Category: Business and Economic Commentary

Business and Economic Commentary by Christopher Ram

Part I: When business disputes expose underground networks

Introduction

The leak of an explosive March 25, 2025, interview between businessman Azeem ‘Junior’ Baksh of Gold Target Imports and intrepid journalist Travis Chase has triggered more than just a public clash between wealthy businessmen. Baksh detailed what he described as a “harrowing” gold importation scheme, claiming it implicated high-ranking officials. “I am sure that they want to close me down,” Baksh said. “Tamesh Jagmohan wants me closed down… Sonna made that very clear to me – if I pursue him for owed cash, (those in authority) would use state agencies to get me.”

The parties have denied the revelations. But beyond the specific business dispute lies a more troubling question: how did our country arrive at a point where underground economic networks appear so deeply intertwined with state power?

This is no child’s play. It recalls a time when the underground economy which kept the country supplied to an extent that it was tolerated by the state and woven into everyday life. But crucially, it did not threaten the state’s survival – it existed around politics, not inside it.

Frighteningly, Baksh, reflecting his experiences, tells us that in this new world, State agencies would act as agents of a different type in service to private disputants.

In the 1970s and 1980s, it was sometimes difficult to distinguish the underground economy from what was described as the official economy. Top public servants and business executives left their offices to buy contraband flour and potatoes and dhal and toilet paper from shops that had lookouts for the state police. After the Sophia Declaration nationalisations, the government controlled an estimated over 80% of the economy. Import licences, foreign exchange rationing, and price controls created chronic shortages. The oil crisis of 1973, collapsing bauxite prices, and the fixed exchange rate of G$2.55 to US$1 became a fiction.

How the original underground worked

On the streets, US dollars traded at several times the official rate. Traders traveled to Trinidad, Suriname, Venezuela, and Curaçao to buy goods with black-market dollars for resale at home. Tellingly, when President Hoyte introduced cambio licences to formalise currency exchange, the men who had been selling US dollars in Commerce Street (where else?) and around Stabroek Market were among the first to apply for licences to operate non-bank cambios.

Border routes moved goods from neighbouring countries: Springlands on the East, Lethem on the South and fuel coming via Morawhanna to the North. Some operators became household names – the man with an oriental nickname who started out dealing with flour, built a massive construction equipment empire, an accomplished athlete who hawked ladies’ underwear was eponymously associated with a nightclub (and noise nuisance) and now a major entertainment and gambling operation.

That phase also produced the market vendor who founded a prominent national newspaper; another whose buildings have transformed Georgetown’s skyline, and three enterprising professionals who pioneered the barrel trade that grew into a major shipping operation. These were textbook cases of how contraband profits could be folded into legitimate corporate identities.

Political tolerance, not dependence

Despite public threats to “stamp out smuggling,” the state often looked the other way. Contraband eased shortages, and the underground currency market provided hard cash that even official agencies sometimes accessed through intermediaries. Crucially, operators did not try to buy political influence – they were traders, not power brokers. Indeed, one of them up to this day describes himself simply as a hustler.

By the mid-1980s, this economy was part of normal life. Border towns like Lethem and Corriverton bustled with unofficial markets. Regent and Water streets offered goods that government outlets lacked. Civil servants and police officers ran small side ventures – a minibus, a shop, rental rooms – to supplement incomes. These were modest, low-profile, and carefully kept separate from public activities.

That sector did not escape academic interest. Perhaps the most famous was Clive Thomas whose study found that the underground economy at 80-100% of the official economy during the mid-1980s. Notable too were Bishnodat Persaud (UWI) and Kenrick Hunte (UG) who found valuable opportunity to study the phenomenon of parallel markets and shadow activities, exchange rates and tax evasion. Inevitably too, there were institutional sources like the IMF, World Bank, and ECLAC.

Then and now

This first-phase underground economy distorted prices and eroded formal business, but it was not an existential danger to governance. The black market, not the Bank of Guyana, set the real price of the dollar. Formal importers could not match contraband’s speed or cost. Staying in one’s place was the rule. Politicians tolerated the underground economy. The unwritten rule was simple: take a little, keep it quiet, and stay away from the political arena.

