Government spends big on idle property - $50m for annual security bill By Erica Virtue, Staff Reporter The Government-funded National Investment Bank of Jamaica (NIBJ) is paying a massive bill annually to secure several commercial buildings islandwide, some of which are equipped with nothing but outdated and corroded machines. The bank, through its privatisation department and enterprise team, has been in charge of divesting Government assets and supporting strategic sectors of the economy which offer good prospects for foreign exchange earning and employment. However, The Sunday Gleaner understands that more than $50 million of its annual budget goes to securing at least 40 commercial buildings islandwide, some for as long as 15 years. The payments could continue for several years as there are few indications of early divestment for many of the buildings. Responding to Sunday Gleaner queries, the NIBJ admitted to paying a minimum of $50 million for securing buildings over several years, but said, it did not know how many buildings it was securing or over what period the money was paid. "It can be confirmed that the NIBJ has paid a minimum of $50 million in security cost for several buildings over the years. Exactly how many buildings and how many years, cannot be confirmed", the NIBJ stated in its faxed response dated June 18. The Sunday Gleaner first made inquiries of the NIBJ by fax on May 24. A response was received on June 11, but it ignored questions relating to the security bill. The NIBJ stated then that "where a building is leased, the lessee pays security cost." But Sunday Gleaner investigations revealed that the NIBJ was paying money to secure at least 40 idle commercial entities that were neither leased, sold nor privatised. Among those with a hefty security bill is the Spring Plains Farm in Clarendon, the agricultural showpiece of the Jamaica Labour Party Government of the 1980s. The farm which began operation in 1982, incurred losses of more than $100 million by the time it closed in 1986. Since then, security costs at the location have run into several million dollars. Spring Plains, which produced and exported winter vegetables, was run by Eli Tisona, an Israeli, who was banned in 1998 from entering Jamaica and has been convicted of drug related and money laundering charges in the United States. Sources close to the matter described the once hi-tech farming machinery on the property as "rotting and corroded farming equipment." The NIBJ stated: "In the last seven years since 1994, the bank (NIBJ) has paid approximately $3.9 million in security costs" for Spring Plains. The farm has been closed for 15 years. The NIBJ did not supply information indicating how much it cost to provide security for Spring Plains between 1986 and 1993. Asked about possible divestments, the NIBJ said that there had been several proposals and enquiries over the years, and negotiations had been held with some prospective investors in the now idle properties. However, problems were encountered as prospective investors were unable to fund proposed projects. Policy ignored The NIBJ also stated that some investors were interested in sections of the property, "...but Government's policy prefers divestment of the entire property en bloc..." That policy, however, was apparently ignored when only sections of The Jamaica Cotton Polyester Plant, in Old Harbour, St. Catherine, were leased. Returning residents Lloyd and Patricia Heath, leased two warehouses at the plant for the purpose of garment production, but not the entire complex. "We will be producing uniforms for the tourism sector and other sectors and we hope to bring it back to life," Mrs. Heath said last week. Another factory which ran a high security bill was the Ariguanabo processing complex in Spanish Town, St. Catherine before it was reportedly sold in 1993 for $96 million. The security bill was a reported $2.5 million a year, up to the time it was sold. However, the principals of the Hong Kong-based Golden Leader International, the reported purchasers, could not be contacted despite several attempts by The Sunday Gleaner. The Chinese Embassy in Jamaica did not respond to questions seeking assistance to finding any of the principals. The announcement of the sale was made by Minister of Foreign Affairs Dr. Paul Robertson in 1993, while in Hong Kong, as part of an Asian tour. A visit to the factory last week revealed that some preparatory work is being undertaken at the farm. Workmen were fixing the fence around the property and indications are that the lessee of Ariguanabo will be sharing the textile mill at the Jamaica Cotton Polyester Plant with the Heaths. Ariguanabo's assets consisted of 332,000 square feet of heavy induastry factory buildings, including air-conditioned factory space and offices; 435 acres of land, two deep water wells; stand-by generators and textile weaving and dyeing machinery, much of which is obsolete.
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