Category: Media

03 Feb
By: Tanika Jones 1

Opening Address by Hon. Winston Jordan, Minister of Finance on the occasion of Training Course/Capacity Building in Macroeconomic Management for Resource Rich Countries Feb 3-7, 2020

3rd February 2020

Good morning participants, IMF expert trainers and invitees. 

It is certainly a pleasure to finally have the IMF team here this morning to deliver this programme, in country, on Macroeconomic Management for Resource Rich Countries. This was identified as useful, as we approached first oil. Rather than sending 2-3 persons, annually, to attend the course at IMF Headquarters, in Washington, DC, we consider that the impact of having a core 35-40 persons exposed together, at home, would certainly redound to more effective national capacity building and institutional strengthening in strategic technical areas of the Ministry of Finance, Bank of Guyana, and other key sector ministries and stakeholders. 

I hope the collective thinking that is inspired by the content of this course leads, subsequently, to well- researched and thought-out technical advice from those of you here today. Indeed, the content of this programme is intended to elevate the level of thinking, discourse and analysis among the key technical agencies that contribute to compiling key macroeconomic fundamentals in the economy. Today, I am pleased to note that we have expanded our invitation to include the Bank of Guyana, the Ministry of Public Infrastructure, the Department of Energy and Ministries of Natural Resources and Agriculture. These are reflective of agencies that play key roles in designing the programmes and projects that are instrumental to the diversification efforts and institutional strengthening that must be undertaken with haste, to ensure that we are able to mitigate the detrimental impact of Dutch disease and resource curse.

Human capacity building is a critical determinant within the formula for institutional strengthening. Our ability to better conceptualise and analyse the world in which we now find ourselves, and to critically apply that knowledge to advancing informed policy proposals, thereby contributing to the macro economic stability of our country, must become part of our everyday thinking. Without competent and capable human capital, our institutions will fail to deliver as required.

Being able to contribute to development, requires us to design programmes in ways that are not inimical to macroeconomic stability. We must be able to recognize the actions the country needs to adopt, for example, to contain inflation and maintain a stable exchange rate, non-achievement of which can undermine our competitiveness in the non-oil sector. We must be conscious about the impact of the elements that contribute to Dutch disease and resource curse as a nation.

Even as we are undertaking the rebasing of the gross national product (GDP), it is anticipated that improved methodologies would improve our ability to capture growth in the economy.  Additionally, much has been said about the substantial growth spike that we expect from the inclusion of petroleum – those of you who are economists know that a GDP number does not automatically translate to improved livelihood for all our citizens. Indeed, this is why we have long argued for developing countries to have a multi-dimensional measurement of development, given the inadequacies of GDP as an indicator of development and equity.

History is replete with examples which demonstrate how per capita GDP increases do not translate to improved quality of life.  These exemplify the consequences of both institutional weaknesses, weak resource governance structures, and the collective behaviour of the citizenry that, collectively, have worked to exacerbate the resource curse and Dutch disease. We have an opportunity to do better and to distinguish ourselves as a country that can learn from the experiences of others, and exercise greater responsibility to allow both present and future generations to be beneficiaries of good governance. This administration has taken deliberate steps to avoid the presource curse – where several countries have spent funds long before first oil, in anticipation of future revenues. We chose to be prudent in our expenditure management. Further, through the establishment of the Natural Resource Fund, we have established a sound governance structure that will see petroleum revenues being deposited directly into the Fund. We have designed the Fund in a manner that accessing the funds is by way of a withdrawal rule. This rule is based on an analysis of both the oil and non-oil sectors. It will prevent oil price volatility from entering our economy, afford funding for national development priorities, and allow for interest-bearing investments to be made. In this way, the earnings from petroleum will benefit both present and future generations. I am proud to state that the reporting and accountability criteria within the NRF Act meet the well-established Santiago principles for transparency and good governance.

It may seem almost surreal to be a country that is considered resource-rich, especially for those of us who have worked for decades fighting the good fight for additional resources and more concessional resources. But even that definition of being resource-rich needs to be considered thoughtfully. Though we will be accessing petroleum revenues, we will be doing so cognizant of the substantial deficient in human capital resources. The factors of production – land, labour, capital and entrepreneurship – would then see two factors being seriously compromised by such deficiency, unless we manage and invest more strategically in the quality of our education.

