CJIA contractor embroiled in Jamaica port hub controversy

The proposed contractor for the CJIA airport expansion is now embroiled in a controversy in Jamaica over plans for a shipping hub in an environmentally sensitive area, underlining concerns in the region about the lack of transparency in dealings with big Chinese firms backed by Beijing.

It was only during a state visit last week by Jamaican Prime Minister Portia Simpson-Miller to China that the Jamaican public became aware  that China Harbour Engineering Company (CHEC) was in deep discussion with Kingston over a shipping hub in Goat Islands, an environmentally delicate area off the south coast of the parish of St Catherine.

Ironically, it was via the Jamaican media that Guyanese learnt that CHEC had been identified as a contractor for the US$138M expansion of the Cheddi Jagan International Airport, Timehri. That project is now in limbo as the opposition cut the 2013 budgetary allocation to it. The contract has also been hammered by analysts for being defective and for having inflated costs for inputs among other serious problems.

Jamaica’s recent case has highlighted the secrecy in which business has been transacted between the government there and CHEC in relation to the Goat Islands area. It has attracted the wrath of environmentalists and the Jamaica private sector.

Goat Islands (Jamaica Gleaner photo)
Goat Islands (Jamaica Gleaner photo)

According to yesterday’s Jamaica Observer, Private Sector Organisation of Jamaica (PSOJ) head Christopher Zacca slammed the government over its handling of the Chinese firm’s proposal to construct the trans-shipment hub.

He suggested that Government’s actions on the matter so far have been in violation of the Partnership for Jamaica (PFJ) agreement signed only weeks ago.

Fait accompli

“The way the Government has so far handled the potential major logistics project by a Chinese firm on Goat Islands in a much-protected environmental area in my view, has met neither the words nor the spirit of the partnership agreement,” Zacca said at the Hugh Lawson Shearer Trade Institute Public Forum held at the University of the West Indies.

He argued: “Such a possible major shift in planning our country’s development, which would have major negative environmental and possibly even negative commercial consequences, cannot be handed to us almost as a fait accompli.”

The Jamaica Observer report said that the PFJ agreement seeks to recommit all signatories — the Government, private sector, unions, and civil society— to the “principles of social dialogue and partnership, specifically to further the process of deepening democracy and participatory decision-making and to engender meaningful participation of all partners in national development”.

The report said that the controversy erupted four months after CHEC,  which had signed a Memorandum of Understanding last year with the Port Authority to explore the feasibility of a new trans-shipment port at Fort Augusta — rejected that location as it was not big enough to provide the space they needed.

CHEC, the report said,  wants some 3,000 acres of land to build the port. It had showed interest in Goat Islands before, but looked elsewhere when met with environment restrictions.

The Jamaica Observer said that at a meeting last week in Beijing, CHEC assured Simpson-Miller that it is committed to environmental protection and social responsibility.

“Jamaica is a major target market for CHEC and we hope Jamaica can provide us with a platform to continue and expand our collaboration to larger levels,” Liu Quitaio, president of CHEC parent company China Communications Construction, was quoted as saying.

Further, Minister of Land, Water, Environment and Climate Change, Robert Pickersgill told journalists in China that time is of the essence for the development.

“There are competing interests and they are not waiting on us,” Pickersgill said, reiterating that the Government is aiming for the hub to become operational in 2015, to coincide with the reopening of the Panama Canal.

Employment opportunities

He said, according to the report, “I expect that the environmentalists will be defending what now exists and the development ministry and the Government will have to say to the country what it is we will be foregoing and why, because the employment opportunities are very much there,” he added.

Urgency has been one of the reasons floated by the Guyana Government for the speed and secrecy in which a deal for the CJIA was clinched with CHEC.

Zacca was not impressed with Pickersgill argument.  “It is difficult at this point for any informed comment about this proposed development, because we don’t have any facts, and therefore, I urge the Government and all the social partners to have frank and fulsome factually based discussions about this proposed development on an ongoing basis, and for sincere meaningful consultation between the partners before any decision is made.”

This line was also adopted by the Jamaica Observer in an editorial in today’s edition.

It noted that the  initial announcement came, “most unfortunately, from the environment minister, Mr Robert Pickersgill, while on an official visit to China last week with the prime minister”.

It further pointed out that  the Goat Islands are protected by the Natural Resources Conservation Authority Act 1991, and also come under the St Catherine Coast Development Order and the Town and Country Planning (Clarendon) Development Order.

The editorial stated that both orders mandate protection and conservation of the natural environment in cases where development is deemed necessary.

It added that the development orders also says that decisions must be made in a ”transparent and accountable manner”. The newspaper said this is where it believes that the Government has a problem.

“For, before the trip to China (by Simpson-Miller), the information released to the country about the logistics hub spoke of development at Cow Bay in St Thomas, and Fort Augusta and the Caymanas lands in St Catherine.

Quench

“It appears now that the Government, in an effort to quench its thirst for cash, went ahead and opened the door to Goat Islands to the Chinese without consultation.

“We fully well appreciate the validity of the arguments for and against this proposal. That is why we are suggesting that individuals on both sides meet, as soon as possible, and discuss this issue in a rational manner”, the editorial said.

Meanwhile, a  Jamaica Gleaner report quoted Industry Minister Anthony Hylton as saying that the logistics-hub initiative will not be jeopardised if CHEC decides against creating the port facility and logistics and industrial park proposed for Goat Islands.  Hylton said that the Goat Islands project has not been factored into projected investments, which have been measured at between US$10 billion and US$15 billion.

“Goat Island is not the logistics hub. It is a specific project proposal – a significant one – but it is an element of the logistics hub,” the minister said.

He said  “While they (CHEC) don’t have all of the cards, they have the final card to play, and it is they who decide whether to play or not play,” Hylton said.

CHEC has said it is prepared to pump US$1.5 billion into the Goat Islands project, which would involve the construction of a container terminal and industrial park.

“If you have US$1.5 billion on the table and you take it off, it is US$1.5 billion gone. But it would not be fatal to the logistics-hub project,” Hylton told the Gleaner.

Hylton emphasized that although the Goat Islands have been named in the proposal, “It will have to go through its normal vetting process and procedures and we will see what the end result is. In the meantime, the other parts of the logistics hub are proceeding apace.”

The Gleaner said that with its geostrategic location, Jamaica is seeking to take advantage of the expansion of the Panama Canal, which is due to be completed in 2015.

The expanded canal will be able to receive larger ships, and Hylton said Jamaica is poised to be the hub for trade, supplying markets in the eastern seaboard, South and Central America with goods brought primarily from southeast Asia.

“There are a number of other investors from all over the world, [who] I think a global hub should attract. It is not just Chinese. We have people from the Middle East, Canada, the United States, South America – all over,” Hylton told the Gleaner.

The tumult over the Goat Islands plan also led to the media being evicted from a meeting  between the Jamaica Exporters’ Association and Hylton on Thursday afternoon, despite an earlier invitation.

CHEC has had a major presence in Jamaica. The company is implementing the US$400-million Jamaica Development Infrastructure Programme. CHEC is also to construct a 66-kilometre highway over a three-year period at a cost of US$610 million.

In both Jamaica and Trinidad, CHEC had been criticized for delays, labour issues and other matters.

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