A team of officials from a Canadian university will be in Guyana next month to explore and finalise aspects of the Sovereign Wealth Fund (SWF) the government plans to set up, according to Minister of Governance Raphael Trotman.
Asked for an update on the SWF during a post cabinet press briefing yesterday, Trotman said that the Canadians have used their good offices to allow Guyana to benefit from the processes and the expertise available at the University of Calgary in Alberta.
He said that later in the month of November a team is coming from the University with the specific responsibility of commencing the putting together of the mechanism for what “we loosely refer to as a sovereign wealth fund”. He reminded that the intention of the fund is to attract a percentage of all the resources not just from oil but also from gold, diamonds, sand, stone and possibly agricultural products such as seafood.
Water is also on the agenda. The minister said that in another few years water is going to be a very scarce resource. “We are accustomed to allowing it to just run away but it is a resource that we are going to start to harness and to manage much better than we have been”, he said.
Asked if government has identified a percentage of revenues for the fund, he said that that is an arrangement that will have to be determined by cabinet after taking the advice of the minister of finance. He said that government would want to have three options or funds before it; one that secures the wealth of nature for future generations; one that allows government to tap for budget support and one for the developmental trust. “So you may wish to say that a percentage is used for the development of ports and highways and aerodromes to open up your hinterland, some of it should be used for budget shortfall …or some natural or unnatural incident you can tap into it and I can you can also secure some for further generations”, he said, adding that there are three funds which “comprise the sovereign wealth fund but each will have a different rate at which it is supplied and different reasons and mechanisms from which you can draw down on it”.
Plans to establish the fund were first revealed in February by the then PPP/C government.
The then Ministry of Natural Resources and the Environment had said in a press release that Guyana is considering the establishment of a sovereign wealth fund as part of its strategy to manage revenues that could accrue from its oil and gas potential.
