CATEGORY:COMMENTARY
--------------------------


by Lloyd Noel (Attorney-at-law)
Inside Grenada correspondent
Tuesday November 14,2006


AS WE CONTINUE to review the happenings and the results surrounding the Mid-term Election in the U.S.A. last week, and we stop a while to reflect on
our own economic strangulation in these Isles - one cannot help wishing for and envying, the type of solution the American people democratically opted
for, by their votes on the 7th November.

Some commentators are saying, that the Democrats did not win at the Polls, it was the Republicans who lost. And the point they are trying to make, is that because of the failed policies, and or the adamant refusal of the Republican leadership to change
its course on Iraq - that is why the party lost at the Polls, rather than because the Democrats are seen as the new saviours for the American people.

Our situation can be equated to that of the U.S. people, in the sense that those in authority have been doing, and continuing to do, (or not doing,
what they should) the clearly wrong things in dealings with the people’s business - and therefore pushing or alienating the people away from them.

Some of the local policies in the U.S., as they affected different States in different ways, could have been tolerated or accepted from the point of
view of difference of opinion on important matters.

But the tragedies flowing from the war in Iraq, with the loss of so many young American lives, in a fight that seems to have no end in sight, and victory that maybe impossible to measure - were just too much to be tolerated any longer, and the people spoke out in clear language.

In our Tri-Island State, the tragedy is the debt burden being built up around the people’s necks with no end in sight; while at the same time the
same people continuing to catch hell, and those in authority neither listening, hearing, seeing, nor responding - and the ship continues sinking.

I have noticed that we got our Bill Board with the Ministers photos outside the Cemetery as you enter the town of Gouyave - so the promise of more “Bill Boards” to come was not an empty threat, and no doubt the rest of the Country will soon be getting their pre-Xmas decoration.

But in keeping with the trend of the powers-that-be, to get involved in shady deals with persons or groups in the outside World; or to embark on
worthwhile schemes or projects, which could benefit our Country and people if properly operated and implemented - but instead are twisted and manipulated to fatten the pockets of a few by outright Criminal acts and demands - we are again in the World spotlight of high-level Law Suits, that could cost our people Millions of dollars, and drag our Country’s image even further down the drain of dis-repute and scandal, if that is still at all possible.

We already have the Dipcon Judgment of over $20 Millions, and the Miller’s of over $15 Millions hanging around our Financial necks - and both came from cases heard and decided in London, England, to do with Contracts entered in Grenada by Government.

Now again we are faced with another case for Breach of Contract - in the Arbitration Court for settlement of Investments disputes in London (ICSID). The matter arises from an Agreement entered into between The Government of Grenada and RSM Production Corporation - whereby The Government agreed to give RSM exclusive rights to explore for Oil and Natural Gas in our Maritime Territory. The Agreement was signed on the 4th July, 1996.

At the time of entering the Agreement, Grenada Maritime boundary was not settled with Trinidad and Tobago and Venezuela - so a Clause in the
Agreement provided for suspension of RSM’s obligations under the Agreement, pending settlement of the boundary disputes.

That dispute was referred to as a “Force Majeure” provision in the Agreement, and was accepted as excusing RSM from performance of its obligations until the disputes were settled. Having signed the Agreement on the 4th July, 1996, with the “Force Majeure” provision, the Company (RSM) sent a letter to Government on the 18th July, 1996, confirming the existence of the dispute provision and its effect on the Agreement and performance by RSM.

That letter was counter-signed by Senator Patrick Bubb, Minister of State in the Ministry of Finance, on behalf of the Government of Grenada, and a
copy returned to RSM in confirmation thereof.

All the foregoing is in the Arbitration papers filed in London between RSM and Government - as provided for in Article 26.3 of the Agreement for settlement of Investment disputes.

And after the matter was filed with the Arbitration body in London last year, the Government, through its Senior Law Officer, Mr. Hugh Wildman, confirmed its consent to jurisdiction in that Court, in a letter to RSM dated 5th July, 2005..... i.e... “the Government would wish the dispute to be resolved by the ICSID Arbitration, as expeditiously as possible. If the Arbitration’s award shows that we are wrong, we will of course abide by the result.”

