Home' Trinidad and Tobago Guardian : September 6th 2015 Contents SEPTEMBER 6 • 2015 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
NEWS | SBG5
Bank not asked to finance
Point Fortin Highway
Trinidad-born general manager of the
Inter-American Development Bank s
(IDB) Caribbean Country Department,
Gerard Johnson, says the institution was not
asked by the People s Partnership adminis-
tration to finance the highway to Point Fortin.
Responding to a question from the Business
Guardian on August 25, Finance Minister Larry
Howai said the Government has funded 70
per cent of the cost of the Point Fortin highway
from its recurrent cash flows with $3.5 billion
out of a total of $5 billion spent on the highway
coming from the State s coffers.
Questioned on why a borrowing member
country of the IDB would not avail itself of
financing from the resources of the interna-
tional financial institution, Johnson said there
were many reasons to explain why a member
country would not choose the IDB to finance
a large project, including that the country
might get the financing from somewhere else.
"There are some countries that have so
much of their own financing that they do not
need to borrow from the IDB," said Johnson.
He also said that the IDB is problematic in
that it has safeguards for the protection of the
environment and for the promotion of social
equity, which would seek to ensure that no
one in the affected population is being hurt
by the project that is seeking IDB funding.
He said the IDB also insists that all of its
projects have technical safeguards---to ensure
that it is the most efficient use of resources---
as well as economic safeguards, which answers
the question of whether the project makes
sense for the country to get involved in.
Speaking on the margins of the International
Monetary Fund forum on "Financing Growth,"
Johnson also added that IDB financing comes
with transparency safeguards.
The IDB technocrat said: "Is the money
going to be spent using transparency involving
procurement? Will it be spent using trans-
parency in terms of financial controls. When
you go through all of that, sometimes gov-
ernments say that the IDB is too difficult.
"At the end of the day, some countries
choose to borrow money from commercial
banks that ask no questions and are just inter-
ested in being paid back.
"That might cost ten times more, but the
banks are not harassing the governments with
all of these questions."
He said there are also bilateral lenders who
are willing to advance monies to countries in
the region, but who bring their own designs
and labour to complete the contract.
Asked specifically why the Point Fortin high-
way was not financed by an international
financial institution, Johnson said: "I don t
know. The IDB was never asked to finance
that project. I have no way of knowing the
answer to that question. The only people who
know the answer to that question are the ones
who took the decision."
Optimism in Grenada's
The Grenada economy is recovering
under its home-grown structural
adjustment programme with the
country s Prime Minister Keith Mitchell
describing the mood in the country as being
"upbeat" in an interview Friday.
Grenada is getting debt restructuring to the
tune of almost US$400 million and is paying
down its debts.
"We are seeing investment confident in the
business sector, which is moving in one direc-
tion. We are also seeing an increase in job cre-
ation. While we still have high unemployment,
particularly among our youths, that is moving
in the right direction.
Speaking on the margins of the IMF con-
ference "Financing Growth" held at the Mar-
riott hotel in St Kitts, Mitchell said: "There
is an air of optimism in several sector of the
economy, such as agriculture and tourism.
There is an upbeat mood in many respects,
but we still have fiscal challenges. We still
have to raise sufficient capital to finance some
of things that we are doing."
He said the Grenada government has imple-
mented a freeze on hiring in the public sector
and is seeking to reduce numbers there by
attrition. The Grenada government has agreed
with the international community that for
every ten Grenadian public servants who leave
the public service, the government will only
replace a maximum of three.
Mitchell also said commercial banks in
Grenada are mostly foreign owned and are
very liquid and one of the challenges the Gov-
ernment faces is in getting them to lend money
to non-traditional industries.
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