$420M fertiliser contract was “return” on political investment

… says GRDB director, rubbishing GM’s claims
Amidst swirling controversy over Raphael Trotman of the AFC describing campaign contributors to the AFC

Ann Narine with AFC Vice Chairman and now Prime Minister Moses Nagamootoo

as “investors who expect returns”, Jinnah Rahman, a director on the Guyana Rice Development Board (GRDB) is contradicting the claims made by the General Manager (GM) of GRDB, Nizam Hassan that a now dead $400 million fertiliser deal was for the farmers’ benefit.
Rahman said the $420 million fertiliser contract was entered secretly among Hassan, the Agriculture Ministry and a political supporter of the Alliance for Change (AFC), Hardat Singh.
Rahman highlighted that the board of directors agreed they should give concessions to rice farmers “and one of the things we said that we were going to do was to give them relatively cheap fertiliser so that was recommended to the Minister of Agriculture.”
However, Rahman said that, “we had to sign a secret document saying that we shouldn’t disclose any information or give any information to anybody, even our rice farmers. I am totally against that and I will not be stopped. I will say and disclose to the public what I feel is important for them to know or else it will conflict… with the Freedom of Information Act that was passed in this country. I am not going to abide by any secret act; they can do what they want to do, but I am going to continue to campaign that we must not have any secrecy when it comes to the public interest.”
Rahman lamented that the $420 million contract was issued to “a man

Guyana Rice Development Board General Manager Nizam Hassan

called Hardat Rampersaud Singh.” GRBD’s GM Hassan, in his media release outlined that the contract was given to HDM labs.
Guyana Times understands that HDM labs is owned by Hardat Singh, a campaign contributor to the AFC coffers. Singh is also the co-owner of Spice Restaurant, Catering and Lounge in New York along with Ann Narine who was also photographer with Prime Minister Moses Nagamootoo during a meet there.
Rahman noted further that the board was not furnished with a copy of the contract even though it was agreed that all the directors would be given a copy. “I understand that the matter went to the Cabinet and the Cabinet approved of this person so the board didn’t know who this person was before, it came to us as a surprise.”
General Secretary of the Rice Producers Association, Dharamkumar Seeraj had said in a press briefing months ago that Cabinet approved a contract for the procurement of $420 million in fertiliser from a known campaign financier of the AFC/APNU collation. He also pointed out that the contract was not tendered, nor advertised and government’s actions were “in direct contravention of the laws, norms and conventions applicable to the acquisition of farmers’ inputs.”

GRDB’s GM Hassan broke his silence on the issue after information went public that the shady deal was in jeopardy. He said in a press release that the contract was granted to the foreign company in a move to improve farmer’s production costs and overall productivity, since their rice, no longer being supplied to Venezuela at US$760 per tonne, would now attract the world market price of US$400 per tonne.
According to GRDB, one of the ways in which this could have been done was by assisting in making fertiliser available to farmers at lower prices. The price for urea fertiliser at that time was between $5500 and $6500 per bag.
Hassan pointed out: “It is noteworthy, that when local suppliers became knowledgeable of GRDB’s attempt to reduce the cost of fertiliser to farmers for supply of urea, the price immediately fell from $1000 to $2000 per bag.” He also said that, “while payment for the fertiliser was by Letter of Credit established through a local commercial bank, the supplier requested that the Letter of Credit be irrevocable and transferable.”
The GRDB GM said this suggested that a supply from that source was not immediately available. However, the local bank only provides the service of irrevocable Letter of Credit which is not transferrable.
“GRDB continued to monitor the supply and prices of urea on the local market and has been in constant communication with HDM Labs Inc since the supply of this commodity can no longer be considered urgent and immediate” said Hassan.
Rahman contends that the contract fell apart because indeed, Hardat Singh could not supply the fertiliser since he did not have the financing to do so and wanted an advance payment on the contract from the bank to be able to deliver the goods, “that’s why he asked for the Letter of Credit to be irrevocable and transferable”, but as GRDB’s GM Hassan pointed out, “the local bank only provides the service of irrevocable Letter of Credit which is not transferable.”
Guyana Times understands this move by local banks to make credit not transferable is done to prevent money laundering.
Rahman is calling for Hardat Singh to be investigated since he is in receipt of information which shows that Singh was convicted in the USA on charges of fraud and money laundering.
“In my view I believe somebody, some political party or some group of individuals would have benefited from this deal and not the rice farmers. That needs to be further investigated, why is it that after all this talk, especially in the AFC camp about sole sourcing, tendering transparency and setting up of the Public Procurement Commission [PPC], the government did not put this contract out for tendering. There was no urgency to purchase and sign a contract with this gentleman” said Rahman.
Just recently Opposition Leader Bharat Jagdeo in a press conference pointed to the credibility of the supplier that was given the contract, citing that “we saw somebody who owns a Chinese store now getting a $420 million contract to supply fertiliser to Guyana without any tender.”
According to Rahman “most of the board members are extremely angry that such a deal was signed behind there back, and this is the kind of nonsense that is still going on that used to go on in the past; we have to put an end to that; we are not any longer going to allow any form of corruption, nepotism or squandermania to take place in this country. At the end of the day it’s the people who are producing the rice and paddy who are suffering and you have a group of crooked people who want to make money.”