We are still many years away from being a carbon neutral world; the demand for fossil fuel is likely to last well into next decade – possibly peaking within this decade. Climate concerns are both global and national priorities. Issues of climate change and global warming are areas we seek to address within our Green State Strategy – Vision 2040.  Being green is about sustainability and improving our ability to take sustainable actions regarding production and consumption as a nation. The window of petroleum revenue generation that is afforded us is finite and comes from the extraction of a finite resource. So, it is incumbent upon us to manage this opportunity well so that, ultimately, the non-oil sectors are strengthened to ensure a resilient and diversified economy during this Decade of Development and in the decades beyond petroleum.

In this room, you represent the generation of future thinkers and leaders in supporting the management of our resource-rich economy, but cognizant of where we are resource-poor. While abundant resources are on the horizon, there are abundant needs to be met in bridging the developmental divide between the hinterland and the coastland; ensuring equal access to quality education in every region, from early childhood to secondary and technical vocational skills; ensuring quality healthcare, even as we confront regional and global emerging health challenges; expanding private sector and domestic production of goods and services; and diversifying exports.

In deploying an arsenal of policies and programmes, to address and mitigate the resource curse and expand the non-petroleum sectors, our Government continues to:

  1. be in active partnership in an Inter-ministerial Working Group with the Guyana Manufacturing and Services Association on expanding agro-processing and wood processing sectors. Later this year, we will be focusing on the services sector and tourism product development
  2. prioritise agriculture, since it remains key to ensuring food security and economic diversification across our ten administrative regions 
  3. strengthen our manufacturing and services sectors, so vital for ensuring global competitiveness
  4. leverage our standing forests
  5. design and implement investments in catalytic infrastructure, while ensuring a robust public investment management system
  6. design strategic interventions in education to effect a performance-based approach to ensuring quality and equity
  7. focus on institutional strengthening activities across government 

While the list is by no means exhaustive, in combination with good governance and public financial management, these seven (7) are key to ensuring that we emerge as a buoyant and diversified economy through the leveraging of our resource wealth to address the areas that we are resource poor.  In the end, time will tell our story. Make no mistake that you are key players in that story and I expect this and other training to which you have already been exposed, will serve to make you active shapers of a history of which we can all be collectively proud. The technical quality of your work, your research, your economic modeling, your ability to design systems to support stronger institutions, and your ability to lead effective implementation, must be what drives your work ethic. 

I charge you to learn and participate actively over the next five days.

It is indeed a pleasure to declare this workshop officially open. 

Thank you.

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29 Jan
By: Tanika Jones 0

Minister Jordan tours E-Networks’ subsea cable landing station

Applauds investment by local consortium to advance Guyana’s digital economy

(Georgetown, January 29, 2020): Finance Minister, Winston Jordan, on Wednesday was given a tour of E-Networks subsea cable landing station at Kingston, Georgetown. The landing station houses E-Networks’ Xlink cable, a newly constructed submarine fiber optic cable that links Guyana to Barbados.

Commenting on the project, Minister Jordan said that he was particularly impressed that it was organised and successfully executed by a consortium of local investors. He added that he was encouraged by the evident confidence of the investors in assuming such a massive and capital-intensive undertaking, that will provide considerable benefits for the development and modernising of the sector. This, he noted, aligned with the Coalition Government’s encouragement of the private sector in advancing Guyana’s economic expansion beyond agriculture and mining.

The Finance Minister further said that the Xlink project exemplified the ideal investment model for Guyana, one in which local benefits, local content and indigenous ownership are guaranteed through the collaboration of Guyanese companies, Guyanese investors and local financial institutions, especially now that the economy is poised for transformation.

Minister Jordan congratulated the Managing Director of E-Networks, Mr. Persaud for the boldness of the investment, and expressed full support for the Xlink venture. He said that he was excited about the possibilities it had for universal connectivity and the realization of the digital economy promised during the Decade of Development, 2020 -2029.

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21 Jan
By: Tanika Jones 0

Guyana’s Natural Resource Fund attains associate membership at IFSWF

(Georgetown, 21-01-2020) – Guyana’s Natural Resource Fund (NRF) has attained associate membership of the International Forum of Sovereign Wealth Funds (IFSWF); a global network of sovereign wealth funds of more than 30 countries including Singapore, Botswana and Australia. 

The IFSWF works to foster good governance, transparency, accountability and prudent investment practices within its members through the application of the Santiago Principles, helps them navigate the complex investment environment through knowledge sharing, and represents the ‘views of members to the wider financial community.’ 

