Last night, we showed you the three government guarantees that Minister of Budget Management Ralph Fonseca signed for Glenn Godfrey companies in 2001 and 2002. Well, today, most likely responding to increasing unease in international financial markets, government sent out a press release clarifying its position. We'll tell you about that unease among Superbond investors shortly, but first to the release. Most notably, it says that as far as government's legal advisors are concerned, the 'put option' agreements have long expired and are no longer valid because "the put" was not exercised by the bank within a specified time. The release says that this position has been conveyed to Provident Bank by the Ministry of Finance and, "this continues to be the position today."
Well it might continue to be the Ministry's position, but it is the bank's position as we are informed that they continue to send notices telling the government that it owes. The release also makes the case, and a quite incredible one, that government guaranteeing a private project to build a casino at the border was in the public interest.
Lastly it also makes the point that as Budget Minister, Ralph Fonseca was fully authorized to sign loan guarantee agreements because loans were under his portfolio. But that is not the position of the Leader of the Opposition who discussed the guarantee documents with us today.
Jules Vasquez,
The Prime Minister has said he as Prime Minister is authorized to sign such documents before the Finance and Audit Act. Is the Minister of Budget Management also so authorized?
Hon. Dean Barrow, Leader of the Opposition
"I don't think so. We have always contended that the Minister of Finance doesn't have the authority in the absence of a Cabinet decision and in the absence of authorization from the National Assembly. If the Minister of Finance doesn't have it, it follows that the Minister of Budget Management even more cannot have it."
Jules Vasquez,
What is your feeling about these 'put options'?
Hon. Dean Barrow,
"This is how they the PUP do it. Now admittedly one would have to feel that what Channel 7 has exposed with respect to these 'put options' represents a situation that's perhaps even worse than the UHS situation. At least forced by the public opinion pressure, the government has a hospital that it can latch on to. With respect to these 'put options', there is absolutely nothing that the government can seize that will come to the people of this country a return for the moneys that we will have to pay if these 'put options' are exercised."
[May 10th, 2007]
Rt. Hon. Said Musa, Prime Minister
As far as I am concerned there are still some matters of contention, of dispute, in respect of those so-called guarantees, or put options, it is a matter of
dispute."
Jules Vasquez,
But did not a Minister of your government, the Minister of Budget Management at the time, sign a put option for those figures, for those guarantees?
Rt. Hon. Said Musa,
"I am not aware of that."
[End May 10th, 2007]
Hon. Dean Barrow,
"Again it really would be laughable if it were not so tragic. The Prime Minister upon being confronted by an object that is without a doubt red, tells us that it is blue. There is this amazing propensity on the part of our Prime Minister to continue to deny a reality which is there big and bold and large for all the world to see. I am sorry to say this but it must be equally clear to all of us that the Prime Minister possesses a diseased mind. That is the only way one can describe this continued insistence on saying, on camera, on public television, that something that is clearly black, is white."
As we said earlier, this release is most likely directed at international financial markets where there is growing unease with the skeletons in the Musa administration's closet.
