Highlights

Senior Finance Minister urges IDB to ramp up private sector lending in Guyana

Demerara Bank disburses financial support to businesses through IDB’s US$7M Trade Financing Facility

Georgetown, Ministry of Finance, June 23, 2021: Today, five private sector enterprises received financial support through Demerara Bank’s access to the Inter-American Development Bank’s (IDB) Trade Financing Facility (TFFP) Program during the Bank’s Disbursement ceremony at its Corporate Head Office on Camp Street. Senior Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh in recognising the IDB’s efforts, urged the Bank to continue and expand its support to Guyana’s private sector in this regard as the country undergoes its current remarkable transition towards economic prosperity.

Demerara Bank was incorporated by the IDB into its TFFP in 2020 thereby later allowing for the opening of a line of credit to be used for short -tern international trade finance transactions to support local small and medium enterprises. Through the facility the bank is now able to diversify its network of partners and offer trade finance products for imports and exports including loans and guarantees. Alluding to this support, Minister Singh said it could not have come at a timelier period than the current, when the country is on the verge of an economic turn-around, despite the current challenges of a flood coupled with the COVID-19 pandemic.

“We are a resilient country and we are going to get past the flood…and once we get past this, we need to come together, Government, the financial sector, the domestic private sector and indeed our valued development partners to consider how to ensure we realize this aspiration we have. Today’s event is an important step in that direction- the disbursement of this US $7M from the IDB to Demerara Bank represents an example of what we can achieve through partnership.”

Also speaking at the event was IDB’s Country Representative Sophie Makonnen who noted that the IDB in considering the support, recognized the need for diversification in Guyana’s economy and the fundamental need for small business growth and small business support as well as increasing their capacity. This in turn, it was noted, would not only in turn assist in job creation but also in growth in the country’s Gross Domestic Product (GDP).

Meanwhile, Founding Chairman of the Board of Demerara Bank, Mr. Yesu Persaud whose idea it had been for the establishment of a local bank upon his return to Guyana many years ago, alluded to how his idea came to fruition after much difficulty in accessing a license at the beginning. Mr. Persaud , however referred to the many achievements the bank has had since then and how it has weathered all storms to become one of the most successful financial institutions in the country.

As part of its support, funding from the TFFP will also be directed towards the Agriculture and Mining sectors in Guyana.

Finance Minister successfully pilots Supplementary Appropriation Act in Parliament

Over $23B Supplementary funding secured for flood relief, vaccines, other emergency interventions including in security, agriculture sectors.

Georgetown, Ministry of Finance, June 14, 2021: Supplementary allocations to address the recent major flooding in several Regions as well as for emergency interventions in key sectors including
Agriculture, Health, Housing and Water, Public Works and Security have been secured with Senior Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh successfully piloting the Supplementary Appropriation Act in the National Assembly after which it was meticulously scrutinized and debated with the Opposition A Partnership for National Unity/Alliance for Change (APNU/AFC) posing a number of questions before the Motion was finally passed late Monday night.

The Supplementary Appropriation Act approved comprised Financial Paper 1 of 2021 totalling $1.9 B to cover for the period April 1-June 8 which provides for drugs and medical supplies and air, water and land transport and Financial Paper No.2 of 2021 totalling $21. 3 B for works in various sectors including for the Demerara Harbour Bridge and for the rehabilitation of public and access roads. Additionally, funds were approved for the purchase of COVID 19 vaccines and expansion of health facilities and infrastructural works in new and existing housing areas.

In relation to Financial Paper No. 2, $10B was secured under the Office of the Prime Minister as provision for flood relief interventions including repairs to infrastructure and support for recovery in the productive and household sectors as well as for community-grounds-enhancement under the Ministry of Culture, Youth and Sport. Additionally, funds were secured under the Ministry of Agriculture to provide for additional resources to support the restructuring of the Guyana Sugar Corporation (GUYSUCO) and under the Ministry of Home Affairs for the provision of more resources to support the Customs Anti-Narcotics Unit (CANU) in its operations.

