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Archive for the category “Infrastructure”

To All Stakeholders: UNRA remains committed to its mandate (15.09.2018)

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Somalia: Puntland Press Statement on Jalam – Harfo Road Project (13.09.2018)

Solicitor General letter to UNRA: Sector Support Project v RSSVP Lot 1 – Civil Works for Upgrading of Rukungiri Kihihi-Ishasha / Kanungu Road (78,5km) to Bituminous Standard (14.09.2018)

High Court of England & Wales restrains Djibouti’s port company from terminating joint venture with DP world (05.09.2018)

Port Company also prohibited from replacing DP World directors in joint venture Company.

DUBAI, United Arab Emirates, September 5, 2018 – The High Court of England & Wales has granted an injunction restraining Djibouti’s port company, Port de Djibouti S.A. (PDSA), from treating its joint venture shareholders’ agreement with global trade enabler DP World as terminated. The High Court has further prohibited PDSA from removing directors of the Doraleh Container Terminal (DCT) joint venture company who were appointed by DP World pursuant to that agreement. PDSA is not to interfere with the management of DCT until further orders of the Court or the resolution of the dispute by a London-seated arbitration tribunal.

PDSA is owned in majority by the Government of Djibouti and its CEO is the Chairman of the Ports & Free Zones Authority of Djibouti. Hong Kong-based China Merchants is the minority shareholder in PDSA.

The High Court’s order follows the unlawful attempt by PDSA to terminate the joint venture agreement with DP World and the calling of an extraordinary shareholders’ meeting on 9 September by PDSA to replace DP World appointed directors of the DCT joint venture company.  This is the third legal ruling in relation to the Doraleh Container Terminal following two previous decisions from the London Court of International Arbitration (LCIA), all of them in favour of DP World. It recognises that although PDSA is the majority shareholder of the DCT joint venture company, it is DP World that has management control of the company, in accordance with the parties’ legally binding contracts.

The new ruling against PDSA, issued by the Court without PDSA’s participation, makes clear that PDSA:

  • Cannot act as if the joint venture agreement with DP World has been terminated
  • Cannot appoint new directors or remove DP World’s nominated directors without its consent
  • Cannot cause the DCT joint venture company to act on the “Reserved Matters” without DP World’s consent
  • Cannot instruct or cause DCT to give instructions to Standard Chartered Bank in London to transfer funds to Djibouti

If PDSA disobeys the Court’s order and seeks to replace DP World nominated directors of DCT on 9 September, it may be in contempt of court and face a fine or the seizure of its assets and its officers and directors may be imprisoned.

The Court has ordered PDSA to present its defence at another hearing on 14 September.

Meanwhile, DP World is notifying Standard Chartered Bank so that the bank will reject any instructions that may be sent to them after the 9 September meeting. China Merchants, who have been given operational control of the Djibouti Freezone in breach of DP World’s exclusivity rights, will also be informed given its minority shareholding in PDSA.

Opinion: If the Cabinet scraps NMS and UNRA, what about the weird expenditures at the Presidential Affairs?

As the giant Cabinet of the Republic are planning to scrap Uganda National Roads Authority (UNRA) and National Medical Stores (NMS), that these are going back into their ministries. Because of how these two organizations has supposed wasted government funds and spending. The National Resistance Movement (NRM) knows the ordeal and the reasons for that, but they are instead scrapping the organizations, to keep the deals in-house and not as sole organization doing the operations as expert organizations for the government. That is why this will go back to Ministry of Works and Transport for UNRA and Ministry of Health for NMS. I have one more vital idea for the Cabinet members, but don’t expect them to so.

