Give locals a bite at the cherry

Nov 17, 2021 Features / Columnists, Peeping Tom

Kaieteur News – It is good to learn that investors from the United Arab Emirates (UAE) are in Guyana examining investment opportunities. The country should not hedge too much hopes on anything coming from that part of the world; they have long talked the talk but failed to walk the walk.
Last November, the country hosted a delegation from the UAE. Nothing has materialised as yet from this mission. Well not quite, Guyana was able to buy some vaccines at double the world market price from that country.
Guyanese therefore should not get excited. The oil rich Middle Eastern countries have no interest in investing in Guyana. They will come here and sell whatever they can sell but it is too much to ask them to invest in Guyana.
I am willing to bet that nothing much will emerge from these delegations. They will come here, look around, turn up their noses and then get the hell out of here for good.
No one is coming here from oil-rich countries to build any deep water harbour. The traffic is too small to interest those investors. No one is coming here from Qatar to invest in agriculture. This I believe.
And they have good reasons to do so. There are better and safer places for them to sink their oil wealth than in risky Guyana where a commercial dispute can end up taking 20 years to resolve.
No investor from the Middle East is going to come here when he will need a retinue of body guards to protect him if and when he makes an investment. Crime is a serious deterrent to doing business in Guyana.
Guyana has also hosted delegations from other part of the Caribbean, including recently Barbados. The Barbadians will be more interested in pre-fab housing. But Guyana does not have the means to supply this to them. They are not here to buy our rice or sugar or timber. They are looking for housing products and Guyana can simply supply the quantities required or at the price required. This I believe.
It is time the government stops looking to external forces and start looking locally for investment. Charity, they say, begins at home.
The funds in our banking system may not be sufficient to finance the Yellowtail Field Development Plan. But it is more than sufficient to finance the projects which the government seems not to be keen on opening to local investors: the gas-to-shore project and the Amalia Falls Hydroelectric Project and the new Demerara River Bridge.
Perhaps the reason is that the government already has lined up its syndicated investors for these projects. The Chinese we are told are likely to fund the bridge across the river and other major road projects. But what is China asking for in return?
China’s Belt and Road Initiative was widely seen as the means to assure that country of resources. But that era has ended. China’s economy is now undergoing its own transformation and China is now moving increasingly towards a services-based economy. Guyana, therefore, instead of being a source of raw materials could end up becoming a source for more Chinese products, something that will inflame the United States.
China may lack its past enthusiasm to finance projects in Guyana, which is too small a market to entice China’s growing services sector which now accounts for 54 percent of that country’s GDP. And no Vice President is flying into the Region waving money for projects.
The Americans have nothing to offer Guyana. They and the Canadians are more interested in taking out rather than putting in. At one stage, it was estimated that western countries took out three times more than they invested – not a bad barometer to use to assess foreign appropriation.
America does not want China in Guyana because they want Taiwan. But America prefers to apply pressure rather than encourage investors to invest directly in the non-oil economy.
Guyana therefore has to look to satisfy the need for money for its major infrastructural projects. And it should begin to look increasingly at domestic funds but not only for the friends and cronies of the government but also for the average citizen.
If locals can be given the same concessions as foreigners; if they can be given projects with a guaranteed rate of return, they will invest. But do not ask one of two local investors to back a major project; spread the risks widely among a large pool of investors and the results will be startling.
But why am I holding out such hopes when it is known that these projects will end up in the hands of favoured investors?
(The views expressed in this article are those of the author and do not necessarily reflect the opinions of this newspaper.)

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Give locals a bite at the cherry

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