Modernization? Guyana spends over US$150M for repairs, and a few new features, to CJIA

Sep 09, 2018 News

The project was smeared from the beginning. Jamaica knew about it before Guyana. The money to execute the project was secured a year after the contracted company was given the go-ahead. It has been embarrassingly delayed. Today, it costs way more than what was originally budgeted. That, in a nutshell, is the story of the Cheddi Jagan International Airport (CJIA) Expansion project.

The runway, apron and other work carried out on the CJIA facilities at Timehri.

Would it become the great hub for Africa that former President Bharrat Jagdeo and former Minister of Public Works, Robeson Benn promised? Not from the looks of things.
As for now, the airport simply represents another debt to China that Guyana has to repay.
This year, there has been much fuss on the international stage about China and its quest to rule the world.
It has been noted that China is indebting many small countries in an attempt to “colonize” them. This is largely under the Belt and Road Initiative. But Guyana’s experience with China thus far, is in taking “unnecessarily” large loans.
The ongoing expansion project at CJIA is an example of how countries fall into one of China’s many debt traps, mostly because they agree to go into the arrangements without pursuing the necessary feasibility studies and other checks and balances.
Over the years, there have been questions and comments surrounding whether or not Guyana needed to modernize the airport at the time it chose to.
In April 2012, Former Minister of Public Works, Robeson Benn, had said that Government had entered into the agreement because there was a very narrow window in capitalizing on funding. He said that in September 2011, a Chinese Vice-Premier came to the Caribbean with several billion dollars to fund projects, and it was the only opportunity that Guyana had then to fund this undertaking.
“It was the only undertaking then and we had a particular line of documentation and information ready. We were able to take advantage and make use of that funding which would have gone elsewhere if we had not done what we had to do.”
PPP/C officials including Former President Jagdeo and Benn said that the airport project was targeting Africa, with Guyana being used as a South American hub.
In justification also, it was said that the old airport terminal building was not capable of meeting peak traffic demand or expanding to meet the desired growth in passenger volume.
It also could not accommodate state-of-the-art terminal systems for passenger comforts, convenience and efficiency. The one-storey buildings could not accommodate aircraft boarding bridges forcing passengers to walk to and from the aircraft along the apron.

Former President, Bharrat Jagdeo

But still, all that was said could not have justified the cost for the project, neither the financial and execution models it took.
In November 2011, a few weeks before the General Elections and at the end of the Constitutional two terms for Bharrat Jagdeo, Guyana learnt of a major contract via Jamaica media reports.
China Harbour Engineering Company (CHEC), the current contractor, is the one who let the proverbial cat out of the bag. CHEC told the Jamaica Observer that it secured a contract to modernize the CJIA.
A Government statement, in response to that leak in the Jamaica media, hurriedly said then that the Jagdeo Cabinet had approved a US$138M design and construction contract with CHEC.
Construction was supposed to start in 2012 and be completed in 32 months.
The monies were coming from China’s Export/Import Bank and would have excluded all taxes, duties, royalties and fees of all kinds imposed by the Guyana Government.
However, it took an entire year after the announcement in the Jamaica Observer, specifically on October 31, 2012, for Government to sign the financing agreement for US$138M. Guyana was supposed to plug US$12M as its part.
It was clear then that the contractor was chosen without the procurement procedures being followed.
In March 2013, the sod was turned and CHEC agreed to complete the job by the end of 2015.
Fast-forward to today, the project remains incomplete with a 2018 year-end date being floated.
The entire project design has been altered drastically. Instead of a brand new terminal building, CHEC decided to renovate and expand the old one and build an arrival area.
The Chinese contractor was also accused of using its equipment and material it brought in for the CJIA project for the MovieTowne mall at Turkeyen. It is the contractor for the multimillion-dollar mall as well.
It is unclear how much of an impact CHEC’s attention to the MovieTowne project would have had on the delays on the airport.
Hired to supervise the project was MMM Group, said to be a Canadian firm, in collaboration with CEMCO. They are being paid millions of dollars.
Kaieteur News found that project ran into major problems when works were being executed on the northern side of the runway.
CHEC found out too late that the soil was not good for the foundation.    By then, several million dollars had been spent to dump thousands of truckloads of sand there.

Minister of Public Infrastructure, David Patterson

CHEC was forced to abandon the northern side of the runway and start instead at the southern end.
When the Coalition Government, under President David Granger, entered office in May 2015, they found that almost 70 percent of the monies were expended with just over 30 percent of the work done. This is no new phenomenon with Chinese-funded projects. Many countries continue to complain about this.
The project was suspended but was allowed to continue after the Ministry of Public Infrastructure carried out a review.
CHEC was supposed to extend the primary runway 1,066.8 metres, to reach a total length of 3,336.8 metres in order to satisfy the operational requirements of wide-body aircraft.
A turning area was to be provided at the end of the extension. Navigation facilities such as lighting are to be installed and a service vehicle lane is to be provided as well as emergency facilities such as firefighting systems.
Regarding the terminal building, a new two-storey terminal building was to be built next to the existing one, and was to be divided into two parts – the terminal building and the departure lounges/gates and arrival concourse.
On the second floors of the terminal building, it was the plan for a Departure level with space for airlines’ back-of-counter office space, concessions and security check point (x-ray).
On the first floor (the arrival level), it was planned that there will be baggage make-up rooms (outbound), Immigrations, baggage claim (inbound), Customs, greeters’ lobby, ground transportation, 20 check-in counters and a passenger drop-off zone.
The concourse on the second floor was also supposed to house departure lounges with ‘B’ loading bridges and sterile corridors. There were also plans for a new, larger car park, a reconfigured internal roads area, and a bigger handling equipment area.
However, that plan is far from what Guyana is getting for over US$150M.
THE REALITY
Instead of a brand-new terminal building, CHEC has basically gutted the old one and made some extensions. It will be the new departure area. Nearby, a smaller building will house the Arrivals terminal.

Former Public Works Minister, Robeson Benn

There were supposed to be at least six passenger bridges. Currently, there are only two bridges. Earlier this year, Government asked the National Assembly to approve some extra money—$346.5M—which is intended to be used for the purchase and installation of two additional boarding bridges for the project. The money was approved.
The request for more money went to the National Assembly despite the fact that last December, the National Assembly was told that there will be no additional costs to the people of Guyana, other than the US$150M.
Minister David Patterson had said that the project cost went up because prices for materials escalated as the exchange rate fluctuated, causing difficulties.
There were no explanations or disclosures whether it was all CHEC’s fault that the project was delayed or whether the supervising consultants, MMM Group/CEMCO were held responsible.
There were no talks of whether CHEC has been penalized.
What is known is that Guyana is getting a much, much smaller airport than originally envisaged, for what was regarded as one of the biggest loans in the country’s history.