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National Assembly>Parliamentary Questions>Debate No. 02 of 23.03.2004

Debate No. 02 of 23.03.2004

The Leader of the Opposition (Dr. N. Ramgoolam) (By Private Notice) asked the Prime Minister, Minister of Defence and Home Affairs whether, in regard to the lease of land to Ireland Blyth Limited (IBL) in Agalega, he will state-
(a) the total area of land involved, either directly or indirectly;
(b) when, how and why was it decided to lease part of Agalega to IBL, indicating the terms and conditions thereof;
(c) the public investments incurred for infrastructure since September 2000 and being now contemplated, giving a breakdown thereof, and
(d) the costs involved for implementing security, environmental and other policies in order to safeguard the national interest and the allocation of such costs
The Prime Minister: Mr Speaker, Sir, as the House is aware, Agalega consists of two islands, the North and South Islands situated at about 1000 km North of Mauritius and is managed by the Outer Island Development Corporation under the Act of 1982.
There is a resident Manager in Agalega, resident staff of OIDC, 57 households, 42 on North Island and 15 on South Island. Some of these families have been living in Agalega for generations.
In spite of progress having been achieved under OIDC Management, Agalega had been left with a number of problems for a number of years. Actions have been taken to address those problems even before the IBL Hotel project surfaced.
The main problems were -
(a) the bad condition of the airstrip which only allows for the Dornier aircraft to land and take off in Agalega;
(b) the dangerous and difficult conditions for embarkation and disembarkation of passengers and goods at St James anchorage;
(c) the bad quality of water and intermittent supply of electricity, and
(d) poor health and education facilities.
On 11 January 2004 I led a delegation to Agalega comprising my colleagues, the Minister of Social Security and National Solidarity and Senior Citizens Welfare and Reform Institutions and the Minister of Training, Skills Development, Productivity and External Communications. We visited both islands and had meetings with the local residents.
As a result of that visit, a number of actions are being taken. These are as follows -
(i) the setting of an Agalega Island Council;
(ii) the possibility of leasing to the residents State land for construction of houses and agricultural purposes;
(iii) the services of a resident doctor;
(iv) the reception of, at least, one MBC channel on both North and South Islands;
(v) provision of additional decoders to enable the simultaneous viewing of different satellite channels;

(vi) elaboration of a Master Plan for the electrification of the island and development of a water reticulation network;
(vii) the consultancy for port development, and
(viii) upgrading of the airstrip.
As far as the IBL Project is concerned, Mr Speaker, it was submitted in June 2001 through the OIDC. The project concerns the construction of some 15 chalets with all amenities, including a fishing centre, a boat house and a game room. The hotel would employ some 40 persons, 60% of whom would be Agaleans, residents of Agalega. Besides, the hotel complex would also include a desalination plant and a sewerage treatment plant.
Following discussions, which a Technical Committee under the chairmanship of the Ministry of Tourism had with the hotel promoters, it was recommended that -
(i) 25 arpents of State land would be earmarked for the hotel development, which is the normal extent of land put at the disposal of hotel promoters on main land Mauritius;
(ii) 87 arpents of State land for landscaping purposes only. The whole site of 87 arpents landscaping lease would be accessible to the public as well as all existing roads, together with a 2 m reserve on both sides, which would be excluded from both leases;
The main advantages of the project would be -
(i) regular air links, employment and handicraft development especially as any agricultural development is constrained by restriction on the use of pesticides and insecticides so as not to pollute the underground water table;
(ii) provision of social, sport and leisure facilities as is the case in Mauritius whenever there is hotel development.
The total land extent of the two islands is 6200 arpents.
On 19 December 2003, Government, that is, Cabinet, agreed to issue a conditional Letter of Intent in favour of Ireland Blyth Ltd. (IBL) or any of its fully owned subsidiary for the lease of 25 arpents of State land for the development of the Agalega Island Resort Project and 87 arpents of land for landscaping purposes only. As stated above the 87 arpents would remain open to the public and would also allow OIDC to continue the exploitation of the coconut plantation found thereon.
