by International Monetary Fund

Cultural Safari to President Obama’s African {ancestral} home

Day 1:Arrival
On arrival at Jomo Kenyatta Airport,you will be met and transfered to a hotel in Nairobi booked on bed and breakfast.

Day 2: Nairobi – Nakuru – Kericho – Kericho – Kisumu
After breakfast,you will depart from Meridian Court Hotel at 7.30am to Lake Nakuru National Park home of the Multi-Million Flamingo birds for a game drive. The game drive will take you to the shore of the lake to a maze at the sight of this pink flamingoes and the pelicans which are in their millions.You will also be taken to the Rhino Sanctuary to see both the White and the Black Rhino.The game drive will aso pass through the vintage Baboon Cliff to have a panoramic view of the lake.You will then drive for a buffet lunch at Lake Nakuru Lodge.After lunch depart to Kericho town with a break at Kericho tea hotel which was built in 1950’s by Brooke Bond Tea Company, enjoy evening fresh tea and then go for an escorted walk in the Tea Plantations. Kericho is a Tea country which has put Kenya to be the world third largest Tea producer after India and Sri Lanka. There are beautiful rolling hills carpeted in neat, bright green tea bushes as far as you can see. The climate here is perfect for Tea with rain falling almost every afternoon. Kericho was named after Ole Kericho, a Maasai Chief who was killed in the battle by the Gusii in the 19th Century.You will then drive to Kisumu City to check in at Ukweli Pastoral Centre for dinner and an overnight stay.

Day 3: Kisumu – Kogelo -Kit Mikayi – Mbita – {Rusinga Island}
After an early breakfast from Kisumu,depart to Siaya District,Nyang’oma Division,Kogelo Village to visit the kenyan home of the President of the United State Of America,His Excellency President Barack Hussein Obama.We will get to interact with the people in the home including his Grand Mother, Mama Sarah Obama who may be very busy for us as she has been appointed as an envoy as a goodwill ambassador against malnutration by Intergovernmental Institution for the use of Micro – Algae Spirulina Against Malnutration {IIMAM} and the sarounding.We will have time to visit the graveyard of Obama snr.After this visit,you will then depart to “Kit Mikayi” {in the local Luo dialect the Stone of the “first wife”} Kenya’s most dramatic archaeological site, a vast granite rock tower. The Stone is about 70 to 80 ft tall and is located 30kms Far East of Kisumu city and 1km from Kisumu Bondo road.The legend has it that long time ago, there was an old man by the name Ngeso who was fascinated with this Stone as every morning he could climb into the cave and stay there meditating the whole day.When his wife was asked where the old man was,she could reply that he was with the “first wife” hence the Stone of the first wife.Over the years this place has become holy and many people go there for prayers and seek cleasing.You will get more stories on site through a local guide and also you will get to know the attachment of this Stone to the Luo Tribe which is the tribe of Obama senior.After this intriguing adventure,you will drive further to catch a ferry to Mbita picnic lunch enroute.On arrival,you will check in to Lake Victoria Safari Village.This will be followed by a drive to Rusinga Island and into the home of Tom Joseph Mboya where his mausoleum lies on the family land at Kamasengere Village.Tom the then powerful Economic and Planning minister in the government of Kenya was the person whom with the help of JFKennedy orgernised for the University Education Scholarships and Students Airlift through Kennedy’s Familly Trust of the young bright Kenyans to United States of America.Among the first beneficiaries of this noble project was Obama snr who went to University of Hawai where he met his second wife Ann Dunham the mother of President of the United States of America His Excellency President Barrack Obama.The Mausoleum has various mementoes and gifts Mboya received during his life from the prominent World leaders and eminent personalities.Tom Mboya, civil rights champion, trade unionist and charismatic young Luo politician was gunned down in Nairobi in 1969, sparking off a crisis that led to over forty deaths in widespread rioting and demonstrations.Among the casualities who were sacked from the government after this assination,was the bright Obama Snr who later was reinstated by President Kibaki when he was Minister for Finance by then.Dinner and overnight at Lake Victoria Safari Village.

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Day 4: Mbita – Awendo – Lolgorien – Maasai Mara
After breakfast at Lake Victoria safari Village,you will then drive past Kanyamwa escarpment,then to Rongo and to Awendo passing through Maize and Sugar plantation, amazing at the beautiful landscape of Nandi and Kipsigis tribes to enter the famous Maasai Mara with an enroute game drive to Sarova Mara Game Lodge for dinner and overnight.Picnic lunch enroute.

