Govt to sign Agreement for Specialty Hospital alternative

Jul 18, 2017 News

Two years after the Government of Guyana (GoG) requested a cancellation of the Line of Credit (LOC) it had with the Export/Import (EXIM) Bank of India, the state is now moving to sign a similar agreement with the agency to upgrade primary health care facilities here.
Finance Minister Winston Jordan will be signing the agreement on behalf of the state tomorrow at his Ministry, Georgetown.
According to the Finance Ministry, the LOC will allow residents of five Administrative Regions to benefit from upgraded primary health care facilities.
These Regions according to the Ministry are Pomeroon/Supenaam; Essequibo Islands/West Demerara); Cuyuni/Mazaruni: Potaro/Siparuni; and Upper Demerara/Upper Berbice.
The last LOC that Guyana had with the Indian lending institution in the area of healthcare, resulted in the Specialty Hospital debacle, from which Guyana is still reeling.
The facility was estimated to cost somewhere in the vicinity of US$15M.
The contract was terminated for several reasons including the construction firm, Surendra Engineering’s inability to meet deadlines.
Following the termination of the contract, Government moved to the Commercial Division of the High Court and sued the company.
Government was claiming damages in excess of $100M, as well as special damages amounting to over US$4M.
By then, Surendra had flown the coop and had vacated its local office in Berbice when court officials visited to serve the writ.
The matter was called twice and no one appeared on behalf of the company. The court awarded judgment in favour of the Government of Guyana.
From all indications, Government is still to collect over US$4M from the embattled firm.
Following the APNU+AFC government’s accession to office, it reviewed the project and concluded that since there was no existing contract that could be enforced, it was deemed “impractical” to continue to keep the LOC in its existing form, especially since it was attracting commitment fees.
Government therefore requested EXIM Bank of India to cancel the LOC for the Specialty Hospital and to reallocate the balance of funds to a project to modernize three Primary Healthcare Facilities.
However, the Government of India (GOI) in its response, while indicating it’s no objection and support for the modernization of Primary Healthcare Facilities suggested that the David Granger administration consider salvaging the Specialty Hospital, as it will complement primary healthcare facilities in Guyana.
The administration having examined the merits of the proposal began searching for a willing partner to complete the Specialty Hospital using the remainder of the LOC.
In the interest of time, Government approached Fedders-Lloyd to explore the possibility of the company completing the project.
This company at the time of the tendering stage of the project in 2012 had submitted a bid.
Not only was that bid lower, the company also had actual experience in constructing specialty hospitals across the world.
However, Fedders-Lloyd has since been blacklisted from India-funded projects following a penalty by the World Bank for alleged procurement violations.
The government had approached the EXIM bank to have the remainder of the monies to be spent to upgrade the primary health care facilities. The EXIM Bank has seemingly given into the request hence the inking tomorrow.

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