Blame the government - Making decisions in the best interest

Blame the government – Making decisions in the best interest

May 16, 2008 Peeping Tom

The government recently announced that it is prepared to do everything in its power to fight crime and to ensure that Guyana is a country in which people can live as normal citizens. One of the things that help a country is investment and for some time now this government has been seeking foreign investment to aid its development.

Because of certain conditions people have not been rushing in large numbers to invest in Guyana and among the limiting factors are the prevailing global conditions, the problems that beset Guyana and the dwindling money supply in some quarters.

But there are still people willing to put their money in the country and one of them is investing heavily in an asset that had been lying idle for some time. At one time it provided all the cloth that children used to fashion their uniform, the cloth that made the yards and yards of decoration and created employment for dozens of Guyanese.

It fell on hard times and efforts to revamp it were not successful despite the best efforts of the Chinese so it was left idle. A Guyanese entrepreneur saw it and decided to reverse its fortunes by putting a lot of money into it. The deal involves paying $50 million a year in rental for an asset that was falling apart and earning nothing; investing some US$30 million to create jobs for more than 1,000 people; and rehabilitating the compound.

This asset was advertised for, but there were no takers and the tender had to be withdrawn. The government was then approached by the Guyanese entrepreneur who outlined a development plan and who signaled his seriousness to enhance the deteriorating surroundings.

Talks with the privatization unit resulted in an agreement that would see the company enjoying a ninety-nine year lease and paying a rental that would be adjusted as the currency moves.

There have been some criticisms of the deal; people have claimed that it is a giveaway without taking into consideration that until that agreement with the investor it was an asset that was declining in value by each day and that it was not earning anything, instead, costing the government money.

People want to suggest some collusion between President Jagdeo and the investor but contrary to what operated in the past, President Jagdeo pointedly declined to be a part of the discussion on the privatization. He publicly stated that when the discussions began in Cabinet he left the meeting; he did not want his presence to influence any decision.

This country has seen privatization deals that raised eyebrows. Some were not even known about until the deal was concretized and by then nothing could have been done. Some assets were undersold and some had to be repossessed because the investor was not really serious.

Some people recently set out to blame the government for the agreement with the investor and this is surely a shortsighted approach. How could one justify watching an asset deteriorate into the ground as against having that same asset earning money for itself and a country that needs every cent it could get so that it could continue its social programmes to the most vulnerable?

At this time when the government is keen to expand its social programmes how could the people seek to blame the government for doing the best it could? In the world of business those who have had to dispose of assets have found that they have had to adjust prices and even had to call off their sales bid because the best offer they wanted was just not attractive enough for the potential buyers.

Who has not tried to sell a car and demanded a price but found that no one wanted to pay what was being asked? The next best thing is to accept the nearest offer to what is demanded.

This was the same with the sale of the BMWs; there was a tender but the offers were too low, so low that if the government had gone ahead there would have also been accusations of giving away the assets, just as some are trying to insinuate on the occasion of the deal for the property that was once operated by Sanata Textiles Limited..

Don’t blame the government because had the shoe been on the other foot the action would have been the same. There is another side to all this. When individuals make decisions they are often not asked to account to anyone. These same individuals, however, are the ones who seem to know what is best when anyone else makes a decision that is often miles better than any that they could have been made under similar conditions.

Again, the critics hope to embarrass the government but will once more fail.