Attorney-General (AG) and Minister of Justice, Godfred Yeboah Dame, has disclosed that the nation’s economy was at risk of collapse due to arbitration claims against the government, which threatened to cost the country nearly $9 billion over the past four years.
However, Dame emphasized that the timely dismissal of these arbitration claims ultimately safeguarded Ghana’s economy from a potentially catastrophic collapse.
Mr. Dame said, “Over the past four years, the value of arbitral cases against the Republic has been in excess of $9 billion, and I will cite a few examples to illustrate the point. One such case was the financial claim by ENI Vitol against Ghana, which was initially $7 billion and subsequently reduced to $915 million after Ghana successfully challenged the proceedings in court. In fact, any of these amounts could have collapsed the Ghanaian economy.”
During the Public Sector Law Conference in Accra on Tuesday, November 5, 2024, Mr. Godfred Dame warned that Ghana’s economy could face severe consequences if arbitration claims against the government are not effectively managed.
“There are certain glaring dangers that I think arbitration portends for Ghana and the developing world which seem to be overlooked. Whilst arbitration is touted to assure neutrality, privacy, and efficiency in the adjudication of disputes, arbitral claims filed against the government, if not diligently managed, tend to collapse the entire Ghanaian economy.”
Mr. Godfred Dame outlined several key arbitration cases during his speech, including the 2020 dispute between Ghana and the International Finance Corporation (IFC), which had invested in Ghana’s energy sector.
He also referenced a 2019 case between the Ghana National Petroleum Corporation (GNPC) and Aker Energy, a Norwegian oil company, concerning an exploration agreement in deep-water offshore oil fields.
Another notable case cited by Mr. Dame was a 2018 dispute between the Government of Ghana and Kosmos Energy over the interpretation and application of tax provisions in an offshore oil exploration contract.
He emphasized that in just four years, arbitral claims against Ghana had totaled over $9 billion. However, Mr. Dame assured that a potential economic collapse was prevented thanks to the successful defense efforts by his office.
Additionally, Mr. Dame highlighted a domestic arbitral case where his defense successfully saved the country from a potential loss of GHC10 trillion.
“In point of fact, over the past four years, the value of arbitral claims against the Republic has been over US$9 billion. I cite a few examples to illustrate the point:
a. The financial claim by ENI/Vitol against Ghana was initially US$7 billion and subsequently reduced to US$915 million after a challenge in the course of the proceedings by Ghana. Any of these amounts (US$7 billion or US$915 million) could have collapsed the Ghanaian economy. By the Grace of God, this financial claim was recently dismissed in its entirety by the international arbitration tribunal.
b. Cassius Mining Ltd’s claim against the Government of Ghana has a value of about US$300 million.
Mr. Dame also mentioned the ongoing arbitral claim involving GCNet, which amounts to over GHC4 billion, roughly equivalent to US$250 million.
Additionally, he referenced the recently filed arbitration claim by Eland against the Government of Ghana, which seeks a minimum of US$320 million.
“These are just a sample of a few of the international arbitration claims against Ghana. Domestically, there have been claims in excess of over GHC10 trillion successfully defended by the Office of the Attorney-General against the State,” Mr. Dame said.