Commenting recently on the flood situation in many Regions due to a lengthy heavy rainfall period, Minister Singh said that despite providing an immediate response to the countrywide crisis, more funding was urgent to address the situation and to fix damages in the aftermath. He had indicated that deployment of additional equipment including pumps to get water off the land would have taken place and this action would need to be sustained by Government for the period that the rains continue. He added that the provision of relief for citizens directly affected would need to be sustained as well with there being no access to food, markets and cleaning supplies for thousands.

The Finance Minister had reminded too that several dams, bridges and roads would have been washed away as a result of the flood while some would have been battered by the persistent rainfall
and therefore, additional costs to the country would have been incurred. These, coupled with Government’s continued fight against the dreaded and ongoing COVID-19 pandemic, would have necessitated additional vaccines, thus the Supplementary Provisions.

Senior Finance Minister describes APNU/AFC’s 2016/2017 closure of sugar estates as ‘a most callous and unconscionable act’

Assures Government’s commitment to revitalizing, restructuring of the industry

Georgetown, Ministry of Finance, June 10, 2021: In his feature address today during the virtual launch of the International Labour Organisation (ILO)- sponsored study on the Socio-Economic Impact of the Closure of Guyana Sugar Corporation (GUYSUCO) Sugar Estates on Sugar Workers in Guyana, Senior Finance Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh expressed disgust at the A Partnership for National Unity/Alliance for Change’s (APNU/AFC’s) decision to close sugar estates leaving thousands on the breadline and the Coalition’s failure to acknowledge the socio-economic impact of the act.

The Senior Finance Minister who addressed the forum on behalf of His Excellency Dr. Mohamed Irfaan Ali said the move by the then Administration was one which affected the lives of sugar workers tremendously leaving many of the workers suffering and experiencing hardship.

“The closure of Wales, East Demerara, Rose Hall and Skeldon estates in 2016 and 2017 under the APNU/AFC Administration was a most callous and unconscionable act committed against workers, including thousands of persons working in the industry as well as tens of thousands living in communities that depend on the industry, resulting in social and economic hardships in rural Demerara and Berbice, with rippling effects throughout Guyana,” Minister Singh reiterated.

“What was worse, this was undertaken without the benefit of any proper socio-economic analysis and conflicted with the APNU/AFC-sponsored Commission of Inquiry (COI) which did not recommend the closure of any estates. Approximately 7,000 sugar workers were placed on the breadline, resulting in grave hardships to these workers and their families- thousands of small and micro-business devastated as their livelihoods were intricately linked to these estates,” the Minister added.

He recalled that sugar cane production played an integral role in Guyana’s development since time immemorial with the cultivation of sugar cane and sugar production paralleling the country’s economic history and being instrumental in shaping its demography.

“The industry once had the distinction of being the largest foreign exchange earner and employer and has sustained generations of Guyanese especially those of rural Guyana. Even today the rural economy is still integrally linked to sugar production,” Minister Singh reminded.

On this note he said Government welcomed the commissioning of the study by the ILO which is being undertaken by Dr. Thomas B. Singh, a well-known academic, in collaboration with the Guyana Agricultural and General Workers Union (GAWU).

It was recounted that the turmoil for the sugar workers and the sector commenced in February 2016 when the field workers of the Wales Estate were given a three-day ultimatum by GUYSUCO to either accept severance, be transferred to Uitvlugt Estate, or be dismissed. Despite being later rescinded thorough the efforts of their Union, the services of the workers were terminated when the estate closed on 31 December 2016. Similarly, the workers of East Demerara, Rose Hall and Skeldon Sugar Estates faced the same fate, with their services all terminated on 29 December 2017.