The most telling difference between then and now lies in scale and integration. In the 1970s-80s, a senior public servant might own one or two minibuses or run a small shop. Today, many in similar positions have become major contractors, licensed and unlicensed exporters, or concession-holders, and dredge owners, using public office as commercial weapons.

This change is fundamental: the side hustle has moved from the margins to the heart of the state apparatus. Phase One was a safety valve in a scarcity economy. Underground operators made money but did not bankroll political parties and their election campaigns or dictate policy. Nor did politicians need them to survive in power to retain – and remain in – power.

Conclusion

What we see in the Baksh revelations is fundamentally different. The underground economy has grown richer, politically powerful – and dangerous. Unexplained and dark money are called on to finance expensive election campaigns. Political and commercial interests combine in a symbiotic web of private and public corruption.

This is no longer tolerance – it is mutual dependency. When underground wealth and political power lock together, they threaten not just fair competition, but democracy itself.

Next week: Part II examines how this transformation threatens democratic institutions and what the Baksh case reveals about modern underground networks.

Introduction
One day before Guyana observed Emancipation Day, the mercurial universe Boss Donald Trump confirmed his April 2 Liberation Day Executive Order to unilaterally impose tariffs on every country trading with the United States of America. The US President imposed on Guyana’s products entering the United States a 15% tariff beginning next week – a blow with implications for this country’s trade policy and its economic diversification programme. If one is looking for any consolation, maybe it lies in the initial implausible reciprocal rate of 38% previously announced in April, using an amateur’s methodology based on the size of the trade deficit which that country has with the United States. Thanks Exxon!

It is no consolation however that Guyana and Trinidad and Tobago all have a higher rate than the other countries of the Region, including all the CARICOM countries, Suriname, Cuba and Haiti. This appears a cautionary word to Guyana which has been cosying up to the Americans, accepting that the lopsided 2016 Petroleum Agreement will remain unchanged up to 2057, hosting its Secretary of State at a special function and tolerating its ambassador interfering in Guyana’s domestic affairs in an election season. It will take some time to see the economic consequences of Trump’s action which even questions the well-worn cliché that America does not have permanent friends, only permanent interests.

Strategic partner?
It is not as if Guyana is of no consequence to the United States. We are not only of strategic importance, sitting at the top of South America. Nor are we of no diplomatic value – we make our voice heard at the United Nations and are not ideologically at odds with the USA. Indeed, there is a view that Guyana is a compliant and accommodating partner. On the economic front, we have no equal among CARICOM states. In another few years, Guyana will contribute significantly to the energy security of the USA with around 600,000 barrels of oil per day earned by American giants Exxon and Chevron from the Stabroek Block. Does that not count for something!

This imposition is not an oversight. We have former President Sam Hinds heading our embassy in Washington. We have a highly paid lobbyist in that country, and we have in Georgetown an ambassador with whom we are obviously in contact. They have all failed us and the question we must ask – without getting any answers – is why has Guyana been excluded from the 10% club? By what measure could we be placed below Cuba and Haiti and on the same plane as Venezuela? What message are the Americans trying to send? 

Despite the abundance of rhetoric about Guyana being “a strategic partner” or “the new frontier,” we remain little more than a resource basin, extracted by multinationals and then sidelined when broader trade benefits are being shared. This 15% tariff is not merely economic. It is a diplomatic signal that Guyana does not carry sufficient weight in U.S. trade calculations to warrant even the same treatment as Haiti or Saint Lucia. That is both alarming and deeply humiliating.

Question time
Even as we accelerate towards national elections, we expect our leaders and politicians to ask some searching questions. Did we request inclusion in the 10% group? Did we raise objections when the 15% classification was being drawn up? Were our diplomats even informed? This is no time for passivity. The 15% tariff decision is a clear sign that our foreign policy must be recalibrated. Our leaders must be willing to make meaningful, not symbolic representation.

