Loans guarantee ceiling passes after AFC supports PPP/C

The House this morning passed a government motion aimed at raising the loan guarantee ceiling for public corporations from $1 billion to $50 billion after a marathon session which began yesterday.

While the AFC supported the motion said to be crucial to the Amaila Falls Hydropower project, APNU did not. The sitting ended at 3 am today.

Minister of Finance Dr. Ashni Singh brought to the House an amendment to the motion that was tabled yesterday, changing the figure of the guarantee proposed from $150 billion to $130 billion. Further, the minister’s amendment proposed that the ceiling be specific to the arrangement between GPL and the hydro project.

However, AFC MP Khemraj Ramjattan proposed a ceiling of $50 billion and an undertaking that this is renewable every three months.

Singh said that this proposed figure by the AFC will not be sufficient for the obligation by GPL. He said it is left to be seen whether Sithe Global will accept this figure of $50 billion. Sithe Global has threatened to drop the project if certain conditions are not met.

APNU’s Carl Greenidge said that there are questions not satisfactorily addressed so APNU could not support the motion.

He said if the private sector is so convinced that it is a good project then they should put their money in it instead of looking to the IDB for the additional US $150 million to close the deal.

Ramjattan said if Guyana has to guarantee the GPL debt, it means GPL is not doing a good job. He said Government was not making a proper case for the motion.

“I must say that Government has provided the documentation but the guarantee of $130 billion is still too high,” he said. “We have to act cautiously. ..we don’t want to jump in with a $130 billion guarantee,” he said.

He said it is important to hear what the IDB says on the economic and environmental studies attached to the project.

“We are still uncertain about a number of things, like rates coming down, losses coming down and so on,” Ramjattan said.

Yesterday’s session also saw passage of the hydro-electric bill which was the other matter that government said was crucial to the Amaila project and approval of sweeping local government reforms contained in four bills. (See stories below)

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