IBL has indicated that the whole project is subject to two sine qua non conditions -
(a) access being made available through the enlargement of existing passes on both sides of the Island so as to allow fishing boats to operate whatever the climatic conditions, and
(b) It would have to purchase a small plane. The operation thereof would not be sustainable if the plane did not operate to Rodrigues, Reunion Island, Madagascar, Comoro Islands and other countries in our sub region.
In the first case, Mr Speaker, the whole project will, of course, be subject to a full Environment Impact Assessment (EIA), but I foresee no problem.
Mr Speaker: Order, please!
The Prime Minister: As far as air transport is concerned, Mr Speaker, it is much more complex as regular flights to destination other than Rodrigues seem out of question and would entail the re-negotiation of bilateral air services agreements between Mauritius and these countries and Air Mauritius and other airlines. Non regular flights to those destinations are being considered.
As regards part (c) of the question, I am informed by the OIDC that a sum of about of Rs21 m. has been spent in the construction of a hospital, a primary school for staff quarters, one warehouse, one bakery, one duplex, one entrepreneur centre, one tourist shed, one post office savings bank. However, no specific expenditure has been made in relation to the IBL project.
As far as part (d) of the question is concerned, should the IBL project, go ahead, all measures required to safeguard the national interest would be implemented as is the case in regard to any hotel development project in Mauritius and in Rodrigues.
Mr Speaker, Sir, let me conclude by saying that I do hope that the hotel project goes ahead because those are not many potential projects that can be envisaged for Agalega. The hotel project would, as I have explained, create a win-win situation for the local population, the OIDC and the promoter.
Dr. Ramgoolam: Mr Speaker, Sir, first of all, the hon. Prime Minister said that 25 acres have been earmarked and he mentioned 15 chalets. Does not that make it a huge amount of land per chalet, approximately 1.7 acres of land per chalet? Does he find this normal?
The Prime Minister: It is just a start. I am sure the hon. Leader of the Opposition is aware that 25 arpents is the normal extent of land put at the disposal of hotel developers here in Mauritius. As I pointed out for this project to be viable - it is a small island, it is not very wide - the promoter argues that they need access to the sea on both sides and passes on both sides. In reality, the only attraction, apart from the natural beauty of the place, would be fishing. So, they would wish to have access to both sides of the island and through passes to the open seas. Therefore, the extent that they requested for goes to both sides of the island. But allowance is made for the already existing roads which will remain public and for 2 m reserve on both sides which I made clear.
If it was successful to start with that number of chalets I have no doubt that with 25 arpents available the promoter would develop further subject to all the conditions being fulfilled.
Dr. Ramgoolam: So, would the prime Minister say that it is a condition of the lease that they can extend the number of chalets?
The Prime Minister: I repeat, when they presented it, they said that they would start with 15 chalets, but any further development would be subject with the same conditions. There is no question of allowing for overcrowding especially in Agalega, but even in Mauritius we do not allow for that. The conditions of leases and permits given by the Board of Investment, by tourism and so on provides for adequate protection against overcrowding, especially in Agalega.
Dr. Ramgoolam: Does the hon. Prime Minister not agree that therefore it would be more judicious to give them a small amount of land and as they decide, we can examine what is the situation?
The Prime Minister: Mr Speaker, I can tell you, I personally and Government is keener than IBL than this project goes ahead. I have been to Agalega, I have come back from St. Brandon and especially in Agalega, the potential for development and for bringing in fresh air and opening to the outside world - regular flights between the mainland and Agalega - is very limited. So, 25 arpents is what we provide to any hotel promoter here. They have requested for 25 arpents, it is absolutely reasonable. I personally feel very sorry that there is the big risk that this project does not go ahead and I can tell you for the local residents and so on, it would be a big deception. Let us take, for example, water. It is clear that before we provide pure water to the local residents, it will take a lot of doings; it will cost a lot of money. If we have to do it, we will do it. But the hotel will come with a desalination plan and will provide pure water to the resident population. There would be a lot of fallouts; the local residents are aware of that. It would be a big deception if that project does not go ahead.
Dr. Ramgoolam: Can the hon. Prime Minister confirm whether that original project did not include a less amount of land, between 10 and 17 acres?
