Predictions 2010

Introduction
Accustomed only to the arcane drudgery of a calculator and a columnar pad, I turned to the Angel Gabriel and the Deity Ganesh for divine guidance in looking at the world in 2010. They point to a different world in 2010 from the one predicted by the Economist’s publication of that name. But then what can one expect from someone who thinks that Guyana is on the African coast? Inspired by such dual divinity I see for Guyana the best of times and the worst of times, spectacular winners and catastrophic losers, drug pushers and soup drinkers, strike-breaking employers and spineless unionists, ambitious turks and aging politicians, their sell-by dates long past. With predictions, the probability of success is 50/50 – either right or wrong. Accordingly, mine come with the usual exclusionary clauses about non-responsibility – the type clients receive from their accountants and policy-holders from insurance companies. With this in mind, let us look into Guyana 2010 in which there will be several developments in politics, the economy and the government and private sector to comfort Guyanese bracing for tough times ahead.

The economy
Fed up with the bureaucracy and transparency of Norway and the EU, the government will advance and rename the Low-Carbon Development Strategy to the Loving Chinese Democratic Systems. Same LCD S… Chinese logging companies will replace Barama as the bête noir of the forestry sector. The Indians will give a further loan to the country to help maintain the traffic lights and to promote culture. Venezuela will provide PetroCaribe funds to help us police our ‘shared’ territory. The boys from Brazil will help finance the Road to make it easier for their illegal exploitation of our forests and gold-mining activities, while their female siblings will take over our social scene, creating more unemployment for our ladies.

To align its logo with practice, the PPP will trade its emblem, the cup, for a set of environmentally-friendly, bio-degradable plastic bowls – the large one for begging and several smaller ones for soup drinking. China will provide the bowls under a Grant Aid Agreement with the Ministry of Finance under which the Chinese will be permitted to compete locally with our merchants of ‘pirated everything,’ and will be exonerated from any liability for the mess-up with the Skeldon Factory. Their consultants will help us with our electricity – funded of course by the Chinese currency. The Grant Aid Agreement will be submitted to the United Nations as the model for non-transparency and non-accountability for resource-rich, low-income countries willing to submit to new age exploitation by the new rich and powerful.

The Minister of Finance will publish his biggest ever Budget within the three month deadline. He will make the decline of the first half year of 2009 into a full year growth – all due to the export of “non-traditionables.” The Minister of Finance will assist the Bureau of Statistics in compiling the GDP and the inflation rates – they will both be favourable, the numbers I mean. Clive Thomas will see red. There will be no available statistics on unemployment and no disclosure statistics on VAT. Inquiries on the absence of related numbers in the areas will be attributed to the high probability of bias in observers.

Dr Ashni Singh will, for the first time, read the Bank of Guyana half-year report before tabling it in the National Assembly. His own mid-year report will be several months late but stamped several months earlier. No change. The Auditor General’s Report for 2008 will be released one year late. Again no change. The Public Accounts Committee will again not notice.

The GRA will announce a tax amnesty, to be followed by a partial one for illegally imported vehicles; automatic and full amnesty will be granted for vehicles found housed in politically connected residential compounds. Not to be outdone, the Ministry of Home Affairs will broadcast its own amnesty for illegal firearms. It will pay $10,000 for every handgun surrendered, and $50,000 for each Kalashnikov-type weapon. Funds will come from the police budget, which will be replenished by the secret results of a resumption of talks with the Brits. If the British talks collapse, patriotic business elements will fund the programme from VAT and/or Customs duties and/or NIS not paid to the government.

The amnesty will be accompanied by the removal out of existence of all records related to taxes; the opposition will be supportive since there will be a removal of its own 100 million dollar debt from all associated files and papers.

To ensure consistency, in 2010 the government will award the same single digit raises (3% for sugar workers, 6% for public servants, and so on) that it offered in 2009 to workers in various sectors. To ensure the same consistency, it will vote and award to itself the same near 100% increase package that it did in 2006. The opposition will, once again, be on the receiving end, which will reiterate the new spirit of inclusion and sharing.

Politics
Despite an easily explained haemorrhaging at the Local Government Elections, the PNCR’s life will be prolonged due to intensive financial care by Dr Jagdeo.

