Dear Editor,
About two weeks ago I had published a letter to the editor which dealt with the urgent need for Guyana to upgrade its anti-money laundering and financing of terrorism laws in keeping with CFAT recommendations made four years ago.
As the newspapers now confirm Guyana has until the end of this month to amend and upgrade the relevant legislation. To say government has been dilatory in getting its house in order for compliance would be an understatement. Rather, its attitude has been decidedly cavalier.
Now that the implications of this sloth loom, government has gone into panic mode and blame-the-opposition gear. The deadline of May 26 is almost here and at last the penny has dropped that Guyana may soon be up the proverbial creek without a dugout, much less a paddle. To blame the combined opposition is cheap and churlish, and government should order its AG to desist from this pathetic and sickening line of action.
If Guyana is black-listed by the OECD countries, and that seems imminent, there will be major upheaval in Guyana’s banking system. Every movement of money in or out of Guyana will be intensely scrutinized by the transacting banks here and abroad. The process will be long and tedious as corresponding banks overseas through which these transactions pass, will want to be 101% certain that any Guyanese transaction is squeaky clean and whiter than white. There is a cost penalty involved in this level of scrutiny which goes well beyond the existing ‘know thy customer’ requirements, and it will be passed on to the transacting customer. I envisage that some correspondent banks will determine that it is not worth their while to carry out such painstaking and time-consuming scrutiny for the relatively paltry sums of money involved in most Guyana transactions.
Money transfer businesses will feel the pressure in a big way and will increase the cost of their transactions. As a result remittances may slow down, reduce in dollar terms and may dry up as senders in the US, Canada, the UK and the Caribbean are systematically harassed to show origins and sources of the money being remitted.
At present annual remittances to Guyana may total as much as US$300M. When this drops significantly, dependent Guyanese will suffer hardships with few options at their disposal ‒ finding work at the Marriott Hotel construction site will clearly not be one of them. The resulting strain on the economy will be formidable.
Local importers will face difficulties making their payments to foreign suppliers while local exporters will experience long delays in receiving payments from foreign importers. Such a situation can lead to employees being retrenched or having their hours reduced. A fall-off in remittances will reduce purchasing power and personal savings. The worst-case scenario may be that some businesses will be forced to close.
It so happens that the new dispensation is all about give and take. Government now desperately needs to abandon its high-handed, Olympian attitude to the administration of the nation’s business.
It must now embrace a collegial approach to resolving this serious problem.
The task is for the government of the day to behave like one.
Yours faithfully,
F Hamley Case
