AFARI HOSPITAL CONTROVERSY: Genesis of the additional $85 million
- azureachebe2
- 20 hours ago
- 4 min read
There is a raging controversy over an additional $85 million claimed by the contractor working on the 500-bed Afari Military Hospital. Amidst this storm, a minority in parliament suggests that the current government intends to inflate the project's cost by smuggling that amount into it.
While the minority may be right in disputing the amount and rejecting the claim for additional payments, the facts do not support the suggestion that the figure is introduced into the cost t by the current administration.
The additional claim originates from the contractor, not the government, and documents available to pacgh.org indicate the origins of the claim precede this administration.
In fact, the administration of the NPP, whose minority in parliament are up in arms over additional funding requests, was notified of the additional requests by the contract in 2024, before the party lost power and exited in January 2025.
How NPP was notified of additional claims
In July 2024, while the NPP was still in office, the contractor for Afari Military Hospital, Euroget De-Invest s.a., made an additional claim for $6.5 million and served notice of additional claims against the government. This was contained in a letter dated July 5, 2024.
In a response letter dated November 21, 2024, the then Minister of Finance, Dr Mohammed Amin Adam, disputed the claim. He said the government and the contractor had negotiated and agreed on the outstanding balance payable to the contractor.
The minister said: “You will recall that in your letter of 14th July 2023, you agreed to the payment of $3,500,000.00, being the outstanding claim value and associated financial cost of the project. This followed discussion [sic] at which we negotiated for you to complete the project with the $3,500,000.00.”
The July 14, 2023, letter referenced by the Minister of Finance was signed by Dr Said Deraz, Chairman and CEO of Euroget De-Invest s.a.
In that letter, the contractor concludes by saying: “In furtherance, we will appreciate the release of an amount of Three Million Five Hundred United States Dollars (US$3,500,000.00) to progress activities towards commissioning. This represents outstanding claims of One Million United States Dollars plus 26.5% of the associated financial costs.”
Before leaving office, the NPP administration failed to pay the $6.5 million the contractor claimed he was owed.
In a letter dated April 2, 2025, the contractor added another claim of $78.4 million, which it had notified the government of in July 2024.
This brought the total claim to $84.9 million.
The current Minister of Finance, Dr Casiel Ato Forson, who took over from Dr Mohammed Amin Adam, told this reporter that he has refused to pay the $6.5 million claimed by the contractor.
He said parliament had not approved any payment beyond the original contract sum of $180 million, which he said had been paid in full to the contractor.
Both the Ministry of Finance and the Ministry of Defence have also not engaged the contractor on the additional claim of $78.4 million, which it notified the government of in 2024.
The initial contract sum of $180 million for the Afari Military Hospital has been paid in full through government bonds.
Due to delays and relocations of the site, the contractor made a claim of $30 million in 2018. This was negotiated down to $19.3 million.
“As far as I’m concerned, we have paid the contractor in full. We do not owe him anything. It will be criminal for anybody to pay the contractor any amount,” the Minister for Defence in the NPP administration, Dominic Nitiwul, said in an interview with this reporter.
Warning against politicisation
Dominic Nitiwul, whose ministry supervised the contract during the eight years of the NPP administration, said politicising the project favours the contractor, who, he believed, is holding the nation to ransom with unreasonable demands.
“I have dealt with the contractor. He knows the politics surrounding the project, and he is taking advantage of that. If we continue to make everything political, it is Ghana that loses,” Mr Nitiwul said.
“I don’t blame the current government for the delay in completing the project,” Mr Nitiwul said, insisting that no additional funds should be paid to the contractor for the demands made on the government.
Background of the contract
The 500-bed military hospital at Afari was one of nine hospital contracts awarded to the Egyptian company, Euroget De-invest s.a (EDI), in November 2008.
The NPP administration led by President J. A. Kufuor left office after losing the 2008 election.
Over the eight years of the National Democratic Congress (NDC) administration, the project was delayed in starting due to relocations, redesigns, and delays in granting tax exemptions to the contractor.
In 2008, when the contract was awarded, the military hospital was to be sited in Sofoline in Kumasi.
In 2009, the project was relocated to Tamale.
In 2010, the same project was relocated to the 37 Military Hospital in Accra. Here, preparatory work began, but the project did not proceed.
In 2013, the project was relocated to its present site at Afari, near Kumasi in the Ashanti Region. However, there were further delays.
The Government of Ghana changed its policy on tax exemptions, and the contract required that the contractor be given a tax exemption as a prerequisite for work to begin.
The tax exemption was finally granted in December 2016, the month the NDC lost power after eight years in office.
“We wrote to officially notify the contractor of the tax exemption in early 2017, and that was when the counting began. The contractor was supposed to complete and hand over the facility in June 2020,” Mr Nitiwul said.
Actual construction of the hospital, however, started in 2014.
The recent stalling of the project results from a disputed claim the contractor presented for payment.
“As far as I’m concerned, we have paid the contractor in full. We do not owe him anything. It will be criminal for anybody to pay the contractor any amount.”
Mr Nitiwul has advised that a firm decision should be made on the project so that the people of Ghana can benefit from the investment in the hospital.
“My recommendations are two: either they make the contractor complete the project at no additional cost, or they should terminate the contract and award a new contractor to complete it,” he said.
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