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Don't sugar coat it, Omar - Forward-sale alumina deal was bad
Dr Omar Davies, former finance minister, is to be commended for admitting to punching holes in the bottom of Jamaica's economic ship.
Last week, in the House, Davies said the decision to forward sell Jamaica's portion of alumina produced by Jamalco in Clarendon was necessary at the time, and for that he would not apologise.
It was as if Davies were playing that old prank of sugar-coating lime and giving it to an unsuspecting lad. Davies did not bother to tell the House that because of that forward-sales arrangement and overall management of government's interest in Jamalco, taxpayers now owe US$504 million through the plant.
Wilfully negligent From Prime Minister Bruce Golding's account of the situation, while financial conditions, which Davies in part created as finance minister, demanded creative ways to fund the national budget
and to aid in the expansion of Jamalco under his watch, the way the forward sale was handled appear at best to be cavalier.
Government minister, Clive Mullings, opined that Davies was wilfully negligent in the way he handled the forward sale. We won't venture that far, because we believe the language was unparliamentary, only that House speaker Delroy Chuck did not caution Mullings for his loose tongue.
To the substantive matter though, we believe that the decision to engage in the forward sale of alumina would have been an excellent long-term decision had the government of the day been sensible enough to ensure there was an escalation clause which would protect the taxpayers' pockets against a substantial increase in the cost of energy and caustic soda.
Big league blunder
This was a big-league blunder and Davies is too proud to admit it. The former finance minister was the one who used the term "big league" in reference to how governance decisions are made. But thinking big league is different from acting big league. This big-league decision is like sending Courtney Walsh to open the batting in a Cricket World Cup final even though it is clear that Brett Lee, who is snorting at the top of his run up, is a bowler of no mean order.
To govern, you have to take tough decisions whenever there is a crisis, but there is no excuse for ignoring advice to include an escalation clause in the agreement.
We are happy that Prime Minister Golding is taking steps to sell government's share in Jamalco. The fact is that Jamaica will lose nothing except the red dirt. We are already getting the bauxite levy and jobs from the sector, so there is no point in holding on to losses anymore, especially when one considers that just over 40 years of bauxite mining remains in the country.
Inconvenienced
We also welcome the renewed call from Michael Peart, the member for South Manchester, for bauxite-producing areas to be the focus of serious attention from Government. Very few of these communities have anything to show from the bauxite they have given up and the displacement and inconvenience they have suffered as a result of the mining activities.
But where was Peart all along? He has been MP since 1993. During all this time Davies was enjoying this rich pool of finances called the Capital Development Fund, which he used at will for budgetary support. Now the bauxite/ alumina sector is on life-support machine and the doctors and nurses are overwhelmed. They have not said it explicitly, but when one checks the sector's pulse rate we recognise it might die.
What would Peart's conscience do with him if this happens, what would successive Governments say to the people of these bauxite-producing communities who have been stripped naked and rewarded with little from the sector?
We guess Davies would say he has no regrets about that and surely he would be dry-eyed in telling Jamaicans, "I make no apology." email feedback to thegavel@gleanerjm.com
http://www.jamaica-gleaner.com/glean...business3.html
Dr Omar Davies, former finance minister, is to be commended for admitting to punching holes in the bottom of Jamaica's economic ship.
Last week, in the House, Davies said the decision to forward sell Jamaica's portion of alumina produced by Jamalco in Clarendon was necessary at the time, and for that he would not apologise.
It was as if Davies were playing that old prank of sugar-coating lime and giving it to an unsuspecting lad. Davies did not bother to tell the House that because of that forward-sales arrangement and overall management of government's interest in Jamalco, taxpayers now owe US$504 million through the plant.
Wilfully negligent From Prime Minister Bruce Golding's account of the situation, while financial conditions, which Davies in part created as finance minister, demanded creative ways to fund the national budget
and to aid in the expansion of Jamalco under his watch, the way the forward sale was handled appear at best to be cavalier.
Government minister, Clive Mullings, opined that Davies was wilfully negligent in the way he handled the forward sale. We won't venture that far, because we believe the language was unparliamentary, only that House speaker Delroy Chuck did not caution Mullings for his loose tongue.
To the substantive matter though, we believe that the decision to engage in the forward sale of alumina would have been an excellent long-term decision had the government of the day been sensible enough to ensure there was an escalation clause which would protect the taxpayers' pockets against a substantial increase in the cost of energy and caustic soda.
Big league blunder
This was a big-league blunder and Davies is too proud to admit it. The former finance minister was the one who used the term "big league" in reference to how governance decisions are made. But thinking big league is different from acting big league. This big-league decision is like sending Courtney Walsh to open the batting in a Cricket World Cup final even though it is clear that Brett Lee, who is snorting at the top of his run up, is a bowler of no mean order.
To govern, you have to take tough decisions whenever there is a crisis, but there is no excuse for ignoring advice to include an escalation clause in the agreement.
We are happy that Prime Minister Golding is taking steps to sell government's share in Jamalco. The fact is that Jamaica will lose nothing except the red dirt. We are already getting the bauxite levy and jobs from the sector, so there is no point in holding on to losses anymore, especially when one considers that just over 40 years of bauxite mining remains in the country.
Inconvenienced
We also welcome the renewed call from Michael Peart, the member for South Manchester, for bauxite-producing areas to be the focus of serious attention from Government. Very few of these communities have anything to show from the bauxite they have given up and the displacement and inconvenience they have suffered as a result of the mining activities.
But where was Peart all along? He has been MP since 1993. During all this time Davies was enjoying this rich pool of finances called the Capital Development Fund, which he used at will for budgetary support. Now the bauxite/ alumina sector is on life-support machine and the doctors and nurses are overwhelmed. They have not said it explicitly, but when one checks the sector's pulse rate we recognise it might die.
What would Peart's conscience do with him if this happens, what would successive Governments say to the people of these bauxite-producing communities who have been stripped naked and rewarded with little from the sector?
We guess Davies would say he has no regrets about that and surely he would be dry-eyed in telling Jamaicans, "I make no apology." email feedback to thegavel@gleanerjm.com
http://www.jamaica-gleaner.com/glean...business3.html
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