Private Sector Commission

Executive Director’s Report 2017 The Private Sector Commission is the…

Executive Director's Report 2017

The Private Sector Commission is the apex private sector body in Guyana, representing businesses and business support organisations across the length and breadth of the country. As such, it remains cognisant of its responsibility to defend and protect the interests of the business community and, indeed, of consumers and the nation as whole. This entails both advocacy to the Government and other organisations as well as the maintenance of collaborative relationships with these. The year 2017 saw the deepening of its relationship with Government and Government agencies as well as with the diplomatic community and international bodies.

In 2017, growth of Gross Domestic Product slowed to 2.1% confirming the experience of the business community of a slowdown in economic activity. Though rice and forestry grew healthily, most other major sectors were down, including construction, mining and quarrying, livestock and sugar. As a result primarily of a decline in exports and increase in imports the Balance of Payments deficit grew to US$287.4m from US$12.4m in 2016. This was financed largely by debt forgiveness and a measure of debt relief but also by a draw down on net foreign assets of the Bank of Guyana which, however, retained enough reserves to provide for just over three months of import cover. Net domestic credit, both public and private, grew by 9.9% with credit to the private sector growing by 2.3%. Credit to the manufacturing and construction sectors both declined. Inflation was contained at 1.5% while interest rates declined with the commercial bank weighted average lending rate declining to 10.19% as at December. The value of the Guyana dollar against the US dollar remained relatively stable at US$206.5 to one US dollar.

The year 2017 began with the suggestion of the reintroduction of foreign exchange controls by Government and the Private Sector Commission registered its deep concern with this possibility and appealed to Government to reconsider. The Commission highlighted the certainty of capital flight which would result from such a move as well as the reduction of foreign direct investment and reminded Government of the disastrous effect upon the economy which had resulted when such controls had been introduced before. The Commission met with the Governor of the Bank of Guyana on what was perceived to be a shortage of foreign currency which resulted in long waiting periods for foreign exchange to be made available to businesses as well as an increase in its cost. The Commission obtained the Governor’s assurance that the situation was temporary and that measures were being put in place to address the problem and committed to supporting the efforts of the Bank.

The Private Sector Commission also met with a team from the International Monetary Fund which sought its views on developments in the country. The Commission expressed its satisfaction with the establishment of the Public Procurement Commission but registered its concern with other pressing matters such as the sole sourcing of contracts and the slide in value of the Guyana dollar. The team highlighted the fact that the private sector is a catalyst for growth and plays a crucial role in job creation. The Private Sector Commission reiterated to the team that it remained committed to collaborating with the Government in the national interest.

The Private Sector Commission also lent its voice to the objections to the introduction of parking meters to the city, a move which saw wholesale and retail sales fall by some 50% as citizens registered their displeasure by avoiding transacting business in the commercial sector. The Commission’s concerns centred around the dubious legality of the contract entered into with the parking meter company and the fact that the rates were draconian given the low income of the citizens.

In March of 2017 the Commission, in partnership with The Energy Institute, hosted an Energy Forum at which presenters shared their ideas for growth of the sector in Guyana and also highlighted options and plans for renewable energy in keeping with the Government’s green trajectory for the economy.

Of particular significance to the business community in 2017 was the announcement that the Financial Action Task Force had released Guyana from its Monitoring List thus reducing the stringent international controls which had imposed significant hardship on the nation. The Commission commended the Government for this achievement and singled out the Bank of Guyana for particular recognition of the part played by its supervisory framework.

The Private Sector Commission was honoured in May by the visit of Baroness Anelay, Minister of State in the British Foreign and Commonwealth Office, and Member of the House of Lords. Baroness Anelay conveyed the compliments of her Government and expressed her pleasure at being able to visit Guyana. Discussion with the Minister centred on post-Brexit trade relations with the United Kingdom, the challenge to the integrity of Guyana’s borders, the status of the Security Sector Reform programme, the green economy and the new oil and gas sector.

The planned closure of sugar estates emerged as a new challenge to the private sector as the year wore on and the Private Sector Commission, with its members, the Guyana Manufacturing and Services Association and the Chambers of Commerce of the potentially affected areas, dispatched an appeal to the Government to stay its hand and try to save the industry given its status as the largest employer apart from Government and its crucial role in the earning of foreign exchange.

The Commission also cemented a collaborative relationship with the Guyana Oil and Association and the Guyana Oil and Gas Energy Chamber with a promise to collaborate on matters affecting the business community.

