Category: Business and Economic Commentary

Business & Economics Column

Attorney General Anil Nandlall recently conceded that the NIS cash grant “is not the solution” – yet proceeds to promote it anyway. This telling admission encapsulates the government’s approach to the NIS crisis: politically expedient band-aids rather than principled reform.

The proposed one-off grants, ranging from $260,000 to $650,000 for contributors with 500-749 contributions, suffer from critical flaws.

 The NIS Act already provides an Old Age Grant for persons with 50-749 contributions, and it would have been a better solution to amend the Benefits Regulations under the NIS Act for consistency and some degree of permanency.  Second, the flat-rate payments ignore earnings history, violating the principle that benefits should reflect contributions. Third, the arbitrary cutoffs are particularly unjust: contributors with 749 contributions receive substantially less than those with 750.

I have proposed an alternative to the government: calculate benefits as a percentage of what contributors would have received with full contributions, based on their last insurable earnings.

This maintains that benefits should reflect contribution history while providing immediate relief. A crucial virtue of this approach is that it offers continuing benefits for life, rather than a one-off payment that necessities will soon consume amid our high cost of living. My proposal would make this a permanent feature through amended regulations, avoiding future ad-hoc interventions. Almost a week later, the proposal has gone unanswered.

Particularly concerning is that two governments have done little with two consecutive actuarial reports, compounded by the delay in publishing the 2023 Annual Report, which would likely show a dramatic improvement in NIS’s financial position due to oil sector contributions. Such neglect is not even appropriate for a cake shop – let alone the country’s most important social security scheme. Doling out money might have political benefits but is no substitute for management.

The Zainul case and GuySuCo story typify the challenges faced by the NIS over decades. The late GM Patrick Martinborough highlighted this in the only meaningful story ever told of the Scheme in its more than 50-year history. His book, published in 2015, offered the solution that the current Administration seeks.

“Oblivious of that fact, in 2016, the NIS announced a ‘strategy to recover outstanding debts’. Yet the same problems persist nine years later, suggesting these grand pronouncements were nothing more than political theatre to pander to the political directorate, with no serious implementation intention.  Did they check on Zainul’s employer – Toolsie Persaud Limited – whose carpenter employee appears to have kept better records than the company?  

The timing of the cash grant initiative, coming on the heels of another election, raises legitimate questions about whether this is genuine social policy or electoral politics. The optics of distributing cash grants, however inadequate, appear calculated to appeal to voters rather than to implement principled reform of our social security system.  But the politics itself are equally troubling. Nandlall is not even the subject minister responsible for NIS, yet he leads the support cast, having himself been guilty of violations of the Act, which he attributed to “ignorance.”

He must also know that many of the defaulting employers were or are government corporations and political colleagues. This selective accountability undermines enforcement credibility. The same government that threatens prosecution has shown remarkable leniency toward political allies and state entities that violate NIS regulations.

With our oil wealth, Guyana has a historic and unprecedented opportunity to transform NIS into a system worthy of our citizens. We need comprehensive reforms: modernising the NIS Act, restructuring the Board for independence, implementing actuarial recommendations, pursuing all delinquent employers regardless of connections, and establishing systems for reconstructing employment records when employer negligence is proven.

The announcement of the NIS one-off grant may be a done deal. That is a pity since it can be refined. Yet, it represents a missed opportunity for meaningful reform. The benefits to the Administration seem more designed to earn political mileage than to assist the hard-done-by NIS pensioners. The aim is to win another five years while the people of pensionable age get some cash equivalent to just six months’ worth of pension. Not a bad deal.

The Scheme loses reputation, credibility and the opportunity to establish a sound, sustainable framework. The cash grant – a newly discovered panacea for all ailments facing the country – fails to address systemic issues, creates new inequities, and kicks the can down the road.

Guyana needs solutions built on sound principles, not political opportunism and expediency. The question is not whether we can afford a better solution, it is whether we are prepared to expend the energy to analyse the problems and find and implement proper solutions.

The columnist has a long association with NIS reform. He drafted the NIS Act of Grenada (1983), served as the first Chairman of the NIS Board, was a member of President Jagdeo’s NIS Reform Committee (2007), and has represented numerous contributors in pursuing their claims.