Today’s news:

The Cabinet has taken a decision to scrap Uganda National Roads Authority (UNRA) and National Medical Stores and transfer their mandate to the mother ministries to reduce wastage of resources. According to a source, the decision was taken in two meetings with the first held on August 20 and the last one on Monday last week. The source said President Museveni was unhappy with the UNRA performance, especially in the rural areas where roads are impassable yet it is where majority of votes for his NRM party are” (Andrew Bagala – ‘UNRA to be scrapped in merger of government agencies’ 03.09.2018 link: http://www.monitor.co.ug/News/National/UNRA-to-be-scrapped-merger-government-agencies/688334-4740804-qvrsbnz/index.html?utm_medium=social&utm_source=twitter_DailyMonitor).

As these ideas are noble, but we know the reasons in itself. More direct control and cannot use the organizations as faults for the corrupt, graft and embezzlement anymore. The Cabinet are thinking this will stop this, but they are just making sure the deals and agreements made with tenders and buying, will be happening in-house and not by experts in the same regard as today. That is the real reaction to what is happening with this.

My advise would be find ways to merger and move responsibility from the Office of the President, State House and Office of the Prime Minister. As these could be moved to their representative ministries, as the Youth Livelihood Programme should end elsewhere. The budgets for the Residential District Commissioners are put under the President, this should be put Minister of Local Government and not under the President.

Like what does the budget of Internal Security Organization and External Security Organization lay under neath Office of the President, as this should be under the Ministry of Internal Affairs or Ministry of Foreign Affairs.

As well as all the development expenditure that is parts of the Office of the President and Office of the Prime Minister. Both of these should have been put under fitting expertise of certain ministries, as the Ministry of Agriculture, Ministry of Education and Sports, Ministry of Works and Transport and so on. As well, as the ones fitting Ministry of Internal Affairs and Ministry of Internal Affairs. All these ministries could have connected these projects under the State House, Office of the President and Office of the Prime Minister.

Like what does the Uganda AIDS Commission does under the Office of the President, shouldn’t this be under the Ministry of Health? Why does the Office of the Prime Minister have the Disaster Preparedness and not the Ministry of Internal Affairs or the Ministry of Local Government?

This is just what I wonder about, because, if the Cabinet is serious about scrapping UNRA and NMS, why are not the government looking into the weird expenditures at the Office of the Prime Minister, State House or even the Office of the President?

They should really ask and wonder. If they are not doing this as a political stunt, as we know how corrupt these enterprises are, but will it make a difference to cut out the middle-man? Peace.

Is the Filipino getting into a debt-trap with China like Sri Lanka and Tonga?

If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.”John Maynard Keynes

There are worries about the rising levels of debt the Philippines has to China. That should worry all Filipino. Since, this will be repaid, even as the infrastructure projects under the President is served now. The time for repaying these debts will come. This might be the next one after President Rodrigo Roa Duterte might have to answer for that. But he should be worry himself of the levels he is putting the Republic in, unless he wants important parts of the infrastructure be “given” to the Chinese as a way of repaying the debt like Sri Lanka did.

The conclusion of an agreement with China to manage the Hambantota port was seen as inevitable after the government buckled under Chinese pressure when the China Communication and Construction Co Ltd, which was building the port city, demanded USD 143 million as compensation for the stalling of the work. The Sri Lankan government was also compelled to renegotiate the Colombo Port city project last year, which had been suspended due to criticism about the Chinese ownership of 20 hectares of freehold land as well as controversy over the project’s possible negative environmental impact” (Smruti S. Pattanaik – ‘New Hambantota Port Deal: China Consolidates its Stakes in Sri Lanka’ 17.08.2017).

This story should be worrying for the Philippines as the rising debt to China will come to roost one day. Duterte has accepted and taken it for his projects, but will it be sustainable. That is something he himself should ask himself and also if they can repay this debt without paying a high price.

Jovito Jose P. Katigbak reported in June 2018 this: “Another issue worth noting is debt sustainability. There are concerns that borrowing heavily from China will lead the country into a debt trap. A 2017 Forbes article contends that the Philippine government debt could swell up to USD 452 billion by 2027, which translates to a debt-to-GDP ratio of 197 percent. The estimated figure is based on an annual 10 percent interest rate on loans levied by the Chinese government, hence tying the Philippines into a “virtual debt bondage”” (CIRSS Commentaries – ‘BRIDGING THE INFRASTRUCTURE INVESTMENT GAP THROUGH FOREIGN AID: A BRIEFER ON CHINESE ODA’ June 2018).

