The proposed US$138M Chinese-funded expansion of the Cheddi Jagan International Airport, Timehri has from the inception triggered notable and well-founded concerns.
First among these, of course, was the stealth with which the deal was clinched. It would appear that sometime last year during the visit of a senior Chinese government official to the Caribbean, Georgetown was advised that the cash flush Beijing government had money to lend to Guyana and the airport project was seized upon. Beijing is not known to distribute its largesse without conditions and quid pro quo. At least one imposition for the money to be made available through China’s Exim bank was that the contractor would be China Harbour and Engineering Corporation.
Just why the Guyana Government, then under President Bharrat Jagdeo, felt obliged to yield to the dictates of Beijing is a question for its principals to answer. With ever diminishing sources of ready financing available to Guyana, President Jagdeo had not been averse to looking east for more money even if the terms were not as concessionary as they should be. It doesn’t even appear as if the government was going to trumpet this project and its financing for the purpose of securing votes at the general elections last year as it was only on the publishing of a report in the Jamaica Observer newspaper on the airport project 10 days before the general elections that the Guyanese public became aware of it. The government had most likely intended that this project be kept secret prior to the elections precisely because of the manner in which it was struck. Post-elections, and hopefully with a comfortable majority in Parliament, the government would then have unwrapped the deal with little consideration of protests and normal service would have returned. That was not to be. The project is now swathed in the most unflattering light and it puts the new government in a spot.
There is no provision in the procurement framework of this country or no power accorded to the President that easily allows the solemnizing of a deal worth US$138M with a foreign power in the manner in which it was. Since very little has happened so far with this project, the casual and unstructured manner in which it was sealed would be adequate grounds for it to be suspended and the entire project and the rationale behind it reviewed.
Further pressure has been brought to bear on the government over this project as it has now been revealed that CHEC has been blacklisted by the World Bank by virtue of its parent company. The World Bank debarred the parent company, CCCC from being eligible to bid on road and bridge projects funded by the bank for the period 2009-2017. However, the parent company says that the blacklisting issue raised by the Office of the Contractor General in Jamaica was inherited by the CCCC when it took over the China Road and Bridge Corporation in 2005. That, notwithstanding, it would seem that the parent company still has to satisfy the World Bank that it operates within a framework that eschews corruption and limits opportunities for it. Until there can be greater satisfaction that CHEC/CCCC have stringent measures in place to deter corruption it would be unwise for them to be parachuted into an environment that is rife with corruption at many levels.
However, the most extraordinary development in this matter must have been the beguiling declaration by former President Jagdeo that President Ramotar should not lightly consider the blacklisting of CHEC by the World Bank. In an interview with NCN, Mr Jagdeo called upon President Ramotar to seek explanations from the Chinese government about the conduct of CHEC since the company is state owned. Mr Jagdeo also urged that President Ramotar “review the CJIA contract to ascertain whether Guyana will be getting value for money and if there is any illegality in the project,” the report added.
Astounding. Where exactly was former President Jagdeo when this deal was clinched last year? Wasn’t he the one who would have had to bless the project? Had he and his government been more circumspect as expected, a glancing due diligence would have revealed right away that this company had been blacklisted. The selection of the contractor might not have proceeded farther as a result. Further, feasibility and value-for- money considerations should have been concluded a long time ago before this senior Chinese official touched down in the region. Having been President between 1999 and 2011 one presumes that President Jagdeo would have been acutely aware of all of the parameters relevant to the massive expansion of the airport and whether it was feasible. It just could not be the case that the PPP/C began evaluating the financials for this project only last year.
For whatever it is worth, former President Jagdeo’s remarks will come across as completely self-serving and an undisguised attempt to put distance between himself and the discredited decision-making for this project. He must bear the responsibility for this deal and he and the signatory to this project signing in Jamaica have a lot more information to supply to the public.
Aside from these issues, the contracting of such large debt in a cycle of increasing debt repayments and sensitivities about unsustainable debt loads should have been adequately discussed in the public domain. Finance Minister Singh should be asked in Parliament to defend the wisdom of taking on such a big loan for a project whose returns have not yet been adequately defined or projected.
What is the sense of having an airport the size of Piarco if there is unlikely to be traffic to keep it busy? It will only serve as a further drain on the economy. Construction of a bigger airport in itself will not yield higher traffic. What are the underpinnings of the financial feasibility study that should have accompanied the decision to go ahead with the signing? The last 20 years of PPP/C governance has not produced a significant expansion of airlift into Timehri. What will change with a bigger airport? Which airlines might be interested in using Guyana as hubs and could this be credible without dedicated passenger traffic?
The Ramotar administration – despite the involvement of some of its Cabinet members in this deal – can well say it needs to pull back from this CHEC contract to review all of the relevant factors. This contract is definitely the result of the worst forms of governance applied by the Jagdeo administration and should be put on hold.