Make no mistake: this has real economic consequences. Exporters of rice, rum, lumber, processed foods, and other non-oil products will now find their goods 15% more expensive in the U.S. market than similar products from Barbados or Jamaica. It undermines Guyana’s already fragile export base and disadvantages any attempt at economic diversification.

Even as we talk about building a manufacturing sector or value-added production, such efforts are directly harmed by this kind of tariff penalty. And since our oil exports are outside the scope of these tariffs, it is the non-oil sector – the very segment we claim to want to strengthen – that takes the hit.

Conclusion
We must now wait until the elections are over to address the issue and its consequences. Late as it is, we need to understand the rationale for the decision. There seems no reason why we do not call in Kingston for an explanation. The Ministry of Foreign Affairs must publish the timeline of its knowledge of this classification and the representations, if any, made to U.S. authorities. The Office of the President and Ministry of Finance must clarify how this tariff will impact exports and growth. And the Private Sector Commission must shake off its inertia and demand redress on behalf of the exporters it claims to represent.

Business and Economic Commentary By Christopher Ram

Introduction

The recent letter to Stabroek News (SN 19th. July – Decision to have Attorney General lead the compulsory land acquisition process contradicts global best practices) raises legitimate concerns about the Attorney General leading the compulsory land acquisition process. The writer’s observations about power imbalances strike at the heart of what I have been advocating – that Guyana’s approach to compulsory land acquisition is fundamentally flawed and incompatible with constitutional principles and international best practices. I go further: the role played by the Attorney General blatantly violates the Compulsory Acquisition Act.

Let us remember that Article 142 of the Guyana Constitution guarantees “prompt payment of adequate compensation” for compulsorily acquired land. Yet the reality reveals a troubling disconnect between constitutional guarantee and the Act which dates back to 1914. The relevant provision restricts compensation to basic market value while excluding factors any reasonable person would consider relevant – including psychological trauma of forced displacement and loss of generational ties to ancestral lands. This creates what I have previously described as “a very imbalanced relationship between the Government and the citizen,” where the state wields “the coercive force of the law against the timidity of all but the well-heeled in society.”

When the Constitution promises adequacy, but the law delivers only market value minus most market factors, we have a system designed to shortchange citizens. Market value (MV) itself contradicts compulsory acquisition since MV is defined as the price agreed by a willing buyer and a willing seller. But the law is even worse. It has so many exclusions as to strip the landowner of his or her rights. In other words, not only is market value inappropriate, it is further denuded of the flawed amount offered by market value. My preference would be for a replacement value, or an expansion of section 19 to the Act which gives the Court latitude in increasing the amount of the market value. Sadly, it has not been my experience that the Government is too comfortable with this addition. 

The Attorney General’s role

The AG is, by definition, the government’s chief legal advocate. The practice in all these compulsory acquisitions is that the Chief Valuation Officer and the Attorney General play lead roles. I am not in the least bit certain that the roles they play in practice are legal, let alone proper.

The Act sets out detailed procedures that the State must follow when acquiring private property compulsorily, beginning when the Minister declares a project “public work” under section 3, authorises land examination under sections 4 and 5, and receives a survey report and plan under section 6, after which the Minister may either negotiate a purchase with the landowner or compulsorily acquire the land by making a declaration under section 6 that automatically vests the property in the State one month later subject to compensation (s.7), requiring the Minister to serve notice on the proprietor (s.8) and file certified copies in the Deeds Registry (s.9), before the Attorney General must apply to the Court under section 13 for compensation assessment, with the Court directing valuation and determination of appropriate compensation under sections 13-16. It is unclear whether these steps are followed and what non-compliance means to property owners.

Mr. Barrington, as Chief Valuation Officer, has held no statutory authority under the Act since the post-1990 period, and his valuation disclosed a single inapplicable comparator, raising serious concerns about the soundness of the evidence he would have tendered within the land acquisition process on behalf of the state.

The practice is different

The AG plays a lead role in meeting with and negotiating with landowners, ably supported by the Chief Valuation Officer who is promoted as an authority. This is not only wrong. It is unfair. Asking affected landowners to negotiate with the person whose job is to advance the government’s legal interests creates an inherent conflict that no amount of good intentions can resolve. International best practice emphasises independent facilitation precisely to avoid such conflicts. When communities feel they are negotiating with an adversary rather than participating in a fair process, the entire legitimacy of the project comes under threat.

