Dear Editor,
The Government’s recently released second draft Local Content legislation looks good on paper, but in reality, does little to solve the real issues local businesses face every day in Guyana. Of course local content is important. But while raising the local content standards may sound nice, it doesn’t actually help make it easier to start or operate a business in Guyana. Everyone knows there are opportunities in the oil sector. What’s holding us back can’t be solved by just telling the oil companies to hire locals. Who are they meant to hire? Many of the needs of this new oil industry are clear: trucking, food service, waste disposal. All things local could dominate. But the size of these needs is not something small companies can handle right now. Government “targets” won’t change that.
Any businessman or woman can tell you how hard it is to start a new company here. Electricity is expensive, financing is hard or impossible to come by and permitting is absurd. If the government wants business to grow enough to work in the oil sector, it needs to address those root causes first. Businesses, especially small ones, need more access to financing to be able to invest in new machinery and larger office spaces, pay new employees, and train current workers. The reason so many Trinidadians can outcompete us is not skill, it’s that when a Trinidadian company needs to buy more trucks for an opportunity like this, they have access to the capital to do so.
Meanwhile, out of 190 countries studied, Guyana came in 134th in the World Bank’s Ease of Doing Business Report. Addressing the factors that contribute to this rating, especially the high cost of unreliable power, inadequate banking options, and ancient regulations, should be top priority for this government if it truly wants to see local companies competing to supply the oil industry. The intention behind these targets is the right one. Local companies deserve a fair shot. But with targets like these alone, too many of the benefits will be going to those who can already stand on their own. Smaller companies need help, too. We see the opportunities and a little help from the government could help us seize them.
Sincerely,
Clement Smith