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JEEP stays stalled - Gov't awaits approval of loan from China Ex-Im Bank to restart project

Published:Friday | February 28, 2014 | 12:00 AM
E.G. Hunter

Daraine Luton, Senior Staff Reporter

JAMAICAN authorities are currently awaiting a letter from the China Ex-Im Bank which would pave the way for the re-start of the Jamaica Emergency Employment Programme (JEEP), which has been without fuel for some time.

E.G. Hunter, head of the National Works Agency (NWA), yesterday told Parliament's Public Administration and Appropriations Committee (PAAC) that Jamaica had satisfied its conditionalities to draw down funds from the Chinese lenders. He said contractor, China Harbour Engineering Company, is in position to execute works as soon as Beijing gives Kingston the green light.

"There is one document that we are awaiting (from the China Ex-Im bank), and it is the letter of effectiveness. All the conditions precedent have been satisfied by the Jamaica side, including the relevant fees," Hunter told the committee. "Any day now we can get that letter and once that letter of effectiveness is issued to us, we will be in a position to execute contracts the following day."

During the committee meeting, Financial Secretary Devon Rowe committed to peruse the contract with the China Ex-Im Bank in order to determine how soon after Jamaica has satisfied its end of the bargain, the lenders would be required to release funds.

He said that from his experience, contracts normally stipulate a period of 60-120 days for lenders to release funds.

But late yesterday, after he had reviewed the contract, Rowe told The Gleaner that no time frame had been stipulated regarding the release of funds for the Major Infrastructure Development Project (MIDP) and that the lender would determine when funds would be handed over.

Last August, Jamaica signed an agreement with the People's Republic of China for a preferential loan for the MIDP. The US$353-million infrastructure project, funded jointly by the China Ex-Im Bank and the Jamaican Government, was slated to be rolled out this fiscal year.

Some US$50 million (J$5 billion) has been earmarked to revive JEEP.

However, despite many announcements by Government about the programme, only J$422.2 million of the J$2.5 billion approved this fiscal year is to be spent by April. Of that amount, J$100 million is to pay commitment fees and the remainder is for the mobilisation of the contractor.

Jamaica satisfied its obligation under the contract from as far back as December and inked the agreement with China Harbour in January 2013 for works to be done.

Despite the delay, Hunter gave the assurance that "work is going to break out and work is going to break out in a more fulsome way".

Said Hunter: "What we have done, in anticipation of the green light, we have prepared all the points. We are going to start out with the JEEP component and MPs have already submitted their work proposals. Those work proposals have been transformed into contracts, and those contracts are ready to be signed, and so the moment we have the go-ahead, those contracts will be executed and physical work will begin on the ground."

All 63 members of parliament have been allocated $10 million for works in their constituencies. But as Hunter spoke yesterday, many committee members murmured that they had been announcing and re-announcing the re-start of JEEP and the failure to get the engine turning had been creating a credibility deficit.

"That has been coming from September last year and can't reach anywhere," said Ed Bartlett, the committee chairman.

"We have been hearing this for weeks now - that any minute now. ... It is beginning to sound like something we learn in Sunday school, but you know not the minute nor the hour."