Sace offers SVG loan reduction
August 5, 2005
Sace offers SVG loan reduction

Prime Minister Dr. Ralph Gonsalves has dubbed his recent negotiations with Sace, the Italian agency that provided a guarantee on the EC$225 million loan for the Ottley Hall Mariner and Shipyard as being “very successful”.

The Prime Minister who visited Italy in July disclosed that Sace offered a reduction immediately on the subordinated loan.{{more}}

However, on the substantive rescheduled loan the company has offered a US$22 million reduction.

“I indicated such an offer is not substantial,” said Dr. Gonsalves at the July 21 sitting of the House of Assembly as he explained that the Government ought to have a more substantial debt relief.

“Some Governments would have taken the offer,” said Dr.Gonsalves adding that it was not good enough for him.

The Prime Minister said very soon Vincentians will know the outcome of the negotiations.

“It is morally and legally untenable to ask us to pay a debt which amounts to US$80 million for something which is worth only US$10 million at most,” Dr Gonsalves lamented shortly after taking office.

The Ottley Hall Mariner and Shipyard saga, became a source of controversy during the 1990s.

The project then became one of this country’s biggest failures which resulted in the disappearance of millions of dollars.

Currently, an official inquiry is being conducted into the failed project.

Retired High Court Judge and acting Justice of Appeals, Justice Ephraim Georges, is the sole Commissioner.

About EC$225 million was borrowed from a consortium of European banks and financial institutions to fund the project, which was valued by a firm of international accountants at less than EC$20 million.

The Ottley Hall project hailed by Prime Minister Sir James Mitchell as one of the New Democratic Party’s major drives for economic take-off, was reported to be in serious financial trouble as early as 1995.