If the Filipino doesn’t get to worried about the amount they are borrowing from China. It isn’t only Sri Lanka who has eaten over more debt than they can swallow and has to repay with other means. There are worry in the Pacific island of Tonga.

As reported from Tonga: “Chinese aid in the Pacific region has increased dramatically in recent years and the country has become the region’s second-largest donor. Tonga’s debt to China has been estimated to be more than $100m by Australia’s Lowy Institute think-tank. The prime minister told local media last week that countries would get together to ask the Chinese government to “forgive their debts”. “To me, that is the only way we can all move forward, if we just can’t pay off our debts,” he added. Beijing has refused to write off loans in the past but has given Tonga an amnesty on repayments” (Simone Rench – ‘Tonga premier to ask China to ‘forgive’ Pacific debts’ 21.08.2018 link: https://www.publicfinanceinternational.org/news/2018/08/tonga-premier-ask-china-forgive-pacific-debts).

We have seen what the Chinese done to the Sri Lankan and Tongan counterparts. Both of instances could be happening to the Philippines. Not that you wish that, but the repayments of the growing debt will happen at one point. Even if there is long grace-period of lower rates on the interests as promised to Manila. You can wonder when the Beijing want to recoup the funds and the debt.

Right now, Duterte has a good relationship with Beijing, but when do they feel they have invested enough in the Build! Build! Build! (BBB) projects and wants profits and returns on the investments?

Because the Chinese will not do this forever. They might act nice at first and investing in infrastructure projects as a part of the Belt and Road Initiative (BRI), but when time goes by and lack of repayment hits the fan. The familiar faces of Beijing will get their value for the money and the sovereignty will be taken away. As a port, a piece of mines or exploration of some sort of industrial output will go directly to Beijing and a state owned company. Since they will get their repayment for all the offered debt to the nation.

That is what Duterte is risking, if it is oil exploration and extraction, mineral resources or even ports that is vital to the business done in the Philippines. Does he wants to risk that for the signature building of the BBB?

Peace.

Bugiri By-Election: The Final Stages now and Museveni offers only development there if they vote for NRM!

The last day of the campaigns in the Bugiri By-Election, which the final polls are on the 27th July 2018. This is where the candidates of Asuman Basalirwa (JEEMA), John Francis Oketcho (NRM) and Eunice Namatende (FDC). All of this candidates has massive backings from their parties and allies. Where the Police Force have started to follow Asuman Basalirwa especially and his ally Robert Kyagulanyi aka Bobi Wine, whose been followed and monitored by the Police Force. Therefore, you know that National Resistance Movement doesn’t want to lose this new district.

We know, that Museveni is behind his candidate, who will be part of the NRM Caucus and follow his every lead. That is why he went to Bugiri to tell his side of the story, because he couldn’t do without. Museveni have to be a part and also show his power to the tin-soldier he wants from the district. That is just the way he do.

Bugiri by-election: President Yoweri Museveni has pledged to connect the people of Bugiri with clean water, construct for them better roads if they vote NRM’s Francis Oketcho. Museveni said the NRM is a party of action and this has been exhibited bvy the many things that have been done among them construction of better roads and the improved hospitals” (93.3 KFM, 25.07.2018).

What is the weirdest from all the final rallies from Basalirwa, Namatende and Oketcho where packed. That is just weird, all photos from these rallies are filled to the brim. Therefore, the pictures from Museveni rally isn’t alone. The FDC rally had Dr. Kizza Besigye and Patrick Amuriat Oboi, these two people could gain crowds on their own too. That Bobi Wine and Basalirwa would bring people are natural, as the swagger of Bobi Wine hits the masses. While Museveni could for all we know, be ferrying masses from other parts of Busoga and giving them food and gifts. That is what the NRM have done during the General Election last time. So why not do it now too?

