AFC notices “dip” in Bank of Guyana’s int’l reserves

Mar 14, 2014 News

– wonders if money was used to finance Marriott

Alliance for Change Executive Member, Moses Nagamootoo, said yesterday that he was not at all surprised by the reported rude reaction by Chairman of Atlantic Hotels Inc, (AHI) Winston Brassington to an issue of national importance.

AFC parliamentarian Moses Nagamootoo

Brassington on Wednesday afternoon dodged Kaieteur News on the Marriott Hotel issue. So rude was the official that when he answered his mobile phone, he drew (sucked) his teeth and hung up.
According to Nagamootoo, his party is being kept in the dark with regard to details about the Marriott Hotel and the identity of the US$8 million private equity investor (s).
“What we have noticed is that there is a “dip” in international reserves and we are wondering whether any money has been transferred to NICIL in order for further financing at the Marriott Hotel,” Nagamootoo told Kaieteur News yesterday.
The parliamentarian explained that his party is now studying the third quarterly report from Bank of Guyana on the state of the country’s finances.
“There are quite a few alarming revelations in that report,” Nagamootoo said.
It has been almost six months since a commitment by Brassington to disclose who the US$8 million equity private investor would be. Brassington had made several assurances that the public would know the investor. However the identity remains a mystery.
The construction rate at the hotel seems to have slowed down. One source explained that the “slow up” in construction was probably due to the fact that the project has not been able to secure financing from Republic Bank of Trinidad and Tobago. That bank was approached to prepare an investor-friendly package to source U$S27M for the project.
The Guyana Government is, to date, the sole investor in the Georgetown Marriott Hotel, given that AHI is yet to have financial closure for US$39M of the US$58.5M required for its completion. NICIL has already injected its US$20M, which it had committed to the project, so it is unclear what the source of financing is for the works currently being executed.
Prior to the NICIL funding, Government had given a US$1M contract to a local company for the rerouting of the sewerage system in the Kingston locale.
That contract was pulled after more than US$700,000 was paid over. It was then given to an overseas company, this time for a further US$2M.

Winston Brassington

AHI also leased the prime seven acres of shorefront property, on which the Hotel rests, for a measly US$120 (G$24,000) per month with the option to buy.
The Food and Drug Department which had a building in the location was removed and that property was dismantled.
Brassington, last September, held a special media briefing on the project and told reporters that while the AHI would have executed a number of agreements with Republic Bank and the private investor, whom he is still to name, there is no definitive financial closure for the money as yet.
He said, then, that AHI was looking to have this aspect of the deal concluded by year end (2013), so that the hotel could be completed and opened this year.
“We haven’t closed, but we have every confidence it will close soon,” Brassington had said.
That unnamed private investor is expected to put US$8M in the project and will have majority ownership of AHI, equivalent to 67 per cent shares in the company, while government will own 33 per cent.
US$4M is to be invested by the National Industrial and Commercial Investments Limited (NICIL). The remainder of the money will be in the form of debt/loans.
Republic Bank has been asked to solicit a total of US$31M, to be repaid at an interest rate of 8.9 per cent, while NICIL will be lending US$15.5M with zero per cent return.