Govt in 40-year giveaway of E-Governance fibre optic network; company binds self to future legal battles

Last Updated on Wednesday, 29 April 2015, 3:02 by GxMedia

Less than one month before facing the electorate, the Guyana government has handed a small privately-owned Guyanese company the right to manage and maintain the state-owned fibre-optic cable with lucrative tax concessions for the next 25 to 40 years, according to the agreement.

In exchange, the company has tied itself to risks of new telecommunications laws whenever they are enacted and helping the government in legal battles against Atlantic Tele Network (ATN), the United States- headquartered parent company of Guyana Telephone and Telegraph Company (GT&T).

“Dax Contracting will fully and timely support the Government of Guyana in any response that the Government of Guyana has to legally undertake in the likelihood of intervention by GT&T/ATN with regards to the granting and use of the Operator License,” states the March 16 agreement signed by Head of the Presidential Secretariat, Dr. Roger Luncheon and Managing Director of Dax Contracting, Faisal Mohammed.

GT&T/ATN has maintained that it wants to be properly compensated before agreeing to the liberalization of voice and data services which it says it enjoys an agreed monopoly on since 1990 with the government.

In the deal that would see Dax rehabilitating the cable from Lethem to Georgetown to international internet transmission standards, the company would be allowed to use and maintain the said fibre optic cable repeater stations and equipment for a period of 25 years from March 16, 2015 with the option of renewal for an additional 15 years.

The only time the government would provide direct financing is if there is an emergency, but this has to be in keeping with the huge tax concessions on equipment, spares and tools that will be granted to company. The exemptions include but not limited to tax holidays, remissions, waivers, duty-free concessions on the importation of equipment, spares, tools and two SUVs and three four-door pickups.

The agreement states that government will provide Dax Constructing Services with licenses to transmit and receive data via the fibre optic cable; access and use the Government of  Guyana-owned fibre-optic structure equipment including road access, access to poles, access to repeater stations.

The agreement allows Dax Contracting Services to enter into a joint venture agreement with any other company or entity so as to execute this agreement which includes the use of cable to transmit and receive data and information from any part of the world, according to the laws of Guyana.

The Working People’s Alliance (WPA) earlier Tuesday voiced grave concern about the deal, saying it was a total giveaway of a multi-million US dollar project. That party, which is one of six in the opposition coalition A Partnership for National Unity+ Alliance For Change (APNU+AFC), wants the fibre-optic agreement scrapped if the PPPC loses the elections.

According to the WPA, there has been no audit or valuation of the E-Governance Project before the agreement was signed.