The 38% tariff on Guyana’s exports to the United States is among the highest announced by President Donald Trump late last week. The number is half of the 76% that Trump’s economic advisers have calculated as the actual value of the tariff disparity between the USA and Guyana. However, what began as a comparison of tariff rates between the USA and individual countries soon evolved into something more complex – one that included non-tariff barriers, such as exchange rate manipulation, import controls, and phytosanitary measures. Finally, if anything can be called definitive under a mercurial and erratic figure like Trump, it is that the tariff was calculated based on US trade statistics.

The formula used is the higher of ten percent or the 2024 US trade deficit in goods with a given country, divided by the total value of US imports from that country. For example, if the US has a $100 million trade deficit and imports $250 million in goods, the resulting tariff is 40% which is higher than the default 10%. However, if the deficit is only $10 million, the percentage would be 4%, and the 10% minimum would be applicable. It is mind-boggling that the country with the world’s largest number of Nobel laureates in economics would rely on what is worse than voodoo economics.

The Economist, a highly respected weekly, described the move as “the most profound, harmful, and unnecessary economic error in the modern era.” Others have been more cutting. The London Observer labeled the tariffs “fundamentally wrong, brutal, and paranoid,” while The Atlantic suggested that understanding them requires insight into Trump’s mind alone. Among the absurdities: the inclusion of the Heard and McDonald Islands – uninhabited volcanic outcrops mostly home to penguins and, in another case, a few U.S. military personnel.

Guyana compared

Guyana, like Trinidad and Suriname, is part of CARICOM’s Common External Tariff and VAT system. Yet while our neighbours face only a 10% tariff, Guyana’s is a staggering 38%. Why the disparity? The answer lies in how the U.S. counts oil.

Our largest export to the U.S. is crude oil, totaling several billion U.S. dollars. In 2023, ExxonMobil alone accounted for nearly US$5 billion. And yet Guyana neither owns nor controls this oil – it is extracted and exported by foreign companies under a contract that leaves us with little revenue and even less control. This is reminiscent of Vietnam, Cambodia, and Laos, which were encouraged by the U.S. to replace China as low-cost producers. So much for believing that America is ever a friend.

Stabroek News on Friday carried the government’s announcement that crude petroleum, gold, and aluminum are exempt from the Trump tariff. Unlike the government, I take no comfort in that unsourced information. These are not Guyanese exports in any meaningful sense. Our country does not export petroleum products to the U.S.; ExxonMobil and Hess do. The same applies to bauxite ore and gold. Unless the 38% is reduced to 10%, there is no benefit to our genuine local exporters – of seafood, rum, lumber, and other products.

Opportunity for renegotiation of the 2016

Petroleum Agreement

Guyana is not the villain here. We are the victim –  first of a contract, then of a misrepresentation, and now of a penalty. We must assert our sovereignty, protect our economy, and demand accuracy and fairness. We have been and continue to be robbed, once by the 2016 PSA, then by the statistical misrepresentation of our exported products, and now, a third time, by a tariff rooted in that fiction.

If the last is rectified, our exporters will face a 10% tariff and struggle to remain competitive. At 38%, they’re either out of the U.S. market or out of business. In light of this fundamental shift, we should now assert our right to call for renegotiation – not just of the tariff, but of the petroleum agreement that underpins this entire distortion.

Renegotiate the tariff

International media have reported that more than fifty countries have requested meetings with the U.S. Admi-nistration to negotiate their assigned tariffs. Guyana must join that effort –  perhaps through CARICOM – but with a competent team and accurate data. We must ensure that the value of oil exports by foreign companies is excluded from the balance of trade figures used by the USA to compute the tariff it will impose on Guyana.

Here’s the key distinction: Exemption refers to any product that escapes the tariff. The oil exported by Exxon and Hess is not Guyanese in any economic sense. Exclusion means not counting it in the equation since it inflates our true surplus and wrongly triggers penalties. What Guyana truly needs is exclusion, not exemption. Our politicians and negotiators must be clear and uncompromising in this matter. If they do not, we will be negotiating from a position of weakness.

