PHILIPSBURG: --- Minister of VSA Richinel Brug confirmed to SMN News on Wednesday that the Council of Ministers press briefing that there has been an increase in cost to construct the New General Hospital on St. Maarten. However, the Minister said that he could not provide any details on the increased cost because he was informed by St. Maarten Medical Center (SMMC) that there is a non-disclosure agreement between SMMC and the contractor FINSO.
Brug said he was informed that the cost has increased due to several factors, such as the redesigning of the New General Hospital, Indexation, the effects of COVID-19, and the War in Ukraine.
The Design and Build and Maintain (DBM) contract to construct the New General Hospital was signed on September 16th, 2016, by former Minister of VSA Emil Lee, USZV, and St. Maarten Medical Center.
Back then, the cost of construction of the New General Hospital was USD 120M; this amount was divided as follows:
• USD 25M, a grant from the World Bank.
• USD 85.7M from a consortium of lenders
• USD 9.3m from SMMC.
The tripartite had to increase the cost of the New General Hospital by USD 1M when the USZV had to compensate VAMED based on a court verdict.
Despite the increase and the slowing down of construction, the government has not indicated if the penalty for default in construction was applied at any time.
While the current Minister of VSA could not provide details on the increased cost and redesign SMN News, it was learned that the price has risen by over USD 40M. However, no information has been provided on how SMMC or the government of St. Maarten will finance the extra $40M that the loan consortium produced.
SMN News further learned that FINSO wanted an increase of $USD 80M, but that amount was decreased based on negotiations with the former government of St. Maarten. The agreement states that the contractor will no longer demolish the old SMMC building, but instead, SMMC will hire local contractors to demolish the current structure and the building of the parking lots.