The Senior Finance Minister alluded to the fact that the then Government made no provisions for the displaced sugar workers with even severance payments guaranteed by law being denied and delayed resulting in the sugar workers resorting to the Courts to fight for the payments to be honoured.

“Further, the three remaining estates were starved of investment and resulted in sugar production reaching its lowest ever level. This left approximately 7000 workers on the breadline with no viable alternative options for employment in a struggle against the APNU/AFC government while still having to pay mortgages and importantly, support their families. Some were not able to receive their final severance payments until 2020,” the Minister recalled.

He noted that the report highlighted a decline in weekly household income for persons affected and that to appreciate the total impact, the average number of dependents was 5.3 with the average age of the respondents being 50 years old and many advanced in age for being considered for new employment.

Minister Singh however assured attendees at the launch that Government is in the process of developing a master plan for each estate that will guide the future development of the industry, adding that the master plan would seek to restore the socio-economic balance of the sugar belt through recapitalisation of the industry, promoting product diversification and value-added products as well as agro-energy.

“Among the elements that are being considered within this master plan is the redirecting of GUYSUCO’s efforts towards an optimised product mix, moving away from the current low value bulk-sugar market. This is high on the agenda and it is anticipated that there could be a quadrupling in sales from packaged sugar market both locally and internationally over the next five years. This would require the expansion of the Blairmont and Enmore Packaging Plants,” Minister Singh stated.

He noted that ‘these measures are in line with the recommendations of the study, for there to be diversification of the economy in a way to counterbalance the price volatility that characterizes
commodity markets.’

With the report recommending the need for assistance to the affected workers and their families for the avoidance of poverty traps, Minister Singh indicated that the Government is cognizant that this is the reality faced by these workers and is, therefore, working hard to restore their livelihood.

“The sugar industry still has an important contribution to make to Guyana. Our government is committed to the revitalisation and restructuring of the sugar industry to support a diversified and modernised sector so as to ensure its sustainability and economic viability. We have begun to take steps to recapitalise the industry, with a $7 billion injection in 2020 and an additional $2 billion budgeted in 2021 for critical capital works. We envisage a sugar industry which shall continue to contribute to national development, to restoring livelihoods and boosting the rural economy,” Minister Singh concluded as he thanked all involved in the study and expressed appreciation to the ILO for supporting it.

APNU/AFC hullabaloo about CET on soap just the latest example of that party’s habitual distortion of facts – says Finance Minister

‘Reinstatement required by COTED ruling, as they are well aware’

Georgetown, Ministry of Finance, May 27, 2021:

The Ministry of Finance has taken note of a release by the A Partnership for National Unity /Alliance For Change (APNU/AFC) leadership which attempts to convey that party’s indignation at a notice published by the Guyana Revenue Authority (GRA) regarding Guyana’s intended reinstatement of CARICOM’s Common External Tariff (CET) on soaps falling under the tariff heading HS 3401.

The fact of the matter is that the APNU/AFC has been well aware for the longest while that, in 2018, Dominica had filed an official complaint at the Caribbean Community (CARICOM) Council for Trade and Economic Development (COTED) against a number of member States which were applying rates of duty on extra-regional soap less than the prescribed CET rate of 40 percent. Guyana was amongst those countries, given that we were charging at the time a rate of 20 percent. COTED ruled on the matter and directed that all such member states which were in violation of the CET should reinstate the 40 percent.

Following the 2018 ruling by COTED, the then APNU/AFC government started to take steps to implement the reinstatement of the CET, including drafting the required legal instruments. They, however, did not proceed to finalize these, presumably because they were more preoccupied with trying to find a way to hold on to office illegally and preparing plans to rig the upcoming 2020 election.

Additionally, shortly after the onset of COVID-19, the APNU/AFC government which was by then illegally in office, proceeded to lower the rate of duty charged by Guyana from 20 to 0 percent, which further exacerbated the CET violation. Worse yet, they did so without invoking emergency procedures through the appropriate COTED channels, which might have been used to regularize the matter. Instead, they acted with similar arbitrariness and highhandedness which characterized their entire five years of misrule.

