In a recent publication, the Global Times Newspaper has urged the Sierra Leonean government to exercise caution as it negotiates a new lease agreement with Kingho Mining Company for the management of the Pepel Railway and Port.
The article highlights concerns over the payment of lease rent to the government of Sierra Leone “how much have they paid to the Government of Sierra Lone as lease rent for the use of the facilities?”
The report note that even with the new 20-year agreement about to be signed, Kingho have only agreed to pay US$1.5million a year as lease rent to the Government of Sierra Leone. That, again, is a ridiculous amount.
In 2021, the Government of Sierra Leone leased the assets to Kingho Railway and Port Company Limited. After two years, the Government decided to terminate the lease agreement with Kingho Railway and Port Company Limited on 10th January, 2023.
Before the lease agreement was terminated in January 2023, Kingho was paying a flat rate of US$1,250,000 (One Million two hundred and fifty thousand US Dollars) as annual lease rent to the Government of Sierra Leone. That amount has been described by industry experts as a pittance.
Several private companies have applied for the Railway and Port to be leased to them, for an annual fee, far higher than what Kingho was paying before their agreement was terminated in January 2023.
Global Times emphasises the need for government tread carefully and recognise the legally binding agreement already in place with ARISE IIP.
The Global Times has raised questions about the potential consequences of entering into an agreement with Kingho Mining Company, citing a lack of tangible benefits . The article suggests that the government should prioritize the interests of its citizens and evaluate the potential long-term impact of any new lease agreement.
Experts have called on government to note that, the on-going negotiations with Kingho for the management of the Pepel Railway and Port be put on hold until the issue of the lease agreement signed with ARISE IIP is fully addressed.
We cannot afford to undermine investor confidence by engaging in such illegal way of handling signed contracts or agreements.
The credibility of the Government is at stake. It is important to point out that, ARISE IIP still have a valid agreement with the Government of Sierra Leone, approved by the Cabinet to develop, expand and manage the Pepel Railway and Port. That agreement has never been terminated by the Government of Sierra Leone.
It should be noted that the only legally binding agreement currently in force for the management of the Pepel Port and Railway is the one signed between the Government of Sierra Leone and ARISE IIP. The Global Times emphasizes the significance of honoring this agreement, which was entered into to ensure efficient operations and maximize benefits for the country and its people.
ARISE IIP, a reputable international infrastructure investment platform, has demonstrated its commitment to fostering sustainable development in Sierra Leone. The company has implemented various initiatives aimed at improving infrastructure, creating employment opportunities, and promoting economic growth in the region.
The Global Times’ call for caution and adherence to the existing agreement with ARISE IIP reflects growing concerns among Sierra Leoneans about ensuring fair and equitable management of the country’s vital infrastructure assets. The government must carefully consider these concerns and act in the best interest of its people when negotiating any new lease agreements.