Stabroek News

GO-Invest sees ‘significant’ local investments ahead of emerging O&G sector

Time to change residence? GOINVEST’s colonial style Camp and Church streets office. Inset is Chief Executive Officer Owen Verwey.

What now appears to be the certainty of an economically transformative oil and gas industry has significantly altered international perceptions of Guyana as a prospective haven for investment and underscored the Guyana Office for Investment’s (GO-Invest) enhanced role in facilitating that external investment interest, the agency has said.

Last week in an uncharacteristically detailed media release assessing both its recent performance and its prognosis for external interest in investing in Guyana, going forward, the state investment agency declared that the first half of 2018 has seen interest in investing in Guyana growing “dramatically” as manifested in what it says has been ‘hundreds of local and foreign investors seeking to explore investment opportunities in Guyana across all sectors.” Specifically, it anticipates the local participation in joint venture investments in the country’s oil and gas sector is likely to accelerate in 2019 ahead of what is expected to be ‘first oil’ early in 2020.

On the whole, what it anticipates will be a “substantial and rapid increase in executed investment agreements” during the half of this year, should, it says, manifest itself in more than $95 billion in new projects being inserted into the country’s economic pipeline up to August this year. The Agency said in its release that these include projects that have already been submitted to the Government of Guyana but are currently the subject of due diligence probes by one or another of the various state agencies including GO-Invest itself, the Guyana Revenue Authority, the Guyana Lands and Survey Commission or the Industrial Division of the Ministry of Business.

Having asserted that it has enabled more than $12.5 billion in executed investments this year so far out of what it anticipates could reach $107.5 billion this year, GO-Invest says that this wave of investment activity “across various sectors including services, agriculture and energy” should create more 434 jobs.

While the Agency’s report makes clear its  weighty role in investment promotion in the period ahead it has continued to be vague on any concrete plans for building capacity to respond to the challenges that inhere in that role. In its media release the Agency says that in 2018/2019 it will be “actively involved in assessing its organizational role” and in addressing what it concedes are “capacity gaps” in its operations. It further states that unspecified “efforts” are underway “to review the Agency’s current institutional and operational model in order to strengthen and improve its ability to promote exports and attract investments.” Against this backdrop the release alludes to “a proposed strategic plan” which it says “will be developed in line with the vision set forth for the Agency by the Ministry of Business through the National Quality Infrastructure Project (NQI) which will focus on developing its Investment Promotion and Export Promotion Strategies by implementing best practices in trade and investment promotion models as well as renewed strategic and operational arrangements for the Agency.”

 Analysts of investment prospects for Guyana in the period ahead have repeatedly pointed to the need to build capacity to expeditiously execute investment initiatives, noting particularly the limitations of both staffing and physical facilities at the Agency’s Church and Camp streets office. It is now more than two years since GO-Invest has gone on record disclosing plans for relocating of its offices to a more convivial complex.

While the Agency’s assessment of its performance for the first half of 2018 projected  investments for the year totalling $154 billion out of which 5,725 jobs were anticipated, its projections for the outcomes of those investments, it says  was based on assumptions ranging from the outcomes of progress made in ongoing discussions  relating to agricultural and agro-processing investments to time lines for the coming on stream of investments by oil and gas service providers who are already engaging the state investment agency.

 Up to the present time GO-Invest says it has concluded an Investment Agreement with a Guyanese service provider in the oil and gas sector, pointing out that while it had anticipated “an earlier influx of local companies partnering  with international investors” to service the oil and gas industry, “current indicators suggest that there will be a slow buildup in momentum” leading to “significant acceleration in 2019” when, it says, it is anticipated that there will occur “a significant uptake in local investments as businesses familiarize themselves with the requirements of the oil and gas industry and move to improve financial reporting standards and capacity.”