Sun | May 9, 2021

Bengal Development fallout may have long-term impact

Published:Monday | April 12, 2021 | 12:05 AM


I beg to respond to recent articles and news reports which have failed to deal with the approval of the appeal by Bengal Development Company Limited in an objective and impartial manner. Jamaica World, an overseas-registered entity with international as well as Jamaican private-sector investors, as owner of Bengal Development Limited, has been involved in establishing a viable business in Jamaica that plans to employ hundreds of Jamaican citizens and generate millions of dollars in tax revenue, while remaining compliant with the procedures and protocol of the Government of Jamaica and its agencies, including, but not limited to, the National Environment and Planning Agency (NEPA) and the Natural Resources Conservation Authority (NRCA).

Bengal Development Limited has a right, as a private landowner, to seek to develop the property, including applying for a quarry licence and operating the quarry in accordance with the law. The company, in its application over the years, has followed every protocol stipulated to them by NEPA and by law. They have gone through the most extensive and arduous application process in the history of Jamaica’s quarry and mining industry, including an appeal process, in accordance with the law which ultimately resulted in their being granted an environmental permit entitling them to apply for, and establish, a quarry operation at a cost to them of millions of dollars over the past 10 years.

Despite the fact that local stakeholders (including environmental groups and NGOs) worked with NEPA to determine and agree to the area that should be quarried for this site, certain individuals, claiming environmental issues, filed a Supreme Court claim against the attorney general for Jamaica, the NRCA and Bengal Development Company Limited, questioning the constitutionality of the decision of the minister in allowing Bengal Development Company Limited’s appeal, which has had a negative impact upon the company’s ability to conclude its business arrangements and obtain the necessary performance bond financing to commence its quarrying operation.

As a result of the impact this court action has had on the company’s ability to operate, this firm considered it impractical for its client to expend millions of dollars in paying unrecoverable fees for a performance bond of $40 million. We therefore applied on the company’s behalf for an extension of time within which to provide the required performance bond, pending the outcome of the constitutional case. The decision of the court and possible appeals may result in the project being considerably delayed, thereby unnecessarily tying up considerable sums of money.

Why should the NRCA, as an entity involved in the constitutional case, refuse to grant an extension of time and accuse the company of breach of the term of the grant of the environmental permit, when it knows that the obtaining of a performance bond for $40 million will cost the company a few million dollars, which is unrecoverable, when there is no certainty as to how the court is likely to rule on the question of whether there is a constitutional breach?

In 2017, the Mines and Geology Division of the Ministry of Mining and Energy indicated that there could be over J$635 million in tax revenues that can be generated. To my mind, this is certainly not the way to encourage investment in this industry, nor is it the way to do business with foreign investors and operators. The NRCA, in allowing politics to dominate rationality, is playing a tricky game with this project by sending the wrong message to the rest of the global business community looking to invest in Jamaica.

The implications of this behaviour towards foreign direct investors can stretch far beyond this mining project, resulting in long-term negativity to foreign investment in Jamaica.