Since then, Dominica has continued to pursue the matter bilaterally, and has suffered severe economic consequences as a result of the CET violation. Furthermore, Dominica and Guyana share an important trading relationship. Guyana is one of Dominica’s main export markets for soaps, accounting for approximately 42 percent of Dominica’s exports. In addition, Dominica sources 75 percent of its total rice imports from Guyana and 32 percent of its total imports of sugar.

Guyana’s failure to respect COTED’s 2018 ruling on this matter exposed our country to legal action by Dominica and other regional producers of soap through the Caribbean Court of Justice (CCJ) and could result in very substantial damages being awarded against Guyana which would in turn result in a significant cost to the public treasury.

The APNU/AFC is well aware of the history of this matter, and they had themselves already started to take action to reinstate the CET before they got busy trying to steal the 2020 election. Despite being in full possession of the facts surrounding this matter, they have chosen once again to follow the route of trying to mislead their rapidly dwindling number of supporters with a completely contrived and fanciful misrepresentation of this matter.

No soap imported from Dominica or any other CET Member State would be subject to duty. The reinstated CET applies only to soaps imported from outside the CET region.

The action taken today is consistent with the current Government’s respect for the rule of law, the CET being a legally binding regional obligation. This action is also consistent with Guyana’s solidarity with our brothers and sisters in Dominica for whom soap manufacturing is a major industry, a major employer, and a major source of foreign exchange. In exactly the same manner, Guyana would not wish for any other CARICOM Member State to violate the CET as it relates to any of the goods we produce and can export to the region.

It is indeed ironic and even comical that the APNU/AFC would seize on a single item on which the CET is being reinstated in keeping with a regional ruling on the matter, when it was the very APNU/AFC that imposed a vast array of punitive and unconscionable taxes on the people of Guyana, including on electricity, water, medical and educational supplies and services, household necessities, building materials, and heavy equipment for use in the mining and other industries. These punitive taxes have since been removed by the current Government, in line with its pre election commitment to do so.

Senior Finance Minister summons GUYOIL’s Board of Directors on alleged irregularities

Requests that Auditor General be invited to conduct urgent investigation

Georgetown, Ministry of Finance, April 20, 2021: Following media reports earlier today of alleged irregularities at the Guyana Oil Company (GUYOIL), Senior Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh summoned the Company’s Board of Directors to an urgent meeting to be briefed on the matter. During that meeting, the Board confirmed to the Minister that there is no contract with the company Aaron Realty Inc. to supply fuel to GUYOIL. The Board also outlined to the Minister the procedures which are followed by the Company with respect to the procurement of fuel.

Consequently, the Minister requested that the Auditor General’s office be invited to conduct an urgent investigation into the matter which is the subject of the allegations being made.

Following the resignation of the Company’s General Manager Mr. Trevor Bassoo, which was accepted by the Board of Directors, the Minister has also requested that a sub-committee of the Board be formed to oversee the day to day operations of the company and lead the search for a new General Manager.

Minister Singh further emphasized the need for the Company to act in compliance with the established laws and procedures in line with good governance, accountability and transparency. He reminded that the Board is appointed to protect the interest of the Government and people of Guyana and it is what he expects of all State entities. On this note, he reiterated that his Government will not tolerate any type of unlawful practices.

Sod turned for new $800 M Assuria Headquarters

Senior Finance Minister says new building will be yet another tangible example of Guyana’s rapid transformation

Georgetown, Ministry of Finance, April 7, 2021: Delivering the feature address today at the sod turning ceremony to mark the commencement of the construction of an $800M new Headquarters for the Assuria Insurance Company, Senior Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh commended the Company for its resilience and growth in Guyana while noting that the new building will become yet another instalment in the tangible evidence of the rapid transformation that Guyana is currently undergoing.

