Dear Editor,

The concerns being raised by private sector groups about the lack of competence of the Office of Utilities Regulation are missing the fundamental point that Jamaica’s economic and financial profile is not attractive to investors with adequate means for an over US$650-m project.

Those potential investors have more attractive options with much lower risks.

Criticism by the contractor general of the bidding procedures does not go to the fundamental issue of why there were no bidders with strong financial means. We should give attention to these issues and consider the possibility that current debt servicing and foreign exchange flows in Jamaica are not attractive for investors who need to be assured that they can repatriate their profits without difficulty.

Potential investors will consider the demand on available hard currencies for the repayment of the over US$750m in Chinese loans and the over US$1b of loans from the IMF, IDB, etc.

The project should therefore be restructured into smaller increments, despite the fact that larger plants are generally more efficient. We must go for a more effective approach, rather than the one mega-project being pursued that is not implementable under present circumstances.

In view of all these considerations, it would seem that a medium to long- term public-private partnership programme for engergy development needs to be devised with critical support of the World Bank, IDB and others. In this partnership arrangement, the investment risks of the total investment could be minimised by the involvement of the multilaterals and spread over a consortium of private sector entities.

C Courtney Jackson

c.courtneyj@gmail.com