The decision made by the NDC in 1994 to sell 50% of the shares in then wholly state owned Grenlec, proved to be one of the most valuable investment decisions for the people of Grenada, who remain 50% shareholders in the company.
Government continues to own 10% of the shares, the NIS 11% (the people own NIS) and the Grenadian public the remaining 29% in their private capacities. The NDC therefore empowered the people by ensuring that they own half of what is now a profitable company.
NDC wants all of Grenada to understand that when this reckless NNP administration continues to irrationally fight Grenlec, placing its very survival in jeopardy, they are essentially fighting down the very people who elected them to serve. This fight is even more outrageous because it stems from a personal vendetta of one man.
After the sale, Grenlec moved from operating on a $2 million overdraft to pay salaries and operating expenses under Gregory Bowen’s management, to consistently declaring and paying dividends (returns on investment) to its shareholders AND contributing over $5 million of its profits to sports, culture and community development in the last 20 years.
Despite these facts, this reckless administration continues to lambaste the NDC for what they dishonestly insist was a ‘bad deal’.
We invite the people of Grenada to compare the sale of the 50% Grenlec shares with the sale of our oil and gas to GPG; with the sale of our Mt Hartman property to EJ Miller, and with sale of our lagoon property. The last time we checked, our treasury received one dollar ($1.00) and a cinnamon stick for the lagoon sale. Talk about bad deals!
The NDC does not accuse the NNP of being dishonest about the Grenlec deal because we want to score political points. We say so because they are really being dishonest.
As indicated in Part 1 of this article, on 4 February 1997, Parliament passed a motion authorising the Mitchell administration to take steps to ensure that the terms of the sale of the Grenlec shares by the previous NDC administration “are re-negotiated in the best interest of the Government and people of Grenada”.
The re-negotiation did take place and not surprisingly, the NNP failed to re-negotiate a better deal. On 15 September 1998, Parliament passed the Electricity Supply Act, 1994 (Amendment, Commencement & Validation) Act.
By this 1998 Act, the Keith Mitchell administration brought into full force (back-dated with effect from 4 October 1994), the identical agreement the NDC administration reached on the Grenlec sale. Nothing changed. After all the grand standing they could not re-negotiate a better deal.
25 years have passed and Bowen and Mitchell still will not let this go. They continue to display open hostility to these investors who have repeatedly proven their worth to our country.
In June 2016, Parliament passed the new Electricity Supply Act.
Given his acrimonious history with the company, it would have been prudent and in the interest of the country for Gregory Bowen to stand back. Instead, he piloted the bill and led the vicious attack on the company, and as such, the Grenadian shareholders. He was grossly dishonest in the parliament. He told the nation that the terms of the sale of the shares in 1994 were “terrible”. That the sale was for “just over US$5 million” (it was in fact EC$30 million, US$11.25 million). He blamed NDC and Grenlec for the poor state of the economy! He said: “The NDC is to be blamed… for 22 years the NDC action has depressed the economy and stifled economic activities.” The other 14 MPs brazenly joined him in the rabid attack on the Grenlec investors.
Government’s behaviour in this all-out attack caused WRB, GPP and Grenlec to sue the Government and people of Grenada locally and internationally.
Locally, Grenlec complains that section 20 of the Electricity Supply Act 2016 breaches its constitutional rights. That section demands that the company must pay 5% of its pre-tax profits to a committee controlled by the Minister (Bowen) to do with as they please.
On 3 May 2019, government lost round one of this case. We anticipate that they will lose the entire case in the end and cost our taxpayers thousands.
On 5 May 2017, WRB and GPP (50% shareholders in Grenlec) filed arbitration proceedings before ICSID in Washington claiming government breached the agreement with them when it passed the Electricity Supply Act 2016 and failed to re-purchase the shares when requested. That case started last week.
Based on what we know, we expect government to lose this case.
Between the 2 cases filed, the cost to Grenadians will be well over $200 million. Apparently the gravity of the situation is now confronting Bowen. Recently, it was reported that he told the press the Grenlec investors were never asked to leave.
The question is when will the people of Grenada stop this reckless bunch from wrecking our country?
National Democratic Congress