By Kemol King
GEORGETOWN, Guyana, (DPI) – The oil and gas industry has done wonders for the investment climate in Guyana. On top of that, the PPP/C government’s marketing campaign to attract investment to Guyana and its revolutionary economic diplomacy with Guyana’s bilateral partners has made certain that there are investors from every corner of the globe.
Notwithstanding this, there are serious barriers to smoothly running a business which have historically held Guyana back. Here is how the administration of His Excellency, Dr Mohamed Irfaan Ali is handling them.
Improved connectivity
The liberalisation of the telecommunications sector, which occurred shortly after president Dr Mohamed Irfaan Ali assumed office, has done wonders for connectivity.
Included in this improvement has been the addition of 30 km of fibre optic cable with expanded LTE (Long Term Evolution) coverage across communities in the lower East Bank area and Bartica. The government provided 451 new service connections to public institutions and increased the public WIFI (Wireless Fidelity) bandwidth to 200 megabits per second (mbps) at 139 sites. Hinterland communities also benefited from 35 newly installed IP (Internet Protocol) phone services, granting 16,300 persons free calls between villages, government agencies and local landlines. Government also released grants to 33 communities for the retrofitting/rehabilitation of facilities to accommodate Information and Communication Technology (ICT) hubs.
But the work is not done. Senior minister in the office of the president with responsibility for finance, Dr Ashni Singh said that government intends to complete a national ICT policy during the first half of the year, and has budgeted $1.3 billion to support the sector’s development.
“In 2022, the government will continue delivering on its promise to increase connectivity by providing 100 new service connections for additional schools, hospitals and other public institutions. Also in 2022, approximately 200 hinterland communities are expected to benefit from the deployment of VSAT (Very Small Aperture Terminal) equipment to facilitate connectivity, for the first time in many instances. Additionally, 167 communities are also slated to benefit from grants to make spaces ready to host ICT hubs as well as from 400 laptops to outfit them. The government will also be expanding its fibre optic cable network by 115 kilometres to deliver additional services to over 50 communities.”
The minister said the government is committed to improving ICT literacy to elevate the employability and productivity of the population. After having trained 1,300 young people in 2021, the government is targeting 3,000 more trainees in 2022 including events such as innovation and coding camps.
The government’s ICT development programme will also see the development of data protection legislation, and related cyber security mechanisms.
Cheaper, reliable electricity
International Doing Business rankings place a lot of stock in determining how easy it is to get electricity and high electricity costs are a dealbreaker for many investors. Guyanese electricity consumers, even in the capital city, get regular blackouts, while paying about US$30 per kWh for power.
“Inadequate, unreliable, costly, and environmentally unfriendly” is how Guyana’s electricity supply was described by Dr Singh when he presented budget 2022. He said that it has been the bane of Guyana’s industrial development and its citizens’ daily existence for as long as Guyanese could remember.
To respond to the cost issue, the government is operationalising two mega energy projects, Gas-to-Energy and Amaila Falls hydropower, which will provide a combined 415 MW. The economics of these projects, which are both slated for construction commencement this year, will allow the government to provide electricity to businesses at half the current price. Businesses will no longer have to absorb unreasonable electricity costs into their margins to remain competitive against their Trinidadian counterparts.
The reliability issue will be addressed using a stable smart grid. Vice president, Dr Bharrat Jagdeo said in November, that the government is conducting a study for the installation of the smart grid, which will lay fiber on electricity lines, allowing technical officers to detect issues from a control room instead of having to send a crew out. Dr Jagdeo said the project is expected to reduce transmission and commercial losses.
Electronic single window system
The finance minister said that the design of an electronic single window for trade will commence in 2022.
“This initiative will result in the development and deployment of a single-entry point to fulfil all import, export and transit related regulatory requirements aimed at modernising and improving the efficiency of trade operations in Guyana, in support of increasing business activity.”
He also announced that there will be a comprehensive review of the business processes for all trade-related agencies, and the acquisition of the necessary IT equipment to facilitate the roll-out of the single window.
Financing and support for small businesses
The government’s budget holds small businesses in high regard. Dr Singh said small businesses have the potential to strengthen communities, local economies and the economy as a whole, and that this principle underpins the support the PPP/C has always given to them through small business development grants, training opportunities and incubator centres.
A sum of $300 million is budgeted for the Small Business Development Fund. The government will also be providing training to small business owners in business management, record keeping, business plan writing and others, making them capable of effectively developing and managing their businesses.
The Small Business Bureau will also establish an e-commerce marketplace for small businesses to market goods and services to support their resilience, and help them increase revenue. Six small business one-stop shops are scheduled to be held in 2022, in Regions One, Five, Six, Seven, Eight and Nine, with a target of 500 beneficiaries. The government also intends to digitise the licencing process and to develop an online platform for communication with the public and the provision of training to businesses in leveraging technology.
“A sum of $245 million has been budgeted to facilitate the establishment of new industrial estates in Regions Two and Ten. Additionally, business incubator centres at the Lethem and Belvedere estates will be operationalised in 2022 with 16 pods combined between the centres,” Dr Singh said.
The pods, the minister told the House, will provide shared access to light manufacturing facilities, operational space, and training and coaching for small businesses. This way, small businesses will be able to produce value-added agricultural products including virgin coconut oil, indigenous flour, and processed fruits, as well as other goods and services.
“To assure confidence in our private sector and locally-produced goods and services, a National Standards Strategy for the development of priority standards will be pursued in consultation with stakeholders. In addition, we are examining the establishment of a traceability system which would address trade barrier issues, to the benefit of our growing private sector,” the finance minister said.
This builds on work done by the PPP/C government last year, when it provided grant support for 746 small businesses, including covid-19 relief grants. The government had also introduced the first-ever small business one-stop-shop in Region Two, which rendered assistance to 111 persons with business registration, National Insurance Scheme (NIS) compliance and other related business transactions. The government also effected an increase in the number of export/import licences granted, from 5,282 in 2020, to 5,969 in 2021.
