I thank the American Chamber of Commerce- Guyana for their kind invitation extended to me to participate in this, its 2nd Annual General Meeting (AGM). Annual General Meetings are an obligatory requirement of membership organizations. They allow you, the members, to assess the stewardship of your Executive, to review the organization’s activities over the preceding year and to learn of its plans for the coming year.
At the political level we also engage in introspection and advance planning. Today, I propose to be forward-looking about the prospects for Guyana’s business development.
Businesses are the lifeline of any economy. In order for economic wealth to be distributed, and to be distributed more equitably, that wealth first has to be created. You cannot distribute what you do not have. If the economic pie does not grow, then there will be less to distribute. The larger the economic pie the more there will be to share; if the economy contracts and business activity shrinks, the less there will be to distribute.
My government unapologetically and unambiguously supports business development. My administration will not be neglectful or indifferent towards business. We will ensure an robust business environment in order to sustainably generate wealth and create jobs.
Today I wish to outline a 7-point programme for business development. This programme is not exhaustive, it is predicated on creating a more conducive environment for business development by:
- strengthening democracy;
- ensuring greater ease-of-doing business;
- improving national competitiveness;
- facilitating market access;
- supporting small business development;
- protecting consumers; and
- expanding and modernizing business infrastructure and ensuring that businesses operate in a safe environment.
The first element of the programme involves strengthening the country’s democratic framework. Democracy is vitally important to national development and to providing comfort to investors that there is respect for the rule of law and, thus, their investments would not be subject to capricious actions. The absence of democracy creates unfair playing fields, ‘clientelism’, predatory business practices and corruption. On the other hand, a strong relationship exists between democratic institutions and economic freedom. The latter fosters legitimate business activity and promotes investor confidence. We are therefore keen to ensure that democracy is protected so that our businesses can thrive in an environment of economic freedom.
AmCham-Guyana has been in the forefront in supporting of constitutional rule and democracy. Following the landmark judgments by Guyana’s High Court and the Caribbean Court of Justice relating to the no-confidence motion, AmCham took the moral high ground by urging respect for these rulings. AmCham was not prepared to only shout from the side lines; it assumed the role of a democratic watchdog by becoming an Observer for the General and Regional Elections of 2nd March 2020.
We are living today in more optimistic times because democracy triumphed. We must continue to protect democracy and constitutional rule so as to guarantee a more business-friendly environment.
Ease of doing business
The second element, of my government’s business development programme, aims at improving the ease of doing business. The PPPC administrations have traditionally progressively improved the ease of doing business. The World Bank’s Ease of Doing-Business 2020 report however notes that Guyana slipped two slots in its rankings for 2019, relative to 2014. Among the problems areas identified were the processing of construction permits, registration of property and the payment of taxes.
The Ministry of Tourism, Industry and Commerce will spearhead policies to reverse this slippage and to allow the country to climb the rankings. Given that many of the issues concerned with the ‘ease of doing business’ encompass elements outside of its purview, the Ministry of Tourism, Industry and Commerce will collaborate with other Ministries and agencies to streamline procedures which impact on business development. These include procedures relating to business start-ups, the payment of taxes, obtaining electricity and approving construction permits.
Trade facilitation is another area which will receive the Ministry’s attention. Delays in customs clearance increase costs and reduce export competitiveness. As such, we will be implementing an Electronic Single Windowfor Tradewhich will reduce time and costs, simplify trade procedures and eliminate duplication and redundancy. Instead of an importer, for example, having to visit six agencies for permits and approvals, all the documentation will be submitted at a single point, and this will then be shared with the various agencies.
We will also be seeking to ensure that investors’ applications and requests are facilitated more promptly. As part of our agenda to improve ease-of-doing business, the Guyana Office for Investment (GOINVEST) is being restructured as a vehicle to attract and facilitate investment and export promotion.
Businesses need a safe and secure environment. We recognize the need to improve public security. We have begun to strengthen the capability of the Guyana Police Force, to combat crime improving the capacity of the Guyana Revenue Authority to arrest contraband smuggling. My Government will work with the private sector in developing an anti-crime plan aimed to better protecting the business community and citizens.
The third element of our programme to improve the business climate involves enhancing the competitiveness of local businesses.
Through the National Quality Infrastructure (NQI) project the Government will create a catalyst for competitiveness and increased global market access. The NQI aims to improve the quality of local products and services, thereby stimulating greater demand. The implementation of the NQI will bolster the ability of local businesses to engage in global trade and increase their competitiveness therein.
The liberalization of the telecommunication sector has boosted business competitiveness. Already, the cost of overseas telephone calls and bandwidth have begun to be reduced. With increased investment and competition in the sector we anticipate greater competitive gains.
The Ministry of Tourism Industry and Commerce is currently engaging key stakeholders on the promulgation of an Electronic Transactions and Communications Bill. The ‘Bill’ is expected to provide the requisite facilitation and regulation of secure electronic communications and transaction and for their legal recognition.
These efforts are in addition to the cost-cutting and competiveness-boosting measures announced in the 2020 Budget. Businesses will benefit from the removal and reduction of several taxes and fees such as the elimination of VAT on water and electricity, exports, building and construction materials and hinterland travel. These measures effectively put more money back into all businesses – large, medium or small allowing them to reinvest, grow and create additional employment, while simultaneously attracting new companies to our shores.
Additionally, we will establish a National Entrepreneurship and Innovation Council. This body will radically reform the culture of entrepreneurship and encourage the emergence of new entrepreneurs while supporting existing ones.
Facilitating Market Access.
The fourth element of our programme for ensuring a more conducive business climate relates to our trade policy. Trade is an essential vehicle for energizing and expanding an economy. Given the size and structure of Guyana’s economy, there is an increased reliance on exports. This carries both attendant risks and opportunities.
