The special purpose government-owned company, Atlantic Hotel Inc; which owns the Marriott-branded hotel cannot afford to pay its debt to Republic Bank, forcing government to pay more US$1 million every six months to prevent Guyana from losing the property, Finance Minister Winston Jordan said Friday.
Jordan said the loan guarantor, National Industrial and Commercial Investments Limited (NICIL), also could not afford to service the debt.
He said the latest amount paid was US$748,000, but usually the debt is US$1.1 million every six months for the next 13 years.
Jordan said even if the hotel rakes in a profit, it would be unable to pay Republic Bank. “Even if it does well, it would not be able to pay its debt. Remember it is the entertainment part that is going make it … that is not being done so for the time being now unless we just say ‘take the asset’, it is the government which has to come in now.
Construction of the casino and entertainment complex was expected to cost another US$16 million.
That is an un-budgeted expense. Where we are going to find the money? We have to find the money otherwise we lose the asset,” he said.
The Finance Minister said in the past government has asked Republic Bank for more time to pay its debt periodically.
AHI has secured US$15.3 million from Republic Bank as part a syndication loan. The 197-room Marriott hotel in Guyana was constructed at a cost of US$58 million.