Brazil/GT road… Keep shady deals with China at bay, but maximize available opportunities – Finance Expert

Mar 15, 2019 News

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By Abena Rockcliffe- Campbell

Make no mistake; a road from Brazil to Georgetown can have its benefits for Guyana. It was known to be so since the days of former President, the late Cheddi Jagan. It was included in the national development strategy. But the benefits to be derived from that road can be easily erased if Guyana allows China to take it for a ride in the same vehicle of trickery and corrupt activities it took countries like Sri Lanka and Pakistan.
This is the opinion proffered by finance expert, Sasenarine Singh.
Last year, the APNU+AFC government signed a Memorandum of Understanding (MOU) with the People’s Republic of China under the Belt and Road Initiative (BRI).
It should be widely known by now that one of the big ticket projects being considered under that initiative is the road from Brazil to Georgetown.
Sentiments expressed already are to the effect that Guyana will be used by China and that the road will benefit Brazil and especially China way more than it will benefit Guyana. This is especially in the context of the Chinese takeover of Lethem’s economic zone and considering the Chinese population in Brazil. https://www.kaieteurnewsonline.com/2019/03/03/putting-brazil-to-georgetown-road-into-perspective-chinese-take-over-lethems-commercial-zone/.
Singh has a differing opinion. He thinks that Guyana only stands to lose if it negotiates a bad deal for the line of credit from China.

ROADS NEVER BAD
Singh thinks that roads are never bad and more so can only be deemed developmental in an underdeveloped country such as Guyana.
He told Kaieteur News, “Roads are never bad, it creates the revenue potential for Guyana to charge a container tax. It creates the opportunity for Guyana to open its hinterland; it creates an opportunity for some more of our people to move from the coastal plain onto that road link to open things like gas stations, car wash and hotel restaurants.”
Citing an example to support the vision to which he gravitates, Singh said, “When FDR (former Untied States President, Franklin Delano Roosevelt) was building the highways during the great depression, he built roads through places like Wyoming where nobody lived in those days. But there are thousands living there now.”
Singh said that it is known that a road creates its own economic energy.
But this was not the experience of Sri Lanka, which took a huge loan from China to build a road that was only then used by the Chinese.

Singh was pointed to this fact.
Aware of that case, the financial expert said that Sri Lanka’s fate was sealed that way because the island leaders allowed China to have its way.
He said that the road in Sri Lanka was badly located to be of benefit to the people of that island but was strategically located for the purpose of China’s agenda.
Singh said, “China did that strategically because it was on their shipping path, but in the case of Lethem, that road has been part of our first development plan since 1953, it has conceived by Ford from the Ford Motor Company during the war…”
He continued, “This road has history. It was in Cheddi’s first development plan that he did with the British government and a critical part of the National Development Strategy.

WHEN IT GOES BAD
Singh stressed that it all comes down to the deal sealed.
He said that the road can become an albatross around the neck of Guyana if the deal for the loan and construction of the road is lopsided, “like what happened with the oil deal.”
The finance expert noted that China is in the habit of going about deals in an unconventional way.
“China comes and drops the cash on the table. If you go to the IDB, you have to do a feasibility study and go through a long process. But politicians have a five year cycle and may want to deliver fast, they want to get things done now, China says ‘ok’, here is all the money in your face but sign this deal and a lot of politicians just sign blindly.”
According to Singh, therein lies the real danger.
He said that Guyana simply needs to secure good and experienced people to negotiate on its behalf.
Singh said that there are many things that need to be secured in a deal. Guyana should have exclusive rights to manage the road so that it will be able to impose a container tax.
He said that a very critical consideration should be to not give away the land near the road.
“The company building the road sometimes asks for land and they lock away those pieces of land for their own purposes. We should have priority access to the roadside land and we would then decide how developmental work will take place along the road.”
He said too that Guyana should ensure local labour is used “because when they do projects as you saw in the Marriott, they bring their own labour. It is the same thing they will do if they build a deep water harbour or a road.”
Singh said that Guyana should also make sure that it does not take on the burden to find money for the entire road, “ask Brazil to fund part and in that way, you diversify the risk.”
Singh spoke about how China will benefit outside of the loan agreement and how Brazil will benefit as well, (see in follow up publication.)
He said, “So there can be an agreement where we all can benefit.”
The finance expert said, “You cannot run away from China, they have a lot of cash. So you cannot say okay they are bad and we do not want to work with them.”
He said that the politicians just need to tap into the resources in the Diasporas so as to get the skills needed from Guyanese to negotiate.
“You have a ton of people working at the executive level in the USA and Canada doing multimillion dollar negotiations every day, we need to tap into those people. It should be a local Diaspora technical assistance, get the IDB to join the team but it is about constructing the team then framing broad principles for agreement.
“We need to sit down with them and negotiate with awareness. We do not need a PNC team nor PPP team but the best possible men like how Burnham had Sir Shridath Ramphal, Fred Wills and all the best guys negotiating for him in the 70’s.”

 

 

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