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26 July 2016

Chinese Coy Swindles K’SI Poly

polyIn A Multi-Million Dollar Deal; Yet Management Enters Another Phony $844 Million Transaction With US Company

AN ATMOSPHERE of uneasiness is currently prevailing on the campus of Kumasi Polytechnic as anxiety hangs over the whereabouts of the much-talked about computer assembling project, which involved an agreement reached between the school and a Chinese IT firm, Songtech Limited, about two years ago.

A painstaking investigation by The Chronicle paints a sad and murky picture of another wasteful venture, with several amount of money said to have gone down the drain.

Staff of the institution are seething with anger after a deal which was supposed to benefit and enhance the image of the institution turned almost to be a scam, with the Chinese partner said to have allegedly swindled authorities with a ‘poor quality product’.

After failing to deliver on their promise and leaving authorities of Kumasi Polytechnic in a rather embarrassing situation, Songtech Limited has also seized over 252 sets of computers which were said to have been kept at a warehouse located at Pease, without the consent of K Poly management, under the pretext of going to sell them to potential buyers.

The whereabouts of the computers and that of Songtek Limited is unknown and authorities of the school, The Chronicle gathered, are finding it hard to provide answers to curious staff who keep asking about the outcome of the deal.

Discrepancies in the contract was said to have been uncovered after auditors of the school came around to audit accounts and assets of the school recently. According to investigations by The Chronicle, the auditors were not pleased with the answers given by management of the school after sinking over One Million Ghana Cedis (GH 1,000,000) into the deal with the Chinese Computer firm.

HOW IT ALL STARTED
Somewhere in 2013, authorities of the Kumasi Polytechnic, led by its Rector, Prof. N.N.N. Nsowaah-Nuamah announced a mega deal with Chinese IT, Songtek Company Limited.

The deal involved the assembling of over 2,000 computers locally by students of the polytechnic, as part of their training in entrepreneurship and computer technology.

It was agreed that the cost of shipping the product to Ghana will be jointly shared, as well as the profit, after the products had been sold in the open market.

Under the deal, the Chinese partner was expected to bring in the computer accessories, which were to be sent to the school’s newly constructed workshop centre at Pease, where the products were to be assembled.

However, investigations by the paper indicate that the two parties could not fulfil their final commitments so they agreed to form a joint company, Kumasi Polytechnic Song Technology (KPST), to serve as a proxy to solicit for funding into order to clear the goods.

When the products landed at the Tema Port, information available to the paper indicates that the Chinese partner refused to make any financial commitment towards clearing the goods, leaving Kumasi Polytechnic and its Rector with no choice than to seek for financial bailout.

Information revealed that subsequently, Kumasi Polytechnic raised a Letter of Credit (LC) to the tune of over One Million Ghana Cedis to clear the goods which included desktops, laptops and tablets in order to avoid payment of penalties for late clearance of the goods.

The Rector of the School, Prof. Nsowaah-Nuamah, has told the paper that he also made personal additional payment of GHC 76,000 to get the goods to clear and this he said, had been captured in the minutes of meetings held by the school.

After the accessories were cleared, they were sent straight to the Polytechnic’s workshop at Pease where they were assembled by the students.

Subsequently, the Kumasi Polytechnic reportedly bought 200 pieces of the computers and distributed them amongst the staff and various departments of the school. The amount realised was handed over to the Chinese partner.

However, the rest of the products were left at the workshop at Pease and could not be sold because of concerns about the quality, which was said to be below standard.

Some staff complained to the paper that they have had difficulties using the equipment, which frequently breaks down. The situation has left them to question the quality of the product.

But having waited anxiously and not getting the rest of his investment recouped, the Chinese partner reportedly organized some men to go and cart the remaining computers from Pease, under the guise that he had received orders from some potential buyers.

This action was done without the consent of authorities of Kumasi Polytechnic, who later discovered the act to their amazement.  According to the agreement reached under KPST, one party was not supposed to pick items from the workshop without the consent of the other.

Prof. Nsowaah-Nuamah told this reporter that they currently do not know the whereabouts of the computers, but will surely get in touch with their partners to sort things out.

It is not clear how authorities of Kumasi Polytechnic intend to deal with the ‘missing’ computers, particularly now that information has emerged that the deal between the two parties has collapsed, with equipment at the workshop said to be disposed of, pending auditing.