The Suriname-based company has been operating in Guyana since 2012 and the Senior Finance Minister urged other companies to emulate the Company’s commitment to growth and expansion outside of its domestic space in Suriname.

“I would like to say to Guyanese companies that just as Assuria spotted an opportunity in the Region, there are lots of Guyanese companies in the private sector who operate at a world class, who deliver world class services and world class products and who I would want to encourage equally to look beyond the confines of the Guyanese market space. There’s nothing to stop Guyanese companies looking beyond Guyana, looking at the Regional economic space,” he emphasized.

Dr. Singh reminded that while Guyana is receiving attention due to oil and gas production, persons should examine other areas of investment as he urged the company to expand its products and services at a countrywide level while also encouraging Guyanese companies to also see how best they can utilize the opportunities available Regionally and Internationally.

“Many of the Guyanese companies are now required to ‘up their game’ so to speak. They have to compete at international standards, some are now complying with international standards, are now competing with international companies. I look forward to the Guyanese companies of today becoming the large regional companies, large regional conglomerates of tomorrow and indeed becoming companies with an international footprint,” he said.

Meanwhile, touching on the aspect of insurance, the Senior Finance Minister urged the Company to ensure that the Guyanese society is educated more on the importance of insurance to their families and everyday activities.

“I feel very strongly that insurance is not discretionary or optional expenditure. There are lots of people in Guyana who feel that insurance is something that you can afford to do without or you take the absolute minimum insurance that is required because you must have insurance just to get by. Insurance is an indispensable staple in any company’s and any household’s risk management tool kit. You can’t speak of risk management without considering the importance of insurance,” the Minister reiterated.

Dr. Singh then further advised those gathered at the event that insurance is something that needed to be taken more seriously.

”You might not appreciate the importance of insurance until perhaps you consider at the household level what happens to your family if God forbid you suffer a calamitous experience ….death…or incapacitation….or inability to work…and if you consider what that means for your family ….you might have a second thought about the value of personal insurance,” he pointed out.

Assuria’s Managing Director Mr. Yogindra Arjune, in his remarks at the forum, indicated that the new building is expected to be completed in 14 months and will consist of a five-storey modern building at the corner of Church and Carmichael Streets, Georgetown.

Finance Minister tours Qualfon Providence campus

Advocates Guyana as prime destination for business process outsourcing (BPO) operations

Georgetown, Ministry of Finance, April 6, 2021: During a tour of the Qualfon Call Centre Providence campus today, Senior Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh indicated that the Government of Guyana will be promoting Guyana aggressively as a prime destination for business process outsourcing (BPO) operations such as call centres which have the potential to create thousands of new jobs for the Guyanese working population.

The Minister highlighted that Guyana has a number of obvious advantages as a destination for BPO operations, including the country’s English-speaking population, as well as the population’s high level of literacy, along with the country’s location in the same time zone as the East Coast of North America. He added that the recent liberalization of the telecommunications sector also adds to the factors weighing in Guyana’s favour as a destination for this kind of business.

He noted that call centres such as Qualfon which employ large numbers of persons will assist in the diversification of the economy through job creation and employment which is a major focus of President Irfaan Ali’s Government.

While recalling that it was under the People’s Progressive Party/Civic that Qualfon opened its doors in Guyana, Minister Singh said, “Guyana has remarkable potential in the BPO sector especially in the generating of income and creating jobs. Our Government (at the time of the Company’s opening) had recognized the remarkable potential of the Company.”

The Senior Finance Minister reminded that the company started its operations in Guyana in 2005 with 25 employees and expanded rapidly to reach 2,800 employees by 2014, but that in the last five years this figure had fallen to below 1,800. He posited that it is this Government’s intention to see the Company once again realize its full potential, and that the BPO sector more broadly would once again become a major employer in Guyana.

