The Vanuatu government says it’s seeking advice as to whether a Singapore-based company which lost a deal to develop an international airport can claim compensation.

The Greenfield airport plan, introduced by the recently removed Prime Minister, Moana Carcasses, was met with strong opposition from MPs over the unclear terms of the US$350 million contract.

An ad hoc parliament committee decided the plan’s risks outweighed the benefits, and the project was canned last week.

The Prime Minister, Joe Natuman, told Radio New Zealand the company – Vanuatu Trade Development Limited – is claiming US$31 million in losses, but the government will contest that figure.

“The agreement had a clause that upon one year of signing, within 12 months, its party will complete what they call condition precedents. Both the Singaporean company and the Vanuatu government have failed to meet those condition precedents.

“The 12 month period lapsed on July 27 so parliament’s ad hoc committee recommended that we leave things as it is and let it lapse, so that’s what we did last week in parliament.”

The company, Vanuatu Trade Development Limited has suggested it will seek compensation.

“They have suggested that they are. They say if this agreement is terminated or has lapsed, they are claiming certain fees. Maybe around US$31 million .

“We will be looking at costings and we are asking the taskforce which was responsible for advising government on this particular agreement that they will work with that Singaporean company and they will go through their costs, itemise every cost, decide whether or not to gather those costs.

“There are some costs, but not the amount they are claiming. We will be contesting those,” Natuman said.

It has been reported that compensation can’t be provided to the company anyway because they are not a registered company in Vanuatu.

“The Vanuatu Investment Board, the VIB, is saying that this company was never registered with them.

And would that mean they can’t claim losses, RNZI asked?

“It’s really up to the courts and the legal system to decide. But that’s one aspect. This company has not been registered under the Foreign Investment Board. I don’t know. But the people from VIB say the company was not registered to them. Usually foreign governments that come here to do business are registered.

Vanuatu is now looking at renovating the existing Bauerfield Airport instead of going through with the Singapore deal.

“Our immediate concern now is to try to prepare Bauerfield up to the level that is ICAO standard, because if it is blacklisted then we will be in a lot of trouble without tourism. So I’m trying to task another committee to specifically deal with Bauerfield.

“The Singaporean company after they signed the agreement last year was supposed to resurface and refurbish the existing airport, but they haven’t done it. Maybe they have done some feasibility studies but nothing yet on the ground.

“So this agreement has now expired, so we will have to try to look and get another group or another company to fix our current airport.

“The long-term plan is to look at the new airport in the future, but right now we have to fix the Bauerfield Airport, this is urgent.”

The Vanuatu Chamber of Commerce says it supports the government’s decision to scrap the Greenfield airport plan.

The Chamber’s tourism councillor, Bryan Death, said the new airport would not have brought more tourists to the country for another eight years.

He said that means the existing Bauerfield Airport would have had to be renovated anyway.

“The timing wasn’t good and the agreement didn’t do much for Vanuatu as such and could have been quite embarrassing for the government down the track in terms of cost.

“We need to grow tourism with our existing facility which is quite possible.

“There’s quite a lot of potential growth in our tourist arrivals without a new international airport.”