Energy costs, silted harbour hurting Guyana’s exports – consultant

Some of the barriers to the competiveness of Guyana’s exports on regional markets are the result of constraints that are internal to the economy, Canadian Professor Thomas McKaig told a media briefing in Georgetown earlier this week.

McKaig is a Canadian author with some 30 years of international business experience. He owns Thomas McKaig International Inc and is an adjunct professor at the University of Guelph in Ontario.

He is in Guyana on a Canadian International Development Agency (CIDA)-funded mission to undertake a study of non-tariff barriers and their impact on trade and export. He stopped short of describing constraints like high electricity charges and transshipment costs associated with Georgetown’s badly silted harbour as “self-inflicted non-tariff barriers” but accepted that these amount to additional “production costs” which must be removed if locally produced goods are to more competitive on the regional market. The study is being undertaken at the behest of the Guyana Manufacturing and Services Association (GMSA).

Public/private sector discourses over issues associated with the desilting of the Georgetown Harbour have centred chiefly around costs. At Monday’s briefing, McKaig said the use of feeder vessels to transship goods—on account of the silted port—was likely to add as much as 17 per cent to goods being exported from Guyana.

A release circulated at the media briefing noted that Guyana’s manufactured products also continue to be buffeted by restrictions imposed “far too often” by importing countries. “Many exporters, particularly of locally manufactured products, have spent billions of dollars to comply with the ad hoc but stringent demands made by receiving countries upon arrival of their shipments,” the release said.

It added that other Guyanese exporters “have had their goods returned as a result of what can be described as import restrictions.”

Few concrete details of the study’s outcomes and the intended follow-up action were revealed during the briefing. GMSA Public Relations Consultant Marjorie Chester said it was likely that the Canadian consultant would be in Guyana again next February to make a presentation to a much larger audience of government and private sector officials. Such a move suggests that the GMSA is seeking to create a strong public/private sector partnership to mount a robust intra-regional lobby for the removal of non-tariff barriers to Guyana’s exports.

Some of the initial findings of Professor McKaig’s study referred to in the media release alluded to increases in the cost of locally produced goods which render the products uncompetitive on the export market. “On the import side, foreign products are allowed to enter our domestic market freely since non-tariff barriers are non-existent,” the release said.

The move by the GMSA to place a spotlight on intra-regional non-tariff barriers that negatively affect Guyana’s exports would appear to be a precursor to a call for what the release describes as “a common Caribbean non-tariff regime”. Such a regime, it said, should “permit a level playing field across the import and export spectrum and ensure that all exporters face the same non-tariff barriers”. It said that an “intra-regional competitive environment based principally on efficiency and innovation” would be provided by such conditions.

Among the specific assignments with which the Canadian was charged was to determine whether demands for the additional certification of product standards and technical regulations which have plagued some Guyanese exports constitute unfair practices. Product dumping within the region and an assessment of the impact of non-tariff barriers on the services trade, which constitutes around 62 per cent of local economic activity, were also on the agenda.

Meanwhile, the release appeared to chide the Customs and Trade Administra-tion for neither making nor enforcing demands “for safer, healthier or higher quality imports” while criticising foreign suppliers and domestic importers” for not always respecting the rules of origin when bringing goods into Guyana. “The Guyanese economy,” the release said, “is known for its openness to trade,” though it added that such openness can be harmful to the country’s economy.

 

 

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