– The increasing need to avert a political and economic crisis
On February 25, 2019, it was reported in sections of the media that the President of the Georgetown Chamber of Commerce (GCCI) indicated that its members have so far experienced a decline in business activity. In his report, it was noted that approximately 85 per cent of the businesses which registered a decline in business activity experienced a 25 per cent to 50 per cent decline in the level of commercial activity, while the remaining 15 per cent reported a decline of 75 per cent to 100 per cent decline in business. The GCCI further expressed its concern that this significant decline in commercial activity is worrying, and, with the continued state of political uncertainty, can result in further decline in business activity.
At another forum recently, another association’s President; namely, the Guyana Manufacturing and Services Association (GMSA), also joined with the GCCI and expressed similar concerns. To this end, the Association’s President noted the need for “a stable political environment, and one which is conducive for doing business.”
Readers of this column would recall that, even before these events were manifested, this author made such pronouncements weeks and months ago in previous columns. For ease of reference, in the most recent column on the issue, carried on February 9, 2019, this analyst contended that on the economic development side, both private and foreign investors are already worried and holding back from getting involved in terms of investing in Guyana – much less signing any contracts with the Government.
The manifestation of these events would only hurt the Guyanese people, and especially the working class, at the expense of politicians fighting for power and clinging to power without any regard for a strong and prudently governed economy in the interest of all Guyana’s peoples. The economy is at risk of becoming standstill overall. Very little or no investment would occur during this period; unemployment would be on the rise, crime would be on the rise, and social and economic hardships would be imposed upon the working class especially. Other articles on these fronts were featured in January and sometime last year.
Notwithstanding that, and politics aside, Guyana has too much at stake for having to treat with the risks and implications of what a political and economic crisis can do to Guyana; the negative impacts would be far reaching. Guyana cannot afford to have international sanctions imposed upon it at this time, as this would potentially affect international trade with the rest of the world. With an excess of 4.5 billion barrels of recoverable oil offshore Guyana and a sea of international companies coming to Guyana owing to the notion of massive oil wealth here, wherein production is projected to commence next year, these events would only weaken Guyana from an economic governance perspective.
All this time that is wasted in the fight for political power should see us focused on working together to craft a long-term strategic development plan for Guyana. For example, what are the development projects that should be high on the agenda for the next five years? The fact remains that oil will not last forever, it will be exhausted. In fact, the traditional export commodities such as gold would outlive oil, and therefore how do we continue to incentivise and revamp these traditional sectors as part of a long-term development strategy for Guyana? These are but a few examples of where the attention needs to be focused by not only the political leaders, but also all other stakeholders involved.
Finally, speaking of traditional sectors that will far outlive oil, it is unfortunate that Guyana has opted to get rid of the sugar industry, rather than focusing on how to reposition the sugar industry amidst the evolving global changes of where the sugar industry is heading. In this respect, empirical work has suggested that, with changing sugar markets in the U.S and around the world, innovation and environmental protection through value addition and diversification will be crucial for sustainability of the sugarcane industry. Commercial sucrose has very high purity (99%), making it the purest organic substance produced on an industrial scale. Several value added commodities are currently produced from sucrose by chemical or biotechnological derivatisation. Increasing use of biotechnological methods to derivatise the sucrose molecule is envisaged to add special functionalities to the sucrose products, which are becoming important in the emerging bio-economy (Eggleston et.al, 2016).
In referencing Eggleston et.al. (2016), the sugarcane industry is currently faced with the reality that sugar, molasses, and bagasse can no longer be regarded as the final products for factory refinery. Instead, the sugar industry should be regarded as a biomass-based industry that is not only equipped to manufacture products for the food sector, but also value added biofuels, energy and chemicals for the non-food sector. Sugarcane fits well into the emerging concept of a renewable carbohydrate feedstock because of its availability, and it is among the plants giving the highest yields of carbohydrates per hectare.