The broader picture

Trump’s tariff policy reveals a deeper strategic miscalculation. The United States helped create and benefited most from the post-war global trade architecture, including the WTO, GATT, and Most Favoured Nation (MFN) treatment. That system fostered prosperity and stability. Now, Trump seeks to unravel it.

The signs are not good. Trump is doubling down, and reversing his executive order would deflate the tough-guy image he cultivates. We should expect inflation, a dip in oil prices, and a period of economic turbulence. Global trade infrastructure will need to be rethought – and re-fought.

Conclusion

Guyana must resist being cast as a trade surplus villain when, in truth, it is a victim of a flawed contract and misleading data. We must demand a new conversation – one grounded in economic reality and national dignity. This is a moment for clarity, courage, and collective action. “The question, then, is not whether we respond – but whether we are ready to do so with courage, clarity and competence.

Business and Economic Commentary

Introduction

It took 136 years for the Georgetown Chamber of Commerce and Industry to elect a woman – Mrs. Kathy Smith – as its President. While that milestone is welcome, it underscores just how far Guyana still has to go in honouring its constitutional promise to women. While considerably younger, the more powerful Private Sector Commission does everything to sideline women as its leader. The promise of equality enshrined in Article 29 of the Constitution of Guyana, is a distant dream. This is what Article 29 states.

“Women’s participation in the various management and decision-making processes, whether private, public or state, shall be encouraged and facilitated by laws enacted for that purpose or otherwise.”

It does not need to be elevated to a fundamental right: there is an article against any form of discrimination. It is not aspirational: it is binding. And yet, over 40 years since an equivalent provision was included in the controversial Constitution in 1980, its implementation has moved incredibly slowly. This may have explained the choice of the topic by acting Chancellor Yonette Cummings-Edwards in a lecture honouring Dame Desiree Bernard, the first woman judge, first woman Chancellor of the Judiciary, and the first woman on the Caribbean Court of Justice. It was an occasion for reflection – and lament.

Progress and reality  

During the 1990s, Guyana saw a brief but hopeful period of progressive legislative reform. This included the landmark Domestic Violence Act of 1996, the Equal Rights Act, the Medical Termination of Pregnancy Act of 1995, and the first serious efforts to address sexual harassment and gender-based violence. These measures, hard-won through years of advocacy and the leadership of Cheddi Jagan, suggested the beginning of a new era. But the momentum has faded, almost standing still. Since the early 2000s, little legislative advancement has addressed gender inequality. The silence around Article 29 is part of that broader stagnation.

The statistics tell the story. Only two of the thirteen companies listed on the Guyana Stock Exchange are chaired by women, one effectively non-trading, and the other of comparatively small capitalisation but as well led as any of the others. Women lead only three of fourteen key public agencies and account for only 19% of Guyana’s ambassadors. The private sector is even more male-dominated, with almost all leading business organisations headed by men.

Only nine of the forty-two recently reviewed companies, agencies and missions had women in top leadership roles – just 21%. Politically, the imbalance is more severe: the five top government positions are held by men, and every major political party—PPP/C, PNCR, AFC, WPA, and ANUG—is male-led. It will take a more scientific analysis to determine any link between gender and the state of politics and governance in Guyana. Even in professions like law and accountancy, where women now match or exceed men in numbers, leadership remains overwhelmingly male. Women are often confined to leadership in “care” sectors or social organisations, reinforcing outdated ideas about their appropriate role in public life.

Two ironies in the judiciary stand out. First, the Chancellor and the Chief Justice – both distinguished and experienced women – remain in acting positions, their appointments blocked by the refusal of a single man, the President, to confirm them. Second, at the Chancellor’s lecture, sponsored by the Guyana Associa-tion of Women Judges, only one of six male judges of the Court attended. Their absence said more than words could.

Other salient concerns

But the failure to honour Article 29 is about exclusion, fear, silence, and even danger. Domestic violence and femicide are endemic in Guyana. Even women in high office face indignity. Sitting in the front row of UG’s main lecturer theatre was Ms. Priya Manickchand, Minister of Education having been  publicly berated by the President – an incident still proudly displayed on his Facebook page. No Cabinet colleague, male or female, defended her. To her discredit, she stood there and took it, some days later posing with the President.

