THE GUYANESE RETAIL TRADE IS UNDER UNPRECEDENTED CHALLENGE

Dec 01, 2024 Consumer Concerns, Features / Columnists, News, Waterfalls Magazine

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CONSUMER CONCERNS

By PAT DIAL

 Kaieteur News- Whenever a small Oil-producing country emerges in the world, a large number of predatory carpet-baggers congregate on the horizon awaiting the opportunity of pouncing down on the new Economy and exploiting it.  By the use of well practiced techniques, they quickly edge out the local population from the lucrative sectors resulting in the promise to the native population of enjoying a quickly rising standard of living becoming a pipe dream.  Guyana, as a new Oil-producing country, was faced with the same fate, but was able, in the nick of time, to protect Guyanese citizens by the Local Content Act which reserves certain types of investment and employment for Guyanese with the possibility of expanding them when needed.

One area of investment and employment escaped the protection of the Local Content Act and through this loophole a steady stream of East Asians, almost all  Chinese, have been flooding into the country with the intention of displacing and taking over the local retail trade.  The movement has been quick and organized as if centrally directed and local retailers and a growing body of consumers have been complaining of this apparent unfair exploitation.

The Georgetown Chamber of Commerce and Industry, one of the Caribbean’s oldest and most respected trade organizations, has spoken up against this unfair onslaught on local retail businesses and Dr. Jagdeo, as Vice-President and General Secretary of the PPP, the Party in Government, has also publicly acknowledged the problem.  Local businesspersons, while accepting the entry of new players in the retail trade, are convinced that the playing field is not level and that it is the unfair competition to which the local retailers are subjected which presents the real problem.

The elements of this unfair competition could squarely be placed at the door of those departments of Government which are charged with enforcing the laws and regulations which relate to retail trade.  Key officers in these various departments seem to have a very relaxed attitude when they should enforce laws and regulations on these East Asian retailers and this administrative inefficiency and lapses need to be brought into the open by the various responsible Ministers. We will give below some of these lapses which need to be immediately addressed:

Careful assessment of income taxes of each retailer needs to be done.  Some of these East Asian entities evade income taxes and even in the few instances where attempts are made to collect taxes, they resist paying.  Recently, it was reported in the media that a very large hardware store was assessed for $10.M taxes and after agreeing to pay, suddenly changed its position and took the matter to the Courts.

National Insurance contributions are ignored.  Local businesses dutifully pay their contributions, in particular the larger ones. If these East Asian businesses pay their contributions, NIS finances would considerably improve and a step would have been taken to establish a level playing field between local and East Asian retailers.

Invoices of stocks need to be carefully examined.  It is suspected that elements at the Customs Department corruptly admit their goods at undervalued rates or goods are admitted duty-free by hitching them on to imports by several Chinese entities which qualify for duty-free imports.  Local businesses never escape payment of customs duties.

These East Asian shops are known to sell expired or near expired goods to unsuspecting customers at cheaper prices.  Such goods are acquired by the retailer at give-away prices.   Indeed, there are instances where expiry dates are brazenly altered.

The distribution of certain types of goods requires the distributor to be licensed to do so.  For instance, the selling of certain types of drugs require the employment of a qualified druggist and a special license; similarly with the sale of alcoholic drinks.  The local retailers never infringe these laws but the East Asian retailers seem to do so with impunity.

The East Asian retailer never issues bills (receipts) except the purchaser requests it.   This makes it impossible to return or exchange an unsatisfactory purchase or even to establish ownership.

Warranties; the East Asian retailers do not issue warranties on consumer durables or if they do, it is for a month or at most three months.  Unsuspecting buyers from such shops pay a cheaper price but often find the item bought unworkable or costing to have it repaired.  Local retailers, though charging a higher price, have much longer warranties and do repair faulty purchases.

East Asian retailers pay scant regard to the Labour Laws and often open their shops outside of normal working hours, forcing staff to work more than the 8-hour day.  Local retailers never infringe these Laws and if they do, either the Union or the Labour Department bring them into order.

Many of these Asian retail entities are established in the busier areas of towns without provision of any parking space thus causing traffic jams and even accidents.    This contrasts with local businesses like DDL and Survival supermarkets which incurred the expense of providing customer parking.

These East Asians do not pay VAT , thus they are able to have cheaper prices than  Local retailers.

The above and others are areas where a level playing field does not exist between Local retailers and the East Asians which give the East Asians unfair advantage over the local retailers and which the State of Guyana has the responsibility, capability and obligation to rectify.  Protection of the Guyanese retailer is analogous to the practical and philosophical bases of the Local Content Act.

(THE GUYANESE RETAIL TRADE IS UNDER UNPRECEDENTED CHALLENGE)

(THE GUYANESE RETAIL TRADE, THE GUYANESE RETAIL TRADE)

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• CONSUMER CONCERNS, Oil-producing country, predatory carpet-baggers, THE GUYANESE RETAIL TRADE

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