The NRF was established in 2019 under the Natural Resource Fund Act 2019 and is designed to manage the revenues garnered from Guyana’s petroleum resources for the present and future benefit of the people, and for the sustainable development of the country. The Ministry of Finance has entered into an operational agreement with the Bank of Guyana to manage the Fund. 

The achievement of associate membership demonstrates Government’s commitment to transparently manage Guyana’s petroleum revenues.  

Read more about the NRF at finance.gov.gy. and at https://www.ifswf.org/members/natural-resource-fund.

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16 Jan
By: Tanika Jones 0

No increase to President’s salary as claimed by Citizens Report

Order signed before Parliament dissolved

(Georgetown, January 14, 2020) – The Ministry of Finance’s attention has been drawn to a report in the online media outfit Citizens Report, which claims that the President awarded himself a salary increase. This is patently false and the purveyor of this lie knows it to be so.

Had there been an increase in the President’s salary, there would have been a corresponding increase in the pensions received by the three ex-Presidents – Bharat Jagdeo, Samuel Hinds and Donald Ramotar. If Citizen’s Report was not so bent on causing public mischief, a quick check of the pensions of any of the three ex-Presidents would have shown that they have remained the same since 2015.

The Ministry wishes to remind readers that it is Mr. Jagdeo who caused the law governing Presidential pensions to be changed to 7/8 of the salary of the current President, instead of 7/8 of the salary of the President at the time he demits office.

It is unfortunate, as we enter the elections season, that the issue of a well-deserved increase in wages and salaries for public servants, who, under the PPP/C administration, were financially impoverished and subjected to poor working conditions, should be twisted into a blatantly false claim.

It is worth recapping that this latest increase in the minimum wage represents an overall increase of 77 per cent since the A Partnership for National Unity/Alliance for Change (APNU+AFC) coalition took office in 2015. This is a tangible demonstration of the government’s commitment to building a Good Life For All Guyanese, as we enter the Decade of Development. 

It is also unfortunate that attempts were made to impugn the Constitutional Order, which was signed by Minister of Finance Winston Jordan, on December 2 2019, well within the life of the Parliament, which was dissolved on December 29, 2019. 

The Ministry wishes to exhort the reporters of Citizens Report to become more acquainted with the tenets of good reporting, rather than pander to their handlers and do a disservice to their readers. 

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16 Jan
By: Tanika Jones 0

MoF debunks claims by former President of GCCI

(Georgetown, January 15, 2020) The Ministry of Finance notes with alarm the comments of former President of the Georgetown Chamber of Commerce and Industry, Deodat Indar, at a roadside meeting, recently. We are quite appalled at his interpretations of economic issues, and are, equally, flummoxed at his wild allegations and fear mongering on critical aspects of the economy. To the less informed, his ramblings would have been sure to cause anxiety.

It appears that we are indeed, in the ‘silly season’, but this does not give any person the licence to make unfounded pronouncements and believe that those pronouncements will go uncontested. It is for this reason that the Ministry of Finance would like to add context to, or refute outright, the allegations made by him.

Mr. Indar claims the following:

1. That the government has spent all the monies and sold all of the gold held in reserves at the Central Bank. FACT: A cursory check with the Bank of Guyana will confirm that our reserves have always been positive. Additionally, reserves of the Bank are held distinctly and separately from the Consolidated Fund, the latter of which is used by Government for expenditure.

2. That Guyana is unable to pay its import bill because the government has spent it all. FACT: The reserves of the Bank of Guyana are used, principally, to pay for the imports of fuel and the servicing of Guyana’s external debts. All other imports are financed through the commercial banks, foreign currency accounts retained by approved persons and/or foreign direct investment. The Central Bank’s reserves are adequate enough to meet the identified imports. All of the reports from the international financial institutions on Guyana’s economy including the most recent IMF Article IV Country Report never commented negatively on the state of Guyana’s reserves. In fact, these reports have lauded government’s efforts to avoid the presource curse and its management of the economy.

3. That the introduction of VAT on forestry products caused imported pinewood to be sold cheaper than local woods. FACT: Indar neglected to mention that it is the Minister of Finance who initiated the establishment of the Inter-Ministerial Roundtable with the Guyana Manufacturing and Services Association (GMSA) as a means of addressing challenges within the sector; that this Roundtable included the Ministers of Natural Resources and Business; that it is the government through the Ministry of Finance that sought an increase in the Common External Tariff from 5% to 40% on imported pinewood and pinewood products as a means of ensuring that local wood and wood products become more competitive; that it is the government through the Minister of Natural Resources that stipulated import permits for importers of pine wood as another means of managing its importation and ensuring that it cannot be sold cheaper than local wood products; that $120 million was set aside to begin a forest inventory; that logs and rough lumber for the saw milling industry became VAT exempt from January 1, 2018; that $50 million was allocated for the establishment of a dimension stockyard. Though sadly, the stockyard was never realised as an agreement could not be reached on a preferred model.