Day 5: Maasai Mara Full Day
Full day will be spent in the vast Maasai Mara in search of its renowned plain game; Black manned Lion, Leopard, Cheetah, and migration of Wild Beast and Zebras. The Savannah country in the Mara with plenty of grass and short trees (shrubs) sustain the bigger number of herbivorous animals which Maasai Mara boost of and also act as vintage to enjoy a wonderful view of the animals. The ride will take you to the famous Mara River where we have a big school of Hippos and plenty of Crocodiles. This section also boasts of many species of Bird life. Drive back with a game drive to your Lodge for dinner and overnight. Picnic lunch will be enjoyed on the game. Note: You can also enjoy Balloon ride very early in the morning at an extra cost of US$ 425 per person with champagne breakfast or a visit to a Maasai village at US$ 20 per person or a guided Maasai Nature Walk in between at US$ 20 per person.

Day 6: Maasai Mara – Nairobi
Enjoy an early game drive before breakfast.After Breakfast,you will depart to Nairobi to check in at Hotel booked on bed and breakfast.After checking in at the hotel and refreshing,you will be taken to Carnivore restaurant for dinner, Nairobi has many restaurant offering varieties of cuisine. We recommend dinner at the unique Carnivore Restaurant which is famous for the succulent barbeque dishes of Meat as an excellent compliment after holiday in Kenya; especially as an excellent farewell. The restaurant also offers Vegetarian menu.Drive back to the hotel to enjoy your sleep.

Day 7: Departure
After breakfast,you will check out from the hotel latest at 10.00am for your transfer to the Airport for your onward flight home to end your holiday vacation.

The price includes:
1.Return Airport transfer on the first and the last day out of Nairobi.
2.Use of a Safari mini-van with photographic hatched roof.
3.Use of English speaking driver/guide.
4.Accommodation as per the tour dossier above.
5.All park entrance fee.
6.All game drives.
7.Kericho Guided Tea walks.
8.Ferry’s fee from Lwanda K’Otieno to Mbita.
9.Car and driver’s entry fee.
10.Driver’s allowance.
11.02 Nights accommodation in Nairobi.
12.Dinner at Carnivore Restaurant on the last day in Nairobi.
13. Government tax.

The price excludes:
1.Flights both international and domestic.
2.Visas.
3.Extra activities in Maasai Mara as per what is mentioned above.
4.Bevarages.
5.Laundry.
6.Mineral water.
7.Donations to the guides and curators of the mentioned sites e.g Kit Mikayi and Tom Mboya Mausoleum.
8.Tips.

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by International Monetary Fund

Sierra Rutile: One year after collapse of the dredge

As we approach the one-year anniversary of the capsizing of the dredge at Sierra Rutile Limited (SRL) in July 2008, resulting not only in fatalities, injuries and property damage but triggering massive lay-offs and interruption of rutile production; my research into how the company,  its insurers and reinsurers were handling this major national catastrophic loss, has also unearthed hitherto unpublicized unconscionable agreements between successive Sierra Leone governments and Titanium Resources Group (TRG).

What is TRG?

Titanium Resources Group (TRG), for readers unfamiliar with its operations, is the parent company, owner and operator of two of Sierra Leone’s major extractive mineral mining companies, namely Sierra Rutile Limited (SRL), the country’s largest private sector employer and TRG’s major source of revenues and until recently Sierra Minerals Holdings Limited, its wholly owned bauxite mining operations in Sierra Leone.  The company is 59 percent owned and controlled by a Mauritian-born mining magnate, Mr. Jean Raymond Boulle and has as its Chairman, Mr. Walter Kansteiner, the former US Assistant Secretary of State for African Affairs and a Sierra Leonean, John Bonoh Sisay who serves as the Chief Executive Officer and also a Director.

A press release issued by the company in April, 2009 that it had successfully reached a settlement agreement on its million dollar loss claims with Zurich Re, one of its major reinsurers, marked a major milestone and gives confidence that the other reinsurers will soon make whole the company’s losses from the dredge loss.

The major question now is whether the country which has made repeated sacrifices through tax subsidies and concessions and even allowed TRG to use as leverage its rutile and bauxite deposits in international financial circles will recoup some of the insurance recovery towards her development.

The collapse and loss of the dredge, estimated at 35 million dollars resulted in the company embarking on a series of cost cutting measures including a 25 percent workforce reduction, suspension of exploration activities and agreement with the government on a 2 year moratorium on interest payments to the government of Sierra Leone relative to a 45 million dollar EU loan.

However, despite the loss the company posted only a 5 percent loss in rutile production ( 78,908 tons in 2008 as opposed to 82,530 tons in 2007) while it increased ilmenite production from 15,750 tons in 2007 to 17,528 tons in 2008. The company nevertheless states that it “does not have sufficient cash reserves to rehabilitate Dredge D2 and no assurance can be given that the Company will be able to secure funds to rehabilitate the dredge”.

