Guyana means business- Minister Gaskin

GINA, GUYANA, Saturday, December 3, 2016

Minister of Business with responsibility for Tourism, Dominic Gaskin said that Budget 2017 is a progressive one. The Minister was at the time speaking on the programme ‘Budget in Focus’ aired on Friday evening.

Minister Gaskin said that the budget balances very carefully people’s needs, as well as businesses’. “It’s our biggest budget ever, $250 Billion and with revenues of $218 Billion which is a deficit of $32 Billion which, in the general scheme of things, is not abnormal or anything like that, nothing to be alarmed or concerned about for a developing country such as Guyana,” Gaskin said.

Tax Revenue

Minister Gaskin noted that the projected $162 Billion in tax revenues is more than last year’s when it was $150 Billion.

The Minister however, noted that there are some concerns in the public domain as to where the increased tax revenue will be collected from. “I think it’s always a challenge because without the tax revenues there will be no budget, we have expenditures to make in some very important sectors – Agriculture, Infrastructure, Health, Education, Public Security, and Social Protection. Those are all areas of heavy expenditure, and for good reason, and that expenditure has to be made and tax revenues have to be collected and who those are collected from are always going to cause some concerns,” the Minister said.

Tax revenue collections  have to be done in a way that is fair, transparent and ensures that there is a balance so that it does not  upset the economy, Gaskin stated.

Minister of Finance, Winston Jordan did a very good job in explaining, during his 2017 budget speech as to how the revenues were allocated and very importantly ensuring that the workers are not affected, Gaskin pointed out.

The focus is on income tax and the budget ensures that every single Guyanese worker will be better off in 2017. “They will pay less taxes for the same dollar for dollar, a very good signal on his part (Finance Minister), also the reduction of tax on manufacturers from 30 percent to 27.5 percent, I think, sends a clear signal as to what our government’s focus is in terms of where our priorities are when its comes to business. He (Finance Minister) did a very good job in keeping our economy ticking and balanced,” the Minister said.

The Minister of Business further explained that taxes have to be raised so that the Government can spend; highlighting that the economy is projected to grow also.

“I am not concerned or worried, and a lot of consumption of products is something that consumers will have to do, and if you are not consuming that means that you cannot afford it. It will be crafted, and we need to look at every measure carefully and we need to look at it holistically.”

2017 plans

The Business Minister said that his concern for 2017 is promoting investments, and value added exports, with ensuring inclusivity in terms of creating better opportunities for the vulnerable, utilising a number of different agencies and departments.

The Small Business Bureau (SBB), which is responsible for developing small businesses, Minister Gaskin said, does a lot of work with training and provides access to subsidise loans. Gaskin also noted that a new council has been set up and it’s members are very vibrant.

The Bureau of Standards which does a lot of work in promoting standards is involved in economic development and there is a lot of capacity building taking place in that aspect.

Long – term investments

Minister Gaskin, during the Budget in Focus programme, highlighted some of the key long- term investments one of which is the Single Window Automated Processing System which swaps with trade facilitation measures. This deals with computerising Government’s business transactions.  The Minister noted that with the tie in with the system which is now being implemented at the Guyana Revenue Authority (GRA) and, “once it’s up and running, and the two can integrate, and we get one giant integrated processing system that businesses can access online with a single window, that will significantly reduce the time it takes to do transactions. It reduces the scope for human intervention on the first come first serve basis. We are looking forward to really having that system up and running,” the Minister said.

He next spoke of the Industrial Estates, stating that the Ministry of Business is developing the industrial estate in Lethem using a new model. Minister Gaskin noted that it is an ongoing project that he would like to see conclude early in mid-2018. As it relates to investors for the estate, with the right strategies, the right investors will come, which will be a boost for the local economy he opined.

Tax Exemptions

In relation  to tax exemptions from the Business Ministry; investors in the area of construction, water treatment plants, and recycling among others will benefit from tax exemptions.  Minister Gaskin said that this move reflects what the Government has been talking about in terms of sustainable development and the green economy.

Minister Gaskin pointed out that there have been a lot of speculations as to how it will work; however businesses and investors are beginning to see their investments in certain types of economic activities which are green in nature.