4. That the government has increased taxes. FACT: Indar has fallen into the mantra peddled by his political party that the government instituted 200 taxes since coming to office. However, neither he nor his fellow peddlers have been able to list these taxes simply because it is a lie. The truth is, this government has implemented tax reform that is unrivalled by any previous government at a similar stage. Among the progressive measures were substantial movement in the income tax threshold, from $600,000 to $780,000 or 1/3 of gross income, whichever is higher; lowering of personal income tax to 28% on the first $180,000 of chargeable income per month; removal of income tax on employees’ NIS contributions; lowering of company income tax to 25%; lowering of VAT to 14%; increase in VAT threshold to $15 million; and increase in the number of zero rated and VAT exempt items. Indeed, more than 100 reform measures were instituted that benefitted businesses and individuals. In addition, the Guyana Revenue Authority, which now enjoys real autonomy, has strengthened its monitoring and enforcement which has resulted in substantial expansion of the revenue base and facilitated the massive increase in workers’ wages and development across the country. More persons and businesses are now paying their true and correct taxes as a result. Mr. Indar may have also missed the news that the economy is growing and therefore, it naturally follows that the tax base will grow and, by extension, so will the amount of tax revenues collected.

5. That the government has spent 1.2 trillion dollars and cannot account for it. FACT: This unmitigated lie is really not worth a response; however, the Ministry of Finance has made public all of government’s spending through the publication of the annual budget, the Mid-year report and similar reports and publications from the National Tender Board and Administration. In addition to infrastructural, social, educational and other projects, government has had to repay billions of dollars in judgements won against the former government by local and overseas investors and businesses, bail out Guysuco to the tune of nearly $50 billion, and subsidise the tolls for citizens using the Berbice Bridge.

6. That investors in the oil and gas sector are the only beneficiaries of concessions; that local investors do not receive the same benefits. FACT: This is palpably false; it has been debunked on several occasions by the Minister of Finance and the Commissioner General. The investment agreement signed between the government and operators in the oil and gas sector states very clearly that the operators and their subcontractors will benefit from the same concessions, no matter their nationality. It is common knowledge that the oil and gas industry requires significant technical expertise and it would be naïve, unreasonable and downright callous to suggest that Guyanese were deprived of the opportunity for concessions as there are no Guyanese-born oil and gas companies of significant experience. However, again, subcontractors will benefit, regardless of their origin.

7. That the government has said it will give five thousand United States dollars to each citizen. FACT: It is Professor Clive Thomas who has been championing what he refers to as the ‘Buxton Proposal – Cash transfers to households’ and the Peoples Progressive Party that endorsed it soon after (See Demerara Waves report of October 3rd, 2019). There is no record of the government saying that it will be handing out unconditional cash transfers to citizens. In fact, the government is on record that while it will consider avenues to provide incentives to citizens through the revenues gained from the energy sector, those incentives must be sustainable. 

8. That the government has no plans for the oil and gas revenues that it will earn and that there is no local content policy. FACT: The Ministry of Finance successfully presented a Green Paper on Guyana’s sovereign wealth fund – the Natural Resource Fund (NRF) – which was fully legislated. As a result, the NRF is a solid piece of legislation that provides for the mechanism that will govern how revenues earned from our natural resources will be saved, spent or invested with full Parliamentary and public oversight. Further, the government remains committed to managing these revenues according to best practices, including the Santiago Principles, as demonstrated by Guyana’s recent acceptance as an associate member of the International Forum of Sovereign Wealth Funds (ISFWF). Additionally, the Green State Development Strategy sets out the priorities of the country, and revenues from oil will be utilised within the context of this national development plan. It should be noted that the GCCI, which Mr. Indar served, was invited to participate as part of the GSDS Expert Groups to ensure that the vision being elaborated was inclusive and representative of all facets of Guyanese society. Additionally, we wish to remind Mr. Indar that he is on record endorsing the draft local content policy spearheaded by the Department of Energy, which makes his criticisms about the local content policy disingenuous.