The Prime Minister: I agree that the original proposal was exaggerated. They had requested for 700 arpents of State land; and indeed, we found this to be unreasonable, the hotel project itself was brought down for 25 arpents. But landscaping part of it is common in Mauritius. When I have been in Agalega, I did say that OIDC is doing good work, but I must say that I was not impressed at all by the state of coconut plantations. I would not describe them as an eyesore, but they certainly need landscaping. So, the idea is for the promoter, at his cost, to landscape the 87 arpents and to make a really nicely landscape providing for the OIDC to continue with its coconut plantations and that landscape which would be a nice piece of environment would be open at all time to members of the public and visiting tourists of course, but to the local residents and for anybody from Mauritius. I am sure the hon. Leader of the Opposition realises that there is no hidden agenda. Everything has been done in full transparency and I repeat, I and Government and the local residents would be really sorry if that project does not go through because of practical considerations like especially that air link. There is no hidden agenda. We want a win-win situation. It is a golden opportunity for Agalega. I do not see many other such opportunities presenting themselves in Agalega, Mr Speaker, Sir.
Dr. Ramgoolam: Can the hon. Prime Minister say whether IBL made an application through the Board of Investment for the project?
The Prime Minister: I am sure it must have. But from what I said they went through tourism. The normal practice is for any promoter to go through both, but the one-stop shop is the Board of Investment. So, if they went to tourism, they were referred to the Board of Investment. We see to it that the Board of Investment is the one-stop-shop through which all promoters go.
Dr. Ramgoolam: Why is it that Government did not consider public auction in that case since we are talking about an island quite far from Mauritius? Why did it not consider that instead of giving a lease to IBL?
The Prime Minister: Mr Speaker, let's be fair! Agalega has been there for centuries. It is open to any visitor. We were casse nou la tête to find what projects can go on there. Those who have been there know that it is a depressed mood. We are breathing fresh air into that, including the setting up of an Agalega Island Council for the local residents to be heard, to have a voice. The IBL people are very enterprising. We have said, for example, that we want to make of Mauritius a sea-food hub. The first company to come forward with a huge project which is going to go up within weeks is IBL. It is a good thing that you have certain groups that are dynamic, that come with projects. They are a bit specialised in fishing enterprises - not fishy enterprises which I leave to others like the hon. Member. They went there at their own costs. They worked out a project and came forward. If there are others or if the Leader of the Opposition wants to come forward with a project, it will be considered.
We are not in favour …
We know that the hon. Leader of the Opposition had friends involved in Albion and other projects! So what! I am not being nasty! I am just saying that the total extent of the two islands is 6200 arpents. There is plenty of land available for other projects. But I repeat that those projects will have to be environment friendly. One of the main problems is that the water underground can be polluted very easily. Secondly, if you want to set up an agricultural project, for example, you will not be able to do so. One of the conditions will be that you cannot tap the underground water, because if you do so, seawater comes in and the water becomes undrinkable. There are plenty of constraints. I have said that there are 6200 arpents. If there are other projects that are environmentally sustainable, they are welcome.
Mr Duval: Can I ask the Prime Minister whether IBL operates currently any hotel in Mauritius as a basis for applying for the operation of a hotel in Agalega?
The Prime Minister: I do not think IBL operates hotels itself. It is a shareholder in companies that operate hotels. Should the project go ahead, I have no doubt that IBL would turn for management purposes to the best management professionals available.
Mr Duval: Can I ask whether the Prime Minister is aware that IBL had two small hotels in Mauritius, but they were not successful and that they were sold off to some other persons during the last year or so? Therefore, with that in mind, what guarantee does he give to the population that the costs involved in setting up a new hotel to the public purse will be fully justified by the operation of a good hotel there?
The Prime Minister: I have made it clear that there are no costs to the public purse. I have made that clear. The hon. Member was not listening. I repeat that there are no costs to the public purse. It is the same situation as exists on mainland Mauritius or in Rodrigues. There is nothing different in that case. I am not aware whether IBL had two small hotels.
Mr Speaker: Order!
