A former president of the Georgetown Chamber of Commerce and Industry (GCCI) has said that the current preoccupation by Business Support Organizations (BSO) with the Local Content spinoffs that promise to derive from the country’s emerging oil & gas industry ought to be matched by a corresponding vigorous lobby for the creation of a domestic economic environment that helps facilitate broader substantive private sector growth.
In a comment on issues impeding the growth of the Guyana economy published in this issue of the Stabroek Business, Clinton Urling, a former Chamber President drops a broad hint that the preoccupation of the local private sector bodies with what they appear to anticipate as a huge economic windfall to be derived from local content spinoffs, may have created a blinkered perspective that could result in diminished focus on addressing the various constraints that impede the substantive growth of the private sector.
“While there has arisen – particularly in the private sector Business Support Organizations (BSO’s), a Local Content clamour that targets the spinoffs from an emerging oil & gas industry there has been no corresponding clamor for the removal of the imposing constraints that stifle private sector potential and by extension the social resolve and economic well-being of the populace at large. As the world economy awakens in the post-pandemic recovery, Guyana should be on the front steps of opportunity to prepare itself for an economic boom. This is not – at least so it seems – where we are positioned at this time,” Urling writes.
The proprietor of the iconic German’s Restaurant, almost certainly the oldest urban eating house in Guyana, writes that the private sector’s focussed attention on the potential returns for local businesses envisaged from economic activity linked to the oil & gas sector may be blinding its eyes to critical weaknesses in the country’s economic profile that have to be addressed if it is to move forward.
Urling’s remarks came against the backdrop of some broader observations regarding what he sees as structural flaws in the country’s economic development profile which, if not remedied, he says, could continue to injure the country’s development trajectory, the financial returns promised by the country’s emerging oil & gas industry notwithstanding.
The GCCI has been, in recent times, a robust lobbyist for the consolidation of the country’s local content credentials and the positioning of local businesses to reap such benefits as might accrue therefrom and which, many feel, is likely to exclude the vast majority of the country’s small business enterprises.
While not failing to recognise the economic prospects that could derive for business growth from local content, Urling contends that even as the world economy contemplates a post COVID-19 recovery, Guyana must move to correct some of the deep-seated flaws in its economy if it is to prepare itself for the anticipated “economic boom” promised by the oil & gas industry.
“As the world economy awakens in the post-pandemic recovery, Guyana should be on the front steps of opportunity to prepare itself for the forthcoming economic boom that promises to emerge from an oil & gas industry,” he writes.
According to Urling, whose emergence as a local businessman derived from his work in modernising and transforming German’s Restaurant into a modern eating house, bemoaned the fact that since embracing “free market principles that advanced the private sector to lead the country’s productive industries more than thirty years ago” Guyana has developed and embraced “all sorts of national development plans and ideas that try to explain what has held us back and what remedies would potentially eradicate the systemic constraints.” His analysis concludes that as a country, Guyana is “yet to remove or reconcile the barriers that have been identified as we continue to struggle to achieve our full potential, prosperity and long-term economic stability.”
Urling, who over the past few years has drawn further attention to his entrepreneurial acumen by creating a branch of German’s Restaurant in New York, tagged the country’s failure, over time, “to cultivate the sort of business environment that could compete on a global scale” as a key reason for its failure, over the years, to attract meaningful investment.
Noting that Guyana has never been ranked in the top 100 (out of 190 countries) in either the Global Economic Forum’s Global Competitive Index or the World Bank’s Ease of Doing Business Index , he draws attention to the need for significant improvement in these areas if there is to be any overall improvement in the country’s economic fortunes. Guyana’s performance, he says “is emblematic of the region, as no Caribbean economy has appeared among the world’s top 10 improvers in the last four years and none register in the top 50. Likewise, the entire region underperforms in measures such as registering property and obtaining credit. For example, registering a property in the Caribbean takes 90 days; nearly double the global average of 47 days,” he writes.
And according to Urling Guyana has, over time, missed “key opportunities” to set the pace for itself and the region. He noted that while in 2015, former Minister of Business Dominic Gaskin declared that red tape was something that his government wanted no part of, and that Guyana would work to improve in areas where they had been marked as deficient, as identified in the World Bank’s index, the country has since then, fared worse, dropping from a ranking of 123 in 2015 to134 in 2019. “One would have hoped that if the government’s commitment had been as sincere and genuine as possible, Guyana would have, at least, improved incrementally its position in the World Bank index,” Urling points out.
And according to Urling, the movement for real change continues to “limp along at a lumbering pace, offering only half-hearted cosmetic moves instead of meaningful reforms destined for long-term improvement.”
The Guyanese businessman alluded to “several glaring constraints to business development” which he says exist and which he believes can be “easily identified by anyone and should be addressed with haste if we intend to become serious about economic development, especially as the post-pandemic economy.” He asserts that among the most glaring constraints are “skills deficits and training gaps; bureaucratic bottlenecks in public agencies; the high costs of finance and electricity; an outdated, compromised and unsecured land and property transfer system; inconsistent and uneven processes for the transfer of state assets, an outmoded electoral system; inadequate e-commerce platforms and data protections; meager support for micro- and small-business development, and a lackadaisical, inefficient judicial system to deal efficiently with commercial disputes.”
