CHEC will be liable for defects in airport expansion – works ministry

The Ministry of Works says China Harbour Engineering Company will be responsible and therefore liable for any defects encountered with the US$138 million Cheddi Jagan International Airport expansion project for which works have started.

The ministry also defended the performance security bond of 10 per cent of the contract sum.

“The Ministry of Public Works takes this opportunity to clarify some misconstrued information that have been circling in the public domain as it relates to the contract inked between the Ministry and China Harbour Engineering Company (CHEC),” a press release said.  The ministry pointed out that Section 1.13 [Compliance with Laws] sub-clause (b) of the contract states: “The contractor shall give all notices, pay all taxes, duties and fees, and obtain all permits, licenses and approval, as required by the laws in relation to the design, execution and completion of the works and the remedying of any defects; and the contractor shall indemnify and hold the employer harmless against and from the consequences of any failure to do so.” The ministry said that the Government of Guyana will pay all taxes, duties and fees, and obtain all permits, licenses and approval regarding the design, execution and completion and remedying any defects during the defects liability period.

“Additionally, Section 11 of the FIDIC (International Federation of Consulting Engineers) document explicitly deals with defects liability, whereby it is very clear that CHEC and not the government is responsible for remedying defects during the defects and liability period,” the release said.

The ministry also defended not naming a government engineer for the project, saying, “Firstly, while an engineer is not named in the contract, those arrangements have been taken care of administratively; and an engineer has been identified and appointed.”

Furthermore, it said, it is a norm in large contracts for the performance bond to be 10 per cent of the contract sum. “The ministry is deeply concerned that misinterpretation of the facts misleads the public, and strongly encourages the public to become their own investigative journalists to determine for themselves what fact from fiction is,” the press release said.

Government in 2012 allocated US$20 million for the works but in the 2013 budget, the opposition cut the allocation for the balance of the funds to complete the project. It is still unclear how government will be financing the upgrade outside of the first allocation in 2012.

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