Political and economic consequences of President Granger’s heavy-handed GECOM imposition will be immediate

Dear Editor,

Since 1992, the watershed year free and fair elections returned to independent Guyana, the country’s democratic being has endured one body blow after the other.  President David Granger’s stunning, though not altogether surprising, decision to unilaterally name retired Justice James Patterson as Chairman of the Guyana Elections Commission (GECOM), heralds yet another addition to the list of post-dictatorship atrocities committed against our democracy, which also includes the PNC’s  repeated attempts to violently nullify the results of free and fair elections, the PPP/C’s 18-year steadfast refusal to hold local government elections, as well as ex-President Donald Ramotar’s unprecedented proroguing of the National Assembly.

Even as the country’s finest lawyers litigate the legality of the Justice Patterson’s unilateral appointment, it is indisputable that the president’s move is in flagrant contravention of the spirit of the Carter-Price formula. The formula, named after US President Jimmy Carter and late Prime Minister of Belize George Price, prescribes a bipartisan approach, since codified, to selecting the members and chairperson of GECOM and has been used for every election since 1992.

As the more recent electoral controversies – over a Region 10 seat allegedly misallocated  to the PPP/C at the expense of the Alliance for Change in 2006, and the near malapportionment of a majority of the seats in the legislature to the same party in 2011 – illustrate, GECOM under the PPP/C was not beyond the occasional chicanery. However, because the PNC, the party which President Granger leads and which dominates the governing coalition, rigged four consecutive national elections to maintain its 28-year grip on power, the President’s riding roughshod over a convention as old as our relatively young democracy, has provoked widespread  and visceral political backlash.

While it remains to be seen whether Justice Patterson is of the wherewithal and inclination to run a credible national election in a polity as deeply polarized as ours, the political and economic consequences of President Granger’s heavy-handed imposition will be immediate.

Certainly, the political uncertainty will further roil an investor class that has always been lukewarm to the President and his party.  The shadow of Forbes Burnham’s PNCR’s past nationalization push; the legacy of strategic patronage and charismatic economic messaging  of Bharrat Jagdeo’s PPP/C; and anti-business sentiments spouted  by current government officials have all fed into that miasma of mistrust between the government and private sector.

Moreover,  a slew of policy disasters in the two and half years this government has been in office has done little to improve investor sentiment. For example, the calamitously hamfisted and legally questionable  quest to sniff out organized crime and recover assets allegedly stolen from the state, has shaken confidence in the country’s banking sector and accelerated a shift away by business people from storing liquidity in bank deposits to holding cash. The recent arrest of top banking executives by the Special Organized Crime Unit (SOCU) for allegedly violating a court order to turn over client banking documents will further worsen matters for a banking sector that is already straining under the weight of a deteriorating economy and worsening loan portfolios.

Perhaps even more damaging to the economy is the government’s tax-and-spend policy which, in practice, works out to be a tax-and-neglect-to-spend policy. In the 2016 budget, the government rolled out a bevy of tax increases which led to a windfall in tax revenues the following year. Although Guyana has, over the past decade, shouldered a heavy average tax burden equivalent to 24.3% of its Gross Domestic Product (GDP), President Granger’s administration did not redirect these tax revenues back into the economy, but instead sat on them.

Since President Granger assumed the presidency, public investment – which includes additions to the health, education, transportation, communications, agriculture and industrial infrastructures that make an economy more productive – has collapsed! The government’s geriatric pace of implementing capital works has been a tremendous drag  on the economy, chipping away at the last fragments of the veneer of competence the administration has tried to wear.

All of that along with the government’s overall rudderless economic decision making and, now, President Granger’s threat to our democracy, will further wound investor sentiment; put more downward pressure  on the exchange rate as business people store more of their wealth in US Dollars and Treasury bonds; and, possibly, hit the brake on economic growth. In the interest of Guyana’s economic  and political well-being, President Granger should set aside his antipathy for Mr. Bharrat Jagdeo and embrace the role of the Office of the Leader of the Opposition, which represents 49.2% of the electorate, in selecting an election czar.

Yours faithfully,

Saieed I. Khalil

 

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