No wonder then the several reports of property owners being presented with offers significantly below reasonable market rates, with little opportunity for meaningful appeal. The psychological pressure created by the government’s legal authority creates a system where “consultation” becomes a euphemism, at best for managed consent extraction, and at worst, being knowingly swindled by the State.

The deafening political silence

At the national, collective level, the most troubling feature is the complete absence of political discourse, let alone leadership on this issue. Despite the unprecedented spate of compulsory acquisitions that has accompanied Guyana’s oil trajectory – from gas-to-shore infrastructure to new highways and energy projects – not a single political party or prominent politician has paid meaningful attention to how citizens have been systematically cheated of their property.

The PPP government implements these unfair acquisitions. The PNC opposition remains silent about the constitutional violations. Third parties focus on trivia. The result is that ordinary Guyanese facing compulsory acquisition find themselves entirely alone, confronting the full power of the state with antiquated legal protections designed to favour colonial authorities.

The only and limited improvement to the 110 years old Act came in 1990 when then President Desmond Hoyte introduced a new version of section 19 which empowered the Courts to use its discretion to enhance the so-called “market value” to give the property owner “prompt payment of adequate compensation”.

The political dimension

And now, as we approach another election cycle, these same political parties that have ignored citizens’ property rights want our votes. They will speak eloquently about development and progress, but not about the families whose sacrifice made that development possible. Political parties that think they can systematically violate property rights and then count on electoral amnesia are making a dangerous miscalculation.

One of the tragedies of Guyana is that as voters do not react to having suffered from property under-valuations. Our voters can divorce their personal challenges from their political choices.

The way forward

Meaningful reform requires compensation that reflects the constitutional standard of adequacy, including a compulsory acquisition premium – no less than 25% above market value—to account for the forced nature of the transaction. The process must be genuinely independent, removing the Attorney General from stakeholder engagement and replacing government-dominated valuation with independent assessment panels.

The letter writer’s call for independent, participatory consultation processes reflects democratic wisdom. Our constitution promises adequate compensation for compulsory acquisition.

Business and Economic Commentary By Christopher Ram

Introduction

Part 1 looked at the contrasting visions of President Irfaan Ali and Mr. Paul Cheong, Ali’s choice for CEO of the beleaguered state-owned GuySuCo, articulated within weeks of each other. As Chief Executive Officer, Cheong unveiled a seven-point plan for the sugar industry, announcing a bold 2025 target aimed at – implausibly – doubling sugarcane yield and securing the sector’s long-term sustainability.

President Ali’s vision seems to change with every pronouncement, his latest being diversification into rice, corn and cassava. In 2020, we heard that Dubai would partner with Guyana to revitalise the industry and make it profitable. Then we heard it would be the Indians, then the Cubans, then the Brazilians. Last year, Ali told the Caribbean Investment Forum that Guyana aims to supply all the sugar the Caribbean needs within two years. A few weeks ago, the slogan was to “make sugar great again” – even as corn, rice, and livestock were added to the mix, as if sugar skills were somehow automatically transferable. These are head-spinning changes that are too difficult to make sense of, let alone implement.

Shuttered estates

We should not forget the overriding 2020 elections campaign promise, repeated by the newly appointed Minister of Agriculture when he announced the appointment of a turnaround specialist as CEO to lead the Conditional Survey ahead of reopening the shuttered Enmore, Rose Hall, and Skeldon Estates. That CEO has since moved upwards, production has moved downwards, and confusion all around. The reality is that since the PPP/C returned to power in 1992 – with a break of five years of the Coalition – GuySuCo has staggered along in crisis, surviving only because of costly, endless bailouts.