The Prime Minister: It is their money. They come with their money. They fulfilled all the conditions that are put. I repeat, Mr Speaker, Sir, that the more we meet with problems and the more IBL feels like dropping the project. I would be very déçu and so would be Government and the local residents if, finally, that is the case. It is our intention to do our best for this project to go ahead with all required conditions fulfilled.
Mr Duval: The Prime Minister will agree that it is the job of the Board of Investment to check the track record of any potential investor and to check their credentials before approving, if indeed they have approved, or recommending, if they have recommended, this particular project.
The Prime Minister: Of course, they have done that, Mr Speaker! One additional consideration that everybody should be aware of is that IBL has a lot of experience in owning and managing …
Mr Speaker: Hon. Duval, you have asked a question. Please listen to the reply.
You have asked a question. The Prime Minister is replying to the question …
I am not concerned whether the answer is wrong or right. So long as the Prime Minister is giving the answer, I do not know whether it is right or wrong. But when a Minister or a Member is on his feet, Members should not interrupt.
The Prime Minister: As I was saying, Mr Speaker, Sir, IBL specifically - I can contradict the hon. Member …
Mr Speaker: Hon. Duval, be careful! Be careful about your declaration, please!
The Prime Minister: Mr Speaker, as I said, IBL has specific knowledge in the management of an installation on Desroches Island in Seychelles which in very many ways resembles the project to be set up on Agalega. They have used their experience and their success story on Desroches Island to devise the project and to make the proposals which they have made. I certainly hope, Mr Speaker, that the project on Agalega does go ahead and is as successful as the project on Desroches Island.
Mr Dulloo: Mr Speaker, Sir, we have just heard that the Letter of Intent was issued on the eve of the by-election, that is, on 18 December. The hon. Prime Minister has invited us to come forward if we have other projects. May I ask him whether IBL has been given exclusive status? Apart from the various fiscal incentives and duty-free even for the airplane, can he say whether they have been given exclusive status, that no tourist activities will be allowed by any other operators on the island by virtue of the Letter of Intent and the agreement to be signed with IBL?
The Prime Minister: Mr Speaker, I am tabling the Letter of Intent.
Dr. Boolell: Can I ask the Prime Minister whether IBL will have exclusive fishing rights in that area?
The Prime Minister: Fishing rights, no. But to start a project like that with the investment required in planes and so on, they had asked for exclusivity for the hotel project over a limited period of time. But I shall table both the Letter of Intent and the representations made by IBL. But not fishing rights!
Dr. Boolell: Can the Prime Minister give the guarantee to the House that IBL would not have fishing rights and whether there will be an assessment of the fishing stock and whether others could apply to have rights for fishing in that area?
The Prime Minister: It is not really fishing rights. Their point - I am quoting from memory - was for them to invest in a risky venture. They would need a number of years to recoup their expenditure. If they are the only ones to be around operating a hotel complex and a fishing complex it is not a question of them having exclusive rights, but, of course, they would be the only ones to be in a position to offer fishing facilities to tourists.
Dr. Boolell: Mr Speaker, Sir, at a time when we are talking about democratisation of the economy, what the Government is doing is that it is giving lock, stock and barrel to one particular company - exclusive hotel rights, exclusive fishing rights. This is what is happening, Mr Speaker, Sir! This is the policy of this Government. I should like to know what is being done by this Government to democratise the economy. They have started with Mauritius, now Agalega, then Rodrigues and all over the place!
The Prime Minister: A lot of Parliamentary rubbish as usual, Mr Speaker, Sir!
Mr Speaker: Order!
The Prime Minister: A lot of Parliamentary rubbish and useless hot air. I repeat, Mr Speaker, Sir, that the risk is for the IBL not to go ahead with the project. Instead of them having obtained this or that condition, the very real risk, unfortunately, is for the hotel project not to go ahead. It is IBL's money, it is their project; it will be their decision. As a facilitator, we shall do all we can for that project to go ahead, all conditions fulfilled. I repeat that it will be very sad for Agalega and, specially, its local residents if, at the end of the day, the project is dropped by IBL.
Mr Dulloo: The Prime Minister has not answered the second part of question (c), that is, whether now the investment being contemplated would be over Rs 1 billion for the airstrip, the new harbour, electricity, telephone, water, and these investments would be required to be made by Government, in order to make the IBL project viable and profitable.
