No clarity on how this new deal makes up for shortfalls on US$150M CJIA project

No clarity on how this new deal makes up for shortfalls on US$150M CJIA project

Dear Editor,

Recently the government announced that it has entered into a deal with China Harbour Engineering Company (CHEC) for additional work at CJIA “to the amount of approximately US$9M at the sole cost of CHEC”, which includes two more passenger boarding bridges, additional commercial space, and completion of outstanding remedial works.  The Minister of Public Works was quoted prior as saying there are 72 items to be fixed to make the airport functional.    The building will now feature a “modern airport façade” covering the full length of the Departure Terminal, and all this to be completed by 2021 year-end.   No mention on how these new supplements make good the severe shortfalls on the US$150M contract complained of by the government to CHEC and the Chinese government.

Hence this new deal is as secret as the 2012 underlying contract with CHEC, announced by the contractor itself after the Guyana government had circumvented its own procurement rules.  Current project status is described by President Irfaan Ali in Chinese diplomatic presence as “not acceptable for the Guyanese people” –  notwithstanding citizens have little insight into the evolving controversy, other than the statements of Ministers encompassing four government administrations, and now the President, in a sustained display of micro-management.  (Though President Ali has also cited consultant and project management team responsibility, there is no information on decisions made at supervisory and oversight levels).  In supporting the Head of State, the Minister of Public Works has emphasized that government must “ensure that this country gets what taxpayers are paying for”.

CHEC in turn has faced some strong-arm tactics:  In May 2017 there was government intervention, supported by many Guyanese, compelling CHEC to contract with local stone suppliers at prices higher than those available from a Surinamese supplier.  Four government ministers were involved and one Ministry wrote the media with congratulations to local suppliers, one of whom publicly thanked the Ministers.   There has been no further information on how the local stone suppliers have fared with CHEC – particularly in light of the present need to generally import stone anyway.  Nor how such action – with ingredients of price-fixing – has impacted CHEC claims, or its attitude towards the government.

Meanwhile, the December 8th letter warning of legal action by the Attorney General is revealing where it states that CHEC failed “…to achieve substantial completion as per FIDIC- Plant Design and Build Clause 4.1.”  ‘Design and Build’ means that the design –  drawings, specifications and cost particulars – remain in the hands of CHEC throughout the project.  This is likely a fact which helped pressure the various administrations from ending the arrangement with CHEC, even after news of CHEC’s debarment by the World Bank, back in 2012.  Without its own design, and it might be added, without knowing “what taxpayers are paying for”, it is difficult for the government to put a new contractor in place.  Also, the particular design-build contract (Plant Design) does not provide for interim approvals by the consultants or government before design is implemented, but rather is intended for ‘plant’ design where performance is set in output units and is low in aesthetics – like sugar plants and oil refineries, rather than airports where aesthetics and other internal amenities are highly desired.  Hence contract selection on CJIA is questionable, and borders on irresponsibility.

Dogged reports in the media, especially the Kaieteur News, have kept the public informed on the CJIA project discrepancies.  Going forward the Ministry of Public Works can improve this situation, by two steps here suggested.  First, have the ‘new deal’ deliver an artist’s impression or elevation drawings to show the modern airport façade to citizens, and adequate blueprints on the extent and disposition of extra space to be provided.  Second, the Ministry to furnish the designation and names of its technical personnel to identify causes of the 72 defects to be fixed, and to approve remediation works.  This would relieve the heavy micro-management evident on this troubled project, and provide some transparency.

Yours faithfully,

Donald Rodney

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