In June of 2017, the Private Sector Commission held its Annual General Meeting where a new Executive was elected by the Council. Veteran business magnate, Mr. Edward Boyer, was reelected unopposed for a second term as Chairman of the Commission. Mr. Boyer is the Chairman and Chief Executive Officer of the National Hardware Group of Companies and a former President of PSC member, the Georgetown Chamber of Commerce and Industry.
Mr. Desmond Sears, President of the Shipping Association, was reelected to the position of Vice-Chairman. Mr. Sears is Executive Director of Delmur Co. Ltd and of Forestry & Technical Consulting Inc. and Omai Transportation & Equipment Inc. He is also Honorary Consul General in Guyana for the Royal Kingdom of Norway.
Major General (rtd) Norman McLean, was elected as Secretary of the Commission. Major General McLean is a Past-Chairman of the Private Sector Commission and a veteran security expert. He is currently Company Secretary of Bosai Minerals (Guyana) Inc.

Mr. Fitzroy McLeod was reelected to the post of Treasurer of the Commission. Mr. McLeod is the Financial Controller of the National Milling Company.

The first major challenge for the new Executive was the deteriorating crime situation and violent crime against businesses. A meeting was sought with the Minister of Public Security, Honourable Khemraj Ramjattan, on the advice of the President. The meeting saw a frank discussion on the security situation and an update on developments with respect to the prison fires and escapees from the penal system. Minister Ramjattan also outlined plans for the improvement of security in the country and plans to address the erosion of public confidence.

In September, in addition to its advocacy work and even as meetings and consultations with various local and international bodies continued, the focus of the Commission was diverted to address the devastating effects of hurricanes on our sister countries in the Caribbean and their need for urgent assistance. Meetings were held with the Minister of State, Honourable Joseph Harmon, to discuss the needs of the Region and how the Private Sector Commission could assist. The response of the private sector to the appeal by the Commission was overwhelming and more than $25m in donations of relief supplies was received and handed over to the Civil Defence Commission to be relayed to where the need was greatest.

For the Private Sector Commission, the highlight of 2017 was the hosting of its inaugural Guyana Business Summit. The idea of the Business Summit was conceived by the Executive of the Commission who felt that a broad-based approach to development which would encompass the contributions of the private sector as well as, importantly, those of both Government and Opposition, was needed to catalyse the economy. The Inter-American Development Bank was approached to assist with funding the forum and they responded generously and with alacrity to the idea. The major challenge for the Commission was securing the cooperation of Government and Opposition to come together and share ideas for development but positive support from both was forthcoming and the historic Summit was hailed to be a success by all participants and observers, including regional and international organisations.

After consultations with the private sector and other interest groups, the Minister of Finance once again presented the national budget before the beginning of the Government’s fiscal year. Budget 2018 contained many measures aimed at stimulating the economy and the Private Sector Commission was duly congratulatory in its response. The Commission expressed the concern, however, that the Budget did not include enough measures designed to alleviate the contractionary effect on business of Budget 2017.

The month of December saw the Private Sector Commission living up to its mandate to support all members and organising a venue for small business members to showcase their products. A section of the Main Street Avenue was rented from the City Council and made available for crafters and other small producers to capitalise on the opportunities of the Christmas season.

Also in 2017, the Private Sector Commission took up the challenge thrown out by Prince Henry of Wales, Prince Harry, during his visit to Guyana and coordinated a visit to Kaieteur Falls by the children of the Joshua House orphanage. The aviation sector members of the Commission responded promptly to the appeal and generously donated the use of their aircraft to transport the children who were mesmerised by the majesty of Guyana’s famous waterfall.

Late in the year several sugar estates were closed and thousands of workers were sent home. In an attempt to provide some relief to affected workers and their families at Christmas, the Private Sector Commission conceived the idea of a toy and hamper drive. The response of both members and non-members of the Commission was gratifying and donations of food and toys poured in. With the assistance of Commission member, the Upper Corentyne Chamber of Commerce and Industry, hampers and toys were distributed to some 900 families at Skeldon. It was also decided to extend the gift distribution to the town of Linden and Christmas Eve saw the Executive of the Commission flying to the mining town to distribute gifts to the children.

The year 2017 saw increased and more fruitful interaction with the Government, especially with the Minister of Finance and the Minister of Business and the Commission made significant progress towards the re-formation of structured public-private dialogue bodies to allow the private sector to have an input into the formation of policy in areas affecting the economy. In the aftermath of the Guyana Business Summit, the Private Sector Commission was assured by Government that the formation of such bodies was receiving priority attention.

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