Aside this, the Chinese partner was supposed to supply additional 1,000 pieces of the computers and tablets as part of the initial agreement but considering the latest setback, it is not likely he will honour that aspect of the agreement.

Meanwhile, efforts to get officials of Songtek to clarify issues to this reporter have proven unsuccessful. When the paper managed to get in touch with one Mr Jake Acquah Simpson, a legal practitioner, who is said to have represented the Chinese partner on the KPST Board, he declined to comment on the matter, contending that he was not in a position to comment on an outcome of an internal audit report of the Polytechnic.

SPECULATIONS
Still not convinced about events surrounding the deal, which is not the first time it is happening to the school, The Chronicle pushed for more answers from anonymous sources within the school.

According to another version of the story, the Chinese partner, having allegedly manufactured shoddy products which could not survive the Chinese market, turned to the Ghanaian market to dispose of the goods.

He then got in touch with some partners in Ghana, who allegedly expressed interest and linked management of Kumasi Polytechnic, who were also looking for opportunity to create avenues for their students to have practical hands-on experience.

Flowing from this, the Chinese partner then disassembled all the products into accessories and got Kumasi Polytechnic to fund the shipment to the country.

Then the KPST was formed as a proxy entity to facilitate the deal which included raising funds to clear the goods and subsequently market them.

Reports indicate that, even the travelling expenses of Chinese workers, who were brought into the country to assist in the assembling of the goods were borne by Kumasi Polytechnic.

Now the products were assembled and K. Poly sold some pieces to itself and handed the money to the Chinese partner (though it is not clear how the booty was shared).

Since Kumasi Polytechnic could not sell more of the products to itself and with the staff agitating that management had wasted their funds, the products were left at the workshop and the Chinese guy, who was growing impatient at the slow movement of the goods, took matters into his own hands and took away the rest of the computers, without informing authorities of Kumasi Polytechnic.

ANOTHER SCAM?

poly2

The Chronicle has information that the school is planning to enter into another agreement with a US consortium to build an infrastructural and technology village.

The deal, worth over $844 million, is an equity sharing with the US consortium expected to fund the entire project based on Build Operate and Transfer (BOT).

In return, K Poly will offer the US Consortium land and other requirements needed to facilitate the smooth implementation of the multimillion dollar project.

THE RECTOR’S REACTION
Meanwhile, the Rector of the school, Prof. Nsowaah-Nuamah, who has come under intense criticism from his staff, gave a slightly different twist to the story, when contacted by The Chronicle.

He first absolved management of the school of any blame, as far as the deal was concerned, contending that the objective of the agreement, which was to provide students with the opportunity to have practical knowledge, has been achieved.

According to him, those spreading rumours that the project was unsuccessful were the very people who had from day one opposed his vision to transform K Poly into a centre of excellence and modern profit making institution.

He further insinuated that the same people, having realised his time was due for retirement, fears that he will be given an extension following government’s policy to turn the country’s Polytechnics into technical universities.

“Everyone knows the kind of work I have done on this polytechnic conversion and they think that I may be asked to stay a bit longer and ensure that things are properly rolled out,” he noted in an interview with The Chronicle.

But the former acting Government Statistician said his detractors were sweating in vain because he has no intention of staying in public service, as he already has juicy offer from a private university (name withheld).

SONGTEK TRUE STORY
Though Prof. Nsowaah-Nuamah admits the deal with the Chinese coy has hit rough patches, he disagrees it has been a wasteful venture.

He also protested against the number of figures which investigations reveal were brought into the country, arguing that only 600 pieces of the products were assembled.

Prof. Nsowaah-Nuamah further pointed out that the Chinese partner took 252 pieces of the computers of the remaining 400 and that the school still has 148 pieces of the product in its possession.

He further denied the assertion that the Chinese firm had swindled Kumasi Polytechnic, arguing that the institution did not in any way incur any losses.

According to him, he took personal risk in the deal, stressing that he personally contributed huge cash in ensuring that the goods were cleared.

“I had to dish out about GHC 76,000 from my personal account to get the goods cleared because I wanted this project to succeed. I wanted to build a legacy for Kumasi Polytechnic, I am not interested in any financial benefit,” Prof. Nsowaah-Nuamah emphasized.

The Kumasi Polytechnic Rector was, however, worried about the negative publicity that otherwise successful project was getting, emphasising that this could adversely affect any future venture that K Poly intends to carry out.

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