Business Support Organizations ill-equipped to meet private sector needs

-former GCCI President

Former Chamber of Commerce President Vishnu Doerga

Former Georgetown Chamber President, Vishnu Doerga wants local Business Support Organizations (BSO’s) to improve their capacity to provide advocacy, technical support and other services to the country’s private sector, responsibilities which he says, are not being discharged effectively at this time.

In a wide-ranging interview with this newspaper, Doerga broached a number of issues relating to the state of the private sector including the challenges and opportunities confronting the business community in the wake of the discovery of oil and the impending commencement of the recovery process in 2020.

The current CEO of the Guyana franchise of the internationally renowned business coaching organization, Action Coach told Stabroek Business that with the longstanding prospect of Guyana becoming an oil economy now lying on the country’s doorstep the local business support infrastructure had little choice but to raise its game urgently if local businesses are to optimize the advantages presented by the opportunity.

In a sharp critique of the overall  local business support infrastructure, Doerga declared that the country’s “more than thirty” BSO’s ”are seriously lacking in capacity to meet the needs of the private sector.” The situation, he said, was likely to become even more dire if remedial action is not taken ahead of the advent of oil and gas as factors in the Guyana economy.

Doerga told Stabroek Business that the failings of the local BSO’s had resulted largely, though not exclusively, from their inability to continually generate sufficient  financial resources to recruit qualified professionals to run their operations efficiently. And pointing directly to the country’s three major BSO’s, the Private Sector Commission, (PSC) the Guyana Manufacturing & Services Association (GMSA) and the Georgetown Chamber of Commerce & Industry (GCCI), Doerga said that the scarcity of financial resources had meant that they were “barely able to cover their expenses” and therefore unable to extend themselves to provide the key services that they ought to be providing to their members. “The question that arises has to do with what is to be done about the gap that exists between what they ought to be delivering and what they actually deliver. The BSO’s probably take in around half a billion dollars and the bulk of it is used to keep the      respective offices running and very often to duplicate each other’s efforts,” Doerga told Stabroek Business.

Noting that the various BSO’s are, in effect, all affiliates of the PSC, Deorga said that in his opinion “there is a lot more support needed for the institutional strengthening of the smaller organizations.” Contextually, he pointed out that since service to the country’s BSO’s was being given by businessmen and women with full time responsibilities to their own businesses, they (the elected executives of the BSO’s) “are often unable to consistently provide the level of service required to ensure the effectiveness of the organizations since “they are unable to step away from their businesses to deal with substantive private sector matters.” He said that what the BSO’s urgently needed was the   resources to recruit the skills necessary to create high quality private sector civil service. “There is need for a better understanding of corporate governance, as much at the private sector level as at the public  sector level,” Doerga said.

One consequence of the inability of the BSO’s to recruit skills to adequately ensure the effective day to day pursuit of their functions, according to Doerga, was the concretization of the practice of Board members “reaching into the operational level of things on a day to day basis,” a practice which, he said, was “undesirable” and reflective of “a lack of understanding of corporate governance.”

Opportunities

Turning to the issue of the opportunities that had opened up for the local private sector on account of the discovery of oil Doerga said that he was concerned that the current preoccupation with “local content” might result in Guyanese businesses failing to recognize the potential for the “greater benefits” that were likely to emerge from seeing the bigger picture. He said that “rather than become preoccupied with the limited returns which the local content dimension has to offer, the local business community should seek to measure up to the standards of foreign companies. “Getting handouts is a far cry from what we want. We should be focusing on global content rather than local content. Local content limits us to operating within Guyana. What we need is a policy that compels the international operators to utilize local skills wherever the opportunities exist. Global content provides different routes to success for local companies.”

Meanwhile, Doerga told Stabroek Business that he was concerned with the challenge that Guyana would face in seeking to recruit skilled personnel to the oil and gas sector, locally. He declared that the pursuit of this task is likely to see Guyana paying a price for the loss of skills which the county has suffered over the years, since, while there appeared to be an interest amongst qualified Guyanese in returning home “now that oil is here the question that arises has to do with whether we will be able to afford the salary demands that they are likely to be making. “What that means is that we could lose those skills a second time to the oil-related private sector. What is also likely is that we could lose some of our best Public Servants to the administrative side of the oil and gas sector.” He added, however, that any consequential shortage of public servants in circumstances where we would then, presumably, be in a better position to pay better salaries could mean that Public Servants will at last receive those salary increases that they have been after for so many years.

The former Chamber President says, meanwhile, that he believes that there is a need for the public discourse on oil and gas and its implications for Guyana to be broadened to enable a practical understanding of the implications of the development across all of the various groups in the society, taking the discourse beyond its present narrow base.  Doerga says that one of the issues that must be raised in the ongoing discussions is the importance of channeling the resources that we get from oil and gas into longer-term development avenues. This is important since given the pace at which many countries are moving in the direction of renewable energy we may well find ourselves with a window of no more than about fifteen to twenty years in terms of benefitting from the resource, given the pace at which alternative energy industries are being researched. “Some countries are already close to reaching that point of having renewable energy. There is a great deal of work going on in advancing wind, solar and nuclear technology and hydropower is still an option for some countries. So that we need more discussion in terms of how income from oil is going to be dealt with, how is that income going to be distributed.”

Asked to share his views on what he regards as the “priority investments” that ought to accrue from the country’s oil earnings Doerga said that it was his view that the country ought to move in the direction of building infrastructure. “I would think that we should see the full completion of the Guyana/Brazil road link and the dredging of the Demerara River …as priorities. There is also the issue of creating a connecting link between the east and the west of the country in order to have more areas available for development,” he added.

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