Marriott is a brazen corrupt exercise – Ramjattan
- says some will pocket billions of taxpayers’ money
Winston Brassington
- Brassington refuses comment on investors
Building a Marriott Hotel in Guyana is a brazen corrupt exercise designed to fatten the pockets of a few chosen Government officials with billions of taxpayers’ dollars, Khemraj Ramjattan, the leader of the Alliance for Change (AFC) declared yesterday.
His comments came in light of the fact that the government has declared its intention to shift the property into private hands.
Ramjattan, a long time critic of the project and how it was conceptualized, said that the government’s intention is clearly to place the hotel into the hands of one of its friends and for next to nothing. At the same time, he said, Guyanese taxpayers would be robbed of billions of dollars.
Ramjattan said that his research shows that the project would cost just about US$22 million. That’s just about the same amount of taxpayers’ money going into the project.
But the government has signed a construction contract with Shanghai Construction Group (SCG) for US$52 million.
“So, what is going to happen here is that someone is setting out to steal US$30 million from Guyanese,” Ramjattan charged.
He said that the prices for the hotel were manipulated so that the treasury would also be manipulated and raided.
Ramjattan reasoned that when the hotel is built and goes into operation and fails to attract business and then goes bankrupt, the government would then move to privatize and hand the hotel into the hands of one of its friends.
The government’s privatization arm, NICIL, under the control of Winston Brassington, was used to create a special company to build the hotel. That company is Atlantic Hotels Incorporated (AHI).
The government, in turn, is taking money out of NICIL – monies that came from the sale of state assets and properties – and funneling it into AHI to build the hotel.
Ramjattan has argued that what NICIL is doing is illegal, and that the money that comes from the sale of government assets and properties should go into the Consolidated Fund.
If the money goes into the Consolidated Fund, it would then mean that any money coming out would first have to get the approval of the National Assembly.
Marriott Hotel under construction.
“The bubble is going to burst soon. The government ‘eye pass’ the constitution and laws of this country,” Ramjattan declared.
The government is so far using tax dollars to fund the project. It has already handed over US$10million (G$2 billion) to SCG, which was awarded the contract to build the hotel under the former Bharrat Jagdeo administration.
The government will participate in the project, by way of equity, in the sum of US$4 million. This will be committed through NICIL, one of the investment arms of the government which holds its assets.
The equity contribution determines the government’s strength in Atlantic Hotels Incorporated – the company created to see the project through. As it stands, the government is currently the sole shareholder in the company.
However, apart from the equity contribution, financing for the project would also come from “subordinate loan stocks” of US$15 million invested by NICIL.
Adding the US$2 million, NICIL will end up spending in development costs for the project, including design and other preliminary studies altogether, US$21 million into the project.
Private investors are expected to contribute US$27 million in a senior debt arrangement with Republic Bank (Trinidad and Tobago).
That senior debt arrangement guarantees the private investors would have preference in getting their money back if the project folds.
So, if in a scenario where the project fails and the value of the property depreciates to a value below what the investors have plugged, then the investors will get back their money, and there would be nothing to return to NICIL. Taxpayers’ dollars would go down the drain.
But there is no indication that that arrangement with Republic Bank has been sealed. Asked about investors into the project, Brassington Friday told Kaieteur News he has no comment.
In a further bid to close the deal, the government has to get separate investors for nightclub, casino and restaurant. But after repeated advertisements, there are no takers.