Well, Voter Tourism might be a thing. While the bigger story is how Museveni continues to talk. The government will deliver project, only if Bugiri vote for his guy. The Bugiri people will get roads and such, if they do the right thing and votes for Oketcho. That means, the government is only there for you, if you follow the direct orders of the State House. This is the final implication and shows the lack of democratic values in the President.

He only gives, if people give him all power. That is what is just in the eyes of the President. NRM or nothing. No Remedy Mentioned (NRM) continues, as the pledges of roads hits Bugiri, a promise that Museveni have been given steadily since at least 2006 for certain parts of constituency. Therefore, as always with the NRM, there have to be recycled pledges. That is just protocol by now.

What is really insulting, is the state of “if they vote”, that means he will stop funding and stop being acting as President over the Constituency, if they vote for someone else. Bugiri will not get money or tax money for development projects, infrastructure development and everything else.

That is what he is saying.

Bugiri will be yet another place, that Museveni might wipe out of the map. As people will not follow his orders. They are not his property, even if he acts like it. Peace.

Opinion: Hope Kagame learns from Sri Lanka!

As conning as President Paul Kagame are, he will never outsmart the Chinese in their loans and agreements, especially when concerning their moneys and the planned extension of the Belt and Road Initiative (BRI). Before I show the naive relations that Kagame has with Xi Jinping on the visit. I will first show the statements made by Kagame as he is signing agreements and loans. Kagame is really risking natural resources and the infrastructure projects that the Chinese are supporting. If there is any default on loans or problematic to pay back. The Rwandan state will repay with the resources in the soil or within bound of the structures put in place. Therefore, Kagame shouldn’t think of himself as an equal with China, he should think of it as a borrower and find ways to secure repayments.

I also want to say a few words from the heart. The growing relationship with China is based as much on mutual respect as on mutual interests. That is evident in your personal commitment to our continent, Mr. President” (…) “More generally, China relates to Africa as an equal. We see ourselves as a people on the road to prosperity. China’s actions demonstrate, that you see us in the same way. This is a revolutionary posture in world affairs, and it is more precious than money” Kagame stressed” (Abdur Rahman Alfa Shaban – ‘’China relates to Africa as an equal’ – Paul Kagame’ 23.07.2018 – Africa News).

When you see this, you wonder if the Rwandan President is naive or if he thinking that the Sri Lankan experiment of high loans and bad repayments cannot hit Kigali, like it hit Colombo. Not that I want this to happen to any state. I am as worried about this in Uganda and Kenya, as the loans to for instance Madaraka express, Karuma Hydroelectric Power project and Kampala-Entebbe Expressway. This has to be repaid to the Chinese at some point and with interest.

Kagame is foolish, if he thinks the Chinese will not expect a return on their investment, that is what they do.

Here what happen with the Chinese loans in Sri Lanka:

Some Sri Lankan economists had privately told me in 2011 that their country will find it difficult to repay the massive loan of USD 8 billion at an interest rate of more than six per cent taken from China for modernising the Hambantota port and that it may ultimately have to convert these loans into equity. That warning came true on July 29, 2017 when Sri Lanka and China signed the Hambantota Port Concession Agreement. Soon after the Agreement was signed, China declared that the Hambantota port is a part of its Belt and Road Initiative (BRI). According to the agreement, China will pay USD 1.12 billion upfront in a debt-equity swap in the ratio of 70:30 approximately, with the China Merchant Port Holdings Company (CMPort) getting 69.55 per cent of the shares and the Sri Lanka Ports Authority (SLPA), a public sector organization, holding the remainder 30.45 per cent. After 10 years, SLPA can buy another 20 per cent of the shares, making the two companies equal partners” (…) “The conclusion of an agreement with China to manage the Hambantota port was seen as inevitable after the government buckled under Chinese pressure when the China Communication and Construction Co Ltd, which was building the port city, demanded USD 143 million as compensation for the stalling of the work. The Sri Lankan government was also compelled to renegotiate the Colombo Port city project last year, which had been suspended due to criticism about the Chinese ownership of 20 hectares of freehold land as well as controversy over the project’s possible negative environmental impact” (Smruti S. Pattanaik – ‘New Hambantota Port Deal: China Consolidates its Stakes in Sri Lanka’ 17.08.2017).

