Budget 2021 will positively impact business community – GCCI President

COVID-19 pandemic

President of the Georgetown Chamber of Commerce, Nicholas Boyer has lauded the 2021 budget presented by the PPP/C Government, since it presents several positive factors for the business community.

Boyer told Guyana Times on Monday as the presentations wrapped up that the removal of tax and investments allotted towards infrastructural development in the country will surely drive investors’ confidence. Since most enterprises are operating during the coronavirus pandemic, the measures in Government’s financial plans are poised to ensure that economic activities continue.
“We are pleased with the measures that we’ve seen coming out of the budget…For the construction and infrastructure portion, we were pleased with it, as well as the tax removal in general. Given that the business community is operating in a pandemic, we think it’ll have a significant impact in keeping a certain amount of demand going or stymieing a loss of demand,” the GCCI President explained.
According to him, they are also pleased with announcements to start the gas-to-shore project, in moving one step further towards cheaper energy. For many years, the Private Sector has complained about the high cost of power, which creates a domino effect on expenditure and prices on the market. Meanwhile, they are also calling for small businesses to receive 20 per cent of all procurement, as prescribed in the Procurement Act.
“The only thing that we want to see is the activation of the small business procurement. There’s a part of the procurement act that says that up to 20 per cent of the procurement should be going to small businesses.”
Shortly after Finance Minister, Dr Ashni Singh had delivered his budget speech, the Private Sector Commission (PSC) which Boyer heads, had commended Government for producing the largest national budget in Guyana’s history.
The PSC, prior to the budget consultation, would have made written submissions regarding its proposals and was pleased that many of the proposed measures were largely considered and reflected in the national budget for 2021.
“To this end, the budget is indeed a people-focused budget which is healthy to facilitate broad-based and inclusive growth of the economy in terms of job creation, encouraging private investments and more entrepreneurial activities. Dr Singh should also be commended that while being pro-business, this budget is also pro-working class and factors in a number of new social programmes,” the PSC had highlighted.
The statement went on to note that the financial plan was designed to enable the diversification of the economy as well as resuscitate the major productive sectors – such as the agriculture, construction and infrastructure sectors. This is crucial since the non-oil economy has contracted by seven per cent in 2020 due to the pandemic and the five months of political impasse.
“The PSC is mindful of the construction boom in the making by the Government through its projects outlined in Budget 2021 such as the resuscitating of the housing development drive – targeting 10,000 house lot distribution for 2021. To this end, the fiscal incentives outlined above for building and construction materials coupled with the increase in the mortgage ceiling will allow for the housing, construction, and banking sectors to experience significant expansion in their activities for 2021.”
Government has reduced water tariffs by five per cent and increased the mortgage ceiling and the mortgage increase relief. To make homeownership affordable, there is now zero VAT on imported stone, locally produced concrete piles, steel beams and locally manufactured PVC roofing. Industrial-grade cement has also lowered from 15 per cent to five per cent.
Some $25 billion has been allocated for transformational infrastructure development to open new lands and road networks.
“The accessibility and availability of new lands for commercial, industrial, housing development and agricultural purposes will be the driver of economic growth and development on a larger scale. This means opportunity for large scale investment by the manufacturing sector – both local and foreign investors as well the emergence of new business ventures,” the Commission added.
The projected growth rate for 2021 is 20.9 per cent and with these measures, the disposable income will also increase. With the gas-to-shore project, energy costs will be lowered by over 60 per cent.
“Taken together, Budget 2021 contains sufficient fiscal measures and public investment programmes that will encourage the growth and expansion of the Private Sector, thus creating more job opportunities for Guyanese, lowering the cost of living, homeownership becoming more affordable and more disposable income in the hands of Guyanese working class.” (G12)