The Prime Minister: No, Mr Speaker, Sir. I said that not one cent has been spent on the IBL project and no public funds will be spent, should the project go ahead. They will spend their money for electricity, water, all such infrastructure. As I said, additionally, they would supply same to the local residents. The situation is perfectly clear. I think the hon. Leader of the Opposition will realise that he has been fed with all sorts of wrong information. This is a genuine project. It is difficult when you deal with mad man like you know who; it is not surprising that he has been fed with wrong …
Mr Speaker: Order, please!
The Prime Minister: I am not talking of him! I am talking of madder than him! Mr Speaker, Sir, I repeat that right now, IBL feels like pulling out. We, as a facilitator, say that it would be a sad day for Agalega and its residents, Sir.
Dr. Ramgoolam: The point that we are trying to make is that it seems that preferential treatment is being given to IBL. I will say why and I will ask the Prime Minister to respond to that. First of all, nobody was aware that there was a possibility of a project there and, then, suddenly, IBL comes up with the project. Did not the Prime Minister chair the first committee which looked at the project for IBL?
The Prime Minister: There is absolutely no preferential treatment being meted out to anybody. Mr Speaker, Sir, this is what entrepreneurship is about! Promoters from all quarters of the economy, including foreign promoters, are there to look for business opportunities. This is what entrepreneurship is all about! I must say that, if the people of IBL did not have a special interest for fishing activities and so on, they would certainly not have spent money. Already millions have been spent on consultancy, pre-feasibility and feasibility studies, etc. There is absolutely no preferential treatment to whoever, Mr Speaker, Sir, and I repeat that the danger, right now, is that IBL drops the project. We will be as helpful as we can, not at public expense, and all environmental and other conditions fulfilled.
Dr. Chady: Mr Speaker, Sir, the hon. Prime Minister must have the figures of the feasibility study that has been submitted by IBL. Could he give us the cost?
The Prime Minister: Yes, I can give a copy of the feasibility study if the Member wants. There is no problem.
Dr. Chady: I would like also to know the amount to be drawn from the hotel project, the fishing part of it…
The Prime Minister: I have no problem. I will lay a copy of the feasibility study. I don't know if the hon. Member has business interest in mind, but we have nothing to hide. We are going to lay a copy of the feasibility study.
Mr Speaker: Order, please!
Mr Dulloo: The Prime Minister is imputing motives on a Member as to whether he has got a business interest.
Mr Speaker: Order! Can you take your seat? Order, please! The Member did not object! So, where is the question of imputing motives?
Dr. Ramgoolam: Again, IBL gets the cake and eats it at the same time! The Prime Minister says that no public money is going to be involved. But he confirms that an airstrip is going to be enlarged, so that IBL can put this airplane of 19 seats. That is what is going to happen. The port is going to be developed, the fishing station is going to be given, everything is going to be given to IBL. And the Prime Minister says there is no hidden agenda! There is a hidden agenda! IBL is being given the island, which occupies a geo-strategic position; and they are going to get an island! That is what the problem is.
The Prime Minister: It's all parliamentary rubbish again, Mr Speaker, Sir. The airstrip was redone by the DWC some time back, and so badly done, as I said, that no aircraft except Dornier and Transal – we don't have any Transal, the French have –can land and take off there. So, the decision to redo the airstrip was already taken before the IBL project came forward. This is the simple truth, just as the project of making safe the conditions in which goods and passengers land and leave Agalega had already been taken before the IBL project surfaced. As far as the fish station is concerned, it is part of the hotel project and will be at the expense of IBL. Mr Speaker, Sir, I think the hon. Leader of the Opposition should be fair. When you have been misled, when you have been fed with all sorts of mad information by a mad man outside, you should acknowledge that once more, you have been misled, you have been taken for a ride all the way to Agalega and back!
Mr Speaker: Time is up. It is already more than 30 minutes.
Order! PQ Nos. B/53 & B/55 will be replied by the hon. Minister of Foreign Affairs at the end of questions, time permitting of course.
(PQ NO. B/53 – See after PQ NO. B/107)