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EDITORIAL - North-south highway welcome, but ...

Published:Monday | June 25, 2012 | 12:00 AM

This newspaper welcomes the apparent formalisation of an agreement between the Jamaican Government and a subsidiary of China Harbour Engineering Company (CHEC) for the completion and extension of the north-south leg of Highway 2000. However, there are a few points for clarification in the arrangement that need to be addressed by the Government.

As announced, the project will mean developing a four-lane toll road, spanning 68 kilometres, from Caymanas, St Catherine, on the Jamaica south coast, to Ocho Rios, on the northern shore.

The highway will encompass the 20-kilometre Linstead bypass, which is complete, except for 650 metres, that has long been stalled because of a dispute with the original contractors, the French company Bouygues, over who should pay for the unfinished section. This portion of the bypass has had to be redesigned, and will cost more because of geotechnical issues.

Our support for the project is based, in part, on our long-held position that the transport link between the two critical regions of the Jamaican economy, the commercial south coast, including the capital Kingston, and the tourism industry of the northern shore, is woefully inadequate - a narrow, winding road over a difficult mountain, and across a Spanish-built single-lane, centuries-old bridge that is usually impassable during heavy rain.

The prospect of doing the trip in less than an hour, especially if it demands no substantial outlay from taxpayers, is enticing. Existing analyses of the economic viability of a toll road on this route notwithstanding, we believe it will drive commerce and probably belie current projections. Moreover, an expenditure of US$600 million over three years will provide some stimulus for a weak economy where fiscal constraints limit the Government's ability for infrastructure spending.

Here, however, is where we need more information from the Government. The transport and works minister, Dr Omar Davies, has stressed that the administration will have no financial stake in the project. It will provide no loan, loan guarantees, or guarantee for traffic or revenue. That is good.

However, the formula for pricing the land that it will lease to the highway developers for the 50-year concession must be transparent. Much of that land is likely to be acquired from private owners.

Clarity is necessary

Further, it is reported that CHEC will reimburse the Jamaican Government the US$120 million it has already spent on the near-complete section of the highway. What has not been made clear is whether this will be a cash reimbursement, or if there are offset arrangements. Nor does the public know whether the refundable sum is separate from, or calculated in, the US$600-million project cost announced by the parties.

Such clarity is necessary, especially in the context of the controversy between the Government and Contractor General Greg Christie, because of the latter's opposition to the direct negotiations - rather than an open-tender deal - between the Government and CHEC.

The issues we have raised notwithstanding, we have confidence in the systems being established to ensure that Jamaica gets good value from this deal. Stanley Consultants, which will provide technical oversight, is a recognised world-class operation, whose bona fides are unquestioned. Further, there is little cause to doubt the competence or integrity of the independent committee named by Davies to help him monitor the project and offer advice.

The opinions on this page, except for the above, do not necessarily reflect the views of The Gleaner. To respond to a Gleaner editorial, email us: editor@gleanerjm.com or fax: 922-6223. Responses should be no longer than 400 words. Not all responses will be published.