Beijing’s money

What finally scuttled the Amaila Falls Hydropower Project wasn’t the question of whether the country needed hydroelectric energy. Indeed, the majority of stakeholders agree that the country should have had hydro as part of its energy mix a long time ago. Why it took PPP/C governments 21 years to meander to this tortuous climax on hydropower is troubling. In the end it was the lack of transparency in the beginnings of the deal that made it nigh impossible for APNU and critics to believe the government’s version of events. The bar of believability rose higher and higher with every suppressed revelation that floated to the top and the government failed the test of convincing the opponents of the project. It is a lesson that both the Office of the President and Freedom House must file away. There may be an air of defiance and bitterness over how things have turned out but all sides must comprehend rapidly that the investment image of the country has taken a battering and no project, big or small, dependent on external investment will be immune to the repercussions. There simply must be a new way to conduct the business of the State notwithstanding the political equation in Parliament otherwise there is a risk of more spectacular failures.

It is in this vein that the government should analyse keenly its handling of bilateral aid coming from China and the attendant relationship with and outlook of big Chinese companies. Given the historic ties between Guyana and China and the friendly relations over forty years, the flowering of Beijing’s assistance is of great value and importance to this country and the rest of the region. It must, however, align with the parameters of transparency, accountability and reasonableness and accord the fullest respect for national sensibilities. Too often, it appears that aid from Beijing is being pressed upon the Caribbean in such a way as to circumvent the normative processes.

In the region, this problem has not been unique to Guyana. Last week, the Jamaican Government  was embarrassed when it was revealed during a state visit to China by Prime Minister  Portia Simpson Miller that the Chinese conglomerate, China Harbour and Engineering Company (CHEC), incidentally the contractor for the expansion of the Cheddi Jagan International Airport, was in active discussions for the construction of a shipping hub in an environmentally sensitive area. Hitherto, the people of Jamaica had no idea that this was on the cards and it immediately provoked the ire of environmentalists and the private sector which pointed out that the Simpson Miller administration had only recently signed a civil society accord eschewing such behaviour.

That Partnership for Jamaica Agreement recommitted its 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”. It is akin to the moribund Article 13 in Guyana’s constitution.

CHEC had originally been assigned another area in Jamaica and while it had expressed discontent with this, there had been no inkling that it had already recced a clearly environmentally sensitive area and was locked in deep discussions with Kingston over it. That this revelation was made in China during the PM’s visit illuminated the deep channels in which the real business of Beijing’s money is being transacted. Jamaica may now have to backtrack on the Goat Islands area which CHEC has filled its eyes with, undoubtedly shaped by China’s larger interests.

It must also be supreme irony that it was in Kingston where CHEC first disclosed that it was the contractor for the Timehri airport project even though the government here had kept it secret from the Guyanese public. The contract was hurriedly signed on November 11, 2011 by the Jagdeo administration, days before the general elections.  It is this kind of short-circuiting of established procedures that the Ramotar administration must now ensure it will be no part of.

There is enormous jeopardy in conducting bilateral programmes on whims and diktat. However unbalanced the power relations between the two countries are, Georgetown should not permit itself to be clipped on to the coattails of the visit of some high emissary of Beijing with the warning that instant decisions have to be made or else the financing would no longer be available. This is exactly what transpired in relation to the airport project and is undoubtedly a key contributing factor to the shoddiness of the contract that was eventually drawn up as searingly exposed by the former Sunday Stabroek business page contributor Mr Christopher Ram. As it is, there are numerous questions about that contract that should be resolved particularly the unannounced obligations and costs that have to be footed by the Guyana Government. There is also the crucial matter of how the government will handle the concerns of residents living around the airport who have to be relocated.

Several of the other projects that the Chinese government and its firms or financing agencies have had input in have faced similar contractual and social questions, reflecting grounds for concern among Guyanese. The Amaila project is one example. The unanswered questions and the frequently changing value of the project and its access road have not yielded clarifying answers from two of the key players, the China Development Bank and the intended contractor, China Railway. The two have been completely silent, unacceptable in the light of the scale of the Amaila undertaking.

The intended Marriott Hotel which is being built by a Chinese construction firm is a fortress of secrecy and though great heights have been reached in its erecting, on the ground there is no word on where exactly money to pay the contractor is coming from, when and how it was agreed that only Chinese labourers would work on the construction, who the investor is and what attachments there would be to taxpayers money.

The performance of another Chinese company, CNTIC in the construction of the Skeldon factory has been called into question for years. Yet it has escaped any scrutiny or known financial penalty for the dire underperformance of what was supposed to be a turnkey installation.

 

Just days ago,  a grant aid deal was signed between Guyana and China to the tune of $1.7b. This deal was unattended by any information on what the money will be used for, what it cannot be used for and whether there are any conditions attached. It is not the first time that such an agreement has been signed and it is definitely not the hallmark of good governance, particularly in light of the clear determination of the government to circumvent the budgetary cuts applied by the opposition in Parliament.

A recent visit by the Chinese President, Mr Xi Jinping to Trinidad and Tobago brought news of another large tranche of money available to Guyana and the Caribbean but again without any known framework and bereft of any notion of what the conditionalities are. One wonders as to the intention of the Guyana Government in relation to this large sum.

The generosity of the Chinese Government must be received into a framework that both sides have shaped to their satisfaction. On Guyana’s part, it must be patently clear what is on offer, on what terms and the accompanying strictures. Foremost, the construction of the agreements should be achieved in a manner that fully respects the standing of both sides and this is what Georgetown is yet to demonstrate to the public.

 

 

 

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