Beyond politics

Contrast that with the case of a male Minister in the Cabinet who was accused and exonerated of heinous sexual misconduct. Female colleagues expressed disgust privately but said nothing publicly, fearing retaliation or isolation. That man is now being rehabilitated by the male leadership of the Government. In Guyanese politics, showing moral independence -especially if you are a woman – is often interpreted as disloyalty. Speaking out can mean career exile, character attacks, and personal risk. This toxic culture rewards silence and punishes principles.

The problem, of course, extends beyond politics. Our social and economic landscape often forces women into conformity – staying in abusive relationships, remaining silent at work, or avoiding leadership ambitions – because of financial dependency, social norms, or fear of ostracism. To our country’s discredit, for too many women, the stark choice is between survival and self-expression.

Conclusion

If Article 29 is to mean anything, Guyana must move beyond lip service and take concrete action. Laws must be passed to give teeth to its command, and institutions and individuals must be held accountable for promoting – not just permitting – women’s leadership. Cultural change must follow, breaking the social norms that silence women or push them into submission for the sake of survival.

Chancellor Cummings-Edwards asked: “Have we arrived?” Her reply: “We are there, but there is still more to go.” I must respectfully express my doubts. When leadership remains overwhelmingly male, when women are berated in public and silenced in private, and when a promise like Article 29 goes unfulfilled for decades, the journey has barely begun.

Until women are no longer blocked, silenced, or punished for leading, Article 29 will remain not just a broken promise – but a standing indictment of Guyana’s democratic conscience and of our society.  

December 15, 2024

The Natural Resource Fund Debate – That Demands Accountability and Civility

The public debate and exchanges surrounding the Natural Resource Fund (NRF) highlight concerns about governance and the need for principled public discourse, particularly on grave national importance. At the centre is Dr Terrence Campbell, the holder of a PhD in Business Administration and a successful entrepreneur. In a letter to the media in his capacity as a member of the Investment Committee of the Natural Resource Fund, Campbell raised issues about transparency and compliance with the NRF Act. That letter emphasised the requirements of Section 16(2), which mandates that all withdrawals must meet specific criteria: financing national development priorities and major natural disasters.

Instead of prompting constructive debate, Campbell was personally attacked by anonymous bloggers and partisans who offered little substance while serving as a prelude to Vice President Bharrat Jagdeo’s direct intervention.

Jagdeo’s Missteps

In an initial comment, Mr Jagdeo accused Campbell of racism and, more recently, dismissed Campbell’s concerns by invoking a contrast between their respective upbringings. Jagdeo portrayed himself as humbly rooted on the East Coast of Demerara, implying that Campbell was urban and privileged. Correcting the Vice President, Campbell noted that he came out of the distant community of Mahdia with all its attendant challenges.

Taken together, Jagdeo’s statements reveal a dangerously flawed interpretation of the NRF Act. He asserted that detailed expenditure tracking was only necessary for emergency withdrawals, ignoring Section 16(2)’s clear stipulation that all withdrawals must meet specified criteria and undergo oversight. Emergency spending, governed by supplementary appropriation bills, requires a separate process distinct from the scrutiny of annual budgetary allocations. Jagdeo’s conflation of national priorities with general budget items further undermined his position, raising questions about his familiarity and knowledge of the law.

Campbell’s Measured Response

Campbell’s reply demonstrated civility and focus. While acknowledging Jagdeo’s slight concession – from declaring tracking “difficult” to agreeing to track emergencies – Campbell questioned why the same standard could not extend to all NRF withdrawals. Campbell emphasised that the national budget, filled with discretionary items, is not synonymous with national development priorities. He reiterated the NRF Act’s requirement for specificity and accountability, challenging Jagdeo to provide a legal basis for his distinction.

The Governance Gap

This debate underscores a broader concern about the NRF’s governance. Campbell’s call for the NRF Board and the Public Accountability and Oversight Committee to discharge their statutory duties reflects a commitment to the rule of law. These entities must ensure that all withdrawals align with the criteria set out in Section 16(2). If the government wishes to bypass these requirements, it should approach Parliament to amend the law – not reinterpret it to suit its agenda.