Ravi Dev, pushed by Freddie and helped by Donald Ramotar, will take off his toupee and his mask and join the PPP. GAP-ROAR will read of this slow-breaking news in the press. Carvil Duncan of the GLU will move formally into the Office of the President while Komal Chand of GAWU will be described as a “private trade unionist” responsible, along with the weather, for the continued decline in sugar.

Jagdeo will not get a Nobel mention and blackouts will continue. Several areas of the country will experience unusual weather patterns leading to flooding. There will be no Freedom of Information Act but the President’s friend will be granted a radio licence to help anonymously and financially with the Third Term. He will fail. Ramotar will be named the PPP/C presidential candidate with the slogan ‘More of the Same.’ Robb Street will replace Vlissengen Road as the Centre of Power.

The Minister of Destruction will demolish the Cenotaph for impeding the flow of traffic. He will also facilitate the removal and retirement of long-suffering politician-turned-mayor-turned-letter-writing evangelist Hamilton Green who will take up residence in one of the many vacant rooms at Sophia.

Business initiatives
Guyoil will become a subsidiary of GWI. This will ensure a guaranteed supply of high quality, designer water additives for its fuel pumps. Guyanese consumers are free to demonstrate their now legendary adaptability by utilizing this enhanced fuel for potable purposes, as circumstances warrant.

The Lotto Company under direction from the government will have a new management team drawn from PNC ranks. It will be seen as another example of ongoing government outreach to the main opposition and, given the latter’s history of rigging and fooling everyone for decades, of aligning the right people with the right job. This Lotto shakeup is a contingent arrangement. If the PNC is successful in this assignment, it will be awarded by CGX a management consulting contract to provide it with proven expertise on its oil rigging setup.

One man’s pudding is another’s poison will find very visible proof in 2010. On the one hand, the suitcase businesses will reap a bonanza on sales of customized cell phones, radar detectors and telecommunications scrambling devices, as citizens seek to neutralize the government’s advantage relative to speeding and eavesdropping. On the other, the Bureau of Standards will be overwhelmed by nervous owners trying to obtain official confirmation of sellers’ adherence to truth-in-marketing standards on equipment purchased. The bureau will not concern itself with frivolities surrounding legality and appearances. It will simply limit itself to the sellers’ statements and assurances of performance and physical condition.

A long overdue development will be the partial re-engineering of the GGMC. The units responsible for oversight of miners and producers will become part of a revitalized CLICO offshoot. Experts will reason that this makes perfect sense given CLICO’s now well known proprietary early warning system. Miners will be alerted when to play by the rules and not tamper with troy declarations; political powers will be guided by protective leaks to withdraw from costly surprises produced by whistleblowers, the media, or dogged auditors; and in-house parties will retreat into bureaucratic shelters of ignorance and amnesia. As such, the CLICO system will relay timely information to major stakeholders searching for any edge or advantage.

Several monuments to money laundering will rise to the sky and the trade in non-prescription drugs will gain recognition in the national accounts “in appreciation of its contribution over two decades to the national economy, parties’ coffers and the stability of the Guyana Dollar.”

In other developments, insurance companies will decline coverage to any party that identifies GPL as an official energy source. The same insurance companies will go on record to stress that they have no concerns with illegal connections to the same disputed energy source. Super salaries remitted will be justified as a response to local cost of living realities. There might also be a blurb about the cost of attracting and retaining qualified help along the lines of the once highly publicized Bernard Kerik recruitment foray.

Governance
The President will prove to be very prescient, that stresses in advanced economies will have consequences in Guyana. It does not matter that his prescience is three years late, for the delayed effects will be felt in major areas of commercial activity. There will be consequences, and sacrifices must be made all around. Customs bodies will experience a decline in charitable contributions, and law enforcement ranks will feel the pinch through a decline in involuntary tipping traditions. Tender board people will share the pain.

In an attempt to assuage the critics, there will be presidential releases about a push towards more transparency in government accounting. Contracts will be executed with unemployed accounting alumni from Arthur Anderson, Enron, Madoff and Stanford to avoid any allegations of domestic taint. People from NBS, Republic, and CLICO will be quietly persuaded not to apply. The government will express confidence that all Guyana will be reassured.