According to the company, “the mining concession in Sierra Leone is one of the largest natural rutile deposits known in the world” which has been mined since 1967 and currently has a projected mine life of 19 years, as estimated by Mine Development Associates in 2005. The company also extracts and produces ilmenite and zircon at the rutile facilities.

During its recently concluded shareholders meeting on June 11, 2009, TRG unveiled its 2008 annual report which essentially provides among other unreported financial statements, a virtual roadmap of how mining companies in Sierra Leone have been able to deprive our nation of millions in taxes.

Through utilization of coercive measures, insistence on secrecy of mining contracts and false accounting practices for example, TRG and Mr. John Bonoh Sisay were able to secure an unconscionable deal for Sierra Rutile (SRL) by having the Tejan-Kabbah government in 2004 grant his company a 10-year exception on fuel import taxes, a re-negotiation downwards of the government’s standard 3 percent royalties of turnover to 0.5 percent, in return for an equity stake in the mines. The turn over reported by TRG for periods 2006 to 2008 totals 8.57 million dollars. Absence the agreement of 2004, the country stood to gain in taxes at 3 percent the sum of approximately 6 million dollars. However, with the 0.5 percent rate subsequently agreed TRG would only pay the sum of approximately 900,000 dollars. The substantial difference clearly benefited someone at the detriment of the country and such an unconscionable agreement not only invites review by the regulatory bodies such as the ACC but glaringly renders such an agreement voidable in law.

 Mr. Sisay who reportedly was rewarded with the Chief Executive Officer (CEO) position after this unconscionable deal was quoted as stating that “in effect the deal was renegotiated so that the government has an equity position in the company, with a 3 percent annual increase for 10 years, until it holds 30 percent”.  The government and people of Sierra Leone according to very conservative estimates are however projected to loose more than a 100 million dollars in revenues between 2004 and 2016 as a result of the tax concessions granted to TRG.

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It is note worthy that following the signing of the agreement; Mr. Sisay was granted options to common shares in the company in excess of 174,000 in 2005. Further in 2008 he was again rewarded with an additional 100,000 shares payable at 47.00p and 75.50p with maturity dates in 2010 and 2013 respectively.

The 2008 Annual Report:

The report with its accompanying independent auditor’s report by BDO De Chazal Du Mee, Chartered Accountants in Mauritius; its consolidated financial statements; balance sheet and notes to the consolidated financial statements provides a rare glimpse into the operations of a company, characterized by an intricate web of self-dealing, corporate exploitation and tax dodging schemes that have raped our nation’s strategic minerals with the covert and tacit accomplice of our nation’s political leaders.

It is thus of the utmost national economic interest and importance that TRG’s operations, business activities, subsidiaries, contracts and agreements with government officials and the local communities be subjected not only to scrutiny and transparency but an urgent legal and regulatory review by the Anti Corruption Commission (ACC) and or Parliament so that Sierra Leoneans can better understand why despite 40 years of rutile mining our nation basically has nothing of significance to show. Such a probe must be focused and designed to reform the existing agreements and to mandate an annual reporting by mining companies of capital expenditures, profits, taxes and fees and company funded community programs. Such a requirement will ensure public scrutiny of contracts and agreements with the general public better able to monitor compliance and avert the signing by politicians and bureaucrats of such catastrophic agreements, as the 2004 First Amendment Agreement.

What is the First Amendment Agreement?

According to the First Amendment Agreement dated February 4, 2004 between the government of Sierra Leone (GOSL) and Sierra Rutile Limited, the government assigned to SRL “all its rights, title and interest in, to and under the future PAYE taxes due from SRL to the GOSL in an amount not exceeding 37 million US dollars. In consideration for the foregoing assignment, SRL agreed to transfer up to a 30% equity interest in Sierra Rutile Holdings Ltd to the GOSL within 60 days of the end calendar year commencing on April 1, 2005, equal in value to the PAYE amounts accrued during such calendar year”.

According to the company’s financial statements, as of December 2007 and 2008 only a total of 2,466 shares have been transferred and PAYE accrued for the year in Sierra Rutile Limited amounted to 1,840,000 USD(one million eight hundred and forty thousand dollars)  and in 2007 USD1,288,000 (one million two hundred and eighty eight).

The above assignment in lieu of PAYE taxes resulted in GOSL obtaining a 2.063% ownership interest in Sierra Rutile Holdings Limited (SRHL). SRHL is one of several subsidiaries of TRG whose main business is listed as an “intermediate holding company”. Thus, as can be noticed the country’s revenue stream from PAYE taxes payable by SRL has cleverly and or corruptly been transferred into a worthless minority share ownership in a company with essentially no independent source of revenues. As a British Virgin Islands incorporated company, SRHL has no legal requirement to prepare and file audited accounts in Sierra Leone. TRG thus has been able to reap off Sierra Leone of over 3 million dollars just in 2007 and 2008 through such an unconscionable agreement.

