Contractor in secret US$138M CJIA deal under fire in Jamaica… New PM called on to stop US$600M contract

Jan 11, 2012 News

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“…the said transaction, irrespective of its structure, should be subjected to a transparent and international competitive bidding process whereby value for money can be secured for the benefit of the people and taxpayers of Jamaica.” – Contractor-General Greg Christie

 

A senior Jamaican official wants new Prime Minister, Portia Simpson-Miller, to terminate a US$600M

contract granted, without the benefit of a tendering process, to China Harbour Engineering Company (CHEC).
CHEC is the same Chinese company which has been awarded a US$138M contract, under questionable circumstances, to expand the Cheddi Jagan International Airport (CJIA), a deal that Guyanese only learnt about after a report appeared in the Jamaican press in late November.
Jamaica’s Contractor-General Greg Christie, according to the Jamaica Observer yesterday, made the request during a congratulatory message to the Prime Minister whose People’s National Party won the recently held elections.
Christie’s office is charged with monitoring and investigating the awards and implementation of government contracts, licences, permits, concessions and the divestment of state assets.
The Contractor-General wants the new Jamaican administration to “declare its hand in negotiations with China Harbour Engineering Company (CHEC) for completion of the US$600-million North-South Link Highway 2000, and for the consequential granting of a 50-year toll concession to that company is concerned”.
NO TENDER
Christie made the call in a congratulatory letter to Prime Minister Simpson-Miller on her swearing-in in which he, among other things, raised concerns about the project, and sought audience with the administration to canvass its opinions on some 25 recommendations which he says are for urgent consideration and implementation.
Chief among those are what he said are “strong objections to the apparent intent of the former Government to award, without international competitive tender, a sole-source contract to CHEC to, among other things, complete the construction of the Spanish Town to Ocho Rios North-South Link of Highway 2000 and the Jamaica Development Infrastructure Programme (JDIP)”.
“The OCG (Office of the Contractor-General) continues to maintain that the current negotiations between NROCC (National Road Operating and Constructing Company Limited) and CHEC should be terminated forthwith, and that the said transaction, irrespective of its structure, should be subjected to a transparent and international competitive bidding process whereby value for money can be

secured for the benefit of the people and taxpayers of Jamaica,” Christie asserted
The official also said that his office was “not only amazed, but alarmed, that the former JLP administration was seemingly bent on persisting what would be another controversial sole-source contract award to CHEC, despite ongoing public controversies, audits and OCG investigations which have arisen in consequence of a similar sole-source award of the US$400-million JDIP contract to the same company”.
SOFT LOAN
The call by Christie would take special significance for Guyana as CHEC was also awarded the CJIA contract without any evidence provided that the project was tendered, either locally or internationally.
In November, former President Bharrat Jagdeo disclosed that Guyana was still to secure the loan to finance the extension and modernizing of the CJIA.
Jagdeo made this disclosure while seeking to explain to media why there was no public tendering for the project.“We are yet to secure the loan that will finance it…it is a soft loan.”
Jagdeo at that time said 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.”
He 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 had 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.
He had said that the project, which has been some five years in the making, will not affect the squatters.
SECRET DEAL
After vehemently denying claims that it approves contracts, the government had conceded that it approved the airport expansion project for which it signed a deal with a Chinese company.
It was only after this newspaper and the privately-owned Stabroek News ran an online Jamaica Observer story about the project, 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.
CHEC had also announced on its website that it had signed a contractual agreement with the Guyana Government to be the official contractors for 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 Information Agency in announcing the project said that the CJIA expansion 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.”

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