So if the Rwandan take the grants and loans for granted, they might be forced by the financial pressure from Beijing to give away either infrastructure or even make concession of some other vital resources. Because the Chinese expect some value for their money, they are not doing this for charity, but for development of themselves. Therefore, Kagame is not an equal and will not be an equal. I wish that was a serious thing, but the way the Chinese play these agreements. They are not playing around and doling out money for the hell of neither. Neither does anyone else, that is why usually with Western Aid the state expect bought from same source imports and also with strains of governance to get the funds. So, the Chinese does it their way. That is respected, however, the worry is what the aftermath is the for the ones that swallowed to much debt and cannot repay.

Will that happen to Rwanda?

Kagame shouldn’t see himself as an equal, but wonder how he does fit as a piece of the puzzle in the BRI project of the Chinese and how he can pay back with interests. Because that is the next step. The should also worry the neighbors who has borrowed heavily as well from the same They should all be careful and wonder what would happen. This is isn’t only for Kagame, but he was today speaking a bit to friendly to the Chinese.

As if he haven’t gotten the news of what happen in Sri Lanka and for everyone else, that should be warning. Peace.

Opinion: When will the grace period of the Chinese loans end? – While, Kenya and Uganda continues to borrow more!

The Government of Kenya and the Government of Uganda, should both worry about their arrangements and their growing debts, as the non-sustainable rates of debt and higher interests. As the unnatural growth of the national budget, where the lack of revenue is covered with more state debt. To cover both salaries and development projects. All of this has happen over the recent years. As more and more of the yearly budget goes to pay interest on old loans, as the old loans also mature and the rates will become more dire. As the strength of the economy isn’t going in the same rates as the loans. This is in the end a debt trap. A debt trap China has used in other countries.

Sri Lanka is the recent example, which has come into a debt trap, where the Chinese loans has become so dire, become so big and not able to recover. That the collateral for the state was to favorable lease the harbor of Hambantota to the Chinese. They had too, since they couldn’t repay the creditor from Peking. That should be realization from all the others who borrows big and think that the Chinese will not get something valuable back for their funding.

This should be a warning for the Kenyan and Ugandan counterparts, this should be a warning for President Kenyatta and President Museveni. That is if they care about the state resources, about their minerals and about the possible extractions from their republics. If they want to be debt-slaves, or lease away the crown jewels to the Chinese, because they promised favorable debt plans, that in the end put them in juxtaposition, that they cannot come out off; unless they trade away something very valuable. If that would be licenses to drill oil in Turkana or in Bunyoro.

Who knows what the end-game of these massive loans are and if the Presidents and their parties plans to repay them. Or hope that the next generation will try to invent new way of generating money. If so, then they are saved by rare luck and not by planning ahead. These loans are big and taking bigger and bigger slices of the GDP. They are going far beyond the levels of revenue and possible future forecast of funds. Therefore, the loans can only at this point benefit the ones giving them. They will get the repayments and the interests. If they don’t get that, they will take collateral and take other state entities to get their values back. The Chinese are doing that in Sri Lanka, they could easily do that with Kenya and Uganda too. They are in for the taking and ready to muscled out.

The Chinese doesn’t play and doesn’t play with money, they will recollect and they will recover the funds spent. As they are not playing games, they are really investing and hoping to get paid-in-full. They are waiting for the numbers to go from red to black. They don’t expect to loose, and if they do. They will figure other ways to collect the lost.