“We believe that the Company has phenomenal potential in Guyana. We would like to see thousands of jobs created by Qualfon and other companies operating in this sector. We were (at the time of Qualfon’s opening) advocating Guyana as being an attractive BPO destination, which we intend to resume doing. We see companies like this, and the sector as a whole, as being an important part of economic diversification,” Dr. Singh noted further.

The Senior Finance Minister who was accompanied by Chief Executive Officer (CEO) of the Guyana Office for Investment (GO-Invest), Dr. Peter Ramsaroop, prior to elaborating on the role Qualfon and call centres as such would play in Government’s economic diversification drive, was taken on a tour of the campus by Qualfon’s Country Director, Luanna Persaud. There, he witnessed a large number of young people at work in various departments serving Qualfon clients around the world using modern information and communications technology.

With Guyana being a major international player currently due to it being an oil and gas producer, President Irfaan Ali’s Government, since its ascension to Office in August 2020, has continued to reiterate the importance of the other sectors in the country and has placed much focus on ensuring that the sectors receive the necessary attention and efforts to assist in boosting the country’s non- oil economy. Some of the sectors seeing activity increasing and which have been noted to be the ones that will aid the country in its economic drive are agriculture, tourism, services and logistics and housing and water.

Finance Ministry warns businesses of stern action against those still illegally charging VAT

Georgetown, Ministry of Finance, March 24, 2021:

Senior Minister in the Office of the President
with Responsibility for Finance Dr. Ashni Singh is sending a stern warning to businesses that should they continue to flout the laws and unscrupulously attach a 14 percent Value Added Tax (VAT) to items on which the VAT has been removed or has been reduced, they will face the full force of the law as this illegal practice is denying consumers the right to ultimately enjoy reduced prices on various commodities including construction materials.

The Minister is reminding the public that when the last 2021 Budget was passed in the National Assembly on March 4, 2021, it would have outlined a number of measures including the VAT zero- rating or reduction of VAT or duty previously charged on a number of commodities.

Consequently, Order Number 6 of 2021 of the Value Added Tax Act Cap.81:05 of the Laws of Guyana came into effect immediately for VAT zero-rating of certain construction materials namely stone imported for construction and housing from Caribbean Community (CARICOM) countries, locally produced pre-stressed concrete piles and locally fabricated mild steel beams for building construction and locally manufactured roofing and PVC products for building construction. Import Duty on Industrial Grade Cement was also reduced from 15 percent to 5 percent.

Additionally, the VAT zero-rate was also restored to basic food items and household necessities that were previously zero-rated up to May 2015 but switched to ‘standard-rate’ or ‘exempt’ over the past five years, e.g., basic wheaten flour, basic breads, oats, unflavoured cracker biscuits, cooking oil, locally produced bed sheets and pillowcases and toothbrushes.

Prior to this, an emergency Budget was also passed in Parliament on September 25, 2020. This Budget also stipulated the VAT zero rate or removal of VAT on other commodities including the overall removal of VAT on electricity and water. Therefore, since then, VAT would have also been removed from hinterland travel and cell phones, as well as building and construction materials.

The Senior Finance Minister recalled that all of these measures were intended to benefit consumers and ease the expense aligned to these previously burdensome tax measures and with their removal or reduction, the expectancy was that it would have ultimately allowed for the reduction in the cost of living of Guyanese generally.

It has come to my attention through various reports from members of the public that a number of hardware stores have since refused to comply and are still unscrupulously charging VAT on several items,” the Minister said.

Dr. Singh added that he is therefore warning such establishments that this illegality will not be tolerated. As such, he pointed out that he has already instructed the relevant agency-the Guyana Revenue Authority (GRA) to ensure that countrywide checks are made to enforce compliance.

The Senior Finance Minister then warned that the businesses found flouting the laws and continuing to deprive consumers and customers of these benefits will be dealt with according to Law.

