Controversy over 69 Mitsubishi gallopers still rages

By Ebenezer Hanson

The dark clouds of controversy that engulfed the non-delivery of 69 Mitsubishi gallopers by Messrs African Automobile Ltd to the government at the beginning of the New Patriotic Party (NPP) administration has not yet dispersed.

A source close to Messrs African Automobile Ltd has revealed to the Public Agenda that the bankers of the auto firm have dragged it to court because of its inability to pay loans granted it for the importation of the vehicles meant for the distribution to District Chief Executives (DCEs).

The sad aspect of the saga, the source disclosed, was when the warehouse of African Automobile Ltd was opened, some of the cars have suffered profound ware and tear and some getting “rotten”.

According to the source, in 2000, Messrs African Automobile Ltd at the instance of the then National Democratic Congress (NDC) administration allegedly imported 69 Mitsubishi Gallopers meant for distribution to DCEs. The vehicles allegedly arrived in 2001. The source said the NPP claimed the prices of the vehicles were inflated, hence paid only part and refused to pay the rest.

The source further alleged that the amount of money left to be paid by the government stands at ¢ 5 billion (five billion old Ghana cedis).

But Public Agenda’s checks with Hon. Kwadwo Baah-Wiredu, Minister of Finance and Economic Planning who incidentally happened to be the Minister of Local Government and Rural Development(MLG&RD) at the time the vehicles allegedly arrived in the country, unearthed facts which were totally at variance with what the source had made known to this paper.

The Hon. Baah-Wiredu says the NPP administration abrogated the contract government had with Messrs African Automobile Ltd on the grounds that the vehicles “were of poor quality and the non-performance of the suppliers”. Besides, the automobile company reneged in respect of time of delivery and the number of vehicles to be delivered.

He recalled that as part of its efforts to provide logistic support to MMDAs, Cabinet on July 20, 2000 approved the purchase of 110 Four Wheel Drive Hyundai Galloper II Station Wagons for DECs to replace the Mitsubishi short wheel Pajero vehicles allocated to them in 1994. The MLG&RD accordingly placed orders with Messrs African Automobile Ltd for the supply of the 110 vehicles.

Under the trade-in-agreement with the company the MMDAs were to surrender their Pajero vehicles to the African Automobile Ltd at values to be determined by the State Transport Company (STC) to offset the cost of the Gallopers to be supplied.

Hon. Baah-Wiredu disclosed that the cost of the 110 Gallopers was $3,322,000; however, in October 2000 the price was adjusted upwards by the manufacturers to $3,353,000 of which the MLG&RD paid to the company a deposit of ¢ 8 billion in 2000. The deposit, on conversion amounted to $1,586,720.79 which represented 44.7% of the total cost.

He explained that on October 9, 2000 the African Automobile Ltd. in a letter promised to deliver 60 units of the vehicles by November 10, 2000 and the remainder two weeks thereafter. This promise was not fulfilled.

He recalled that as 2002 or thereabout, the company had only managed to supply 23 out of 110. The total cost of 22 Pajeros traded-in for the 23 Gallopers revaluation was ¢ 427.5 million ($ 61, 1085.00).

He further revealed that besides the Gallopers, the MLG&RD also ordered sanitary vehicles/equipment from the company at a total cost of ¢6,118,000($874,000). The Ministry again paid a deposit of ¢3.5billion ($500,000), that is, 57.7% of the total cost on June 5, 2000. But he indicated these were not supplied.

“Initial reports received from the beneficiary districts indicated that the Gallopers were of poor quality and certainly not strong and robust for district,” he stated.

Reacting to the issue, the Chief of Staff advised that the order for the vehicles should be abrogated; the suppliers be made to refund the deposit them with the appropriate interest, less the cost of the of the 23 Gallopers and that the MLG&RD in place of the Gallopers purchase double cabin picks ups.

Hon. Baah-Wiredu disclosed that following the Chief of Staff’s advice a series of meetings involving the representatives of the Attorney General and himself on one hand and the suppliers on the other. “When it became abundantly clear that the company was unable to honour its contractual obligation the Ministry decided to issue a letter on September 28, 2001 to abrogate the contract with effect from September 29, 2001.”


In its response to the MLG&RD’s letter on the abrogation, Messrs African Automobile Ltd indicated in letter to the Ministry that the remaining 87 Gallopers had arrived at the Tema Harbour for clearance.

The company thereafter explained that their inability to deliver the vehicles within the stipulated time was due to number of factors including “the inability of the Ministry to make payment on account; delay of Bank of Ghana to honour and converting the cheques issued by the MLG&RD into dollars for the transmission of their principals and delay in establishing of letter credit as result of reasons indicated above.”

Notwithstanding the above the explanation, “I informed the company that since the vehicles are not suitable for field work the Ministry does not need them any longer; our letter of abrogation therefore still stands”, Hon. Baah-Wiredu emphasized.