BY SHARIEF KHAN
AT LEAST ten public companies are likely to be divested by government as part of its economic restructuring programme, it has been officially confirmed.
Companies identified include — Guyana Transport Services Limited (GTSL); Guyana Fisheries Limited (GFL); Guyana Nichimo Limited; Demerara Woods Limited (DWL); Quality Foods Limited; Stockfeeds Limited; Soap and Detergent Limited; National Paint Company Limited and the Sijan Plaza Restaurant
Profiles are to be prepared of these companies “prior to invitation to private investors,”
Confirmation of the divestment moves came from Head of the Guystac Secretariat, Mr. Henry Bovell this week at a Private Sector-Government consultation organised by the United Nations Development Programme (UNDP) and the Department of International Economic Cooperation (DIEC).
According to Bovell’s information paper presented at the meeting, the term ‘divestment’ used at the forum meant “the removal from 100 per cent or majority ownership by government.”
He disclosed that “initiatives have already been taken with respect to Guyana Timbers Limited which is in the process of being sold while both technical as well as investment consideration for Guyana Glassworks Limited are being pursued.”
Bovell’s paper also confirmed that preliminary discussions have been started with a prospective investor for Demerara Woods Limited.
The document pointed out, “very critical for divestment consideration of these companies will be the ability of the investor to submit an investment plan for the entity which should include managerial capability, technology to be applied, access to appropriate finance for the operation as well as a plan for the upgrading of requisite skills and last but not least access to markets.”
The paper added, “these are alluded to because one of the main considerations for private participation in these entities which, although not inherently weak, their performances in recent years in terms of profitability and effectiveness have been marginal and it is necessary to ensure
that their operation will continue to improve.
“Additionally, it is not intended to part with these assets merely to allow an investor to take opportunity to make as much profit as he can by further sale of these assets, as these will certainly defeat the purpose for which these operations were maintained.”
The company profiles are scheduled to be in circulation from April and Bovell said the profiles would include audited accounts for at least three years and the list of assets, manufacturing facilities, production capacities and other information.
The Thursday Pegasus Hotel encounter was the second UNDP initiative to spur a greater role for the private sector here.
Deputy Prime Minister, Planning and Development, Mr. Haslyn Parris, who was invited to deliver the feature address at the opening of the encounter, advised that politicians like himself should not be invited to deliver the feature address at gatherings like that.
“Drop the feature address at meetings like these by politicians and get on with the job to be done,” Parris advised.
He argued that politicians will only make statements of principles and things like that.
He advised against the sector getting bogged down by what he called “bureaucratic procedures” and suggested that these be honed down to ensure entrepreneurial efforts are not significantly watered down.
Parris also appealed for UNDP and private- sector assistance to publish; government’s Investment Code.
Government, he said, was taking steps to print the Code, but Parris felt the UNDP and the private-sector could help to put out a “decent” publication.
He also announced the document has been translated into Spanish for broader circulation among potential foreign investors.
According to Parris, the sector could contribute to economic recovery by assisting export-led growth. He suggested that the group would have to be specific about what it was going to do if it was to gear itself for the export thrust into the Caribbean, Latin America, North America and Europe.
Government, he argued, had prepared the pitch in the Caribbean Community Market and contended the private sector should look ‘very seriously” at this market.
Caricom was the launching pad for other markets, Parris said.
A number of Caribbean businessmen invited to the forum did not turn up because the local sector was not ready with hard proposals for joint ventures here, sources said.
“They were also worried about the uncertain food, water and electricity situation here,” one source said.
Several businessmen felt that while the forum was a “genuine attempt by the UNDP to help the private sector, the group was still “wary of government.”
“The private sector has been bitten so many times in the last twenty years, it is still unsure and largely we are still in the getting to know you process,” another source said.
No Flour till April
Rice Shipments Suspended
By BERT WILKINSON
THE National Milling Company will soon cease production because it has run out of wheat to mill and Guyana has been forced to suspend rice exports to major buyers until April, it was announced this week.
The mill, which has been running short of the commodity since last year, has only 1,300 tons left, and national average weekly consumption is between 1,100 and 1,200 tons — just about seven days’ supply.
Trade and Tourism Minister Winston Murray, told newsmen Thursday, that, wheat is not expected until April and even though efforts are being made to spread out production as long as possible, the amount in stock is too meagre to make an impact.
A new PL 480 agreement, under which Guyana gets wheat from the US is expected to be signed “within a matter of days,” Murray said, but still there will be a two-month hiatus, US sources said yesterday, however, that Tuesday has been fixed as the likely date for signing.
Murray says the agreement will, like last year, be worth US$4m, but rising prices could mean Guyana gets less, though the best supplier will be sought.
“Given the time necessary to complete commercial arrangements and for shipping, no additional wheat would be in the system until around the first week in April, Murray said.
The wheat and rice shortages have already sparked long lines for the commodities and Murray says Police have charged several people with smuggling the commodities to neighbouring countries.
He said the supply of salt will return to normal following the recent arrival of a Cuban vessel but Guyana will not be exporting rice to the European Economic Community, Barbados, Jamaica or the other major customers.
“Because of priorities we place on supplying rice to the local market apart from brokens, shipments of exports have come to a standstill and in fact we do not foresee any exports re-starting until reaping of the new crop comes on stream in April. We are focusing on supplying the local
Acknowledging the basic commodity supply situation in the interior is serious, he said supplies are lying idle in Georgetown because of air transport problems.
“The difficulties include our inability to get the stuff in to them. A lot of interior areas one needs to have supplies flown in and there have been difficulties as all of you know with the GAC’s ability to get those food supplies in. In fact there are supplies of food for interior locations, lying in Georgetown awaiting transportation.”
Asked about the availability of edible oil, he said current production levels are below expectations and shipments from St. Vincent are not what they should be.