Last week it was reported that a group of forty-nine business owners had written President Irfaan Ali about the number of non-naturalised Chinese-owned businesses mushrooming across the country. They engaged in unfair competition, it was said, and they seemed to lack regulatory certificates and licences. Most of them were supermarkets and hardware stores, which appeared in close proximity to their own businesses, and sometimes several similar Chinese stores would be set up on the same street.
The letter was dated April 22nd this year, and presumably one reason why it was only released into the public domain now was because it was thought it would attract more attention than would have been the case earlier, given the recent allegations about corruption from US agencies. And while the word is never used, by implication the gravamen of the complaint is one of corruption.
A number of the signatories to the letter were members of the Private Sector Commission and/or the Georgetown Chamber of Commerce and Industry, or the Guyana Manufacturing and Services Association, but they did not go through these bodies. Instead they bypassed them, referring their concerns directly to the President under the caption ‘Guyanese Businesses Owners Association.’
Why they decided to go this route has not been explained, although they might have thought it would result in greater expedition in addressing the issues. They did, for example, request a meeting with the President, and if he was unavailable they expressed the hope someone from his office could substitute for him, so the matter could be addressed promptly. It is not known whether the head of state responded to this request, or took any other action, although PSC President Komal Singh told this newspaper last week that the Commission had received the complaints and was awaiting the findings of an investigation.
Similarly the President of the GCCI Kester Hutson told this newspaper that they had become aware of the issue following the article we published and had put the matter on their agenda.
He said that the issue had come up about three years ago and they now thought it was time to look at it again and make a decision.
Clearly sensitive to the argument about the need for competition in a capitalist society, the businesspeople wrote: “While we recognize and embrace healthy competition for the benefit of consumers, our primary concern pertains to the perceived lack of adherence by Chinese businesses to the same laws and regulations governing Guyanese enterprises.” Given the rapidity with which the Chinese businesses were appearing, “significant capital investments” were likely involved, so the question arose as to whether these entities were complying with Guyana’s anti-money-laundering laws.
But what exactly was driving the “sudden surge of Chinese businesses across Guyana?” asked the local business people. Their answer seemed to be that it did not reflect normal market competition “but a strategy to undermine Guyanese businesses by diminishing their market share.” If this is indeed so then it says nothing for our regulatory authorities that they are not applying the local laws.
And they maintained there was another curious fact: Many Chinese businesses employed a considerable number of Chinese on their premises. The group asked if these businesses were mandated to hire Guyanese workers, and if so, in what percentage? However, that is not how the system appears to operate, since on a Guyana Work Application Form an employer is required to state the reason for the employment of a non-national as against a Guyanese. And it can only be asked why a supermarket or hardware store which hardly needs sophisticated skills for the most part, would require Chinese workers in a society which hardly boasts full employment. The form also requires a statement of skill or experience, among other things.
This brings up the question of how all these work permits are being granted – assuming that the allegation made by the group is correct. Once again the Ministry of Home Affairs is brought into the frame, since that is the body responsible for the issue of work permits, naturalisation papers, and the like. After the allegations against its former Permanent Secretary, it would be appropriate if the government mounted an investigation into the issuance of all documents by that ministry, not confined to those issued to Chinese store owners and workers, since its operations appear to be compromised.
At the bottom of the concerns of the Guyanese Businesses Owners Association is the fact that the Chinese are underselling them, which poses what they call “an existential threat” to the Guyanese business community. The answer to how they might be able to sell so cheaply was put in the form of the question as to whether Chinese businesses were subject to the same taxes and import duties as local businesses, or whether they received preferential treatment such as duty-free concessions for their imports. It would be for the authorities to indicate under what circumstances stores owned by non-naturalised Chinese import their goods for sale.
The letter went on to ask whether all Chinese businesses were in possession of the required licences and adhered to building codes and permits, taxation and VAT regulations, the labour laws, NIS and PAYE. It could quite reasonably be asked whether all Guyanese entities did so either. The group also asked about the zoning controls and whether these were strictly enforced. The answer to that, at least where Georgetown is concerned, is definitely not. In fact, they haven’t been enforced for years.
And there was too the charge that many of the Chinese stores did not automatically provide tax invoices with purchases, and when requested for them, these were only grudgingly provided. From the way in which this objection was phrased, the impression was given that members of the group had sent in purchasers to buy items in these shops. They went on to say that they did not display TIN on invoices, and omitted charging VAT on applicable items as well as omitting to list product descriptions on invoices. The group cited instances too where consumers had unknowingly purchased expired food items, and then had “no recourse for product support.” These breaches raised questions about accountability and oversight by the relevant authorities said the signatories to the letter. It should be noted, nevertheless, that it is not unheard of for Guyanese salespeople to sell expired products, and entities of various kinds to avoid levying VAT or paying over NIS and PAYE.
With these kinds of allegations it is easy for the emphasis on the breach of rules to tip over into discrimination against an entire ethnic group. However, if an identifiable group from outside is in serious breach of local laws, and this breach makes it possible for them to drive locals out of business, then there is a problem. Since the publication of the letter Guyana Revenue Authority Commissioner Godfrey Statia did say his agency was investigating. As said earlier there also needs to be a major investigation into the operations of Home Affairs, covering not only non-naturalised Chinese, but also foreign sectors of the mining community, for example. In this instance there are several government agencies involved, and whatever else can be said we should not be tolerating the wholesale breach of our laws and regulations.
