Chairman of the Private Sector Commission, Captain Gerry Gouveia, pointed out on a recent television programme shared with Finance Minister Dr Ashni Singh and Citizen’s and Demerara Bank Chairmen Clifford Reis and Yesu Persaud respectively that he believed that inaccurate, irresponsible and precipitate reporting on issues arising out of the current controversies associated with CLICO and Hand-in-Hand Trust could engender a diminution of confidence in these institutions and in the local financial infrastructure as a whole, resulting in a run on the system. Gouveia is not alone in this view. Both President Bharrat Jagdeo and the Finance Minister have made more or less the same point at separate times during recent public discourses on the CLICO affair.
On the same television programme referred to earlier Mr. Reis made the point that he believed that what was lacking was a process through which the public can be better educated on the financial system and how it works. Mr. Reis, we believe, was conceding that there exists an information void as far as public understanding of the financial system goes and that there is a need to fill that void by reaching out to the public, presumably through the press.
One should add at this juncture that two other heads of major local financial institutions have conceded to this newspaper that the limitations in public understanding of the financial system and how it works is, in large measure, a function of a tradition of simply keeping the media at bay unless some sort of public disclosure becomes absolutely necessary. In fact, one of the two added that it really made no sense to “jump on the media” since the failure of the “culture of quiet” within financial institutions was as much a part of the problem as was the limitations of the press.
It is, of course, generally true that there is not a great deal of specialization among media professionals in matters to do with the financial infrastructure and that itself may be part of the reason why, one of the two heads of financial institutions to whom we spoke openly admitted that “the press is simply not taken seriously in financial circles.”
Arising out of all this the Stabroek Business is inclined to the view that it is both unfair and unhelpful to simply dismiss the media, or sections thereof, as a danger to the stability of the financial system without dealing with the huge information void that has been created by the aversion of both state and non-state institutions to engaging the media. Indeed, if the truth be told, heads of local financial agencies rarely facilitate requests for interviews concerning events occurring in those institutions, which events often belong in the public domain; and while we note, particularly, the very recent efforts of the Hand-in-Hand Group of Companies to create an environment of greater public enlightenment with regard to Hand-in-Hand Trust’s investments with the Stanford Bank it has to be said that in recent weeks the approach of the leadership of both CLICO (Guyana) and Republic Bank to the occurrences of public concern which has more or less amounted to saying as little as possible, has, perhaps far more than anything the media have done, contributed to a heightened level of public apprehension.
Of course irresponsible reporting on the current issues involving the “impairment” of investments by CLICO and Hand-in-Hand Trust are not good for public confidence in the financial system and of course that kind of reporting needs to be discouraged. The problem is that what some CEOs and state agency bureaucrats do not appear to understand is that a culture of near silence on issues of public importance creates dangerous information voids into which rumour and unhealthy speculation creep and it is at that juncture that the financial system becomes seriously threatened.
Whether or not the present CLICO and Hand-in-Hand Trust issues can bring about a changed attitude on all sides is unclear. This past week some media professionals have been meeting with the PSC Chairman and some of the functionaries in the financial sector in the hope that a better understanding might be arrived at on the matter of first, greater openness on the part of the financial institutions and, secondly, a heightened sense of responsibility and capability on the part of the media. One recommendation that has been made by the PSC Chairman is that perhaps, the Commission can work with the Guyana Press Association (GPA) to help create a more professional relationship between the media and the financial and business sector through formal and informal meetings to facilitate both on and off the record exchanges.
Certainly, it is not enough for bureaucrats and politicians associated with the country’s financial sector to simply sit in judgment of the press without themselves understanding their own responsibility to work with the press to ensure the full effective dissemination of information on matters of public interest since, while it may not occur to them, confidence in the national financial infrastructure can just as easily be eroded by their refusal to put information into the public domain as by erroneous and misleading information.