Bank of Baroda designated as Mortgage Finance Company

Finance Minister encourages Baroda to seek out further opportunities to expand

Georgetown, Ministry of Finance, March 17, 2021:

During a simple ceremony today at the Arthur Chung Conference Centre, the Bank of Baroda was designated as a Mortgage Finance Company which will allow the financial institution to also offer home loans to prospective borrowers as well as provide another choice to those considering applying for a loan to construct homes. The event formed yet another aspect of Government’s housing drive and signaled its intention to ensure that its manifesto promise of providing 50,000 house-lots and assistance in providing homes for Guyanese is fulfilled.

Speaking at the event, Minister of Housing and Water Collin Croal welcomed the bank on board as he also encouraged other financial institutions to join in the current development process while noting that investor confidence in the country is at an all-time high.

Minister Croal also spoke of the positive trickle-down effect investment in the sector would have on employment, the business and construction sectors.

Managing Director of the Bank of Baroda, Mr. Arun Kumar Gupta reflected on the Bank’s interest in participating in Government’s housing drive. He also noted that the bank has its historic presence in Guyana dating back to 1966.

Today is a special day for us after being in Guyana for the past 55 years….Bank of Baroda (Guyana) being registered as a Mortgage Finance Company, this is one of our greatest milestones,” Mr. Gupta stated.

While commending Guyana’s Government on their promise of distributing 50,000 house lots within the next five years, the Managing Director said the main reason the Bank joined in the drive was to assist in increasing access to mortgage financing for prospective home owners.

This will not only benefit home owners, but it will also boost the construction sector. Bank of Baroda looks forward to working hand in hand with the Government of Guyana to make its people comfortable homeowners and to continue with the development of the housing sector,” he added.

Meanwhile, Indian High Commissioner to Guyana, His Excellency Dr. K.J. Srinivasa recalled that the Bank of Baroda had recognized Guyana becoming a growth and development story and that India decided that it could not miss the opportunity of playing a role in this process.

The High Commissioner posited that the countries would continue to work on various bilateral projects as he listed a wide range of projects for which his country is working closely with Guyana on implementing. Only recently India donated 80,000 Covid-19 vaccines to this country.

In the meantime, Senior Minister in the Office of the President with responsibility for Finance, Dr. Ashni Singh said the designation of the bank as a Mortgage Finance Company proved to be another important step aimed at improving access to financing by Guyanese households for the purposes of acquiring and/ or constructing their own homes.

These various elements amongst others …form the parts of a comprehensive policy agenda articulated by this People’s Progressive Party/Civic Government with the objective of ensuring that Guyanese families can afford their own homes, can afford to have access to a plot of land, can afford to access the financing for the purposes of constructing their home and can therefore construct and occupy their own home. …we remain convinced that the acquisition of one’s own home is perhaps the single biggest achievement for any family,” the Senior Finance Minister noted.

Minister Singh expressed gratitude to the Bank and to the Indian Government for ensuring that it played a role in Guyana’s development process which will be moving ahead at a rapid pace.

I am pleased that High Commissioner took the time to also speak of the plans that are being rolled out in India with a similar objective to promote home ownership because this serves to demonstrate the universality of recognition given to how important it is for a family to own their own home. This is not something that we whimsically came up with. This is not something that we chose to do by chance …this is a carefully studied position,” the Senior Finance Minister explained as he reminded that there was a time when communities like Eccles, Diamond, Parfait Harmonie, Good Hope, Onderneeming…. ‘did not exist’.

Minister Singh concluded that those communities were a testimony to what can be achieved with ‘the right Government policies along with effort at the personal and individual or household level’ while adding that the financial institutions have played an important part as well.

Alluding to the housing drive events most recently at which Bank of Baroda officials were present, the Senior Finance Minister said, “we are pleased to know that the Bank of Baroda banner was present at those events….the Bank of Baroda has a special place in the Guyanese economic and financial landscape….it came to Guyana before Guyana gained independence and the bank stayed in Guyana throughout all of those years.”

