I am getting
mellow in my advancing years, sure I get angry from time to time, sure I feel
the frustrations we all feel with what is our daily lot, but as we get older we
learn to accept these things philosophically and move on, but there are still a
few things that make me see red.
In 1997 this
country entered a joint venture with an Irish company to manage and be part
owners of our electricity corporation.
This new company
GP&L was supposed to be a 50/50 partnership between the PEOPLE of Guyana and the Irish company ESBI,... and has to be the most
lopsided collaborative economic venture in the history of commerce.
and 1997 this country spent 57 million US dollars purchasing new electrical
Generators, these generators manufactured by Wartsilla were installed at Land
of Canaan and Anna Regina, so in 1997 the value of our GEC had to be at least
57 million US; at the time of sale, the GEC assets including the MONOPOLY it
held, the thousands of miles of electrical cable or line plant, lantern posts,
transformers etc, the substantial commercial properties owned by GEC in
Georgetown, New Amsterdam, Linden, Skeldon, Anna Regina, and so on, should have
I am told be estimated value of at LEAST 100 Million United states dollars in
In 1998 the
biggest problem facing GEC were technical line losses. It was estimated that
30% of all power generated were lost in the distribution system, due to bad
transformers, small transformers, poor electrical connectors, too small cables
for certain areas, and so on, it was estimated that 10 million US dollars would
fix these problems and in the process would reduce the cost of generating by 30
% i.e. our light bill could go DOWN by 30%. Or the drain on the treasury, which
was subsidising GEC, would go down by 30%.
So in 1997
amid much secrecy since our estimable private sector commission and some
obscure consumer group were the only locals consulted, certainly not our
parliament, the Prime Minister of this country agreed to enter a joint venture
partnership with this Irish company under the following conditions.
- ESBI would pay
us 23 million US dollars for a 50% share in GEC. A Company with a market
value at that time of 100 million US.
- This 23 million
would NOT be brought in immediately to fix the major problem facing GEC at
the time, i.e. the technical line losses,... That would apparently have been
too much to ask. SO...
- ESBI would pay
the 23 million over a five-year period..... They would literally be paying
us for OUR GEC with money they were collecting from US over five years of
- We would pay
them a management contract which would cost this nation and its people 765
MILLION GUYANA DOLLARS per year. The total wages of he 1000 local workers
of GPL is around 800 million Guyana Dollars per year. Furthermore this 765
million dollars would not be taxable! The local employees of GPL pay
- In no year would
esbi be required to put in more than 1 million US dollars of capital into
- The board of
GP&L would be completely controlled by ESBI. But how can this be you
may very well ask, how could we possibly monitor ESBI to determine that we
were getting value for the 765 million annual management fee we are paying
them, If they control BOTH the administration and the Board of GP&L.
Many of the other provisions of the contract would
make even the most pious among us blaspheme.
A few months ago it was announced amid much fanfare
that we were going to expand the distribution of GPL to 65,000 homes, this 4
billion expansion requires the Government of Guyana and its people to put up 3
Billion and ESBI, a 50% partner in this company, only 1 billion dollars.
this is common knowledge, the reason I raise the matter again is that I have in
my possession two documents which prompts me to revisit this lopsided,
The first letter dated 16th August 2000,
is a "deposit fund advance warrant" from Minister in the office of the
president with responsibility for finance Mr. Sasenarine Kowlessar, to the
Accountant General authorising him, on his [Kowlessar's] personal
responsibility to pay 400 million Guyana dollars to GPL for and I quote "to
meet part of the electricity debt outstanding to the old GEC".... Now ESBI to the
best of my knowledge has not made the necessary payments of 23 million US to
buy their 50% share in GEC, but in August 2000, 3 and some years after the sale
we are still paying GPL for old debts owed to GEC, debts which we were told
would go into the consolidated fund when collected and not into GP&L.
equally astonishing letter dated 26th September... Mr. Philip
Jacques, Chief financial officer of GPL... writes the Prime Minister, and thanks
Mr. Hinds for the 400 million [and why shouldn't he, it was after all a wonderful
gift] and informs him that it will be spent in the following manner, now listen
to this carefully folks, 130 million will be paid to the BALANCE of the second
quarter subsidy due GP&L and 270 Million will be paid to electricity
account due. I have had this letter for some time and I did not understand the
enormity of it until recently.
The people in
this country are not only paying the highest amount for electricity on the
planet, electricity which is fundamentally causing more damage to their
property than it is worth, BUT they were also subsidising GP&L in the year
2000 to the tune of around 2 BILLION dollars. I understood that we sold GEC
because we wanted to stop finacining it from the treasury, If GP&L loses
money then ESBI must absorb their 50% part of the loss, since they are part
owners of this company and are being paid handsomely to manage it for us. Why
do we have to make up these losses with our taxes because THEY are lousy
managers? Who have failed to address the most fundamental problems of GEC nearly
3 years after the privatisation? But the contract with ESBI that Prime Minister
Hinds signed established that they will they get 23% of the total assets of
GP&L per year not 23% of the profits of GP&L!!!!!
I'll tell you
what I understand from all of this, GP&L wanted to raise electricity rates
even higher, they said so, there was a public outcry and our Prime Minister
told us that they would not be allowed to do so, what he did not tell us was
that we would finance the difference from the treasury with our taxes.
We are too
poor a nation to pay this huge management fee to ESBI. There is no question
about that you know ladies and gentlemen, we ARE paying far too much, we, a
HIPC nation just cant afford it, and this is why all these problems exist with
GP&L today. Until and unless we have a more reasonable arrangement with
ESBI these problems will NEVER go away. ESBI must see that by now.... and sit
down and renegotiate a more affordable deal with us. We are however not forcing
them to do so, since we are paying from the treasury to make up their losses.
letter to the prime minister ends this way, and I quote him "if you have any
queries on this or any other matter please don't hesitate to contact me"
My response to him
is this, why don't you ask me the same question Mr. Jacques, I have plenty!