Dear Editor,
We saw the statement from President Donald Ramotar concerning the Amaila Fall Hydro Project and did not know whether to laugh or cry since his arguments for support of this now dead deal are premised on two things: no debt on the taxpayers (untrue – we will only be able to announce this after 20 years have elapsed); and a reduction in the consumer tariff (although he quite skilfully drifted away from this and replaced it with “the tariff paid by GPL to Sithe for electricity will reduce by 40 per cent” – as different as chalk and cheese).
What we do know is that David Granger and APNU did the right thing by not voting for the Amaila Bill in parliament, and the people are clearly on their side. In joining with the PPP/C to vote for the bill, the AFC not only did the wrong thing but it appears as though they did not have the people’s interest at heart. If the AFC did have their interest at heart, then why would its leaders allow Sithe Global Inc to charge Guyanese a 19% interest rate when commercial lending interest rates in Europe and North America are less than half that amount?
All Guyana wants hydropower, but certainly not at this huge cost and with this financial architecture. It is clear that the creators of these contracts are not prepared to level with the people on the contingent liabilities that are embedded in all the contract documents of the project.
Why do you think they went to the National Assembly requesting a motion to increase the debt ceiling for public corporations? If there are no contingent financial obligations payable by GPL, then why increase the debt ceiling? Why not let GPL and Sithe consummate a private deal without an equity contribution from the state? The people are not buying into the propaganda the PPP is selling them.
In the absence of the engineering drawings and the bills of quantities, there is uncertainty if the engineering estimate and designs are adequate to cover the soil conditions at the location. Have they done the soil tests? Have they established the bedrock conditions in the areas? What happens if their engineering designs and estimates do not reconcile to what is on the ground? Who will pay for the cost overruns? The answer is Aunty Seema in Whim and Uncle Oscar in
Buxton; not Donald Ramotar or Bharrat Jagdeo – they do not pay taxes.
So President Ramotar can keep his sound bites for Freedom House. The fact remains there is a contingent liability on the nation’s books and the people of Guyana will have to pay for this uncertainty.
The Jagdeo/Ramotar regime does not have a good track record on the big capital projects. Everything they touch has resulted in massive cost overruns and would it be different on the Amaila Project? Further, if they had the
people’s interest at heart, they would not have allowed Sithe Global to charge 19% interest rate on its loan of US$157 million to the Amaila project when the average commercial lending rate in North America and Europe is between 6% and 8%. And to allow one person, Winston Brassington to negotiate such a huge deal is irresponsible on the part of the PPP.
A clear example is the Berbice Bridge. This bridge was supposed to be the saviour for Berbicians; it is now the financial albatross around their necks because of the high toll and they did not tell people up front how much it would cost to cross this bridge. It is Guyana’s most costly fiasco to date.
Then the Jagdeo white elephant – the Skeldon Factory was sold as the solution to turning around GuySuCo. That factory is the source of why GuySuCo today is turning on its head. Why should the people believe them on Amaila?
After 5 years the Skeldon Factory remains the most unreliable and inefficient sugar mill in Guyana, while the contract has been paid in full and the contractor is nowhere to be found to fix the problems. In fact, the PPP regime continues to spend the taxpayers’ money repairing a factory that the people at Skeldon described as a ‘scrap metal’ factory. Again, who is paying these bills? Not Messrs Ramotar and Jagdeo but Aunty Seema in Whim and Uncle Oscar in Buxton.
We say yes to hydropower, but not at any cost to the taxpayers.
Yours faithfully,
Asquith Rose
Harish S Singh
