Enhanced high-level discourse between senior officials of government and officials of the Guyana Manufacturing & Services Association (GMSA) aimed at resolving the challenges confronting the country’s manufacturing sector has still left the sector with a slew of unresolved issues which continue to stymie its potential and inhibit its growth, Immediate Past President of the Association Shyam Nokta told the its Annual General Meeting on Thursday February 28th at the conclusion of the final year of his two-year term at the helm of the organization.
In a measured presentation which clearly sought to strike a balance between effort and concrete accomplishment, Nokta was effusive in his praise of the role which the Government of Guyana/GMSA Ministerial Round Table, created in 2017, had continued to play last year in enhancing public/private sector discourse on key manufacturing issues through a Joint Technical Committee co-chaired by the two sides though he said that the enhanced dialogue had, nonetheless, left behind a host of still unresolved issues for the sector.
While acknowledging that the Joint Technical Committee had proven useful in helping to share information and perspectives and to advance collaborative actions” and foster “a functional working relationship between the GMSA and the Government of Guyana,” Nokta alluded to a number of “barriers that include tax measures, access to finance, market access and trade facilitation, procurement, as well as high costs and unstable energy supply” which he said continued to retard the advancement of the local manufacturing sector.
Perhaps unsurprisingly, his address highlighted, particularly, the manufacturing sector’s persistent complaint about high energy charges and the impact of those on the sector’s development. In his address he noted that issues of both cost and “stability and reliability” of electricity supply had had the effect of forcing manufacturers to remove their operations from the national grid and resort to self-generation. “In fact, energy has been the principal limiting factor in addressing adding value to primary production across many sectors,” Nokta said.
Electricity aside, Nokta also targeted “tax measures introduced in Budget 2017 such as VAT on electricity” as developments which he said had continued to affect manufacturers in 2018, though he said that it was the Association’s hope that consideration would be given to “the strong case” that it had made for “tax relief on fuel for manufacturers, similar to what other sectors benefit from”.
In his address Nokta also alluded to what the GMSA believes is the dichotomy between the “continued call for more value-adding in the primary productive sectors, and for more exports”, on the one hand and on the other, “adjustments to the VAT regime in 2018” that have resulted in some manufacturers being unable to reclaim VAT on inputs for exported items. This, he said, served as a disincentive to both manufacturing and exports. Other sub-sectors including wood-processing, fisheries and rice, he said, had also been affected by this development which he said the GMSA was seeking to have “reversed sooner rather than later.”
Nokta’s final public pronouncement in his capacity of President of the GMSA was also used to point to the sector’s perennial concern over the role which “the extended rainy season coupled with lack of maintenance” had had on the state of “key roads to the interior” which he said had thrown up “severe challenges in getting goods to hinterland locations overland and affected the forestry and mining sectors in a major way.” While he conceded that official efforts had been made to address this problem accessibility continued to be a challenge. “
Addressing these principal barriers will be key to the growth of the manufacturing sector in Guyana. It will hinge on Government policies and programmes as well as the support of the donor community and key international financial institutions to assist implementation,” Nokta declared.
For all the considerable challenges, however, the Immediate Past President of the GMSA said in his report that his tenure had witnessed the creation of a more convivial environment in public/private relations as reflected in the environment of enhanced conviviality that had been realized between government and the GMSA. Contextually, he alluded to the role which the Ministerial Roundtable Discussions had played in focusing on the advancement of the agro processing sector. Nokta’s tenure as President of the GMSA coincided with various public/private sector collaborative initiatives including the UNCAPPED agro processing events staged at the Sophia Pavilion and the Providence Stadium. According to Nokta this mechanism had proven useful in helping to share information and perspectives and to advance collaborative actions” while helping to foster “a functional working relationship between the GMSA and the Government of Guyana.”