Jagdeo’s familiarity with the NRF Act adds another layer to the critique. He has been successively junior Finance Minister, Finance Minister, President and Vice President since 1992. He also led the attack on the Coalition Government’s NRF. He was in the National Assembly when the Ali Administration passed its version of the NRF in a late-night session of the National Assembly. And, of course, he has access to the Hansard of that debate.

Therefore, he should fully understand the distinctions between national priorities, emergency measures, and their respective legislative processes. His current misrepresentation undermines the principles of accountability outlined in the Act and emphasised in the Explanatory Memorandum, which committed the NRF to international best practices, including transparency and public reporting.

A Lesson for Public Discourse

Campbell’s approach offers a valuable example of how national debates should be conducted. Despite personal attacks, he remained composed and focused on the law. His critics, including anonymous bloggers, should note that public discourse benefits from substance, not ad hominem attacks. Jagdeo and his defenders would also do well to emulate Campbell’s civility and clarity.

Fixing the problems

There is no question in my mind that the Vice President’s use of words like “balkanisation” and “difficulty” and his subsequent concession on national disasters makes his interpretation less flawed or less mistaken. The Ali Administration needs to step back from this grave error and restore confidence in the entire NRF framework and operation. It must ensure that all withdrawals comply with Section 16(2)’s criteria without artificial distinctions between spending categories, that the NRF Board and oversight committees be independent, and that detailed public reporting on all NRF expenditures – whether for national priorities or emergencies – must become standard.

Public discourse must also rise above personal attacks. By fostering a culture of constructive engagement, Guyana can ensure that the NRF fulfils its potential as a tool for sustainable development and intergenerational equity.

Conclusion

The NRF is a historically unique opportunity for Guyana to secure its future. Its governance must reflect the highest transparency, accountability, and legal compliance standards, consistent with the Santiago principles. Jagdeo’s flawed interpretation of the NRF Act and the uncritical defences from his supporters highlight the urgent need for a course correction.

As someone who has been engaging in public discourses for nearly forty years, I found Campbell’s intervention bringing a much-needed sense of lucidity, decency and renewal. We all need to follow his example and commit to principled debate, ensuring that the NRF serves the people – not the politics of one man.

Part 18 – November 14, 2024

Modi’s visit – euphoria vs. reality

Introduction

The first visit to Guyana by an Indian Prime Minister since 1968 played out well for Narendra Modi back home. The twin objectives of the three-day visit were the CARICOM-India Summit and bilateral talks with Guyana, exchanges between the world’s most populous country and part of the Indian subcontinent and a tiny region of fifteen member countries and five associates, all with a population of sixteen million. While both talks were held in Guyana, the Guyana and Indian press were all about the relationship with Guyana, a country with a significant share of its population tracing its origin to India. No wonder Modi described feeling “a spiritual bond” during his stay in Guyana.

For its part, Guyana outdid its reputation for hospitality. For the entire visit, the country was all about the Prime Minister, who was equally generous about his hosts, describing Guyana as boasting one of the most vibrant democracies in the Caribbean region. The carefully choreographed visit saw Modi receive Guyana’s Order of Excellence amid enthusiastic diaspora celebrations and declarations of spiritual connection. Yet, beneath the near euphoric embrace of cultural affinity and shared historical bonds lay more nuanced and transactional calculations from both countries.

Rhetoric v Reality

It is not entirely clear that Modi’s lofty rhetoric reflected the political realities in the two countries. Neither did the cultural symbolism and forward-looking plans, which mask the complex interplay between diplomatic aspiration and strategic reality of both countries. For example, his emphasis on democratic values, repeatedly calling India “the mother of democracy,” and his praise of the vibrancy of Guyana’s democratic credentials seem excessive. India’s documented democratic backsliding under Modi – including Freedom House’s downgrade to “Partly Free” status and that country’s rating by the V-Dem Institute as an “electoral autocracy” classification are well known.

For its part, Guyana has lost its parliamentary vigour; inclusionary democracy has given way to a winner-takes-all culture in which critical constitutional provisions are treated with half-measures and where accountability and transparency are superficial. During the visit, the absence of scheduled meetings with Guyana’s parliamentary opposition further underscored the country’s democratic deficit, reflecting a pattern of limited opposition engagement that characterises both nations’ current political landscapes.

