Trade facilitation councils

Jun 24, 2018 Features / Columnists, Peeping Tom

The Georgetown Chamber of Commerce and Industry (GCCI) has taken a novel step by establishing trade facilitation councils with Cuba, Canada and India. These are three very important markets for Guyana, and the GCCI is not laying back and waiting on government to facilitate external trade.
The GCCI is doing what was not done before in Guyana, but which is done all over the world. The GCCI is a private sector body and it is taking the lead in opening greater opportunities for businesses.
Trade facilitation is one of the roles of the Guyana Office for Investment (GO-Invest). But GO-Invest would be hard pressed to show how many external markets it has opened for Guyanese exporters.
In private sector-driven economies around the world, it is the private sector which takes the lead in opening markets. But because most of Guyana’s exports are primary products, the country has to look to bilateral, regional and multilateral trading arrangements in order to penetrate these markets, given the lack of competitiveness of local production.
The private sector is now outshining the government in the area of trade facilitation. Earlier this year, a private rice miller unlocked a major rice market in Cuba. This shows that the private sector does not have to rely on government. The lesson here is that it is much better if the private sector does not wait on government to unlock market opportunities externally.
The benefits of these trade facilitation councils will go beyond mere trade. As pointed out by the High Commissioner of India to Guyana, Mr. Venkatachalam Mahalingam, he is working on developing a mechanism where local exporters can benefit from credit from the India Export/Import Bank. Thus, private sector financing is likely to follow the efforts of the trade facilitation councils.
The initiative by the GCCI is as a direct response to the downturn in business in the country. Should these councils lead to increased exports, the litmus test of their success, it is possible that there can be a reversal in the fortunes of the business sector without the intervention of government, which has simply not yet gotten its act together when it comes to improving the business climate.
The government has totally ignored, thus far, the protests of transportation operators who are pressing for a reduction in the price of fuel. This arrogant approach by the government does not bode well for the private sector, since transportation is a supporting sector for business development in Guyana. And when a government cannot even issue a public response to the demands of transportation operators, it says a lot about how the government regards these persons.
Trade is a two-way process, and it is to be expected that these trade councils will result not just in increased exports to Cuba, Canada and India, but also in imports from those countries.
The GCCI initiative is a sign of a maturing private sector, one that is long overdue, and a sector that should not be mendicant when dealing with the government. The private sector must see itself as a generator of wealth in the society. It should be seeking its own opportunities rather than merely trying to hitch itself to the coat-tails of government.
The private sector should also seek to explore greater opportunities within Guyana. The State in Guyana is too large, and there is no reason why the private sector, instead of being crowded out by the State, should not be competing with the government for the provision of services.
The private sector has made major inroads in the provision of education and health care. It should also make inroads into providing utility services such as water. There is no reason why the private sector cannot produce and sell a reliable water supply, cheaper than the government.
There is no reason why the private sector cannot buy out NCN, buy out the sugar corporation, generate cheap electricity and build and administer prisons and private fire services. There is no reason why the GCCI should not establish its own equivalent of GO-Invest, and try to help investors navigate the daunting government red tape.
The establishment of trade facilitation councils is a great start, and shows the difference which leadership can have on an organization. The private sector by expanding its reach within the economy is going to become stronger and less ignored by the government.

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