CJIA ‘secret deal expansion’ hinges on securing Chinese loan

Nov 21, 2011 News

…Jagdeo says Govt. to put US$5M more in project

By Gary Eleazar

Government is yet to secure the loan to finance the extension and modernizing of the runway at the Cheddi Jagan International Airport (CJIA).
President Bharrat Jagdeo made this disclosure yesterday to the media while seeking to explain why there was no public tendering for the controversial project.
“We are yet to secure the loan that will finance it…it is a soft loan.”
Jagdeo says that this is the way it works in China in that “you have to get a Chinese company to do the project to secure the soft loan.”
He told media operatives that, “we had a few Chinese companies that gave conceptual work and this one was thought to be the best and so that is why they were selected.”
Jagdeo said that the government will work with the company but pointed out that the project will “only become a reality if we secure the soft loan from Exim Bank in China.”
Jagdeo said that Guyana has already applied for that loan “I raised it with the Vice President when he was here and it seems as though we will secure the loan.”
The loan, Jagdeo said, is for US$138M but the government will have to plug at least another US$5M into the project.
He said that the project entails the building of an entirely new airport with at least eight air bridges and an extension of the runway by 3,500 feet.
Once completed, according to Jagdeo, it will be a modern world class airport where any aircraft in the world would be able to land and take off.
He said too that the project will also entail the filling of the nearby ravine which could prove to be difficult but can be achieved.
Jagdeo stated that every government in Guyana has talked about extending the airport pointing to 30 year old reports that he has seen on the matter but prior to now this was never done.
He said that the project on the cards which has been some five years in the making will not affect the squatters.
After vehemently denying claims that it approves contracts, the government on Saturday conceded that it approved the airport expansion project for which it secretly signed a deal with a Chinese company.
It was only after this newspaper and the privately-owned Stabroek News ran a Jamaica Observer story about the project online that the government confirmed that it had approved the project.
The government here had chided the company for releasing details of the project and blocked it from speaking to the media.
Kaieteur News reported that the deal was signed last Friday and that the China Exim Bank is putting US$138 million ($27.6 billion) in financing.
CHEC announced on its website that it had signed a contractual agreement with the Guyana Government to be the official contractors on the Cheddi Jagan International Airport expansion. The company said that the project will be funded by the China Exim Bank to the tune of US$138 million.
“The Government of Guyana has announced that it is embarking on a major project to expand the Cheddi Jagan International Airport.
“To this end, Cabinet has approved a US$138M design and construction contract with China Harbour Engineering Company (CHEC),” the Government Information Agency (GINA) said late Friday evening.
The project was not open to bidding, since no such advertisement was placed on the government’s procurement website under the Ministry of Public Works through which the airport is administered.
The GINA statement said that the project was first announced “several months” ago. However, the project was not reported on by the local media, not even the state media.
Further, it was only in August – three months ago – speaking with Caribbean Business Report, Regional Director of CHEC, Zhongdong Tang, said that the company had a team in Guyana, and other countries, “looking for opportunities.”
According to the company, the agreement signed will see the construction of a modern terminal building and the extension of the runway by 1,066 meters to reach a total of 3,336 meters.
The government has been at pains to state that the Cabinet – the governing Council of Ministers chaired by the President – does not award and approve contracts, but simply offers a ‘no objection’.

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