Sugar has been in decline for decades. The Parvatan Commission of Inquiry traced GuySuCo’s production history back to 1940, when the industry produced 155,800 metric tonnes of sugar, rising to 327,400 tonnes by 1960. Between 1960 and 1981, production regularly topped 300,000 tonnes, with only six years falling below that level. But the decline was already set in motion: between 2005 and 2015, production never crossed 230,000 tonnes. Then came the dramatic slide – by 2024, production was down to 47,130 tonnes, and the first crop of 2025 fell to just 15,000 tonnes.

The gambler

Ignoring Kenny Rogers (Know when to walk away, and know when to run), the government keeps pouring good money after bad. It is estimated that the sugar industry has cost this country about one hundred billion dollars over the past decade – and that is a conservative figure, ignoring hidden subsidies, debt write-offs, free land, and all the opportunity costs of what that money could have built instead.

The repeated justification is that thousands of rural workers depend on sugar. In fewer and fewer communities, that remains true – but the reality is that many traditional workers have little appetite for this backbreaking, low-paid work in today’s Guyana. The fact is that even the reduced industry is facing a labour supply crisis – the younger generations, mostly Gen Z, want modern, less punishing livelihoods. They have not gone to school to become cane cutters, by whatever name called. Low recruitment rates are worsened by persistent absenteeism. It means that the promise of “protected jobs” has become more political than practical.

Meanwhile, the industry’s governance remains a structural weakness. GuySuCo is kept on life support by taxpayers but remains under political control – the government appoints both the Chair and the CEO. This ensures that every major decision is at best a political compromise, not a sound business choice. The Parvatan Report’s blunt assessment – that the government’s heavy hand prevents real turnaround – has proved accurate year after year.

The perpetuator  

No amount of money or slogans will solve this. With oil money flowing, only the return of the PPP/C in the September elections will ensure this irrational cycle of promises, wasteful spending, and poor performance continues. It is an expensive pattern that Guyana cannot afford forever. A new administration genuinely committed to sound economics, independent management and fiscal responsibility must break the cycle.

The opportunity of windfall oil wealth does not erase basic economic truth. For every billion dollars spent to prop up GuySuCo’s outdated model, billions are diverted from roads, water, schools, hospitals, technology training, rural diversification and transport – all increasingly urgent needs. The opportunity cost is vast and must not be forgotten, even though it is rarely stated plainly.

The problem solver

There is a way out. The PPP/C did not reopen the estates, and its supporters went about their lives. It can do what the Coalition once did – face reality. A credible first step would be to establish an impartial Commission of Inquiry to recommend on the remainder. Estates that are structurally unviable must be formally and permanently closed. Viable assets must be opened to credible, well-regulated private investment, with binding safeguards for workers and communities. Large sections of estate lands should be transferred or leased to workers, communities or co-ops who can diversify into rice, corn, cassava, livestock or modern agro-processing – matching today’s workforce, not the workforce of the 1940s. The entire corporation must be run by an independent, professional board, free from the revolving door of political patronage. Workers must also have real transition pathways – upskilling, alternative livelihoods, and proper support for those who want to move on from the cane fields.

If the government is serious about rural development and food security, it must stop confusing emotional slogans with economic truth. “Making sugar great again” will not work if we continue to pretend this failing model can be fixed by pouring in more taxpayers’ money.

Until GuySuCo’s fundamental flaws are faced honestly, the same bitter pattern will repeat: more bailouts, more promises, and no real answers.

Business and Economic Commentary by Christopher Ram No. 33

When criticism meets political pressure, grand schemes emerge from thin air

Introduction

Within just a few weeks, Guyana has been treated to two competing visions for GuySuCo. First, President Ali’s appointee as CEO, Paul Cheong promises salvation through drone technology and Brazilian partnerships – focused on making sugar work. Next comes President Ali’s vision of GuySuCo as a “hub of rural development” – many of them towns – extending into rice, cassava, and livestock – essentially admitting sugar alone cannot work.

The contradiction is telling. One vision assumes sugar can be saved through technology. The other requires diversification – or more accurately, diversion – into entirely different sectors. Both appeared as reactive responses to pressure rather than genuine planning. Yet they point in fundamentally different directions, revealing an administration with no coherent strategy whatsoever.

