“I tight right now”

Jul 30, 2008 Features / Columnists

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Peter R. Ramsaroop, MBA

INTRODUCTION:

“I tight right now” seems to be the new buzz phrase around our nation. Over the last few weeks I have travelled to Charity, Corriverton and Lethem, and can say that the cost of living issues have reached to the heart of Guyana.

The extended rainy season has affected cash crops for many of our farmers which ultimately affect prices at the market.

I have travelled to many countries over the last few months and had the opportunity to read many different newspapers. In every one of them there is an article on cost of living and the local economy woes.

It is no different here in Guyana. Cost of fuel continues to be one of our biggest woes. The effects will be felt on our local economy more than it already has.

Many governments around the world are starting to intervene in areas that can bring relief to its citizens. There are critical interventions that our current PPP/C government must now make to adjust our economy to offset the impact on consumers and businesses.

Initial progress was made for public servants earlier in the year, but nothing has been done for the larger population on a whole.

We continue to advocate for the reduction in VAT and the increase of the tax threshold as one way to help us.

GLOBAL ISSUES FOR US TO TAKE NOTE:

As the United States cut discretionary spending in order to reduce their federal budget, less money will be available for aid that countries such as Guyana depends on, mainly because of the lack of our own plan to revitalize our economy.

There is also a critical USA program coming to an end in September that CARICOM leaders are advocating for its urgent renewal.

The Caribbean Basin Initiative Act facilitates the economic development and export diversification of Caribbean Basin economies which includes Guyana.

With the increase in oil prices, Guyana’s economic plan continues to be non-existent in looking at alternative energy sources in an aggressive manner.

Our region does benefit from this act in other areas; therefore, we must lobby for the US to renew the Caribbean Basin Initiative Act. The US must realize that the region is in their backyard and that our development is crucial to a strong Americas.

Abroad, riots shook India after the government trimmed fuel subsidies. Truckers in Britain, France, Spain and South Korea have clogged the roads to protest rising fuel prices.

In the Philippines, soaring prices for oil and petroleum-based fertilizer have derailed the economy and ignited calls for a cut in the tax on oil imports. We have seen so far the protest here in Linden on fuel subsidies cut.

CONSUMERS NEED:

Consumers are limiting their spending on discretionary items as they struggle to pay mandatory bills such as electricity, water and transportation.

It is a well established economic fact that around 60-70% of the GDP (gross domestic product) is simply consumers spending just about all of their hard-earned income.

Every dollar we spend turns the economy at least ten times; therefore the consumer needs as much of their money to spend.

I spoke to a few of our fellow citizens on the street recently; one said it best to highlight the plight many are in.

“If you don’t have money for transportation, you can’t get to work. And if you can’t get to work, you don’t get paid. And if you don’t get paid, you can’t buy food. We’re at their mercy.”

The concern as the school break comes to an end is for our school children whose parents may not be able to afford transportation.

Instead of the government proposing public transportation as a source taking away revenues from the private sector, maybe they can institute public and FREE transportation for our school children.

We need to lobby for fewer taxes from our paychecks to ensure we have more money to take care of our families.

Where is the excess VAT money going? We are not seeing any improvements in our roads, in our villages, or improvement in our education system where teachers are paid better or computer labs are instituted in our schools.

Something must give here. Either we get our money back or it is used for transportation for our children to go to school and to ensure improvements are made to our communities and to our education system.

BUSINESSES NEED:

One businesswoman said to me this week “”I’m a very small businesswoman. If I get any smaller, I’ll be out of business.”

This week I was in Lethem and Brazil. The Brazil side is improving daily yet our side of the border continues to be stagnant. Brazil has created free zones on their side that is creating a better business climate.

I will expand on my trip in a future article. There are five key areas that overall affect the business climate in our nation:
a. Government must establish export free zones
b. Invest in the completion of areas such as the Road to Brazil, Alternative Energy and Deep Water Harbour
c. Improved safety and security for all – a key ingredient to investment success
d. Improved coordination with all Governmental ministries on economic issues
e. Improved transparency on all Government’s decision making and a better investment code.

CONCLUSION:

Our elected Government’s responsibility is to lead without fear or favour, with the implementation of some fast financial decisions, for both individuals and businesses. A crisis management approach is urgently needed.

The private sector needs to revitalize itself and be the advocate for both businesses and consumers alike. To our Government, let’s get on with the business of running our country efficiently.
Send your comments and suggestions to: peter.ramsaroop@gmail.com

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