CJ Politics

Taiwan-Grenada Loan Dispute Threatens Payments to Airports Authority

By: Caribbean Journal Staff - February 13, 2012

Above: Grenada (CJ Photo)

By the Caribbean Journal staff

The Grenadian Ministry of Tourism and Civil Aviation is working to find a solution to current financial issues at the Grenada Airports Authority relating to a lawsuit by the Taiwanese government.

Grenada, which formerly had diplomatic relationship with Taiwan, broke off those ties in favour of a link with China in 2005.

Taiwan, however, had made a series of concessionary loan agreements, and demanded payment.

Taiwan’s EXIM Bank filed suit in the United States and won a summary judgment in 2007 for approximately $28 million. The judgment included all money owing to the Grenadian government and its agencies to pay against the loan, and a request was recently made to airlines flying the Grenada route to pay this money to the Taiwanese.

That money represented loans taken out over a 10-year period.

According to the government, an escrow account has been established, and air carriers such s Virgin Airlines, British Airways and Delta Airlines have begun depositing money owed to the Airports Authority in this account.

The government said it had placed the Airports Authority in a “very difficult position.”

“Mr Rodney George, Chairman of the Grenada Airports Authority, has alerted us in the government about the situation facing our airport,” said Tourism and Civil Aviation Minister Peter David. “I am doing all that I can from a civil aviation point of view. The Ministry of Finance is doing its part from the debt-financing angle and the Attorney General’s Chambers is working towards a legal solution.”

The Tourism Ministry said it would continue to work with other departments to “ensure this matter is resolved quickly and does not severely disrupt airport operations, which would directly impact our economy at a time when we can least afford it.”

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