A deal for the New Demerara Harbour Bridge could soon be reached as government yesterday said that it was anticipating closing negotiations soon.
“As far the negotiations, it has been advancing successfully with the second selected company and we are anticipating closure soon,” Minister of Public Works, Juan Edghill yesterday told Stabroek News when asked for an update.
While China State Construction Engineering Corporation (CSCEC) had been the most responsive bidder when companies tendered for the project last year, negotiations fell through after no agreement could be reached.
CSCEC, in its tender document, pegged the cost for the construction of the bridge at US$256,638,289.
Government then began negotiations with the second most responsive bidder China Railway Construction Corporation International Limited which is in a joint venture with China Railway Caribbean Company Limited and China Railway Engineering Company Limited.
It was Vice President Bharrat Jagdeo who had revealed to the public the situation, during an interview with the United States VICE News Media saying that the financing costs proposed by CSCEC were too high for this country.
Sources had explained to this newspaper that CSCEC’s proposed rate of interest was not agreed to as the company’s negotiators were adamant that it would not accept a fixed rate and had wanted to set the conditions for changes “that would have been solely determined by them”.
APNU+AFC Member of Parliament David Patterson, who is the former Minister of Public Infrastructure, charged that government’s decision to terminate negotiations with the CSCEC raised serious issues of due process, contract evaluation and probity by the administration, and called for “a proper, detailed and coherent” explanation.
Patterson also said the initial reason for the termination of the agreement given by Vice President Bharrat Jagdeo — that the financing costs were too high — was rubbished by the project evaluation process, which the Cabinet received and granted in a “no-objection” approval to the Ministry of Public Works to engage CSCECL from November 2021 based on a Design-Build-Finance (DBF) model.
It was after the criticisms that government explained that “The two sides were unable to successfully negotiate mutually acceptable financial terms and conditions.”
Government added, “It is noteworthy that the team focused on the construction cost and securing the financial terms and conditions that would serve the country’s best interest.”
The team, comprising Sukrishnalall Pasha (Finance Secretary), Ronald Burch-Smith (Attorney), Marcel Gaskin (Consultant/Engineer), and Intakab Indarjeet (Engineer), was appointed on November 16, 2021 by the National Procurement and Tender Administration Board (NPTAB) to negotiate optimal financial terms and conditions for the construction of the new bridge.
The GoG statement noted that the mandate also provided for the negotiation team to engage the second-ranked bidder, should negotiations with the first bidder prove unsuccessful. “Therefore, while CSCEC was adjudged the most responsive bidder, the finalisation and signing of a contract with the said bidder were subject to the successful negotiation of mutually acceptable financial terms and conditions,” it pointed out.
According to the statement, the team commenced negotiations with the CSCEC on December 24, 2021, and having failed to reach an agreement it wrote NPTAB on January 20, 2022, seeking permission to terminate negotiations with CSCEC and commence negotiations with the second-ranked bidder, China Railway Construction Corporation (International) Limited, China Railway Construction (Caribbean) Co. Ltd & China Railway Construction Bridge Engineering Bureau Group Co. Ltd in keeping with its mandate.
It added that the NPTAB approved the request, paving the way for the team to engage the second-ranked bidder.
“Negotiations with this company, which commenced on January 28, 2022, are ongoing. Notably, the Negotiation Team is of the view that any further disclosures about the specifics of these engagements at this time would undermine ongoing deliberations and is, therefore, unprepared to pursue such a course of action,” the statement added.
