Guyana and Brazil are currently looking at setting up a joint technical team to assess the road from Lethem to Linden in preparation for paving it through a loan financed by Brazil.
This initiative follows bilateral talks between President Bharrat Jagdeo and Brazil's President Luiz Inacio Lula da Silva during last Saturday's Rio Summit held at Turkeyen, Greater George-town.
At the opening of the Annual Officers Conference of the Guyana Defence Force on Thursday, Jagdeo had said the Brazilians "… are probably, prepared to extend a loan to surface the road from Lethem and to fix the [Takutu] bridge."
Brazil's Ambassador to Guyana Arthur Meyer told Stabroek News that the Brazilian government is open to financing the paving of the road through a loan from the state-owned Brazilian Natio-nal Economic and Social Development Bank.
He said that at the bilateral meeting at which Brazil's ministers of transport and external relations were present Guyana's President reacted "very positively" to the idea of Brazil providing financing for the road project.
Meyer noted that the road would be very important for Brazil since it would provide access for exports from Brazil's northern province through Guyana's ports to its markets. In September 2006, when asked about plans for paving the road, Jagdeo had told the media that it could not be paved in the short term as in the absence of a substantial investment flow accruing from the project it would not be feasible. "You can't spend US$200 million on paving a road that earns you US$500,000 a year. Normally the rate of return should be about 10% so you have to earn about US$20 million a year and that is at the low end to justify that if government is financing it," he had said.
While the government might be looking at an annual 10% rate of return on the investment, he said, were the private sector to finance the paving of the road they would be looking at an annual rate of return close to 25%. He had said that when he looked at the traffic flow on that road he preferred "to keep my money in the bank." However, he said that if the development of the road could be linked to bigger projects such as exporting or bringing soya products or goods from the free trade area of Manaus or the plans for the development of Northern Brazil then it would be feasible.
He had also said there was no immediate plan to build a bridge at the Kurupukari Crossing. (Miranda La Rose)