Loopholes in Local Content Law will be closed – Jagdeo

– says investigation of companies that ‘front’ must be ongoing

Vice President Bharrat Jagdeo has made it clear that when the People’s Progressive Party/Civic (PPP/C) government returns to the National Assembly to update the Local Content Act of 2021, it will be with an awareness of which loopholes must be closed.
The Vice President was at the time responding to questions from the media during his recent press conference, at which he was asked about the quoted figure of US$743 million that locals had earned from the oil and gas sector and whether the beneficiaries were all genuine Guyanese companies.

“Right now, the $700 odd Million… I’m happy that its happened. It’s a substantial sum of money, nearly $150 Billion of procurement opportunities going to Guyanese companies. So, these are Guyanese companies based on the definition and what they presented. Because they got the certificate of local ownership,” Jagdeo said.
The practice of fronting, which is when foreign companies use local ones to bypass the Local Content Act, is one that has attracted much attention in recent years. Jagdeo acknowledged that while a few of these companies may be engaged in untoward activities that breach the Local Content Act, the vast majority of the money did indeed go to local companies. However, he assured that the government was not complacent, and would be moving to close any loopholes in the law.
“Some of them, I can’t estimate, may be engaged in policies where the way they’re structured, that they’re fronting. So that has to be an ongoing investigation. We’ve identified a few loopholes that we intend to close when we go back to reform the Local Content law. Remember we need to update it all the time. So, it’s an ongoing investigation, but the bulk of the money went to local companies. And we’re pleased that it happened,” Jagdeo said.
During his January presentation of the budget, Finance Minister, Dr Ashni Singh had revealed that the Local Content Register has now grown to over 1,100 companies. Additionally, he had said that US$743 million was spent in 2024 on local services, employment and capacity development… all of which the secretariat facilitated.
In November 2024, it was reported that 1032 companies were registered with the Local Content Secretariat, meaning they are in possession of a Local Content Certificate to confirm they are a Guyanese company and are eligible to supply oil and gas operations.
During his end of year press conference, President Dr Irfaan Ali had spoken about the review of the ACT. Asked if he was satisfied with the impact the Local Content Act has had on Guyana, the President HAD expressed satisfaction with the results so far, while also looking forward to future improvements.
There are 40 areas in which oil companies have to seek services from local providers, to varying degrees. For instance, 100 percent of immigration support, work permit and visa application, customs and ground transportation, as well as insurance have to be sought from local service providers by the oil companies.
Meanwhile, other targets include 90 percent of office space rental and accommodation services; 90 percent of janitorial services, laundry and catering services; 95 percent pest control services; 75 percent local supply of food; and 90 percent local accounting services.