President Kenyatta and President Museveni should know this, but I doubt they are thinking in this direction right now. They are eating and not caring, but their states and their economist should worry. As the growing debts has a backside, not only the interests and the lack of development it creates, as they have to find bigger revenue to cover the debt and the mature loans, as they have to settle old affairs and such. They don’t go away or get deleted over nothing. They got to take charge and find a way to solve it.

The Chinese will take advantage if they start to default, if they struggle to pay, which could come, if the loans and the negative spiral of lack of revenue continues. That is if the state doesn’t find ways to repay. Than, the Chinese might take a port, might take state owned enterprise, but surely they will be paid-in-full. Peace.

The Patel Dam burst: Government neglect as the owner allowed to build an illegal dam!

Whats the saddest about the tragedy in Solai, Nakuru County in Kenya, it is that it could have been avoided, but the common greed is the reason for the fatal dam. That it burst and hit the village. This is where the owner of the farm had put up an illegal dam called the Patel Dam, which was not legally built or constructed. It had already leaked before, but not burst. Therefore, the uncertainty was there, but nothing happen.

That the owners of the Patel Dam should answer for their illegal construction of the dam. Where the forces of water shredded lives, lives that could have had a longer life, if it hadn’t been for the greed of the Patel Coffee Estate Limited. That did this for the benefit of better farming, but dodged the law and built a dam. So that the harvest could be good. Build a cheap dam of sand and rock. Even forgetting a vital principal of having concrete as foundation of it. So that the dam has strength to oppose the currents of the water. Instead, the poor construction burst and took dozens of lives. Innocent lives who couldn’t be prepared for this. Even if there was leaks before, no one would have considered that the construction of it was this weak. That the owners had considered the possibility of it bursting. 

The land was bought and renamed by the current owner, the old name was Milton Siding. That the building of this dam should have caused a stir by the Local Government in Nakuru. The Governor of Nakuru at the time, should have sanctioned the farm as the reports of the building should have been reported to his desk. The Police and the authorities should have inspected it and questioned its papers. Not to allow this sort of installation, unless he had permits and solid foundations for building it. This isn’t a tool-shack or a mere extension of a house. This is a major construction that has to follow certain technical specificity. Even the Kenyan government hire wrong people and building bad constructions, that has happen at ports and even bridges. Therefore, they should be careful to let private farmers and enterprises building dams like this.

That is why this is neglect by the government, the local government and the contractors, finally also the owners. All of them has failed the people of Solai, the Nakuru County Local Government should step-up and take blame, as they should seen this coming. They without actions, has given consent to the farm and its owner to do it. After getting knowledge of the construction, they should have informed needed authorities to stop the building of it, until the proper legal paperwork and shown the plan to safety standards. So that the public shouldn’t fear of what happen yesterday on the 9th May 2018.

The public shouldn’t be responsible for what owners tend to do on their land, they should trust that the owner has legal ability and has hired people with technical expertise to do this. Especially a project like this, building a dam and making sure the waters are steady. However, that didn’t happen here, as the foundation was built on the wrong premise. Cheap construction not built for securing the water. That is why it burst. The contractors, the owners and local government should have answers. Come up with reasons and answer in court for the deaths of innocent civilians. They are innocent people who got caught in the greed of the farmer.

That is the sad thing, that the farmer didn’t build a proper dam. He built a cheap one, that instead of thinking of consequences, only thought of profits. That is the sad reality and the authorities, should really be shaken, as they could let this happen on their watch. They are also responsible, since they didn’t take action and sanction the owner of the estate. That would have been the right thing and gotten the owner to strengthen the dam. However, that is just 20/20 and we know that didn’t happen.

We know how serious the burst is at it affected 2500 people and 500 families, as well as over 40 people are officially announced dead. All of them is too many, when this could have been avoided. They died over state neglect and lack of oversight. Peace.

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