Battered Hylton moves to salvage credibility ... Samuda tells him to resign
Seeking to salvage his own credibility, Industry Minister Anthony Hylton told parliamentarians on Tuesday that Krauck Systems and Anchor Financial Group LLC had shown financial instruments to the Government as part of its proof that it should be considered a serious partner for the development of projects in Jamaica related to the global logistics hub.
Hylton, responding to questions in the House of Representatives, said that even though Dun & Bradstreet, a reputable business credit agency, found limited information on the entity, the proposed investors put forward instruments valuing in excess of US$5 billion to show they can undertake projects.
"Anchor had provided two bonds to the Government for them to be authenticated ... one at an approximately value of US$1.72 billion, and the other for US$3.5 billion," Hylton said.
Doubt about ownership
He said that at least one of those bills was authenticated but that the ownership of the bonds was still in question.
The Government signed a memorandum of understanding (MoU) with Krauck Systems and Anchor Financial Group LLC for the development of projects in Jamaica related to the global logistics hub last month, but with information sketchy about the ability of the entity to execute projects, Hylton has been forced on the back foot.
Karl Samuda, the opposition spokesman on industry, told the minister on Tuesday that he should resign because of the embarrassment he has caused the country. He said that Hylton's clarification on the matter was "utter nonsense".
He said further that Hylton had an obligation to do even some preliminary checks on the investor and said that the decision by the Cabinet to reject two reports from the National Logistics Initiative Council (NLIC) indicates that the project was a "farce".
Hylton said that Krauck Systems and Anchor Financial Group LLC was not looking to borrow or beg anything from the Government.
"The information to be supplied could only be done within the context of an MoU that gave the parties the protection of information that would be critical to determine ownership, source of funds and deep critical and sensitive commercial details," Hylton said.
The minister said that the MOU was established for a period of six months with the execution contemplated over two phases. The objectives of the 30 days of phase one were to allow the proposing parties to satisfy the Government of Jamaica (GOJ)that it had the financial and technical capacity, and experience necessary to execute the project; that the proposed funding is from a legitimate source; and that the personnel and the proposing entities are fit and proper persons to do business with the Government.
"This would require the GOJ to receive the requisite information from the proposing parties and to verify the information received. If the information presented has been reviewed and approved by Cabinet as being satisfactory, then phase two will be authorised," Hylton said.
The NLIC, which is chaired by Professor Gordon Shirley, had submitted a preliminary report to Cabinet on June 1 which raised significant concerns on matters that require clarification and verification from the proposed investors in respect of their capacity to execute the intended projects and their fit and proper status to do business with the Government of Jamaica.
More clarification needed
Hylton said that as a consequence, Cabinet instructed that NLIC meet with the Krauck Systems and Anchor Financial Group LLC to clarify information already reviewed and to facilitate the provision of any additional relevant information. He said that the NLIC met with the proposing parties and clarified certain matters and was in the process of receiving additional information.
"A second interim report was made to Cabinet on June 15, and again, the results were inconclusive. Cabinet has instructed that NLIC complete the receipt of information and that international third parties (international banks and international development partners) be engaged to assist in the process of the verification of information received," Hylton said.