“I am very excited to see how they will operate and certain things need to be embedded in our minds,  and we are going through a process that Guyanese are realising that our government is serious when we say that by 2025  all our electric energy will be generated by renewable sources, and its something we can achieve and we see in budget 2017 over a billion dollars being invested in this sector,” Minister Gaskin noted.

Data base management

Minister Gaskin said that unfortunately data is not always available to make business decisions, however, the Government of Guyana will improve in this aspect.

Gaskin noted that work will be done with the Bureau of Statistics to ensure that particular entities are properly resourced so that they can function and efficiently provide data.

“Guyana is at a stage where decision making is informed by data, and where we can use reliable data in conjunction with reliable based management to get the public service to deliver better on its mandate,” Gaskin said.

“We have indicated that with the recent Public Service College (launch), we are serious about improving the way the Public Service works  through better monitoring and evaluation, management systems and of course, to inform decision making,” he said.

Private sector

Minister Gaskin said that in 2017, compliance certificates will be largely issued by GRA and the National Insurance Scheme (NIS), which are valid for three months.

These certificates will allow small contractors to bid for Government contracts without  hassle. The Minister pointed out that persons will not receive any contracts if there are any discrepancies, however, it will still allow contractors to enter the bidding process.

The Trusted Trader Initiative (TTI) will also be implemented in 2017, according to Minister Gaskin.  This initiative is geared towards regulating and safeguarding against companies that are non-compliant and are seeking to find ways to engage in malpractices and have to constantly be scrutinised.

The Minister noted that streamlining the transaction process of the Private and Public Sectors is important since  there are a number of businesses that have been established for quite some time and they want to know what are the right procedures and practices with which they have to comply.

Between 2015 and 2016, Guyana upgraded by 16 places on the ranking of the World Bank’s Doing Business Index. This has been the largest single improvement achieved in the country’s history of being on the Index. The Minister explained that there are a number of interventions, noting that access to credit was the area that Guyana scored badly in the previous year, however  the Credit Reporting Act was amended to allow for the use of Credit Bureau. The banks are now mandated to utilise the services of the Credit Bureau which means that the risk to banks and lenders have now been  reduced.

“The banks now have access to credit report, and they are now mandated to provide information to the Credit Bureau and that has created significant improvement in the index,” the Minister noted.

Additionally, another area that Guyana improved on in the index and transparency was with the provision of electricity. The Minister said that the report and the improvement in the index is very important, because, “relating to doing business reforms, there are many specific indicators that are surveyed and reported on and scored, looking at measures to improve on these indicators, we need to have good scores because investors read these reports.”

Private sector challenges

Minister Gaskin said affordable energy is always an issue, however he has been assuring the private sector that the Government is investing in renewable energy, and it will become cheaper.

The slowdown in the growth of the economy, the Business Minister pointed out during the budget interview is due to several factors one of which is persons not spending as much. This is cause for concern, he said.

However, the Minister said that this is an issue that did not start with this Government noting that diversification needs to take place.

Security is another concern that the private sector has expressed concerns about even though statistics show that there is a reduction in serious crimes.  

Reaction to Budget

The Business Minister said that the Private Sector Commission (PSC) does not seem pleased with the 2017 budget. However, he said that he respects their views, but encouraged them to look at the budget in a point form and identify the positives and the negatives as it relates to businesses.

“Any responsible government has to collect revenue to fund its programes and a positive, negative check on the measures of the budget by the Private Sector Commission would have been better,” Minister Gaskin explained

The Business Minister was asked if he believes that the private sector is ready to help diversify the economy. He responded thus;  “With the right conditions and right investments, incentives, infrastructure, business environment and also political stability, those are some of the factors that create an environment for investments and I think that we will see more investments in the productive sectors and that is what we are deliberately and strategically targeting such as tourism, agriculture and agro processing among others,” the Business Minister said.

Minister Gaskin said that while private sector investments are important, the public sector also has a role to play by creating the right settings and promoting investments. “The private sector is going to come somewhere; we will promote the investments, and we are confident that we can promote an economy that is viable, and I am confident that our local private sector will show an interest,” the Minister stated.

Gaskin concluded by saying that “Guyana is ready for Business, Guyana is open for Business and Guyana means Business.”

 

By: Gabreila Patram