The visit’s concrete outcomes, particularly regarding energy, revealed Guyana’s transactional approach even when dealing with a trusted friend and ally. The cynical delegation by the Guyana President to his Natural Resources Minister, Vickram Bharrat, to respond to requests from India for the sale of its share of profit oil from the Stabroek Block was disrespectful to Prime Minister Modi. It was in poor taste for Bharrat to state that Guyana “will make a decision at some point in time”. That was compounded by Vice President Jagdeo’s denial that Guyana’s sale of crude has been discussed. This matter was raised with Vickram Bharrat when he visited India very early this year. This uninspiring response about lifts was particularly striking given that a simple deferral of one cargo lift could have facilitated a deal, suggesting a more selfish transactional approach by Guyana.

Omissions

A business column must also note the absence of tangible action to advance discussions on fundamental economic frameworks – specifically a Bilateral Investment Treaty (BIT) and a Double Taxation Agreement. These omissions are significant given India’s interest in acquiring stakes in Guyana’s oil exploration blocks and Modi’s rhetoric about comprehensive partnership. Without these basic treaties, which provide legal certainty and protection for cross-border investments and clear tax frameworks, substantial Indian investment in Guyana’s oil sector remains complicated. Despite months of preparation for the visit, the absence of progress on these fundamental agreements suggests a lack of detailed pre-visit negotiations or more fundamental hesitations about deepening economic ties.

The public reports did not mention any substantive dialogue about Guyana potentially joining BRICS+ despite India being a vital member of this expanding economic bloc. This omission, coupled with the lack of progress on basic economic frameworks, suggests that both countries carefully calibrate their relationship within broader geopolitical contexts. For Guyana, balancing its emerging role as a major oil producer with existing Western and Chinese partnerships and its regional obligations requires careful diplomatic navigation.

The visit also overlooked Guyana’s historical significance in the Non-Aligned Movement (NAM), a curious omission given both countries’ shared heritage in this forum and current discussions about Global South solidarity. This silence probably served a mutual and uncomfortable truth – in the case of India, the role in that Movement of the Congress Party of India, regarded by Modi as a significant opponent, and in the case of Guyana, the outstanding role of the late Forbes Burnham, former Prime Minister of Guyana and leader of the now opposition party in Guyana in NAM.

The preferred route

Both sides might also have had their strategic interests to consider. For Guyana, Venezuela’s territorial claims to Guyana’s natural resources-rich Essequibo region cast a long shadow over any major oil sector decisions. Modi’s silence on this controversy, while diplomatically expedient given India’s interests in Venezuela, highlighted the intricate calculations involved. The Ali Administration, having benefitted from the USA’s role in resolving the 2020 elections impasse, has strengthened its economic and security ties with that country. It may also be hoping that President-elect Donald Trump will help usher in a less antagonistic and bellicose government in Venezuela.

Instead, the two leaders stuck to safe diplomatic territory, such as cultural connections, and the strengthening of cooperation with promises in sectors like healthcare, education and agriculture, although significantly not sugar. Any discussion would have invoked the Chinese elephant in the room and possibly the recognition that sugar may soon cross the precipice of survivability.

Conclusion

Several factors suggest genuine and increasing opportunities for deeper engagement in a potentially mutually beneficial relationship: India’s position as the world’s third-largest oil consumer and Guyana’s interest in exploiting its petroleum possibilities as quickly as possible. The reelection of Donald Trump as US President will change – for the better or worse – all international equations, particularly in the Middle East and Ukraine. The implications for Guyana can be significant, and it clearly does not consider that it is in its interest to strike deals that might not please Trump.

In real and tangible ways, the visit resulted in net gains for Guyana, while India’s only request was denied. When a diplomat as astute as the Indian Foreign Minister says India is not disappointed, you can be sure they are. If there is some irony, Guyana has a much faster growth rate than India, and its per capita GDP is several times that of Guyana.

Yet, Modi would have gained from at least three sources. The publicity back home was all positive; Guyana was reminded that China is not the only Asian powerhouse with which it can do business. And personally, for Modi, enhancing his international standing was a badly needed tonic after his June election setback, in which his party lost its parliamentary majority.