In closing, we would like to remind Mr. Indar that he has a duty to be honest with the people of this country whose votes he seeks. We hope he takes the time to remedy his uneven understanding of the economy and how it functions so as to ensure that when he speaks at events, the public is consuming factual and accurate information so that they may make informed and unbiased decisions. Voter persuasion through the peddling of distorted  information is tantamount to abuse of public trust and calls into question one’s suitability for public office.

The Ministry urges the public to conduct its own due diligence and research, and to reject misinformation.

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20 Dec
By: Tanika Jones 0

Remarks by the Minister of Finance at sod turning ceremony for the University of Guyana’s Early Childhood Centre of Excellence

Season’s Greetings to you all! This holiday season is indeed a special one, as it marks the end of two decades, since the turn of the 21st century. I’m certain that many of us may be reflecting on how life has changed for us over the past twenty years. If you are a working person, perhaps you are thinking about the ways that your career has progressed through these years. If you are a parent, you must be amazed at how quickly your child has gone from being a small, curious toddler to a young adult during their university studies or work activities. And for all of us Guyanese, we are surely reflecting on the growth and evolution that our country has undergone since the year 2000. We as a nation have seen so much, learned so much, and overcome the various growing pains that come with inevitable change that we too must be in awe of our achievements despite the naysayers. As we approach 2020, let us be proud of how much we have been able to achieve, and at the same time, aspire for greater breakthroughs and milestones in the years to come even as the Coalition Government embarks on its Decade of Development that will seek to transform this nation at all levels.

Therefore, it gives me great pleasure to be here with you today to declare the beginning of a yet another milestone for our nation—the establishment of Guyana’s very first Early Childhood Centre of Excellence!

This Early Childhood Centre of Excellence funded jointly by the Government of the Cooperative Republic of Guyana and the Caribbean Development Bank, through Basic Needs Trust Fund Guyana, will stand as a model institution for service delivery and development of early childhood education.

While it is not the first such centre that has been established by the BNTF – 6 centres were established in the 7th and 8th project cycles – this Centre of Excellence which will be established in the 9th cycle will be at the helm; guiding the direction and standards of early childhood education nationwide. A Centre of Excellence is unique in that it not only contains a facility for our children to grow and thrive in a safe environment conducive to learning, but it will also function as a research facility, where early childhood education scholars can come together to conduct studies and further develop good practices. It will serve as a hub and resource centre for other early childhood education practitioners to gain knowledge and advice from experts in the field.

Once established, this Centre will become a flagship laboratory school under the University of West Indies Open Campus (UWI OC) Early Childhood Centres of Excellence Company, as formalized in a Memorandum of Understanding between UWI and the University of Guyana. The Company, also known as BLOOM, has established Centres of Excellence in Jamaica and Trinidad and Tobago. These laboratory preschools employ holistic education methods while creating a nurturing and engaging atmosphere for the students enrolled there. With University of Guyana’s Centre now joining these prestigious ranks, Guyana will also be able to build upon its cultural power and realm of influence throughout the Caribbean.

According to the World Bank, far too few children worldwide, especially those from the poorest families, have the option to enroll in high quality early childhood programmes. And many experts have emphasised that investing in children’s development during the first eight years of their life is critical for their school, life success and productivity. Until the establishment of the Early Childhood Development Centres under BNTF, there was only one state-owned day care centre, and, apart from the services offered by the Mayor and Councillors of the City of Georgetown, services for infants up to the age of three remained largely in the private sector and in the hands of untrained individuals. It is critically important then, that we, as a nation, invest more in early childhood education, to ensure that all children of a certain age have access to these crucial services.

The Centre of Excellence will therefore prove a truly worthwhile investment, with 120 million dollars allocated for the construction of the centre. The building will span 7,624 square feet and contain enough classrooms to accommodate 120 infants and toddlers, along with an observation room, conference room, and research spaces. At least 20 adults will gain employment there and learn to become better early childhood practitioners themselves. Professional development opportunities abound in such a space, with the Centre producing capable individuals to contribute to Guyana’s skilled labour force.

As 2020 swiftly approaches, let one of our goals be to build an “Education Nation,” a country that emphasizes quality at each stage of the education process, from the services catering to the youngest of our population, all the way up to continuing education for adults. Learning should be an unceasing process throughout our lives, but how it starts in the early years of a child’s development is particularly crucial: it will dictate the kind of adults they become, and, in turn, determine the future of our great nation.

With that, I would like to once again commend this wonderful initiative and wish you all a joyful holiday season! Thank you.

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