The trigger: Reactive announcements

Cheong’s technological pitch emerged directly in response to my critical analysis published in this newspaper in June. Within days of “Sugar Dreams and Capital Nightmares” appearing, Cheong felt compelled to respond with his vision of transformation.

Ali’s diversification scheme was unveiled weeks later at the Enmore Martyrs’ commemoration – a setting unsuitable for accountability for the PPP/C’s and his own administration’s failures. Faced with explaining why production has collapsed after nearly five years in office, Ali chose to pivot to fantasies about GuySuCo’s future transformation.

Neither vision emerged from planning sessions or stakeholder consultations. Both were hasty responses: Cheong defending against criticism, Ali deflecting from decades of failures.

What both visions completely lack

More telling than what these visions promise is what they lack: any known planning whatsoever. Neither has provided clear objectives, implementation timelines, cost projections, risk assessments, management structures, marketing strategies, or financial projections.

Nothing. For an administration with nearly five years to develop a coherent GuySuCo strategy, this absence of substance is breathtaking. This is governance by public pronouncements designed for all the wrong announcements and certainly not solid strategies for results.

The logical absurdity is staggering. We have wasted hundreds of billions on GuySuCo even when we had actual plans – flawed though they were. To expect better results with no plan and no execution sounds like insanity. Yet both are proposing grand visions plucked from thin air, unencumbered by planning or realistic assessment.

Cheong’s recycled technology

Cheong’s vision reads like a Silicon Valley pitch: drone technology, predictive maintenance, Brazilian partnerships, new dryers, packaging machines, and “greater mechanisation.” Yet these are hardly revolutionary concepts for GuySuCo – similar technological promises have been made repeatedly over the years, with mixed results at best.

The pattern is familiar: new management arrives promising transformation through the latest technology, whether it’s modern factory equipment, improved field techniques, or partnerships with international experts. Each time, the focus remains on capital expenditure and technological fixes rather than addressing fundamental issues of management, planning, and market viability.

Rather than acknowledging this history of failed technological promises and seeking proven leadership like former successful chairpersons Vic Oditt and Ronald Alli who understood both the industry and sound management principles, Cheong retreats to the same playbook of technological solutions that have disappointed before.

Ali’s trademark diversion

Ali’s pronouncement reveals his characteristic response to failure: pivot to even grander schemes that ignore present realities. Rather than explain why sugar production has collapsed, he declared GuySuCo should expand into rice, livestock, agro-processing, and fabrication services.

This is not a diversification strategy – it was Ali’s trademark diversion from accountability. His approach treats GuySuCo as a political instrument rather than an economic enterprise. The audacity is breathtaking. A complex organisation producing sugar at twice world market prices, struggling with basic operations, is somehow going to become competitive in multiple unrelated sectors?

The track record: Five times the opportunity

Before accepting either vision as credible, examine the track record. The PPP/C has governed for 27 of the past 32 years versus just 5 years and 3 months for APNU+AFC.

This means the PPP/C has been in charge of GuySuCo for more than five times longer than the Coalition. They have had the opportunity to implement technological solutions more than five times, pursue diversification, and achieve the very goals they now promise. The PPP/C tried technological solutions before. They attempted diversification before. They announced grand plans before. Each time: more money spent, more targets missed, more excuses offered.

Ali specifically has had nearly five years to deliver on reopening estates. The results: “catastrophic” production levels and a corporation whose “very future is under real threat.”

We have been this way before

Every element has been promised before. The 2010 Turnaround Plan promised 400,000 tonnes by 2013, mechanisation and transformation. The Skeldon Project promised technological revolution. Previous diversification attempts promised GuySuCo would become more than sugar. Each time, grand announcements without substance. Each time, the same result: failure dressed up in new rhetoric.

Conclusion

Both visions represent competing versions of the same delusion, made worse by their fundamental contradiction and complete absence of planning. When the CEO and President offer incompatible visions within weeks of each other, both triggered by external pressure, it reveals an administration that has lost control of its narrative, let alone its strategy.

Next week: Part 2 examines what this fool’s gamble has cost Guyana while public services crumble and opportunities are squandered.