Minister of Works Robeson Benn says that the huge Timehri airport expansion project is at risk following the opposition-led budget cuts and that government will face penalties for missing a payment to the contractor.
Cheddi Jagan International Airport, Timehri (CJIA) authorities are also worried that that China Harbour Engi-neering Company (CHEC) is beginning to slow down the works being done.
“The first payment on works done was due two days ago. It hasn’t been made. [As a result] we have to pay interest at commercial rates for every day missed,” Benn told Stabroek News on Friday.
The opposition and others have voiced concerns over the scope of the project in terms of the size of the proposed terminal building. Opinions as to whether an eight-gate terminal is warranted in a country where the landings and take offs are few and far between have also been advanced.
Commenting on the issue, APNU Member of Parliament Joseph Harmon said that if the Chinese are concerned about the fate of the project’s financing, then they should encourage the government to ensure that their social obligations towards the project are met.
Harmon said that as far as he knows, the request for financing for the project has not come back to the Parliament as yet.
He noted that with a proper social, economic and feasibility assessment, the size of airport most suitable for the country would be determined. “When you [make a decision] and then try to fit in the situation to the decision already made, then you will have major issues with regards to matching the structure that you put down with what is required for the country,” he said. “You cannot take a model from a book and say this is the one I want,” he said.
He said that while he could understand the need for a larger runway as has been expressed by air carriers, he does not see the necessity of a new terminal building with eight air bridges, even in the foreseeable future. He said that airports like the Grantley Adams International Airport in Barbados handles lots more traffic and is devoid of air bridges. “I don’t see that as a compelling argument in the Caribbean as a tropical [destination],” he said.
Harmon also expressed concern about the relocation of the residents in the area—persons the government has termed squatters. “What I know also is that Minister Benn has made certain statements that the project is going to go on regardless of the concerns that we have raised about the impact of the residents in the area,” he noted.
He said that government cannot arbitrarily remove persons and give them a house lot when they are being uprooted from a homestead. “Some of them are of that age where it would be difficult for any bank to give them a mortgage to build a new home if they were to get a house lot,” said Harmon. “All of these issues must be dealt with,” he said.
The IDB standard for the involuntary relocation of persons who are affected by major projects require public consultation which would assist in arriving at what is called an environmental management plan and ultimately if necessary a relocation plan, he further said. “But government jumped some steps and went straight to a relocation plan,” he added.
He said that as a result of government’s haste, the plan is devoid of consideration of the human nature of things. “I intend to write for assistance from the IDB and ask that they fund a consultation to be done by independent persons who can arrive at the best situation regarding the project,” he said.
Safety
Chairman of the CJIA Ramesh Dookhoo spoke to this newspaper on why the airport project should be seen through to the end and with the current designs.
He said that the accommodation for aircraft is cramped as it is and that this is in defiance of safety regulations.
Dookhoo also said that since the government had approved the sum of US$20.7 million in the 2012 budget, which is being spent as an advance to the contractor and for the on-going design phase of the works. “Right now the Cheddi Jagan International Airport has four parking spaces on the tarmac. On any morning at the airport, three of those are occupied. On Fridays, Saturdays and Sundays there are six aircraft in the mornings,” said Dookhoo, pointing to the need for the expanded airport. “This means that the four parking areas are occupied and there are two aircraft on the jet-way and this is really not permitted,” he said.
“The reduction of the air bridges will not substantially reduce the cost by any big figure, probably by about U$3 million to US$4 million,” he said.
He said that it is the upgrade to the runway and the construction of the terminal building that will see the largest spending on the project.
“What is going on right now is the design phase, so unless that is finished nothing else can happen,” he said. He added that it does not mean that the design phase costs US$20 million but this is the sum advanced to the contractor for the project.
He said that the design phase was expected to have been finished by August this year, but noted that because of the delays it will be pushed back to September or October.
Dookhoo said that there is a lot of nervousness surrounding the project, “But I think the government is going forward. I am aware that at the political level there is talk going on between the opposition and the President of Guyana and his team. It is our hope that these will result in a better parliamentary situation.”
Also speaking to Stabroek News, CEO of the CJIA Ramish Ghir said that because of the uncertainty regarding funds to complete the project due to the on-going impasse, the contractor is not being as aggressive in the execution of the contract as was expected.
Ghir said that the expansion contract has a construction time of 32 months, which began in January of 2013 and it is scheduled to be completed in August 2015. He said that considering the delays at this current stage of the project, this final completion date is expected to be pushed back a month or two.
Dookhoo said that the Chinese lenders for the project do not understand Guyana’s political situation and this is not good for the project. He said that the budget cuts and the impasse could lead to difficulties in recovering the mobilisation advance of US$20.7M since the contractor already commenced work on the project, in addition to possible compensation to contractor (CHEC) for cancellation of contract, possible compensation to China Exim Bank for cancellation of loan agreement and loss of potential airlines.
He also said that the impasse may impact the ability of government to secure future loan from Banks in China could also lead to loss of investor confidence.
Sources within the private sector are concerned that the delays in the large government projects such as the CJIA expansion and the Amaila Falls Hydroelectric Project are the cause of the economy slowing down. “Do you know that the rate of the Guyana dollar against the US Dollar is $209 to one?” said a member of the business community. “The economy is slowing up because
of what is happening in Parliament. There is no foreign exchange in the country. How would you like us to put in foreign exchange restrictions again? That’s what governments do when this kind of thing happening,” said the business official.
The opposition cut the entire sum allocated in 2013 for the CJIA expansion during the consideration of the 2013 budget estimates. The rest of the Air Transport Programme budget, which included a $26.33 million final payment from the European Union for the Ogle Airport Aerodrome was also cut.
