Polack Post: Caribbean Private Sector – Government Loans
By Peter Polack
Peter Polack
The Jamaican government has recently announced a loan of US$150 million to the local electricity provider to ensure quicker reconnection for all customers other than the projected 2026 date. This was because the government intends to review their license shortly, supposedly for the benefit of the Jamaican people, and the loan was necessary to expedite all necessary repairs, presumably because the provider was hesitant to spend the necessary money when their licence was not assured.
The loan has a five year term but the license will lapse in 2027 failing which the government could acquire the assets of the electricity provider, less the loan.
This is the most socialist, nationalization sentiment to come out of a JLP government since 1962.
The government has also indicated that they would like the electricity supply to go underground. A great expense that not even the very rich and tiny Cayman Islands can afford.
A pipe dream for the ignorant.
The experienced utility CEO has openly panned the idea which forgets that Jamaica will be spending for years to recover from hurricane Melissa.
In the middle of recovery efforts, the Jamaican government has lent US$150 Million to a private company, proposed underground electricity at a massive cost and seeks to confine thousands of families in metal boxes. International bodies, celebrity relief efforts and outside countries must be dismayed by this recklessness.
Do as I say not as I do.
The extremely wealthy Asian owners of the Jamaican electricity grid would view the $150 million expenditure as peanuts in the normal circumstances.
This is not the first time a government has had to bail out an electricity provider. Bahamas has had to ride a similar white horse to the rescue by securing a $100 Million development bank loan for the government owned utility that provides most of Bahamian power with a further 20% by a private company that also operates in Barbados and St. Lucia.
A country divided by electricity providers matched only by the Cayman Islands water suppliers in two parts of their main island.
Jamaica is a single island and the Jamaican government must have several potential, hungry and rich operators waiting in the wings to make such a large private sector loan in such desperate times. A priority of any such negotiation would be the much heralded, financially prohibitive, ruling party pipe dream or underground electricity service.
A paean to the gullible.
If the ruling government fails in this decision without a buyer, then every Jamaican must be prepared to become the new owners with the accompanying cost and corruption that is the handmaiden of government interference with the private sector.
Jamaica has had that experience and does not need another.
There must be a hidden agenda.
Notes
https://en.wikipedia.org/wiki/Bahamas_Electricity_Corporation
https://www.emera.com/companies/regulated-electric/emera-caribbean
https://jis.gov.jm/govt-directs-jps-to-explore-underground-placement-of-power-grid
END
Peter Polack is a former criminal lawyer from the Cayman Islands for several decades. His books are The Last Hot Battle of the Cold War: South Africa vs. Cuba in the Angolan Civil War (2013), Jamaica, The Land of Film (2017) and Guerrilla Warfare: Kings of Revolution (2019). He was a contributor to Encyclopedia of Warfare (2013). His latest book is a compendium of Russian espionage activities with almost five hundred Soviet spies expelled from nearly 100 countries worldwide 1940-88.
His views are his own.
