Latest update April 25th, 2024 12:59 AM
Jan 05, 2015 Letters
Dear Editor,
In his New Year’s address, President Ramotar attempted to assure Guyanese that during his new term of office (yet to be announced) he will achieve financial closure for an estimated US$900M to commence construction of the proposed Amaila Falls Hydropower Project (AFHP) on the Potaro River and complete the job to bring all the attendant benefits to his people.
President Ramotar’s political gaff is similar to the one made by former President Jagdeo a few years before he vacated office, as AFHP went nowhere during his tenure, despite his flowery promises to have the project completed before he left office.
President Ramotar’s pronouncement lacks substance as it appears to be more of a political gimmick to win public support at the next poll, rather than a serious attempt to develop a hydropower project and negotiate finance for it; promises unachievable in such a short span of time.
Firstly, a feasibility study will have to be carried out to determine AFHP’s economic, financial and technical viability. If one was already done, then the document will have to be updated to reflect real time costs and circumstances if it is to be seriously considered by prospective investors.
If, after review by them, the project is considered high risk with low return, then it is going nowhere. Further, investors stay clear of investing in politically unstable countries such as Guyana, however attractive the returns.
AFHP is in its preliminary stage of development, as much work remains to be done to complete the river crossings for the access road, geological site investigations for final design of the dam and penstock foundations, as well as that for the power station.
Final detail design for the project has to be prepared, including that for the transformers and transmission lines to the coast, as well as tender documents and cost estimates.
The project then has to be put out on tender, costs analysed and awards made for construction. Does President Ramotar have a time frame for completion of these items of work including that of the project, or does he tacitly expect it to be another East Bank Highway Project, once construction contracts are awarded for AFHP?
The President should stop pandering in an election year and state specifically where the money will come from to achieve financial closure for his administration’s flagship project, as without assured and committed sources of finance, AFHP will once again be going nowhere, despite all the sweet talk of the project laying the foundation for a brighter tomorrow for all Guyanese.
It is unfortunate that the Govt. has already expended over US$30M of its scarce resources to build an access road with appurtenances to get to AFHP site without first obtaining finance to fund the project.
The costs (capital + maintenance ) which is still rising for this white elephant, will impact adversely on development of the Country’s physical infra-structure so necessary to grow the economy to create jobs.
The World Bank, of which Guyana is a member, has been the largest source of financing for hydropower projects in developing countries.
Strangely, Guyana never attempted to tap this source for financing AFHP. President Ramotar/Finance Minister Ashni Singh (Guyana’s rep on the World Bank) could probably enlighten us all why this was so.
Finally, President Ramotar is aware that the high cost and unreliability of electricity have been the biggest impediments to investment and job creation in Guyana but his Government has made no serious attempt to address the problem by first changing the incompetent management of a politically controlled GPL and then reducing the large thefts of electricity.
Instead, he continues, as his predecessor did, to dream that AFHP would soon become a reality and provide cheap and reliable electricity for all Guyana.
In much of the USA, a KWhr of electricity costs more than in Guyana but investments continue to flow into that country and creating jobs for all those newly arriving Guyanese.
Hence the Govt has to look beyond cheap electricity and remove those other impediments such as poor port facilities, roads, water supply, drainage of coastal areas, bribery and corruption that are disincentives to any investor. Dream on, Mr. President, as you head into your next term of office !!!
Charles Sohan
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