Companies must be held accountable to Local Content Policy – President
…says maximum benefits for locals, but not to deter foreign investors
…Guyana cannot only rely on companies’ “goodwill” – VP
With consultations underway on the Local Content Policy, President Dr Irfaan Ali has emphasised the importance of ensuring that companies can be held accountable to the provisions of the Local Content Policy (LCP).
The consultations were launched at the Arthur Chung Conference Centre on Monday with senior Government officials and stakeholders. In his address to those gathered, President Ali reminded of the need to ensure that companies are indeed following the Local Content Policy.
“An important part of the Local Content Policy is accountability. And Government has an important responsibility in ensuring there’s accountability, through the audits and the monthly evaluations,” President Ali said.
“So that also will be part of the Local Content Policy. How do we determine whether they’re in compliance with the policy or not? And how do we hold you accountable to the policy,” the President added.
For better context, the President explained that the Local Content Policy is not just for oil and gas, but all sectors that will see foreign direct investment. He emphasised that the consultation must therefore be broad-based. President Ali also noted that although the policy should have maximum benefits for locals, it should not deter foreign investors.
“The Local Content Policy is set in the national development framework. It is not set in oil and gas. Guyana, our future, is not only about oil and gas. Oil and gas is the catalyst that pushes us. It is a key factor (but) we do not intend for this discussion to be narrowly positioned on oil and gas.”
“We are not here to say that we want to minimise foreign investment; that will be to our detriment. But we want the investors who are coming in to recognise that through legislative mechanisms, through regulations, through institutions that they have to commit to local content; and not only committed to local content, but we are going to move with you in setting targets as to the levels of local content.”
President Ali also said that his Government is ready and willing to play its part in this development process since it recognises that there is an existing gap when it comes to capital, human resource capability and technology.
He pointed out that his Administration has already committed to building a stable macroeconomic environment, improving the ease of doing business, improving the efficiency of Government institutions, and improving legislation to respond to our economy’s future needs. In addition to this, President Ali added that the country will also get an oil and gas training institute.
“In recognising that there is an existing gap, we have to put systems in place now to quickly bridge that gap. In the intervening period, while we bridge this gap, we are saying that we also have to define a space for local business and local participation,” Ali said.
The President’s view on holding companies accountable was shared by Vice President Bharrat Jagdeo. According to him, the Government cannot rely on the goodwill of companies to do what is right. And like Ali, he too made it clear that the policy is not to deter oil companies.
“As the President pointed out, there has to be rigid compliance and monitoring, all of these things. We can’t just leave it to the goodwill of individuals. With the best intentions, often this doesn’t happen,” Jagdeo said.
“The Local Content Policy was not created to disincentivise investment. But it’s a promise that we made to our people, about shared prosperity. And this has to happen. And this policy will be bolstered by the future evolution of the (Production Sharing Agreement).”
The idea of consultation of the LCP is in keeping with the PPP/C manifesto before entering Government. The Head of State reiterated that his Administration wants all Guyanese to be involved and benefit from our forthcoming wealth.
After addressing the gathering, Jagdeo then opened the consultation process, which saw meaningful discussions between stakeholders. Several Government Ministers and officials, along with Private Sector representatives, were also at the consultation.
It is understood that the consultations will remain open for the next month. Persons will be able to submit their views, either at the forum or online. (G3)