The GRA will declare the President non-resident for tax purposes under section 2 paragraph … of the Income Tax Act Cap. 81:01 which requires minimum residence of 183 days in the tax year. This will have no effect on taxes the President traditionally does not pay, since he will claim exemption under section 6, arguing that he exercises his employment abroad and that the thousands of US dollars per trip he receives for staying at friends and relatives, arises outside of Guyana and is therefore exempt.

The head of state will alone burn more dollars in aviation fuel in 2010 than the rest of the nation will expend on gasoline.

Sports
Two top Guyanese spinners – Prem and Randy – will be included in the West Indies team for the World 20/20 championship.

They will perform well on home turf prepared by their side-kick at NCN, but fail outside – taking the team’s chances of success with them. Considered a high risk for this gentleman’s game, another top spinner from the same local club will have to stay at the Office to man the telephone. Brazil will not win the World Cup. Woods will return with a new logo – a hungry looking cheetah – with a warring bevy of waitresses awaiting him at the 19th hole.

Conclusion
Finally, as an indication of its vaunted strategic planning capabilities, the government has already identified several factors that will be rolled out for anticipated business distresses in 2010.

They include: El Nino (La Nina is on standby); foreign terrorist masterminds (wherever located); unattractive US dollar (ugly Americans); lowered overseas demand for local products (except pharmaceuticals); decreased remittances from overseas-based Guyanese (cheap and unreliable); and rising oil prices (whichever year they occur).

In other words, the government is not responsible and has an exit strategy that lays the blame elsewhere. Anywhere else, but not with the government. It seems that 2010 promises to be the best of times and the worse of times.

Next week, it’s back to reality.

Two per cent growth in the economy is wishful thinking

In looking to 2010, Business Page predicted that the 2010 Budget speech would make the economy’s decline of the first half year of 2009 into a full year growth. No sooner had I submitted that column than no less a person than the President himself, in his New Year’s message, reported “preliminary indications that the economy registered a positive growth rate of about 2% in 2009.” He was careful not to provide any support for such assessment, restricting his only specific comment to the sugar and bauxite sectors whose performance he described simply as “below expectations.”

But that limited comment is enough to caution even the most casual observer not to take the President’s assessment seriously. In November 2009, reporting a 1.4% decline in the economy for the first half of the year, the Minister of Finance reported a 19.3% half-year decline in sugar, a 6.7% decline in rice and flat performance in mining and quarrying. For the remainder of the year, the Minister expected the performance of rice to deteriorate and for mining and quarrying to do substantially worse than they did in the first half. We know too that bitter industrial relations since June 2009 ensured that sugar’s woes continued and, quite possibly, deteriorated in the second half of the year.

Even GuySuCo’s CEO, in his New Year message seemed keen to forget 2009 even as he expressed some optimism for 2010. If a miracle had in fact taken place and Guysuco had transformed a 19.3% decline in the first half of 2009 to a full year 10% growth, the corporation and the President would surely have noticed it.

The revised outlook for a 2.5% growth in real GDP, including all economic sectors, predicted in November by the Minister of Finance, was premised on the full-year growth (of 10%) in sugar – equivalent to a turnaround of 36% for sugar in the second half of the year! That simply did not take place and no other sector of significance could have made up for the loss. To put the numbers another way, non-sugar growth was expected to come in at 1.5%, so that the economy did substantially better than the Minister of Finance expected less than eight weeks ago.

The President’s assessment of an overall 2% growth seems more a mixture of wishful thinking, political rhetoric and self-vindication for his firewall assurance, than a serious, informed or honest assessment by someone trained in economics. Having done his political work, he has now placed the Minister of Finance, the Bank of Guyana and the Bureau of Statistics under immense pressure to produce numbers to vindicate yet another of his assessments.

They may oblige. It is hard to be confident about the integrity of the statistics coming out of a Stats Bureau that would not publish the monthly Georgetown price data it collects, usually doing so only after the Minister has announced suitably relevant numbers in his half-year report or his Budget speech. And the fiasco of conflicting rates of 2009 first half (un)real GDP growth, reported in the Business Page series (November/December), but which neither the Minister nor the Bank considered worthy of a public explanation, has similarly affected the credibility of both the Bank of Guyana and the Minister of Finance.

It seems to me that in relation to statistics on the economy and financial information coming out of the government, 2010 will be no different from 2009 and before.