Unlikely Govt. will own and operate Marriott Hotel

Jun 22, 2015 News

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– Tourism Minister hints at selling the enterprise
By Nicholas Peters
It is highly unlikely that the new administration will be in the business of running a hotel like the controversial Marriot Hotel.
This was said by Minister of Tourism, Catherine Hughes, in a recent interview with the Kaieteur News. During the interview, the Minister said that the hotel ultimately belongs to the people and Government of Guyana and that moving forward the administration cannot ignore its existence.

However there appears to be some reluctance on the part of the new administration to operate the hotel.
“I don’t think the Government wants to be in the business of owning and operating hotels,” said the Tourism Minister.
The infamous US$60M Marriot Hotel located in Kingston, Georgetown, was met with much contention by the then Opposition bloc A Partnership for National Unity (APNU) and the Alliance For Change (AFC), when it was being constructed under the previous People’s Progressive Party/Civic.
The project had been criticised for lacking transparency.
Managing the construction shares of the company was Atlantic Hotel Incorporate (AHI), a subsidiary of the National Industrial Commercial Investments Limited (NICIL) which falls under the Government.
AHI had invested over US$20M in taxpayers’ dollars and was looking to raise US$27M more from a syndicated loan arrangement through Republic Bank, Trinidad.
Another US$8M would have been coming from two private investors reportedly out of Hong Kong, which would have subsequently led to them gaining 67 percent control of the hotel. However, the transfer was blocked via a court case that was file by then Parliamentarian, Desmond Trotman.
The Marriot was also given “extravagant incentives and benefits”, which left other local hotel operators screaming over the unlevel playing field.

Despite the controversy, the hotel officially opened its doors last April 16 to begin its phase one operations while other sections of the Marriot are still under construction.
While in Opposition, the AFC, which Minister Hughes is a member of, had made it clear that they would revisit, review and if necessary impose sanctions on the hotel should they get into Government following the May 11 Elections.
Now that the coalesced APNU+AFC administration is in power, Minister Hughes said that a review of the Marriot Hotel will be necessary as the country moves forward. Should the new government choose to separate itself from the Marriot Hotel, the Minister added that the best course of action would be to sell it.
However, the Minister explained that while the former Opposition was critical of how the hotel was handled, it has no reservations about the actual Marriot franchise itself.
“I want people to understand that the concerns we had about the Marriot were purely in terms of the fact that we as an administration did not feel that the Government should spend (US) millions on a hotel,” related the Tourism Minister.
She said they had felt that the private sector or international investors should have been the ones to put their money into the Hotel, without spending taxpayers’ dollars.
Minister Hughes shared that while she and the coalition were on the campaign trail, they encountered communities just off the East Bank Demerara Public Road without electricity, portable water and with insufficient infrastructure.
Minister Hughes said that some of these communities, like Friendship Squatting Area, are on the way to the Cheddi Jagan International Airport. The Minister related that she wondered whether the millions in US dollars could have been spent towards improving such areas, instead of one hotel.
According to the Tourism official, Guyana has an ample amount of local hotels and accommodations, which can serve to build the tourism sector already.  She contended that for these hotels to improve standards an “incentive regime” needs to be adopted. This would ensure that local hoteliers are given the requisite opportunity to invest in Guyana’s tourism industry.
“We have a tremendous advantage in Guyana, in that most of the hotels are owned by Guyanese and have been here for the last 25 years trying to push the industry forward. And therefore, some of the concessions, I feel that are given to foreign investors, should be given to the (local) hotels,” said Minister Hughes.
For a long time Minister Hughes said that smaller hotels (with less than 30 rooms) did not qualify for concessions, but shared that as head of the tourism sector, she wants to put forward an argument to Cabinet which will change that.

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