Following the much-publicised spat between Michael (Lord) Ashcroft and British High Commissioner in Belize Tim David, in which Ashcroft called David a pompous liar (he later apologised), the millionaire businessman and Tory party saviour is in trouble again with the Foreign Office.
Belize Telecommunications Ltd, the monopoly telecoms provider in the ex-colony, in which Lord Ashcroft has a majority interest via tax-privileged holding company Carlisle Holdings, has threatened to cut off the British High Commission's phones if it doesn't stop using callback services to phone London instead of paying normal rates to the phone operator.
'Normal' they may be, in the statelet, but Belize Telecommunications is under constant fire from local liberalisers who say it is extracting monopoly rents from its customers, and in particular that it is holding back the development of the Internet in Belize. E-commerce (particularly betting services) is seen as a white hope for the economy by the cash-strapped government, and it does seem strange that no moves have been made towards telecommunications liberalisation.
The Foreign Office responded angrily in London yesterday, warning Belize Telecommunications Ltd that the threat was unjustified and liable to be in breach of the Vienna convention on diplomatic rights. The high commission took legal advice in 1999 to make sure the use of callback was lawful. British diplomats overseas are urged by the Foreign Office to use the callback facility to cut Foreign Office phone bills and save taxpayers' money.
The row at Christmas is supposed to have been provoked by the British Government's decision to continue a suspension of support programmes for Belize while KPMG, which had been conducting a study of offshore financial services in Belize, extended its remit to include Carlisle Holdings. This in itself can be seen as a response to political pressure exerted in London against Lord Ashcroft by Labour party activists, and predictably infuriated the noble Lord.
The KPMG report will be ready shortly, so expect more fireworks!
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