Despite being a minority shareholder, GOSL does not have a seat on the board of directors of TRG. Decisions thus affecting a company and country that the nation has obtained loans on its behalf, provided subsidies and deferred collection of interest payments and owes equity shares in are made without any participation by representatives of the government. I would be pleasantly surprised if our Ministers of Finance and Mines and at least the High Commissioner in London were present at the concluded June 11, 2009 TRG shareholders meeting in London. Rather Mr. Alex Kamara, a CEMMATS Group Director was appointed to the TRG board on March 10, 2008. According to TRG, CEMMATS has a “number of contracts for the supervision of the construction of the capsized dredge and a new power house at SRL”.

Moreover, compounding the loss to the nation by such an unconscionable agreement signed in 2004, the financial statements for 2008 showed a negative loss of shareholders interests. The company’s loss before interest, tax, depreciation and amortization for 2008 is reported at 22.8 million dollars. The losses attributed thus to the minority shareholder (GOSL) exceeded their equity shares and as such the company absorbed the losses. However, any future reported profit by SRHL and SRL would be allocated to the majority interest until the government’s share of losses previously absorbed by the company is recovered.

The scheme of equity ownership on the surface appears economically viable to a layman, however what it entails in actuality is increasingly the country becomes saddled with the liabilities of a company in proportion to its shares. Thus as an example, with a projected 30 percent shares in the company and losses of 22.8 million in 2008, Sierra Leone is assessed a 30 percent share of the entire losses of the company. It is interesting to note that since the signing of the agreement, TRG has not posted any profits thus robbing the country of royalty payments and saddling the nation with additional debts.

Currently aside from the salaries of its workers and the 10 percent mandatory company contribution into NASSIT, the company does not provide any retirement benefit plan for its employees. The agricultural development fund the company contributes for development of agriculture in the mining communities represents a paltry ,000.00 per annum. This annual amount is allegedly paid into a separate fund under the management of the government. An audit of this account by the ACC on behalf of the chiefdom communities would be highly in order to ensure that the intended recipients are benefiting.

In conclusion, a cursory review of TRG’s financial statements reveals that this company Is highly leveraged with loans and guaranties from international financial institutions Sierra Leone is signatory to forming the bulk of capital for its operations. For example, the European Union provided the GOSL the sum of 25 million Euros, to be on lent to Sierra Rutile in 2006. The loan carries an interest rate of 8% per annum with the principal and interest paid to support socio-economic development projects in Sierra Leone. However, upon capsizing of the dredge, TRG in 2008 secured a moratorium on payment of the interest with GOSL, thus impeding our nation’s development.

It is envisaged that any reforms in the mining arena especially as relates to TRG’s rutile mining operations must ensure a return to the status quo ante were the company is made to pay royalties as originally agreed instead of the bogus equity shares in SRHL, divestiture of shares in the SRHL company, recession of moratorium of interest payments on the EU loan, repeal of tax subsidies and concessions and greater transparency and regulation by the Anti-Corruption Commission (ACC)  to ensure compliance with the terms of mining agreements in the country.

As previously postulated in my article “Enterprise Risk Management: a national Risk Management & Insurance Strategy for Sierra Leone” (http://www.articlesbase.com/authors/kortor-kamara/70274.htm), the country needs a national risk management and insurance office to serve as a repository of governmental contracts and agreements; provide technical risk management and insurance review of all past, present and future governmental contracts; provide insurance and loss control oversight of all governmental contracts to ensure compliance with appropriate terms and conditions. For with such an agency in existence in our country unconscionable agreements, moratoriums and the 2004 First Amendment Agreement would never have been swept over the heads of our nation.

It is now of the utmost urgency that the Minister of Mines and the entire government embark upon a new round of negotiations with TRG to ensure that the interests of the people of Sierra Leone are adequately protected and agreements as negotiated by Mr. Sisay in 2004 are rescinded immediately. It should be noted that TRG’s operations are subject to the laws and regulations of Sierra Leone and changes in legal requirements, terms and conditions of existing permits and agreements are within the legal purview of government to revisit and reform.

On Monday 29th September 2008 Abdillahi Mohamed Duale, Minister of Foreign Affairs of the Republic of Somaliland, spoke on‘Somaliland: why its recognition will improve peace and stability in the Horn of Africa’ from 3:30-4:30pm. Abdillahi Mohamed Duale was appointed Foreign Minister of the Republic of Somaliland on 5 August 2006. He has had a long career in the government of Somaliland, stretching back to 1993. His previous roles have been varied, including Minister of Finance and most recently (since 2001) Minister of Information. Mr Duale was educated at both undergraduate and MBA level in New York.