The Regional Joint Support Team will not add value to the business and investment environment

Jun 30, 2021 Letters

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DEAR EDITOR,

As the debate continues whether the proposed ‘Regional Joint Support Team’ security unit will add value to the current development agenda of Guyana, my concerns are particularly in relation to business, investment, and human development – youth development, women, and the family. My view is that it will not add value.
The government’s decision to establish a new crime fighting unit, outside of the constitution, as well as without any proper justification; and the way in which the decision was made – the lack of transparency, even at the level of the National Assembly; does not augur well for a country that touted as the ‘Singapore’ of South America. This decision is equivalent to the decision by the former President David Granger, to appoint unilaterally the former Chairman of the Guyana Elections Commission (GECOM), Justice Patterson (Rtd.). This kind of behaviour by any government is one of the areas that increases risks in the business and investment environment in the country. Business and investment are essentially about risks and returns; investors examine risks in the Guyana environment, as against the returns on their investments. One of the reasons why it is difficult, almost impossible to renegotiate the ExxonMobil agreement, is because international investors are protected by International Investment Law, as a matter of fact, there is a view that International Investment Law is slanted towards protecting the investors.
Let us examine some of the reasons for this. During the 1970’s and 80’s, countries such as Guyana, had followed a path to nationalisation and many foreign companies were nationalised. The international investment landscape over the past 40, 30 and even 10 years has changed significantly. Life is about stimulus and response, perhaps, the evolution of the international investment environment – laws. principles, guidelines, etc. was in part, stimulated by the need to implement global rules to protect international investors and their investments in a way that makes it difficult for governments and countries, to unilaterally renege on investment agreements.
Therefore, we can conclude that in the absence of Guyana creating a stable environment for investment and business, and reducing the risk of doing business in Guyana, we have reduced our ability to negotiate above a two percent. Other countries can negotiate for six percent and more because their environment is more conducive and the risk is lower, and the possibilities of higher returns are greater.
At some point, the Guyana Private Sector Commission, and Chambers of Commerce, Banking Association, need to stop singing our governments praises and tapping them on the backs for increasing the risk of doing business. The Guyana business community need to start thinking about filling hotels, flights coming to Guyana and increasing the ability of customers to service loans, mortgages, etc.
International investors will continue to come to Guyana because they are protected under International Investment Law, and they can take their returns out of the country, but the local business community has to decide whether they want to play politics or do business, this is the harsh reality.
Guyana has enormous potential for growth and development, but we would not grow, except our governments align their words with their behaviour. Our governments, this government, need to be more transparent and accountable and adhere to the principles of the Rule of Law and good governance; principles are universal, this is the kind of behaviour that will reduce the risk of doing business in Guyana and perhaps, create the environment for re-negotiating agreements. Nothing just happens, we have to make things happen by having strategic and systemic plans on how to achieve our business and investment goals and objectives.
Guyana is reported as one of the fastest growing economies in 2020 which the World Bank describes as an extraordinary growth rate of 43.5 percent, and as one of the richest countries; certainly, in the Western hemisphere, and is at 134 out of 190 countries in the ‘2020 Doing Business Report’. What this report shows, in the context of Guyana’s growth trajectory, is that if the country continues along this pathway, it will become wealthy but with little change in the local operating environment and the trickle-down effect of the wealth, will be very limited. The scenario above shows that the international investors and a small few, who are well positioned, will benefit from Guyana’s wealth, except there is a paradigm shift to create a conducive business and investment environment.

Yours faithfully,
Citizen Audreyanna Thomas

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