The Government of Guyana is pursuing €30 million in performance bonds after terminating contracts for two major hospital projects awarded to VAMED Engineering GmbH, Attorney General Anil Nandlall said.
Nandlall said the contracts for the New Amsterdam Hospital and the Paediatric and Maternal Hospital at Ogle were terminated after what he described as serious breaches and excessive delays by the contractor.
According to the Attorney General, government made repeated efforts to have the contractor complete the works and attempted to resolve the disputes amicably, but was eventually forced to terminate both contracts on July 23, 2026.
“At the date of termination, the works under the contracts were way behind where they were supposed to be by that time, and the government had no choice but to terminate the contract,” Nandlall said.
He said the termination triggered several legal steps, including immediate action to secure both hospital sites and the materials located there. Nandlall said government also moved to call in the performance bonds attached to the two contracts.
Both contracts, he said, were secured by performance bonds valued at €15 million each. The bonds were issued through the Bank of Austria, and the government has taken steps to recover the outstanding sums.
“The government has taken the relevant steps to call in the outstanding sums in relation to each bond,” Nandlall said.
The Attorney General said the contracts contain arbitration clauses requiring disputes between the parties to be resolved before the International Chamber of Commerce. He said Guyana has already initiated arbitration proceedings before the ICC, and those proceedings will now take their course.
Nandlall also disclosed that VAMED filed court proceedings in Guyana, seeking to sue for breach of contract and to obtain injunctions restraining the government from invoking the bonds and taking control of the sites.
However, he said the High Court dismissed those proceedings and referred the matter to arbitration after the State raised objections.
Despite that, Nandlall said the government has appealed orders made by the hearing judge restraining both parties from taking control of the sites and materials until the arbitration tribunal is appointed. He argued that those orders were wrongly made.
“The Guyanese court has no business litigating that matter. It must go to the arbitration tribunal,” Nandlall said, pointing to the arbitration clause agreed by the parties.
He said both arbitrations will be heard in Guyana, with the country serving as the seat of arbitration. Nandlall described this as an important development in Guyana’s effort to become an arbitration destination.
