Government expects lifting of injunction on IDB US$18M loan

Stabroek News
January 12, 2003

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The government is expecting a favourable ruling from US District Judge Thomas Penfield Jackson in the case filed by the local phone company to block a US$18M loan to modernise access to government services and widen internet usage in Guyana.

Prime Minister Samuel Hinds said he had been advised that Judge Jackson in mid-December had taken a position that he did not have jurisdiction to hear the case and intended to hand down his decision formally in writing some time this month.

Atlantic Tele Network (ATN), parent company of the Guyana Telephone and Telegraph Company Limited (GT&T), had filed a case in the US to block the Inter-American Development Bank (IDB) US$18M loan aimed at modernising the information and communications sector. The writ came mid-last year on the heels of the government and the companyís negotiations to end GT&Tís monopoly. A draft memorandum of understanding had been reached on the way forward for the negotiations.

However, ATN lobbied the IDB against the grant of the project and then went a step further to the US courts to have the project blocked. ATN argued that the project would infringe upon its monopoly rights in Guyana. The firm named as defendants then Treasury Secretary, Paul OíNeil, and the IDB and sought a court order directing OíNeil to veto the project.

The Government of Guyana, via attorneys Foley & Hoag, sought to be joined as a party to the action and was given leave by Judge Jackson to file pleadings. All of the defendants, Stabroek News was told, filed motions that the court lacked jurisdiction and moved to have the judge dismiss the case.

Sonita Jagan, General Manager of GT&T via her secretary indicated on Tuesday that there was no update available on the case.

The court case halted the negotiations between ATN and the government to break the monopoly but sources close to the company had in August said the company was interested in having the negotiations resumed from where they left off in Trinidad.

But Hinds had earlier told this newspaper that this should be communicated in writing to himself or the President. Stabroek News understands that this was done but the governmentís current position is that a resumption of those talks would have to await the outcome of the court matter.

Meanwhile, not only the US$18M project and the negotiations have been stalled but the IDB has asked the government to hold off on the implementation of a US$1.1M technical co-operation project already granted and underway to modernise the telecommunications industry. A component of this was an end to the monopoly held by GT&T.

This three-year project was to see the opening up of the telecommunications sector by introducing competition into the market.

It would now be significantly delayed and may cost more than originally envisaged given that consultants had to be hired to guide in the execution of the project.

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