The local private sector is not up to the task of developing Guyana

Dear Editor,

A few days ago the PPP/C government celebrated the 21st anniversary of the election responsible for catapulting the party into the position of being the administrators of our country. The occasion was considered the ‘new dawn,’ a new era that promised untold prosperity for our nation – prosperity way above and beyond what existed during the prior twenty-eight years. While members of the party are gleefully engaged in back-slapping and are, within the group, complimentary about the achievement, I fail the see the yardstick they are using for this euphoria.

Really the PPP/C has nothing to be proud about in relation to the administration of our country. And, compounding the issues, it is my estimation that this party has not been a visionary steward of Guyana’s sovereignty either. Most, if not all the investment they are likely to claim as achievements are actually detrimental to the success and longevity of the Guyanese business community, business persons and by extension ordinary Guyanese workers. If the trend of so-called investments persists, this situation will also affect the investment potential of foreign Guyanese business people and entrepreneurs, who would like to return to Guyana and create jobs.

One has to wonder, given what is happening on the ground today, why the Guyana Small Business Association (GSBA), the Georgetown Chamber of Commerce and Industry, The Private Sector Commission and the multitude of workers unions are not angry. Are they oblivious to the fact that their space is being usurped and their businesses are fast approaching suffocation and extinction?

I find that recent news about Royal Woodworking closing its doors and renting its property to Chinese as the straw that breaks the camel’s back. Don’t you? I am not in Guyana, but I am outraged at the tendency that allows this to happen. It is obvious that government does not care while at the same time businesses are voting against their own interest and extending support while they are, in a very sinister manner, squeezed out of their own marketplace. When would these businesses forget loyalty and stand up and fight for their rights? When would union leaders wake up from their slumber and seriously address a worrying trend that is creating fewer and fewer job opportunities for Guyanese workers?

On May 8th, 2013 Stabroek News published my letter, ‘The Bai Shan Lin deal has negative implications for present and future private investment,’ in which I dealt with this worrying trend. I wrote, “This deal has considerable negative implications for present and future private investment, and the fact that this business can disguise its real intent and sell this to the Guyanese people without a significant uproar is unbelievable. For one, local logging companies and potential furniture manufacturers would not be able to compete with this new company. Take, for example, a business like a Toolsie Persaud or a Precision Woodworking competing with this new company. The value added equipment a Precision would need is manufactured in abundance, in China. Imagine Precision having to purchase equipment versus the Chinese manufacturers dumping the equipment on this new business.”

Well, that did not seem to get anyone’s attention and from all the indications of what is taking place on the ground, the situation is one thousand times worse. This situation in which Royal Woodworking finds itself is an ongoing trend in Guyana that has not been very much publicized or advertised. Indications are that many of our small businesses are forced out of business by the Chinese and to a lesser extent Brazilians. Small business owners are finding it much more profitable to rent out their property and pack up and leave Guyana.

A lot of businesses on Regent Street and around Georgetown are giving up to the pressure of the Chinese influence. I am told by persons on the ground that one who has been away for just five years would not recognize Regent Street because of the changes. Most of the notable faces are gone. The Chinese are meticulously fixing and positioning themselves within every community. They are in Mahdia selling mining equipment. They are opening businesses even in Port Mourant. They are on track to suffocate all the existing businesses with their flashy cheap inferior stuff.

The Chinese do not respect copyrights and brand names, and are the greatest copycats ever, copying others’ technology at will. Heaven help the business person in Guyana selling brand name and

quality stuff. This is huge. And if the John Fernandes, the Yacoob Allys and the Courtney Benns think this will not affect them, what is to stop the Chinese getting the opportunity to build the deep water harbour and taking control of shipping. What is to stop the airport deal and Chinese beginning to purchase aircraft for the local and international markets and sophisticated engineering, like ship-building, taking over the local industry. They already have their own television company. This is the perfect layup.

The ordinary construction guys – the carpenters, the masons, the plumbers – are in serious jeopardy. Can we expect that any one of these disciplines will get some work on the renovation of the Royal Woodworking property? The trend that the unions are unable to break is that the Chinese will do the renovations themselves. The atrocity at the Marriott construction site is multiplied a thousand times by these new business entrepreneurs. What about staffing for the new businesses? Expect to see an Indian or African girl as the ‘front’, while all the persons behind the counters are Chinese.

Gleaned from the press are the following impressions of the private sector in Guyana:

 

(1)  The local private sector is not up to the task of developing Guyana. It is too minute, mired in small-mindedness, short of entrepreneurial and risk-taking drive and ineffectual in mobilizing resources for large-scale investments. It suffers from high capital rents, infrastructural constraints, poor labour productivity, transportation and communication inefficiencies, poor domestic demand, and an inability to penetrate foreign markets amongst a host of other limitations too numerous to mention.

(2)   Much of the private sector growth in Guyana is dependent on government spending. Government spending has been the stimulus that has generated private sector growth, and,

(3)  the private sector can claim to be the engine of growth, but that engine is being lubricated by public spending, without which the private sector would be just a toddler trying to walk in a world of giants.

 

Well, is there a single truth in any of this? Is the private sector fearful of calling out the government and demanding a stop to this nonsense, because they depend on government for their existence? But is this to their benefit? Does anyone remember the days of, ‘Not a blade of grass’? Today our administrators seem to be saying, “Betta, a yuh want grass? Dem bai dis na gat use fuh am. Mi gat wan account in foreign. Make abbi happy and come tek all the grass yuh want.” Am I to believe that these folks will continue to show allegiance to their own destruction? On the other hand, can our sovereignty be of no significance that it can be sold so cheaply?

Also, the suggestion that the private sector is not smart seems to be bearing fruit. If it is true the sector is starved for cash and thus “ineffectual in mobilizing resources for large-scale investments,” what is stopping them from using their clout with the government to insist that foreign companies joint venture with local companies before they can get a foothold in the Guyanese marketplace? Why should Bai Shan Lin get so much latitude outside of a partnership with a Toolsie Persaud or an Amerally? Why not use the concept of Hamley Case and the UNAMCO investment? (Please note that UNAMCO did not die because of the concept).

My contention is that the private sector can be a force to reckon with if they can only take one page out of the playbook of other private sectors worldwide. You have to protect your stuff. No other marketplace allows foreigners the opportunity to walk roughshod over the sustainability of their businesses. What is going on in Guyana is extremely worrisome. But much more worrying is the silence of the opposition politicians. With all these truths to present to the Guyanese people why do I get the impression they are presently sitting in a losing position?

Yours faithfully,
F Skinner

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