All the evidence available shows that the APNU+AFC coalition is anti-business. Over the past two years there has been a marked ambivalence towards the private sector. This ambivalence is manifested not only in the administration’s anti-business practices but more importantly, in policy formulation, especially at budget time.
The overtures by the government have not just been small, but have been characterized by a lacklustre and ‘unwilling bride’ approach. Cumulatively, this adds up to deficiencies on the part of the administration, including widespread incompetence, lack of knowledge about the workings, culture and intricacies of the private sector, and a reluctance to partner with it in a principled and constructive manner.
During its term in office, the PPP/C administration worked closely and productively with the private sector. Under the PPP/C the private sector became the real engine of growth. Public-private partnerships saw development in real terms throughout the length and breadth of Guyana. The economy registered sustained and impressive growth rates, starting in 1992, but particularly over the last 10 years of the PPP/C administration during which the country graduated to become a middle income country. The PPP/C in its 2015 elections manifesto committed itself to “Facilitating the further growth of the private sector; promoting a mixed economy where investments will be attracted from local and foreign capital, and public-private partnerships will be encouraged in specific areas such as infrastructural development.”
In contrast, the APNU+AFC in its 2015 elections manifesto, in an en passant fashion, stated that,
“The economy will be driven by the private sector in combination with the state and cooperatives.” No mention whatsoever was made in the said document about how a Granger administration would work to establish a modus vivendi with the private sector to ensure that it plays its true role as an engine of growth in a small market-oriented economy. Having been in office for over two years now, all that the private sector has received so far from the coalition administration are promises which largely remain unfulfilled.
The announcement in July this year by Mr Joe Harmon that “a ministerial team was appointed to restructure the manufacturing sector,” came as a surprise to many. The question was asked how the government would go about restructuring a manufacturing sector which is predominantly in the hands of the private sector. Moreover, of grave concern is the apparent intention on the part of the administration to hark back to the era of the centralized planned economy in which the state under Burnham played the dominant role, but which was dismantled by the administration of his successor, Hoyte. The captains of industry in Guyana need to keep a watchful eye on these matters.
An indication of the direction in which the government intends to move was given by Finance Minister Winston Jordan when he said at the Guyana Manufacturers and Services Association’s (GMSA) annual business dinner held in early July this year: “It is government’s intention to clamp down on excessive and unnecessary imports.” To many, this is a further worrying sign that signals government’s intention to return Guyana to earlier days. Moreover, it is an indication that the Granger administration is woefully lacking in recognizing the implications which that statement holds for Caricom’s single market and economy and the community’s rules of origin, as well as the trade-related implications in relation to tariff and non-tariff barriers. Gone are the days for imposing and enforcing policies of import substitution.
But back to Mr Harmon and his novel idea about a ministerial engagement with the private sector. According to the Minister of State, it is intended that engagements between a government team and the private sector, “will be held thrice annually and it is hoped that the engagements will lead to increased performance of the manufacturing and services sector.”
Meanwhile, the GMSA’s president has pointed to a number of challenges facing manufacturing, such as securing financing at reasonable rates, the unreliable supply of electricity, high freight costs and market access. Mention was made of the oppressive nature of the tax measures introduced in the 2017 Budget such as the re-categorizing of zero and standard-rated items to exempt, and VAT on electricity and forest products which have impacted negatively on the manufacturing sector.
In the broader context of economic development, unlike the PPP/C, the APNU and AFC while in opposition cut from the national budget tens of billions for developmental projects. The sole aim was to block local and foreign investments. They effectively drove away potential private sector investors from our country. As a consequence, development has stagnated.
Compounding the problem is the fact that government ministries are woefully underperforming.
As late as August this year, former President of the GMSA, Ramsay Ali lamented: “The manufacturing sector in Guyana is at a standstill. Who are here continue to do what they are doing, there is no excitement or new development taking the place at the moment.”
And all the talk by President Granger about caring for the security concerns of the populace was smashed to smithereens following a meeting held in late August this year between representatives of the Private Sector Commission (PSC) and the Minister of Public Security.
In a statement released to the press following the meeting, the PSC reiterated its “concerns over the erosion of public security and safety and the loss of public confidence in government, exacerbated by the fact that no one has been held accountable for the catastrophe at the Georgetown Prisons … Our citizens are now living in a constant state of fear”.
Today, notwithstanding all the attempts at dazzling propaganda by the state media, it is important to note that most of the infrastructural projects currently being implemented, were initiated by the former PPP/C administration. These include the public-private infrastructural partnership projects such as a new bridge across the Demerara River. All of these can be found in the 2015 manifesto commitments of the PPP/C.
Looked at in the context of the performance of various sectors of Guyana’s economy it is clear that the Granger administration is playing a wait and see game with an eye to the flow of oil money as a panacea for the impending economic crisis looming on the horizon. The AFC+AFC administration is calculating that its get out of jail card will be the oil bonanza following a ‘victory’ at the 2020 elections.
Clement J Rohee