TENANTS IN OUR OWN HOUSE!

Mar 19, 2012 Features / Columnists, Peeping Tom

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Donald Ramotar has to stop the Marriott- branded hotel project, and stop it now! It is not good for Guyana and if it is allowed to proceed along the present lines, it will attract the wrong kind of investors. As such it should be scrapped and scrapped immediately. While the government has made public the arrangements for this deal, it should not see this gesture on its part as a means of letting bygones be bygones.
The hotel project is highly suspicious and seems designed to serve the interests of the powerful economic oligarchy that has emerged in Guyana over the past six years and which seems hell bent on cornering all the major segments of the Guyanese economy.
If the oligarchy is allowed to get its way, all Guyanese will become mendicants in their own country because there would be little economic activity left for other investors, both local and foreign.
In short the entire economy would be controlled by this grouping which has only recently emerged on the backs of the taxpayers of this country and on the largesse of the state.
The government of Guyana cannot be naïve to believe that the construction of the hotel is going to have a major impact on the economy. It will not.
The IMF’s assessment is that the Amaila’s Falls Hydroelectric Project which will cost more than ten times what the hotel will cost is not going to significantly impact on growth during the construction phase.
In fact, it is likely to aggravate the balance of payments deficit. So if such a major project is not going to have such a major impact can anyone, including the Minister of Finance, believe that the construction of the proposed hotel is going to impact significantly on the Guyanese economy.
The only impact that this proposed hotel is going to have is on the bulging coffers of the oligarchy and their friends who will now find a good source to invest their money. And they have lots of it.
If these friends want to invest, if they feel that this project is viable, they should do so. They should take the risks since it is a highly risky venture with little prospects for success.
But since those pushing the project feel otherwise, since they feel that it will have a major impact on the economy, they should not have to ask the government to be a joint investor.
Why should taxpayers’ funds be used to support a syndicate of private investors who are likely to have preferred shares which would have a first draw on resources in the eventuality of bankruptcy? Why should taxpayers’ monies be used at all?
If this project is so viable, then private investors, including Guyanese investors should be tripping over to pour their funds into it. Why should four billion dollars which can go to better purposes in Guyana be used to float the hotel investment which in any event is going to enjoy favorable tax concession?
This should not be allowed to happen. If the hotel fails, as it is expected to, then the syndicated investors will get back their monies and the taxpayers will be holding useless shares. The four billion dollars will go down the drain just like the NIS funds went down the drain in CLICO.
It is now incumbent on the Donald Ramotar government to signal that his government will support the building of the hotel but without any government equity in the project.
At the same time, he needs to indicate just what are the criteria that will be chosen to select investors. Can anyone opt to invest?
That is doubtful since this entire deal smells of a plan to ensure that the oligarchy has the opportunity to invest their billions into a project and to guarantee the security of that investment by having the taxpayers float a US$ 21M equity.
Will the government do the same for locally owned companies? Let us suppose that a local hotel owner wants to expand, is the government going to throw in a few million of taxpayers dollars to help that investor? You bet that is not going to happen.
All manner of excuses are going to be made about the dangers of such a move. Yet it seems as if the government is not at all concerned that it could end up with useless paper in its hand because of this Marriot Hotel deal.
If this deal is so sweet to the syndicated investors, then let them find all the money. Let them build their hotel and take the risks as how all the other investors in Guyana have taken risks and built hotels. There is no need for the government to pump any money into this project.
When the sugar corporation ran into cash flow problems last year, it had to release land which was paid for by the government so as to finance its cash flow deficit. So why go to all this extreme to inject US$21 M equity into the hotel project?
It is time that Donald Ramotar wakes up and smells the coffee that is being placed in front of him. Uncle Donald, the honeymoon is over! It is time to put your feet down on what is taking place!
Guyana is up for sale. The mortgage was applied for before you assumed office.
It is now time for you to stop the passage of transport because if the oligarchy continues to extend its empire, then all of us would become tenants in our own house.

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