Four months after a controversial trip to China, there has been no favourable outcome on two major issues that Minister of State Joseph Harmon engaged in.Harmon had travelled to China in March and the government had said that the visit was for the purpose of engaging in discussions with regard to the payment of the outstanding balance owed to the government for the purchase of 20% of Guyana Telephone and Telegraph Company shares by Chinese company Datang Telecom Technology and Industry Group from NICIL in 2012.
This deal was entered into by the PPP/C administration but only US$25 million of the agreed US$30 million was known to have been paid. Four months after the trip, the public is yet to be told the final position with the US$5m. Critics had said that the trip for the purpose of establishing whether final payment was made was wholly unnecessary.
Initially, Minister of Natural Resources Raphael Trotman at a post-Cabinet press conference in April, said the money had been collected and Harmon had obtained documents from his trip which showed that it was paid over prior to the APNU+AFC coalition taking office. “So, we are trying to track down to whom, how and where,” he had said.
However, NICIL said no money had been paid. On April 28, NICIL, in a statement signed by the Chairman of the Board Maurice Odle, outlined the agreement that had been made between the NICIL and Hong Kong Golden Telecom Company Limited (HKGT). It said that that on November 8, 2012, US$25 million was wired to NICIL’s account and the balance of US$5 million became due and payable to NICIL on October 22, 2014.
“Despite several written requests by NICIL, HKGT has still failed to pay the balance of the purchase price,” the release said.
“To NICIL’s knowledge, neither HKGT nor its related companies have alleged that the balance of US$5 million was paid. What was alleged by the purchaser’s signatory to the agreement was that following a series of communications with the former Guyana Ambassador to China (to be authenticated) HKGT was assured that they were not required to pay the balance of US$5 million, because the HKGT had not been granted the same minority protection rights enjoyed by NICIL (i.e. two, instead of one, representatives on the GT&T Board of Directors) which HKGT alleged were promised to them. HKGT also alleged that the decision to waive the US$5 million was contained in a side agreement,” NICIL said.
HKGT’s claim of a waiver is yet to be verified and NICIL has asked the Guyana government to assist in this regard. NICIL said that another press release would be issued at the end of the verification process but this has not happened yet.
Trotman’s statement about Harmon securing documents on the outstanding payment to NICIL had come at the height of a controversy over contact that Harmon had on the China trip with officials of controversial Chinese logging company Baishanlin and businessman Brian Tiwari. Observers had said that the announcement about the documents appeared intended to deflect attention from the Harmon controversy.
Trotman would later say that he might have misinterpreted the meaning of “fully paid.”
He explained that he had only reported what he understood following the return of Harmon from China. Trotman told Stabroek News that when he heard about money being paid in full, his assumption was that it was the $30M (a US$25 first payment followed by the balance).
“But apparently there was some document that shows that the company said it was excused from paying that extra (US$)5, which would mean that my understanding of paid in full was not (US$) 30,” he said.
Long Jiang Forest
Following an uproar over a photo of Harmon and officials of Baishanlin in a private jet in China, the Minister of State had said that Wong Dong Xu, the Vice Director of the Chinese state-owned forestry company Long Jiang Forest Industries Group, in the presence of officials of Baishanlin, gave the assurance that the company’s officials would be in Guyana by May 2016 to complete due diligence for the takeover, and to satisfy and expand on the obligations of Baishanlin to Guyana.
He had said that the firm has acquired 55 percent of the shares in Baishanlin and intends to fully take over the company this year.
However, no reps have come. “I am unable to speculate or presume why these representatives were unable to come,” Trotman told Stabroek News recently. He had said that he was waiting to be advised by the Board of the Guyana Forestry Commission of matters pertaining to Baishanlin.
Several of Baishanlin’s projects have ground to a halt as the company faces financing difficulties despite benefitting from billions in tax concessions from the Guyana Government. Baishanlin has failed to fulfill several commitments made under its investment agreement here.
President David Granger has said Baishanlin is undergoing a corporate transformation in China. “It will disappear as a corporate entity and that will bring an end to any controversy involving Baishanlin as a company. A new entity will take it over and we will have to renegotiate with a new entity. Baishanlin is coming to an end. I cannot say what the situation is in China but I believe Baishanlin is undergoing some corporate transformation within China itself,” he had said.
With NICIL reported as having paid for the trip to China of Harmon and NICIL’s legal counsel, critics say the question now is whether it made sense in the first place.
