Guyana makes strong case for more developmental funding

The GTCP/IP project was a two-year initiative broadly geared towards implementing policy reform that would lead to economic growth, eventually resulting in the reduction of poverty.  The programme was sponsored by the Millennium Challenge Corporation (MCC), which approved a Threshold Program grant from the Millennium Challenge Account (MCA) to the government. When the programme commenced on January 14, 2008, the specific aim was to support government’s efforts to overcome the country’s serious fiscal challenges while also streamlining the business registration process.

In an exclusive interview with Stabroek News, Chaka labeled the programme as a success and as one of which everyone involved should be proud. Speaking about some of the major successes of the programme, he singled out the work done at the Guyana Revenue Authority.  He opined that at the end of these two years, the GRA “is better placed to affectively collect taxes in an equitable manner, that its staff is better trained, it has the systems that it needs to bring in revenue to the government.”  The more taxes and customs revenue collected by the government means that more money was available to bring development in the needed areas, he said.

Chaka noted that with the reforms that would have been achieved under the GTCP/IP, there would be other reforms that now need to be undertaken and consequently more money would be needed to achieve this. Among these necessary reforms, he noted, was increasing capacity of various institutions and training new people even as he identified Go-Invest as an institution in which more can be done.

Quizzed about the likelihood of Guyana benefitting from additional funding from the MCC, Chaka stated that this was a possibility. He said that once a year, at a Board Meeting held in December, countries are chosen for funding under its Threshold grants and Compact grants initiatives. Countries which qualify for Compact grants are allowed funding of significantly higher amounts to enable economic reform.  There is also the possibility of the country being awarded another Threshold grant, Chaka disclosed.  He emphasised that a country cannot apply for a grant but rather is has to be selected by the MCC.

The Threshold Programme Director said that if a country did not receive funding in a given year, this did not mean it was ineligible the next year. He explained countries are chosen based on stringent criteria, including how it ranks on 17 third-party indicators, the most important being Third Party indicators on Control of Corruption.  The other indicators looked at are Political Rights, Civil Liberties, Government Effec-tiveness, Voice and Accountability, Immunisation Rates, Health Expenditures, Primary Education Expen-ditures, Girls’ Primary Education Completion, Na-tural Resource Management, Regulatory Quality, Land Rights and Access  Business Start-up, Trade Policy, Inflation and Fiscal Policy. Chaka also noted that Supplementary Information-such as newspaper reports from a country, could be factored in during the decision making process.

In the case where Guyana does gain additional funding from the MCC, the country will have to maintain its high ranking on various indicators. He said that there have been cases where funding has been terminated because countries have not maintained the required standard.

Citing the example of Niger, Chaka disclosed that the MCC had terminated its Threshold Programme in Niger because the President of that country had suspended the Parliament and constitutional court and held a referendum to extend his term beyond the constitutional limit without consulting with the electorate. He also identified Madagascar as another country that had funding from the MCC ceased because of failing to maintain the necessary requirements.

Now that the GTCP/IP programme has been completed, Chaka explained that a system of monitoring of the country will be implemented, but he said this will not be done directly by the MCC. According to Chaka, this monitoring will be done via third party indicators, the US diplomatic presence in the country through the embassy and other means. He says consistency will also be important since comparisons will be made as to how the country performs in one year as against the next. Further an assessment of tax collections and how this money is used is done.  He also revealed that Guyanese will form part of this monitoring process.

The (GTCP/IP) project was managed and administered by the USAID Mission in Georgetown and the Regional Contracting Office in the Dominican Republic under a SEGIR Macro II IQC Task order with Nathan Associates Inc. as the prime contractor.

The project also included efforts to improve parliamentary oversight and to offer institutional strengthening to the Parliament Office. This included computerising the Hansard (record of parliamentary proceedings) and improving the opening of the committees division. Another key component of the project was improving of the record keeping capacity of the Deeds Registry, thereby reducing the length of time it takes to register businesses. Agencies such as Go-Invest and the Finance Ministry also benefited from this programme.