_{Photo: Port of Magical Belize Developer, David Gegg reappears for Portico Senate Inquiry}

Calling the Senate inquiry a charade, Gegg says securing financing for the port project has become more “problematic.”

BELMOPAN, Tues. May 21, 2024

The Senate Special Select Committee (SSSC) held its 6th hearing today for its inquiry into the genesis and aftermath of the Portico Definitive Agreement signed on October 1, 2020 by then Minister of Economic Development, Erwin Contreras, and the CEO of Portico Enterprises Limited, David Gegg.

Returning as witness was Gegg himself who, based on his first appearance, could almost be considered a tell-all witness, except for some crucial details he kept close to his chest. This time he did not hold back in imputing improper motive against Hon. Tracy Panton, the former chairperson of the Cabinet Sub-Committee on Investment (CSCI) and got into quite the verbal sparring match with the Committee Chair, Hon. Senator Janelle Chanona when, in a heightened pitch, he chose to raise what she has affirmed to be baseless accusations about bias. He ultimately described the work of the SSSC as a charade.

As it relates to Hon. Panton, Gegg alleged under oath that she tore up a letter from Boskalis sent to her and the then Prime Minister about financial backing for his Port of Magical Belize project because she favoured the Stake Bank Enterprises Port Coral project. He went further to claim, “she did everything she could to prevent our project from materializing.” Speaking with Amandala, Hon. Panton vehemently denied tearing up any letter, and reminded that the Stake Bank project actually had support from both sides of the aisle because it had followed all the guidelines and required steps to reach the stage of the signing of a Definitive Agreement. In the case of the Portico project, Hon. Panton was not satisfied that the financial arrangements were in place for the project to move forward. She affirmed that while she was chairperson of the SSSC, every project that went before the Committee was treated with the same level of importance.

Questioned by Business Senator Hon. Kevin Herrera whether Portico completed the process of getting its financing together, Gegg responded, “We need our Definitive Agreement to be passed in parliament and an act to come out of parliament for that next step to be undertaken.” He went on to assert that the Briceño Government has been delinquent in its contractual duty to eventually pass an act, because “the Definitive calls on the Government to pass an act within 12 months – and that I take to be 12 months of when we had received environmental clearance, which would have been April 9, 2021.”

Later in the hearing, when Chanona revisited the matter of the project’s financing, Gegg responded pointedly that he does not have the “confirmed source of funding for the $400 million for the project.” When Chanona pointed out that that was part of the requirements for the project to reach Definitive Agreement stage, Gegg replied, “Do we have it in the bank? No. Did we have commitments? Yes. But with all the cloud that you’ve created, then it’s become more problematic.”

As during his first appearance before the Committee, Gegg affirmed that the Definitive Agreement is valid, and likewise held that the fiscal incentives contained in the Portico Definitive Agreement were what any company investing a significant sum of money would expect. He remarked, “If this country expects to have progress, if we expect to have major FDI … whoever are the developers and the companies behind those projects expect to get the same kind of fiscal incentives, benefits, packages of benefits that we got. We didn’t invent this.”

Gegg revealed that Portico did insist on one incentive different from what the Harvest Caye developers would have received, and that was a tax stabilization clause. He affirmed, “… we can’t be operating in a vacuum when a government chooses to implement new taxes on you, after you’ve invested $400 million. It kills the project … the cruise lines are not gonna come.” He cited as an example the head tax for cruise passengers being changed under a new government.

Interestingly, Gegg today revealed that the actual signing of the DA took place at a private office in Belmopan; however, he said he could not remember whose office it was, but it was not “an official office.” He said it was “an office that I went to with Minister Contreras” after first meeting the Minister at his Government office. Gegg said Minister Contreras’ secretary was present for the signing. The Portico CEO insisted that they never tried to keep the DA hidden; and that, in fact, at a BTIA forum in Belize City in May 2022, he stated that they had a DA in a presentation he made.

Another noteworthy statement made by Gegg today is that subsequent to the change of Government in November 2020, he wrote to the new Prime Minister and all other senior ministers to “let them know that we had this agreement – that it had been signed with the conditions precedent … and that we looked forward to have further meetings of the NEAC which we hoped would grant environmental clearance that we knew was needed to get the project off the ground.” Asked about the reception by the new administration, Gegg replied, “I think it was received quite well, but I think there was that element, and I think that element still exists.” As to now taking the project to fruition, Gegg says he is open to sitting down with this Government to come up with “an alternative document that’s acceptable to both of us.” He described Prime Minister John Briceño’s tearing up of a copy of the Definitive Agreement in Parliament as merely an act of a politician pandering to a particular audience. He spoke of the Briceño Government actually drafting a new act that would give Portico the same benefits as what is already in the October 2020 DA. Gegg described the tax stabilization clause as the main issue of concern, and said this is being re-written to state that if any new taxes are implemented, then Portico would be exempted from those. Gegg says in the current DA, the clause featured the Government returning – at the end of the year – taxes it had collected from Portico. Gegg says currently, the head tax is $7 of which $3 goes to the Government and $4 to FSTV (Fort Street Tourism Village). Gegg commented that to amortize the US $400 million Portico project, “we need to get about 1.8 million cruise passengers, probably the second year of operations paying us a head tax of $25 a person – $5 of which will go to the Government.”

Gegg told the Committee that he has met with Prime Minister John Briceño, Substantive Minister Anthony Mahler and Minister of State Chris Coye to discuss cruise company support for the Portico project. He affirmed though that he had nothing to do with the draft legislation that was taken to the Cabinet last year to give effect to his Definitive Agreement.

SSSC revisits allegation of bribe request

During his last appearance before the SSSC, David Gegg testified under oath that someone in the previous UDP Government had made a request for a 7-figure campaign finance donation from Portico for environmental clearance to be awarded. Today he was asked if any members of the incoming government asked him for such a donation or if he approached them for such consideration. He responded in the negative to both questions, and said that their financial partner, Boskalis, disallowed the payment of any bribes.