Dr. Singh summed up his remarks by encouraging the bank to ensure that it continued to seek more opportunities to expand and participate in the vast development course being experienced currently in the country.

The Bank of Baroda’s designation as an approved Mortgage Finance Company was done in accordance with Section 15 of the Income Tax Act, Cap. 81:01 of the Laws of Guyana.

Approval granted to NBS by Senior Finance Minister for increase in mortgage ceiling

Persons can now borrow up to $15M

NBS also announces decreased interest rates

Georgetown, Ministry of Finance, March 10, 2021:

As part of the implementation process of some of the Budget 2021 measures, Senior Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh handed over the approval for an increased mortgage ceiling to Chairman of the New Building Society Limited (NBS), Floyd McDonald. With this approval, the mortgage ceiling for the financial institution now moves to $15 Million up from $12 Million, allowing for persons to acquire mortgages up to this higher amount.

The handing over took place during a simple ceremony in the eastern conference room of the Arthur Chung Conference room today in the presence of the media, other officials of the NBS and both Senior and Junior Ministers of the Ministry of Housing and Water.

President Irfaan Ali’s Government has repeated and reiterated, since our assumption of office, our firm conviction that home ownership is perhaps the single most important achievement for almost every family, and that acquiring one’s own home will perhaps for many of us be the single most important investment we would make in our entire lives,” Minister Singh noted.

Minister Singh reiterated, “Our commitment to promoting and facilitating home ownership is because we recognize how important home ownership is to the individual family, but we also recognize how important home ownership and home construction and construction activities are to the economy as a whole…the generation and creation of jobs, the generation of income …the
improvement of livelihoods.”

The Senior Finance Minister, while lauding the NBS for the important part they play in the facilitation of home loans, reminded that the Society has come a long way in terms of their loan offers to the public, recalling that in 1991, NBS granted only 125 new loans while by 2014 the Society had granted 896 new loans, having achieved an all-time high of 1,234 in 2012. Unfortunately, over the past five years, the number of new loans granted annually fell sharply to 400 by 2020. He added that in 1992, the NBS was offering loans at a rate of 18 percent per annum reflecting the state of the economy and the financial sector at the time, but that since then favourable government policies had facilitated a steady reduction of interest rates to the point where today the NBS is able to offer its low income loans at 4 percent.

Meanwhile, Minister of Housing and Water Collin Croal said that the 2021 Budget measures are expected to significantly boost the housing sector.

This signals from Government’s perspective our deep underlying intention of ensuring we bring greater relief to our home owners, potential borrowers but also… walking the walk,” Minister Croal added.

He noted that more persons would be able to access financing for home loans as well as be able to afford to build their homes with more choices available in terms of types of homes to be constructed as he alluded to the other budgetary measures that would assist in this regard, especially the reduction of duty and zero-rating of specific construction material. He posited that with the increase in the loan ceiling, it will not only allow for Government to achieve its overall goal of distributing 50,000 house lots but also encourage home ownership.

Also speaking at the ceremony was Chairman of the NBS Mr. Floyd McDonald who expressed NBS’ pleasure at receiving the approval since as part of its corporate social responsibility, the NBS could now offer further reduced interest rates to borrowers. In this vein, the Chairman announced that NBS will now offer loans up to $6M at a rate of 4 percent per annum reduced from 4.25 %. As regards to loans between $6M to $12M the interest rate will now be 5.95% down from 6.15 and 6.75% while loans above $12M up to $15 M will be offered at a rate of 6.25% per annum.

The Society is indeed appreciative of the improved ceiling approved by Government. We know that our collective efforts will redound to an improved standard of living for Guyanese,” the NBS Chairman added.

On handing over the approval to the NBS Chairman, Minister Singh congratulated NBS on its decision to reduce interest rates for prospective borrowers as well as the remarkable role played by NBS over the years to facilitate home ownership countrywide.