In a nutshell, the dispute is that when RSM applied for the License to start actual exploration, the Government (sometime in 2004) refused to grant
the License on the grounds that the said Application was late by a few days, and the Government purported to terminate the said Agreement - hence the
Arbitration case in London.

Behind the scenes, it seems that some Russian chaps came into the picture after the 2003 General Elections, and offered some Ten Million (U.S.) [$10
M. U.S.] to Government to break the Agreement with RSM and give the License to the Russians to do the explorations.

Those Russians are funding some of the Legal costs in London - but if the decision goes against The Government, it is doubtful the Russians would
still be around, because they would have nothing to gain from the losers.

The RSM Company is reported to have spent over $2 Million (U.S.) thus far - and the value of the Oil and Gas is estimated to be about $200 Billions U.S. - so the stakes are sky high by any standards.

And now to add to the above confusion, the CEO of RSM (Grynberg) and another Company have filed a Case in New York in the U.S. - against those Russians and Minister Gregory Bowen, for having conspired to deprive them of the huge benefits expected under the said Agreement.

The two grounds cited in the New York case - are that the Russians paid either Minister Bowen, or the Government, or both, to break the Contract with Grynberg and RSM; and or, because Minister Bowen had requested a bribe from Grynberg and because he refused to pay up, the Minister had adopted unfair means to deprive RSM of the License as provided for in the Agreement.

I must admit that I find that bribery allegation, the way it is put forward, not very convincing - and unless the complainant has other more concrete evidence to support the claim, it looks bare on the surface. Nevertheless, the Contract or Agreement has been terminated by Government and the License has not been granted, and that matter is before the Arbitration Tribunal in London for determination. The hearing is listed for the 4th - 8th June, 2007, after which the Tribunal would deliver its award on the question of whether the Government was entitled to terminate the Agreement of July, 1996.

If the RSM should succeed, it would seek to recover its full losses, including damages for loss of chance, loss of profits and or wasted expenditure in reliance on the said Agreement and based on above figures. It could also seek to have the Agreement declared to be in full force and effect - plus Legal costs. As I perused the case stated by the English Q.C. representing RSM at ICSID - it certainly looks convincing.

But the bigger picture is more worrying for our suffering people, who have been struggling all those years and patiently waiting on the Administration to deliver on those Election promises made in 1995, and again in 1999 when NNP won all Fifteen (15) Seats at the Polls, in a clean sweep.

Yet all they have been getting, at every turn of the financial wheel over the years, have been licks and more expensive licks on all sides. And the picture on the horizon does not look any better for the year ahead.

I have noticed a published estimated cost of the CWC 2007 to the OECS of just over Two Billion dollars, and I have seen a statement by our Finance Minister that our Share of that estimate is only about Seven and a half Millions ($7 M.).

The Government’s full back position is that all the works now taking place on Roads, Bridges, Hospital, Airport, and wherever else, were scheduled before the World Cup to be carried out in any event. Well some of that maybe so, but the reality on the ground looks very different indeed. In any case, nothing about those Projects has anything to do with development that would assist production or employment creation - once they have been completed.

And as for the benefits from the CWC 2007 itself - now that it is getting closer, and the Projects in the pipeline are expected to meet their deadlines for completion - I am noticing some concerns popping up about tickets sales, and crowd participation, and expected visitors, and so on and so forth - that are conveying the impression that all is not as well as has been propagated, by those in control and with the first-hand knowledge at their disposal.

Whatever is the true position, and the causes or the lapses creating the misgivings in people’s minds - some positive steps need to be taken to steady the ship, because the sacrifices and inconveniences that are already in train for local folks, are more than their fair burdens to bear.

And as for the West Indies Team itself, being an added attraction to entice Visitors to come to watch them at home - their performances, and the
selectors choices in team selection these past months, are such that people are more likely to stay away than come to watch them.

Each Island/State of Match Venue will have its own burdens to bear, or benefits to gain as the case maybe. But the gamble is so widespread, and the
stakes are so high, that whatever the outcome, the calls for change of those in control - may well be resounding across the Region, but most certainly in
our Tri-Island State.