporate governance breaches, overbearing shareholder behavior and related party transactional breaches as some of the factors that led to the failure of some banks in the financial sector and their consequent resolution.
He reiterated the need for the Ghanaian society to uphold good corporate governance practices and pledged the Bank’s support for the work of the Institute especially as events in the banking sector has a rippling effect on the Ghanaian
He said these when the Institute of Directors-Ghana (IoD-Gh), led by its President, Mr. Rockson Kwesi Dogbegah, on Tuesday, 22nd June 2021, paid a courtesy call on him and the Management of the Bank. The visit was to commend the Bank for its significant role in promoting the culture of good corporate governance in Ghana and to seek mutually beneficial relationships between the Bank and the Institute.
In his remarks, the President of the Institute of Directors-Ghana, Mr. Rockson Kwesi Dogbegah, eulogised the Governor of the Bank of Ghana, Dr. Ernest Addison, for providing transformational leadership in reforming the financial services sector, which has led to a vibrant and resilient banking sector.
Speaking on the strategic projects of the IoD-Gh, Mr. Dogbegah said the IoD-Gh is developing a charter aimed at setting standards for the practice of Corporate Governance in Ghana. He indicated that the development of a National
Governance Code was another key strategic project to be undertaken by the Institute.
He spoke about the Institute having established the ongoing annual Corporate Governance Excellence Awards; as part of its strategic efforts to celebrate the achievements of outstanding individual personalities and corporate organizations that have represented excellence in leadership, corporate governance, and have made significant contributions to the socioeconomic development of Ghana.
He added that the Institute working in collaboration with key stakeholders has championed the formation of the Ghana Association of Integrated Thinking and Reporting which is aimed at stimulating a strategic and sustainable way of value creation and reporting by organizations