MONTEGO BAY — Responding to concerns, mainly from the Opposition Jamaica Labour Party, that the divestment of the Sangster International Airport (SIA) may not have been the best course of action, government officials on Wednesday went to bat for the privatisation process.

The 30-year lease of the facility to an international consortium called MBJ Airports Ltd, Prime Minister P J Patterson said, would bring numerous benefits without exposing the country to any capital risk.

And all this would be accomplished, he stressed at Wednesday’s signing ceremony, without relinquishing the ownership of the island’s busiest airport.

“Questions have been raised, why is the government going this way? Why has it not, instead, borrowed the capital and then hire private sector management,” Patterson said. “And I will point out in response to that, whatever we borrow for this kind of development, reduces what we can borrow for other such infrastructural and social programme development. And I must emphasise that this agreement does not require any government guarantee. So that the capital risk will rest with the investor.”

When they assume control on March 1, the group of Canadian, Israeli, Chilean and Spanish firms will begin implementing a US$189-million expansion plan. The final phase of the project is slated to begin in 2005.

They will pay the Airport Authority a concession fee calculated to ensure that the country has a share of any profits generated.

“We believe that we have negotiated a fair business deal which will provide reasonable return for our investment partners and enable Jamaica to expand and develop as a competitive and attractive tourism and business destination,” said head of the Enterprise negotiating team, Dr Vin Lawrence Wednesday.

Designed to accommodate an annual passenger flow of 1,000 per hour, the SIA now handles almost twice that number of passengers on an hourly basis. Based on the standards of the International Air Transport Association (IATA), the airport would receive a D grade but the planned upgrading, under MBJ Airports Ltd, will move the airport up to a B.

“In determining the approach to be taken for its privatisation, consideration was given to the sale or lease of the airport,” explained Transport Minister Bobby Pickersgill. “In an island economy, such as Jamaica, that is as highly dependent on tourism and trade, airports are strategic assets and therefore demand a significant measure of government oversight and control.”

He added that the lessee would bring management expertise and the capacity to develop the airport commercially to the table, which would in turn allow the airport to remain competitive in aeronautical costs and the quality of services provided.

“We believe that the route we are taking presents the proper mix of strategies to achieve our objective of an even greater contribution by the sector to national development,” Pickersgill said, “while affording a reasonable return on investment to our partners in this venture.”