Ellio says CHEC signing imminent

A final agreement with China Harbour Engineering Company (CHEC) for the new George Town port is largely complete, and will be signed in “not very long”, according to lead negotiator Ellio Solomon.

Gaining final signatures, however, will require another extension of the CHEC-government memorandum of understanding that, at the previous 31 November deadline, set 31 March as the ultimate date for agreement.

Mr Solomon said accounting giant KPMG had largely approved the port-building contract after completing its several-month value-for-money study, declaring it “a tremendous improvement” on initial negotiations.

“We have feedback from KPMG and other stakeholders and I believe we have a framework for the best agreement with CHEC for the Cayman Islands,” Mr Solomon told iNews Cayman. “The negotiations are pretty much complete, but it is a process and we are now dotting the ‘i’s and crossing the ‘t’s.

“KPMG just wanted to get some points clarified from CHEC, some figures and some questions answered, and it will require a small extension, but not very long,” he said.

Mr Solomon declined to name a date, however, saying “I will leave that to the Minister,” suggesting Premier McKeeva Bush, minister of finance, tourism and development, would offer an announcement.

His remarks came in the wake of last week’s four-page letter, addressed to Mr Solomon, from the Cayman Contractor’s Association (CCA), detailing the group’s concerns about port development and calling on the George Town MLA to circumscribe CHEC.

The letter worries about local employment, wages, imported labour and accommodation, building materials, financial management, environmental degradation, the size of port development, new retail areas and, finally, a prolonged CHEC presence in Cayman.

“Should the Cayman Islands government decide to proceed” with CHEC, the CCA letter, signed by CCA president Kris Bergstrom, recommends a seven-point agreement, addressing the group’s fears.

The document asks CHEC to adopt a local salary scale, worrying that “independent government reports and media accounts” suggest “a repeating pattern” in which CHEC insinuates itself through “attractive financing, well below ordinary commercial rates”, then declares that bids for local companies, workers, building materials and accommodation are too expensive, turning to Chinese imports.

“We have heard nothing at all from him,” Mr Bergstrom told iNews, pointing to the 28 February date of the letter. “The government is required to answer and we are hoping this [public release] applies a little pressure.”

He said the recommended pay scales were based on annual surveys of the local construction industry, representing average cost-of-living compensation for particular positions. “If a carpenter costs $10 per hour, for example, we don’t want to see CHEC pay $8 per hour. That’s not good enough for local hires. It must be at those rates,” he said.

Mr Solomon said he had met the CCA “three times, for not less than an hour-and-a-half each time”, answering their concerns, saying fears for local labour, wages, building supplies and accommodation had been answered.

“The letter makes a couple of errors also,” he said, pointing to CCA fears that the new pier would boast retail space “in excess of 100,000 square feet”, owned by CHEC and threatening local merchants.

“I have said many times that it is not 100,000, but just a little over 50,000,” Mr Solomon said, pointing to clauses requiring CHEC to hire local contractors, labourers and equipment, purchase local materials and rent local accommodation, nevertheless promising that ”we will pen something” in reply to the CCA”.

He also said CHEC would not remain in Cayman – and not bid on other projects – after building the George Town port and piers at Spotts Landing and the Cayman Turtle Farm.

“Once they are finished their job, they’ll be leaving,” he said. “I have answered a lot of these questions, and this will all be done at regional, local Caribbean prices. The Cayman Islands will not be competing with China or any other region.

“There will be significant opportunities for the people of this country. I will contact individual members of the CCA, which almost seems to be against the project, and others who are not members of the association, so as to make sure that everyone gets opportunities with this project,” he said.