FEELING THE PINCH

Aug 07, 2011 Features / Columnists, Peeping Tom

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This past week has seen financial markets in the United States go once again into turmoil. This development has fuelled speculation that another recession is looming.
Nothing could be worse news for Americans than having another recession. Many Americans are still out of jobs. Thousands have lost their homes and are seriously struggling. These are hard times, in which every citizen is feeling the pinch, but more so those who lose when financial markets dip and companies go bust.
The vast majority of Guyanese immigrants have managed to keep their heads above water. But some who diverted into real estate and who had investments in stocks lost considerable sums. This past week’s developments will send further tremors amongst immigrants, many of whom will now be worried that their 8 to 5 jobs may be on the line.
It is also a bad time for politicians. The American people are fast losing confidence in the political establishment. Just when they thought that a recovery, though slow, was on its way, they have been greeted with a wild week on the financial and stock markets, a foreboding that all is not right with the recovery plan. Things may pan out in the end, but there is high anxiety over the situation.
The political parties in Guyana may be hurt by what is taking place. They are hoping to use the remaining days of the summer season to go on their usual fund-raising jaunts within the United States. They may find that the Guyanese immigrants may be unwilling to let go of that spare cash which is usually doled out to the political parties in Guyana, for fear that this cash may be needed should hard times hit once again soon.
Many of the immigrants are not waiting for another crash. Some of them have already made plans to return to Guyana. They like what they see when they come here. They feel that Guyana is making progress, even though they do not like to publicly admit it, and they also need to rest their weary bones after years on the grind.
Once Guyana can get its security right, Guyanese immigrants living in the United States will return in droves. A great many of the immigrants have already made future plans for returning to Guyana. They have over the years sent back their money to help maintain and improve their properties, and they are just waiting on their retirement benefits and social security qualification before making that move.
America is a strong economy and it is not likely to suffer as it did during the Great Depression. It has the capacity for rapid recovery. But people are worried about their hard-earned cash, about their homes and business being foreclosed, and about being put on the breadline. And some of the immigrants feel it is time to come back home to Guyana.
They however want to ensure that their investments are safe. And they would like to bring those investments to Guyana. The immigrants do not wish to simply bring their savings and have it deposited in a bank, earning little or no interest. They want it to bring returns to them
Guyana in turn needs investment dollars. But what is there to invest in? This is where the government comes in.
The government is offering major deals to foreign companies at a fair rate of return on equity and it is believed that for some of the more strategic investments, the government may be even guaranteeing the rate of return. There was once even talk of the government being willing to forego its dividends in the Berbice River Bridge so as to ensure that the bridge remains a viable investment.
The government has a number of major investment projects and it is seeking funding for these. Amongst these are the Amaila Falls Hydroelectric Project and a Marriott-branded hotel. There is also a need to pay for that cable that is supposed to be coming from Brazil to boost telecommunications. A bridge is also being proposed across the Corentyne River. These are all projects in which the government should be seeking public-private sector partnerships, and these projects are good opportunities for overseas-based Guyanese to invest in, once there is a guaranteed rate of return.
There remains also the issue of the government shares in the telephone company. The workers rightly should be offered a big chunk of these shares at market rates. For a government that claims to be a working class government, it is shocking that at least 20% of the shares proposed to be sold cannot yet be offered to the workers.
Local investors should also have an opportunity to buy into these shares, with the remainder being offered as an investment opportunity for overseas-based Guyanese.
A great deal of resources can be raised for development by encouraging overseas-based Guyanese to invest back home. Instead of doing this, what the government is doing is concentrating the wealth of the country in the hands of a few individuals who are already stinking rich.

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