Bureaucratic hindrances to business development: Guyana and Barbados share similar frustrations

Guyana, it appears, is not the only country in the Caribbean Community (Caricom) where the pace of economic progress is retarded by the steely bonds of bureaucracy and where both local and foreign investors must endure what are sometimes bewildering layers of procedure in order to secure approval for their business pursuits.

Recently, the Chief Executive Officer of Invest Barbados, Wayne Kirton, a state-run agency – roughly the equivalent of our own Go-Invest – set up for the purpose of smoothing the wheels of business development – publicly bemoaned the fact that bureaucracy continues to militate against investor interests with investors’ projects taking a considerable length of time to secure Cabinet approval. Kirton estimates that investment projects lost to Barbados because of tardiness in various government departments and agencies amounted to somewhere between US$250 million and $556 million. An estimated 750 plus jobs have been lost in the process. According to Kirton further potential investments totalling more than US$200m may be in imminent danger of being lost in view of bureaucratic sloth and that could mean further job losses of around 1700.

Warning that Barbados needs to take a stand against inertia and bureaucracy Kirton declared that the country can no longer afford a culture of sloth and indifference towards business development in the country. “The bottom line is that things take too long to get done,” Kirton said.

Public criticism of the identical disease here in Guyana is, of course, unheard of, though the local private sector has, from time to time, dropped broad hints of its own frustration over official tardiness in getting things done. A few years ago at a private sector function where President Bharrat Jagdeo was present, a senior private sector official called for less red tape and more red carpet for investors. More than that foreign investors have been known to arrive in Guyana brimming with enthusiasm and depart eventually wondering to themselves why on earth they didn’t take their investment elsewhere.

Barbadian businessmen, it seems, have fared little better in getting the practice eradicated despite a reported public outcry and Kirton has declared that the country can no longer afford this type of attitude to business development in the country.

Another Barbadian business executive, Peter Boos alluded recently that there was a need for a call to action in Barbados to create a new type of economy in order to produce what he described as sustainable results. “I believe that the great recession, as it is being called, requires a response beyond let’s wait and see how this turns out and we’ll be back to business as usual.”

In demanding a “call to action” to smooth out the procedures that facilitate business development Boos wondered aloud as to “how many more discussions, reports, papers, committees and sub-committees must we accumulate before we act. We have been talking about the same problems for twenty years,” he added.

The Barbadian businessman alluded to the difficulties associated with securing town planning for business projects, registering a professional practice, securing a work permit and effecting repairs to important infrastructure. Some of these difficulties, of course, are not unheard of here in Guyana.

One saving grace in Barbados, in seems, is that despite the frustrations, the government there continues to receive substantial support from the private sector in pursuit of the goal of making the country a premier international business centre. Not that the private sector in Guyana has not sent its own signals of a preparedness to work with government in what is commonly termed a social partnership to help build the country’s economy. The difference here is that the relationship between the state and the private sector is informed by far less forthrightness on the part of the latter in addressing issues that impede the pace of investment and business development. Issues like taxation, customs clearance bottlenecks cabinet and ministerial delays in expediting business initiatives and the continuing failure to institute a genuine one-stop agency for investments – too many such projects still require ministerial intervention and, in some cases direct presidential approval – continue to frustrate the private sector though local business executives appear to have adopted a posture of painful endurance, mindful, it is widely believed, of official reprisals  for excessive complaint and bellyaching.

Less than a week ago the Stabroek Business monitored an article arising out of observations made by the Barbados Business Authority in which a former President of the Barbados International Business Authority, John Howard, identified improved business facilitation as one of the three key areas on which it would focus, warning at the same time that the time had come to translate talk into action. He reportedly told the 2010 Barbados public-private sector national economic consultation that it was disappointing to see so many business facilitation goals identified by government being repeated year after year with either full implementation or execution. Additionally, he alluded to the need for “transparent and timely accountability.  The best strategy is redundant if there is no mechanism to deploy it and to effectively monitor its progress,” he added.

It is easy for Guyana to embrace these sentiments given the similarity in the frustrations that attend public-private sector relations. One of the most glaring examples of the kind of inertia informing the relationship is what has now become a delay of several years in transforming legislation enacted in the national assembly (the Small Business Act) designed to create funding, technical guidance and other forms of support  for the growth of the local private sector. More than five years after the enactment of the legislation the support structure to which it was supposed to give life is yet to be properly set up and small business aspirants are still waiting for institutions like the Small Business Council and a Small Business Bureau to provide them with the kind of support which the legislation promised.

Barbados, it appears,. Is looking to countries like Singapore as a guide to more efficient business facilitation practices, in order to ensure that the country continues to grow and to become one of the best places in which to live and to do business. Guyana can do far worse than keep an eye on the direction  in which its sister Caricom country is moving.