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By Al Edwards
Wednesday, January 16, 2008
One of the major airlines seeking to acquire a majority stake in Air Jamaica has indicated that it is willing to fund the rehabilitation and restructuring of the Palisadoes road, the only access route to the Norman Manley International Airport, the Business Observer has been reliably informed.
According to a well-placed source, the foreign airline has expressed a desire to lift the Palisadoes road higher than sea level, a move that would ease the often-expressed fears of many that the road, which is highly susceptible to flooding, could be lost to storm surges.
"The bidder is willing to raise the Palisadoes road and fund it," said the Business Observer source who requested anonymity. "They are also willing to invest in infrastructure projects, including the creation of a free trade zone."
The source projected that it would take about US$100 million to rehabilitate the road in the way the bidder is proposing.
Yesterday, when the Business Observer contacted Transport and Works Minister Mike Henry, he said that the Government had already applied for funds to repair a section of the road.
"A Cuban firm has conducted a study on the Palisadoes road and based on that study we have applied to the Caribbean Development Bank for a loan of US$25 million to address the Palisadoes road situation," Henry said.
"While our loan application is being considered, we have been riveting the road which, to date, has come at a cost of J$40 million. We are now shoring up the harbour side of the road," Henry added.
Minister Henry further added that the Cuban firm has expertise in the area of roads hampered by rising sea levels and that the study is now on his desk. He said that requests for tenders will be going out soon.
Storm surges from Hurricane Dean last August pushed silt, sand and stones onto the road, blocking it in sections for more than half-a-day.
In September 2004, after Hurricane Ivan sideswiped the island's southern coast, the Palisadoes road was blocked for two days by mounds of sand, some as high as six feet, effectively cutting off the capital and the eastern section of the island from airlift.
On November 26 last year, the Office of Disaster Preparedness and Emergency Management (ODPEM) advised motorists using the 14-kilometre-long spit of land that forms the Palisadoes to exercise extreme caution after 25-knot winds pushed sea water onto the road. The ODPEM said that the water incursion was expected to continue for two days.
Last year May, the Sunday Observer reported Professor Edward Robinson from the University of the West Indies' Marine Geology Unit in the Department of Geography and Geology, as saying that since Hurricane Ivan, the average height above sea level of the dunes on the Palisadoes is probably less than one metre, whereas before the storm the road was partly protected by sand dunes about two metres high.
The proposal to rehabilitate the road will likely give the bidder more attention when the Government starts talking to the airlines that have made bids to enter a joint venture agreement with Air Jamaica.
With the national carrier registering losses of US$100 million and an accumulated deficit of US$1.1 billion, the Government has taken the decision to divest itself of this non-performing asset. Prime Minister Bruce Golding has assigned the minister without portfolio in the Ministry of Finance, Don Wehby, with the task of overseeing the divestment of Air Jamaica.
Earlier this month, Wehby had told the Observer that four major airlines, one of them from China, had expressed serious interest in Air Jamaica. Bidders were required to be well-capitalised and have extensive experience in the commercial passenger aviation business.
The bidders for the national carrier are not expected to simply acquire Air Jamaica but make a substantial investment in the country's infrastructure.
Wehby is in the process of contracting the World Bank's International Finance Corporation to put together an airline package that will value all of Air Jamaica's assets.
Wednesday, January 16, 2008
One of the major airlines seeking to acquire a majority stake in Air Jamaica has indicated that it is willing to fund the rehabilitation and restructuring of the Palisadoes road, the only access route to the Norman Manley International Airport, the Business Observer has been reliably informed.
According to a well-placed source, the foreign airline has expressed a desire to lift the Palisadoes road higher than sea level, a move that would ease the often-expressed fears of many that the road, which is highly susceptible to flooding, could be lost to storm surges.
"The bidder is willing to raise the Palisadoes road and fund it," said the Business Observer source who requested anonymity. "They are also willing to invest in infrastructure projects, including the creation of a free trade zone."
The source projected that it would take about US$100 million to rehabilitate the road in the way the bidder is proposing.
Yesterday, when the Business Observer contacted Transport and Works Minister Mike Henry, he said that the Government had already applied for funds to repair a section of the road.
"A Cuban firm has conducted a study on the Palisadoes road and based on that study we have applied to the Caribbean Development Bank for a loan of US$25 million to address the Palisadoes road situation," Henry said.
"While our loan application is being considered, we have been riveting the road which, to date, has come at a cost of J$40 million. We are now shoring up the harbour side of the road," Henry added.
Minister Henry further added that the Cuban firm has expertise in the area of roads hampered by rising sea levels and that the study is now on his desk. He said that requests for tenders will be going out soon.
Storm surges from Hurricane Dean last August pushed silt, sand and stones onto the road, blocking it in sections for more than half-a-day.
In September 2004, after Hurricane Ivan sideswiped the island's southern coast, the Palisadoes road was blocked for two days by mounds of sand, some as high as six feet, effectively cutting off the capital and the eastern section of the island from airlift.
On November 26 last year, the Office of Disaster Preparedness and Emergency Management (ODPEM) advised motorists using the 14-kilometre-long spit of land that forms the Palisadoes to exercise extreme caution after 25-knot winds pushed sea water onto the road. The ODPEM said that the water incursion was expected to continue for two days.
Last year May, the Sunday Observer reported Professor Edward Robinson from the University of the West Indies' Marine Geology Unit in the Department of Geography and Geology, as saying that since Hurricane Ivan, the average height above sea level of the dunes on the Palisadoes is probably less than one metre, whereas before the storm the road was partly protected by sand dunes about two metres high.
The proposal to rehabilitate the road will likely give the bidder more attention when the Government starts talking to the airlines that have made bids to enter a joint venture agreement with Air Jamaica.
With the national carrier registering losses of US$100 million and an accumulated deficit of US$1.1 billion, the Government has taken the decision to divest itself of this non-performing asset. Prime Minister Bruce Golding has assigned the minister without portfolio in the Ministry of Finance, Don Wehby, with the task of overseeing the divestment of Air Jamaica.
Earlier this month, Wehby had told the Observer that four major airlines, one of them from China, had expressed serious interest in Air Jamaica. Bidders were required to be well-capitalised and have extensive experience in the commercial passenger aviation business.
The bidders for the national carrier are not expected to simply acquire Air Jamaica but make a substantial investment in the country's infrastructure.
Wehby is in the process of contracting the World Bank's International Finance Corporation to put together an airline package that will value all of Air Jamaica's assets.
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