GEORGETOW
N, Guyana.
Oct. 15, Cana
Former
People's
Progressive
Party/Civic
(PPP/Civic)
Finance
Minister Asgar
Ally has
described
recent
statements by
President
Cheddi Jagan
about the
Guyana
Telephone and
Telegraph
(GT&T) as
"cause for
gravest concern
and wholly
without
justification".
"The President has put at risk any further investment in Guyana from the United States of America and, in all probability, from anywhere else by threatening to abrogate the present agreement entered into with this American company by imposing Parliamentary authority," Ally said in statement issued Monday.
Ally, now leader of the Guyana Democratic Party (GDP), was referring to statements by Jagan threatening to re-nationalize the local phone company and hostile statements from Public Utilities Chaimman, PJ. Menon.
President Jagan said at a press conference that GT&T was "not the kind of company we want in Guyana", And threatened to go to parliament to review the phone company's contract with the government.
Ally said President Jagan must know that since 1993, the company expressed concem at being unable to finance its expansion program because of the PUC's refusal to grant a full scale adjustment to compensate for the extent of devaluation of the Guyana dollar in 1991.
The former finance minister said he had correspondence in which the government acknowledged some of the difficulties the company was experiencing in relation to its expansion program.
"I recall very well, the company pointing out its inability to obtain the necessary financing bcause revenues from the provision of telecommunicati on services in Guyana were insufficient for the company to be viable as a result of the inadequate rates imposed by the PUC," Ally noted.
He added that between 1993 and 1994, government agreed to allow the phone company an extension of time to complete its expansion program's obligations under the contract because the GT&T was not receiving its entitlement under its agreement of a minimum rate of retum of 15 percent.
Ally noted that as Finance Minister he had examined the GT&T's profit and loss statements and balance sheets and had been satisfied that the compmy had "a legitimate case".
The GDP Presidential hopeful also referred to a Ietter sent by GT&T and Atlantic Tele Network (ATN) Chairman Jeffrey Prosser to Trade Minister Michael Shree Chan and copied to him, in which the phone company undertook to complete the expansion program in five months after the PUC approved rates allowing a minimum rate of return of 15 per cent.
The President and his ministers know fully well that to date govemment has taken no action to resolve the rate issue and that the company, as a result, turned to audiotext revenues for financial survival," Ally explained.
He added that during his tenure as finance minister, GT&T had presented government with evidence that over 90 per cent of the Expansion and Modernization Program has be en completed within 1,000 days.
"Since then 95 per cent of this program has been completed by funds supplied to GT&T from ATN and from audiotext revenues," Ally said.
The GDP boss said GT&T told government that North American banks, including Northern Telecom International Finance would not finance GT&T ope rations and expansion program without a clear understanding from the government on the settlement of the rates issued and that as a result, available financing negotiated by the compmy was withdrawn.