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KCT privatisation under the JLP Administration
HENRY... has the passion, drive and sheer knowledge necessary to oversee his portfolio
Columns
BY THE DRONE  
March 14, 2016

KCT privatisation under the JLP Administration

I was having a discussion recently with friends, one of whom happens to work at Kingston Container Terminal (KCT). The discourse centred on the Jamaica Labour Party’s (JLP’s) recent victory at the polls, what contributed to it and the road ahead with the party at the helm.

My KCT friend posed what I considered, at first, a rather selfish yet very apposite and profound series of questions which went as follows: “(a) Considering that the deal to privatise the Kingston Container Terminal is virtually complete, save and except for a signed financial commitment by the ‘B’ lenders to the project; (b) considering that the Inter-American Development Bank (IDB) has not disbursed any funds to the project as yet; and (c) taking into account the JLP’s opposition to aspects of the privatisation, demonstrated by its attempt to have it probed by the Contractor General, what will happen to the KCT privatisation deal under the new JLP Government and what are the implications for workers there who have been sensitised to the deal being close and who are now eagerly anticipating a redundancy payout and a rehiring exercise?

Naturally, I gave my KCT friend my on-the-spot response as best as I could, but promised her I would dedicate some time to produce a more detailed overview of the matter in days to come.

Although questions were asked and flags raised concerning his age and ability to perform as minister, it was never a surprise to most that the Honourable Mike Henry would have been chosen to head the newly named Ministry of Transport and Mining, under which the Port Authority, having direct responsibility for KCT, falls. While some may find it a convenient pasttime or sideshow to criticise Mr Henry on the basis of his age – turning 81 years in June – and others may even further attempt to apply cosmetics to some decisions he took during his previous tenure as minister, no one on either side of the political divide is equipped with more knowledge, skill, dream and ambition for Jamaica’s transport portfolio and networking than Mike Henry.

I venture to say that as long as Mr Henry possesses the now famous “vim, vigour and vitality”, he should be allowed to continue making his invaluable contribution to the development of the sector so dear to him. He has the passion, drive and sheer knowledge, not to mention the vast amount of investment contacts and relationships he has forged for Jamaica in this sector.

To appreciate this, one simply needs to speak to the Chinese about Mike Henry. His succession road map however, cannot be far away for obvious reasons. This is something he, his party, and his constituency in which he is highly respected and appreciated based on his support at the polls, need to give due consideration during this term.

To address the questions, if not fears, held by my KCT friend and, I am certain, scores of other workers at the port, the deal is already closed, awaiting disbursement by the IDB. The ‘B’ lenders, who are partners to this privatisation, are far advanced in committing financially to the project with a US$50-million pledge. That has served in part to delay the timetable for transition and effective handover of the port.

In addition, the new Administration could not sensibly look to disrupt the process without evoking a feeling of mistrust, partisanship and backward political development. Not to mention the regression it would represent internationally, at a time when Jamaica seeks to forge partnerships, locally and beyond its shores, to stimulate meaningful growth which has eluded it for decades.

The JLP, in its 2016 election manifesto or 10-Point Plan to grow the Jamaican economy, has stated its intention to privatise loss-making government entities. It has also said it has a strategy to ease public debt and give the Government a real chance to focus on matters germane to governance.

The decision by the previous Administration to privatise KCT was a step along the lines promoted by the JLP in its manifesto. The Ports Authority, and more directly KCT, is certainly not one of those loss-making government entities, notwithstanding the fact that it carries a very high debt, previously secured by the Government and people of Jamaica to fund port development. The terminal is now a shadow of itself. It urgently needs capital injection which the Government of Jamaica cannot provide, hence the need to privatise.

It was clear to many who followed the developments and exchanges between the previous minister of transport and works, Dr Omar Davies, and Mr Henry, who was Opposition spokesman, that there were differences in opinion, ideologically and in procedure on both sides, regarding the privatisation of the port.

However, one common premise on which they both stood firmly was the necessity of this asset being privatised in the country’s interest. This point further supports the argument that Mr Henry would only be grandstanding and possibly provoking unnecessary backlash were he to attempt to interfere with the privatisation process and timetable. The only conceivable ground for interference, halt or overturn of this exercise would stem from some basis or source demonstrating clear signs of corruption, impropriety or any other malpractice which would cause eyes to be raised locally and internationally.

Now, considering that the Hon Mike Henry had personally written to the contractor general asking him to investigate and report on aspects of the privatisation process with which he had concerns, and this report — having been completed and presented toward the end of the last calendar year — reflected a “clean bill of health” by the contractor general’s standards, this ought to settle the argument on the port privatisation, as far as Mr Henry and this new JLP Administration is concerned.

In no way am I in any position to direct the actions of anyone in this new Administration. I think that we should support this new team of leaders and not pronounce or assume failure on them with all the challenges they face in the House, due to their very slim majority.

It is fair and prudent that we give them a chance to perform or fail as the case may be, and judge them based on one simple fact – their performance. I say this against the background of hearing Mrs Dionne Jackson Miller interview Mr Henry on

Beyond the Headlines in the middle of last week. Among the questions she posed to him was “What are your immediate plans for the ministry you now head?” Like clockwork, Mr Henry went off to Vernamfield and his raft of other important intermodal transport networking projects.

I listened attentively because I was hoping he would have said something about the KCT port privatisation, as I was preparing this article and would find any utterance useful to this cause. Also, due to the advanced state of negotiations, I thought it would be somewhere close to the apex of his agenda. Unfortunately, nothing was said on this.

Nevertheless, this was a brief and impromptu interview and all could not be disclosed within that time frame. Also, Mr Henry not mentioning the port privatisation in that interview could be another signal that there is no issue there to address. I suggest that Mr Henry, through his operatives at the Port Authority of Jamaica (PAJ), demonstrate commitment and partnership by working overtime and going into overdrive if possible, to facilitate the handover of the port to its pending lessee, CMA CGM Terminals/Kingston Freeport Terminals Ltd, and not have this deal languish, causing further anxiety and frustration at the terminal.

Mr Henry has to also take note of the fact that the workers may be on edge and have questions pertaining to the privatisation and redundancy timetable. He should use his operatives at the Port Authority to quickly address the staff in an attempt to allay fears or misplaced concerns.

One critical feature of this whole privatisation process, from the KCT worker viewpoint, is the lack of timely information and feedback on recent or current developments as the process unfolds. My KCT friend, the one mentioned earlier who inspired the production of this article, stated that she got the impression that the Port Authority was more reactive to the publications in this newspaper on happenings concerning the port privatisation during last year, rather than taking a proactive approach to update the staff on matters as they arise.

“Most times we are visited with recitals by the management at PAJ, flanked by representatives of the prospective lessee KFTL, after an

Observer publication,” she said. “The staff has grown dependent on theObserver to publish matters on the port because, like clockwork, the PAJ and its team will come running. The major questions we all want answered at this moment by the PAJ are, when the transition to Kingston Freeport Terminal Ltd (KFTL) will take effect and also, when will our redundancy packages be made available to us?”

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