Guyana, Suriname ‘business unit’ to address critical shortfalls

THE ability of the local private sector to invest or service a particular sector effectively has been hindered by a lack of capacity, but Chairman of the Private Sector Commission (PSC), Nicholas Boyer, believes that the potential joint Business Facilitation Unit, proposed by Guyana and Suriname, will aid in addressing critical shortfalls.

Guyana, a developing oil and gas nation, has been mainly centered on primary production (extractive sector), but promises from the government to reduce the cost of electricity by at least 50 per cent and steps to create a business-friendly environment have stimulated the interest of business people, who are looking to invest in value-added production and other lucrative areas.
But, since the capacity to make those steps might not be available immediately, the proposed business facilitation unit will serve as a stepping stone for both parties, as there will be mutually beneficial synergies and projects.

There has been no formal meeting of the unit as yet, but Boyer told the Guyana Chronicle that the local private sector has been asked to field personnel for the management committee of the unit.
The idea to establish such as a unit was birthed last week when President Irfaan Ali and other high-level officials from Guyana visited Suriname on November 23, for a three-day trip, to join in that country’s Independence Day celebrations and discuss matters of mutual importance.

President Ali had said that the unit, once operational, will manage and facilitate collaboration among national private sector bodies. The unit is tasked with promoting investment and business opportunities in agriculture, tourism, fisheries, oil and gas, and other sectors.
“Yes, we are small countries, small population, small human resource base, small investment portfolio, but if we bring synergy to what we do, then we can have greater benefits, greater local content, and more resources flowing into the local economy,” said President Ali.

When asked about the potential benefits of such a unit, Boyer said: “There will be co-development…we have a certain amount of development that is needed to accommodate advancements in oil and related industries…so, there will be joint development.”

He anticipates widespread development, which is critical because there is a “lack of capacity” in almost every area.
A pertinent, topic which both countries will have a deep interest in, is access to concessionary financing (low interest financing), since such financing will help in the early stages of new, mega projects, which are anticipated to accompany the nascent oil and gas sector.

Stakeholders will also be keen on examining bottlenecks to development and consulting authorities to have those reduced or removed. Guyana’s new status as an oil producer and oil exporter has generated unprecedented interest by companies across the world, but turning that interest into tangible investments hinges on the reduction in, or simplification of, laborious processes and ‘red tape’ which, in most cases, would discourage investors.

The World Bank’s Ease of Doing-Business 2020 report showed that Guyana slipped two spaces in its rankings for 2019, relative to 2014. Among the problems identified in the report were the processing of construction permits, registration of property and the payment of taxes.
With renewed and increased interest in the local economy, Guyana has an opportunity to assess its systems and create processes which are business-friendly and encouraging for not just international investors, but locals as well.

The new government has already committed to building a ‘modern’ Guyana with world-class infrastructure that improves connectivity and unlocks the vast potential of the economy.
Senior Minister with responsibility for Finance, Dr. Ashni Singh, has said that the current hurdle to Guyana’s economic boom is the novel coronavirus (COVID-19) pandemic, which has presented direct and indirect challenges to economies around the world.

“Government has since taken rapid steps to protect the people and deliver much-needed assistance, while ensuring that the economy neither grinds to a halt nor suffers irreversible damages,” said Dr. Singh, in his address, during the American Chamber of Commerce’s (AMCHAM’s) virtual Annual General Meeting (AGM) recently.
Looking beyond the immediate challenges, created by the pandemic, the Finance Minister said the prospects remain “historically bright” and the long-awaited transformation is on the verge of unfolding.

“Becoming an oil producer presents us with an opportunity and the means to improve the well-being of the Guyanese people and realise the long-standing aspirations of the country,” said Dr. Singh.

The government has assured that an enabling environment for business development will be created through a seven-point plan which includes preserving the rule of law and democracy; improving the ease of doing business; enhancing national competitiveness; facilitating trade and investment; and supporting small businesses.