THE Government of Guyana yesterday convened a stakeholders’ consultation session on the Amaila Falls Hydropower Project (AFHP), at the Guyana International Conference Centre (GICC) at Liliendaal, East Coast Demerara, and stakeholders in attendance, representing umbrella organizations, active networks and groups of civil society, declared their unequivocal support for the Amaila Falls Hydropower Project (AFHP) and appealed to all policy makers to engage in constructive, sincere and meaningful dialogue in order to urgently bring the project to fruition. The project has been at the centre of much discussion, especially within the last week, following rejection by the Parliamentary Opposition parties of Hydro-Electric (Amendment) Bill and a motion to increase the debt ceiling on external loans from $1B to $150B, both of which are critical to the project.

Yesterday’s session was attended by members of the private sector, small businesses, religious leaders and other members of civil society. In addition, a panel of government officials, including the President, Prime Minister and several ministers, were available to answer questions from the stakeholders in order to provide further insight on the project.

In his address to the gathering, Prime Minister Samuel Hinds said there will be significant reduction in payments made for the generation of electricity once the AFHP comes into fruition. According to him, Guyana purchases up to US$200M in fuel for electricity generation each year. However, he noted that the payments to Amaila Falls Hydro Inc. for the generation of electricity will not exceed US$110M a year.

Hinds further explained that electricity is currently generated at a cost of US25 cents per kilowatt hour using petroleum fuel, or US30 to 37 cents per kwh using diesel.
However, the AFHP has the potential to produce electricity at no more than 12 cents per kwh.

“That is what we’ve been aiming for. That is what our country will lose if we don’t go forward,” he remarked

Meanwhile, Minister of Housing and Water, and acting Minister of Tourism, Irfaan Ali, highlighted that the national consensus is that the hydropower project is critical and is needed for the economic transformation of Guyana.

“If there is one project which has built-in national consensus, built-in national support, it is this project; and that support is not because of any political party or any government, but that support is based on a proper and thorough analysis of the economic realities and economic benefits that can be derived out of this investment,” he stated.

On the issue of debt sustainability, Ali related that around 1980, there was a movement in Guyana’s guarantee limit from $500M to $1B. He stated that when put into US value terms, the limit then was US$400M.
He further stated that if this is adjusted based on US inflation, from 1980 to 2013, the equivalent figure would be US1.1B.

“If you are to make the necessary adjustments in the economic framework, that guarantee limit should be today $1.1B. We have never sought to make the US equivalent adjustment over the 1980 limit,” he said.

According to Ali, the limit being proposed is US$750M, a limit far below the $1.1B. He explained that in terms of the guarantee as a percentage of the country’s Gross Domestic Product (GDP), in 1980 it would have been 73.2 percent of GDP, but the guarantee being proposed at present will be only 27 percent of GDP.

The minister stated that the AFHP will reduce the country’s fuel import bill by approximately 20 to 25 percent, and save over US$90M on imported fuel. As such, he said, if one looks at the cost savings that Guyana will derive from this project, it far outweighs the annual repayment for the project.

“So the sustainability of the project from a national perspective and a project perspective is unquestionable,” he said.