An insatiable appetite for valuable commodities in developing countries
Over the past few weeks, Kaieteur News has magnified several developments of China in Sri Lanka and compared those to similar events in Guyana.
The focus is now being widened. From here on, we will examine China’s obsession with getting its hands on valued commodities in vulnerable and underdeveloped countries. These commodities range from land, gold, diamond, timber, oil and even telecommunications.
The telecommunication business is rated as one of the most lucrative around the world. For many years, Guyana Telephone and Telegraph Company (GTT) was the only telecoms provider in Guyana. The company’s profits were celebrated. In local parlance, ‘GTT made a killing’.
Even after Digicel joined the market, GTT continued to record good profits and continues to do so onto this day. That is why many are still at a loss, trying to figure out why the Government of Guyana opted to sell its 20 percent share in the company in the first place.
It was in 2012 that the National Industrial and Commercial Investment Limited (NICIL) sold the Government’s investment in GTT to Hong Kong Golden Telecom Company (HKGT), a Chinese company.
The entire deal is smeared in controversy with conflicting stories being bandied around about the initial arrangement.
The shares, which generated billions of dollars over the years for the Guyana government, were sold for US$30M of which the sum of US$25M was received. The balance, US$5M, was to be paid within two years. The money remains outstanding.
The Chinese company does not want to clear the debt in full, because it has not been given two seats on GTT’s board.
Kaieteur News understands that the Purchase Agreement between the Chinese company and Guyana was framed in such a manner that in the event of any legal issue, Guyana or HKGT would have to petition the United Kingdom courts.
China has been trying to get its hands on telecommunications in many countries, so much so that the country has several telecom providers.
China’s two telecom giants ZTE and Huawei began actively pursuing equipment supply and network rollout projects for both fixed and wireless services in Nigeria since 2010. This was just after China sweetened Nigeria with some loans. Now, those two giants are major players in Nigeria and sure enough, Nigeria is encountering problems with the companies.
Nigeria now claims that ZTE owes it millions of US dollars.
While Nigeria and Guyana’s stories are similar, it is also very different. At least in Nigeria, the Chinese came from scratch, but Guyana gave up a lucrative arrangement.
Guyanese observers are still wondering, what really motivated the sale of GTT’s shares. They are not buying the story that government sold out profit-making shares to invest in the Marriott Hotel which itself was a mystery from the beginning. That hotel also involves China.
“There must have been a backdoor deal,” critics have asserted.
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