In recognition of the importance of trade in promoting economic growth and building economic resilience, we are revising, through a consultative process, the draft National Trade Strategy. The principal objective of our proposed trade strategy is to support competitiveness and diversification through the dismantling of barriers to competition (both domestic and foreign) and to secure Guyana’s best interests in trade agreements with external countries and groupings.
We will continue to work to unlock new markets for our traditional exports, including rice, sugar, bauxite and timber. At the same time, we will seek opportunities for new products, services and industries.
Supporting small businesses:
The fifth element of our programme for enhancing the business environment concerns the small business sector. I am pleased to note that the membership of AmCham-Guyana involves both large-, medium- and small-scale businesses.
Small businesses are indispensable to economic development. Small businesses represent the arms and legs of our economy propelling us forward, sustaining employment and acting as vital cogs in the distribution, marketing and consumption of goods and services of large businesses.
Small businesses have taken a serious hit as a result of the coronavirus pandemic. This makes it all the more imperative that they should be supported. My Government will table in the National Assembly a Small Business Amendment Bill. The Bill will expand the range of procurement opportunities for small businesses. Small businesses that provide small-scale infrastructural works will now be able to functionally benefit from Government procurement.
The Government has also answered the plea of small business owners for increased access to finance. The maximum threshold for grants disbursed by the Small Business Bureau through the Small Business Development Fund has been increased by 100%.
Further, the Government will continue to vigorously pursue other avenues for increasing small businesses’ access to finance. The Ministry of Tourism, Industry and Commerce will engage the relevant financial stakeholders, including commercial banks, micro-credit financing institutions and international development partners in order to expand the resource envelope available for small businesses.
In addition, the Government will soon complete and commission business incubators at Belvedere in the East Berbice-Corentyne Region and at Lethem in the Upper Takutu-Upper Essequibo Region. Other similar facilities to be developed will provide budding and aspiring entrepreneurs with the opportunity to hone the skills needed to become successful.
The sixth element of our programme for enhancing the business climate encompasses consumer protection. Consumers are an integral part of the business ecosystem. Without the consumer, businesses will flounder.
My Government is committed to providing greater protections to consumers. A proposed Hire Purchase Bill will provide much-needed protection for consumers who procure items on credit or through hire purchase arrangements. Currently, the law as constituted provides that once a consumer defaults on a single payment, the owner is entitled to forfeit all the previous payments and to repossess the item. This can hardly be fair to the consumer. The ‘Bill’ will reform this unconscionable practice.
Developing Business infrastructure
The seventh element of our programme to improve the country’s business climate involves the development of business infrastructure. We are committed to stimulating business development nationwide. We want business opportunities throughout Guyana and not solely concentrated in one or two Regions. We want to see industries being developed throughout Guyana. As such we have a plan to establish industrial estates, ICT parks and export zones to stimulate manufacturing and increase trade. We will give preference to manufacturers and technology services for occupancy in these estates, zones and parks.
In expanding the opportunities for businesses, government will ne implementing a transformative infrastructural agenda.
As I have alluded, we are going to transform the country’s transportation network. A new bypass between Diamond and Ogle will be built with connections to Mocha, Eccles and Providence. A high-level bridge will be constructed across the Demerara River and will be connected at its westernmost extremity to a new four-lane highway leading to Parika.
The private sector will be required to use these opportunities to build capacity to capitalize on the other massive long term transformative projects in the pipeline, such as Amalia Falls Hydroelectric facility, a deep water harbor, an all-weather road linking Linden and Lethem, the Parika to Rockstone Del Conte Conte Road with connections to Bartica and a bridge over the Corentyne River. These are only a few examples of the transformative agenda that we will be perusing.
A lot of this agenda must be financed and we will be targeting international financing opportunities and here lies a great opportunity for synergy between large scale American businesses and our local private sector.
The emergence of the oil and gas represents a huge economic opportunity for our country. The levels of investments which are taking place and which are projected in the future will generate massive business opportunities and a demand for human resource skills.
We are determined to ensure that local businesses benefit from business opportunities, particularly in our oil and gas sector. I have already appointed an advisory committee to examine and propose ways in which we can ensure that local businesses benefit from the business opportunities spawned by the oil and gas sector. Local content legislation will be implemented to allow local firms and companies a greater share of opportunities in the oil and gas sector.
We are also determined to secure greater and better job opportunities for our young people in oil and gas. My Government, as promised, will train thousands of Guyanese to create a highly skilled and qualified workforce for employment within the oil and gas sector.
My Government is also seeking to ensue energy security. Cheap and reliable energy is critical to business competitiveness. High energy costs has impacted adversely on local business expansion. My Government has a plan to solve this problem. A number of new energy projects are in the pipeline. I am slated within the next few weeks to address the Guyana Manufacturing and Services Association (GMSA). I will use that opportunity to comprehensively outline my government’s energy plans.
Within the next five years, Guyana will be energy secure. We will be generating sufficient energy to meet peak demand. But more importantly businesses will enjoy a boom because we anticipate that the cost of energy will be slashed by 50%.
We have a long-term plan for business development. This plan aims to ensure an enabling environment for business activity. We are fashioning a conducive business climate by our commitment to the rule of law and democracy, improving the ease of doing business, enhancing national competitiveness, facilitating trade and investment, supporting small businesses, protecting consumers and establishing infrastructure which supports business development.
I look forward to working with the American Chamber of Commerce –Guyana to propel this seven point programme. I am open to meeting with the business community because I believe that business is good for our people and for the country’s development.
I therefore wish every success to this the 2nd Annual General Meeting of the American Chamber of Commerce. I look forward to the Chamber’s instrumentality in enhancing investment, trade, industry and commerce in our country.
I thank you. God bless you.