Category: Letters to the editor

Dear Editor,

Vice President Bharrat Jagdeo has made a searing attack on a ruling by a High Court judge in the Teachers’ strike case in which the underlying issue is free collective bargaining. Despite not having read the judgment, Mr. Jagdeo yet felt comfortable using words like appalling and presumptuous. However couched, this has to be seen as an attack not only on the judge but the judiciary as a whole. There are three branches of government – the legislative, the executive and the judiciary, each with its own functions and powers, giving rise to the concept of separation of powers. Not that the separation is clean or discrete as we see with the intermingling of the executive and the legislative. But the branch which does not allow for such intermingling is the judiciary, which has a special role in any democratic society.

Since the PPP/C’s return to power in August 2020, the guardrails of democracy are being inexorably dismantled, emphasising why the independence of the judiciary needs to be protected and defended. It is therefore dangerous when the country’s First Vice President, apparently after a conversation with the Attorney General, should use language that can undermine the authority, independence and integrity of the judiciary. As everyone appreciates, the judiciary with its layers of appeal procedures has a mechanism for its wrong decisions to be reversed. That is healthy and good for society and citizens, as well as the development of the law.

It is accepted that a decision given by any court should be open to robust but respectful criticisms, never in a way to bring the court into disrepute. Mr. Jagdeo might say that he never intended to attack the judge but only the judgment. That unfortunately is not how his statement came across, particularly since he admitted that he had not read the judgment. Jagdeo has a reputation for bullying and intimidation which creates an atmosphere of fear and what is sometimes referred to as a chilling effect. Perhaps in his statement, he was sending a message beyond the single judge and to the entire judiciary that “this can be your fate as well.”

It is not without some significance that there has been silence since Jagdeo made his ill-advised statement. But no response is not only cowardice but gives a pass to this kind of behavior. It is true that such attacks are not unique to Guyana. Examples abound from the USA where Chief Justice John Roberts came out to defend the judges of the Supreme Court from attacks by Donald Trump, from Australia, Canada, India, Poland, the Philippines, Türkiye, Uganda and Zimbabwe. What is true as well is that in those jurisdictions, those attacks have not gone unanswered by the heads of the judiciaries.

The head of our Courts in Guyana is the Chancellor (ag.) while we have as our apex court the CCJ headed by a President. The current and the past President of the CCJ have politely criticised Guyana for its inordinately lengthy delays in confirming top judicial officers. They cannot just give up and go silent. We have the Guyana Bar Association and the Guyana Association of Women Lawyers whose members are actively involved in the judicial architecture. They are often accused of prolixity and verbosity, not of silence. The Guyana Human Rights Association must show that the attack on its leadership has not silenced it. Our institution of highest learning has a Department of Law and a Law Society. And where are the lawyers in the opposition parties in the country? And where are the Press, the Fourth Estate? That is the work they chose, but now they choose silence.

It is hard to think of any current issue of greater interest and importance than an attack on the country’s judiciary, whether direct or indirect. The silence is bewildering and troubling.

Christopher Ram
Attorney-at-Law

Dear Editor,

It is commendable that Banks DIH Limited has responded, in a full-page ad, to my recent commentaries on the company. Unfortunately, the membership, readership and the company’s reputation would have been better served by less obfuscation, diversion, distortion and ad hominem attacks. Let me state categorically that while it might be a fear, it is certainly not a fact that I have ever been an advisor to the Guyana Securities Council. The allegation was mischievous and false.

Let me state again and, hopefully for the last time, that Banks’ Chairman has personal knowledge of blandishments and carrots offered to me some years ago when I challenged the Company’s short notice for an annual general meeting. My response was that a notice is a personal matter, and it was outside the powers of an individual shareholder to waive a statutory right of any other shareholder.

I will now briefly respond to the substantive major points enumerated in the full-page ad.

1. Re-routing transactions through Florida. The ad appears to convey the impression that the court legitimised this extensive series of transactions. The court did no such thing. The sole issue before the court was whether the payment of commissions of $562,123,894 between 2009 and 2016 arose outside of Guyana and therefore not subject to withholding tax. My contention then and now is that it is unnecessary, wasteful and unjustifiable  for the ordering of products from the Netherlands to be routed through Florida. Nor is it credible that a supplier of decades standing “does not treat with [Banks DIH Ltd] in relation to financial matters,” as the company sworn in an affidavit. Banks DIH is not a pariah company nor is Guyana an AML-blacklisted country. My concern was evaded in a maze of obfuscation.

2. The new holding company. I questioned the decision to convert Banks DIH Limited into a private company. What the directors do not tell us is that the application for the “arrangement” was made to the Court ex parte, despite the fact that Banks has two regulators  directly, and four regulators as a group. Yet, the company did not, from the public records, notify any regulator. Evading responsibility for this simplistic adventure, the ad states that “the decision was made pursuant to advice from BDO, accountants.”

The company boasts that the decision for the conversion had 99.9% support. Yet, shareholders engaged me privately complaining that they do not understand the nature of the transaction. When I suggested questions that could be asked of the directors, the response was “you know this place.”

3. Payment of dividends. My concerns were about the company’s dividend payout ratio which is among the lowest of public companies in Guyana and the Region, and about the transaction cost of paying a dividend of less than a dollar on small shareholdings. Here is an example. Say that the company pays an interim dividend of $0.45 per share to a non-resident person who owns one thousand shares. That is $450 from which withholding tax of 20% has to be deducted, converted to foreign currency, and the net paid over. That leaves the shareholder with less than two US Dollars. Again, evasion and obfuscation.

4.  A share re-purchase agreement of December 2016. My question was the reason for paying more than the market price under a share repurchase agreement. That speaks for itself but like the company did then and again now, it evades the real issue and its only recourse is a personal attack and a veiled threat of reporting me to the Institute of Chartered Accountants of Guyana. What an undignified response.

In my Business and Economics Commentary column this coming Friday, I will be publishing an open letter to the Company’s Audit Committee Chairman of my concerns as the holder of 117,000 shares in the Company.

Christopher Ram     

Dear Editor,

Two events usually attract misinformation, once known as propaganda. These are wars and strikes. In a war, each side pushes information to show that it is doing better than the enemies – in fatalities, losses and territory. In a strike, the employer understates the support for the strike while the workers’ representatives overstate that support and the moral imperatives of their cause. In similar vein, I have seen numbers cited by some closer to the facts, such as the Chief Education Officer and the leadership of the Teachers’ Union.

In the case and context of the current strike I went to sources I consider most objective, if not always very clear – the 2024 Estimates. From these, I could make some reasonable assumptions and deductions on the affordability of any increase. What I also found is that some of the numbers cited by some non-associated persons like Dr. Tara Singh were off the mark by quite significant margins. My overall finding is that the Government can pay much, much more than the 6.5% it has offered teachers.

I say this even as I concede that the Estimates are not the easiest of documents to read and that the reader has to plow through dozens and dozens of pages and make rough assumptions arising therefrom, including how the averages pan out. Here are some of those numbers. The provision in the 2024 Estimates shows an increase in the allocation for Wages and Salaries for teachers, exclusive of related overhead costs, of 25% over 2023. Of course, the number of teachers is also expected to increase, even after natural attrition. The crude average annual increase in the number of teachers over the past three completed years was approximately 9%. The projection for 2024 is 14% of which we can assume that the significant increase will come at the beginning of the new academic year in September. From this, we can deduce an increase in the effective number of teachers for the school year to be about 5%.

Let us then assume that the Government is unwilling to make this up via savings from part of the total capital budget or by way of supplementary appropriation, the 2024 Budget appears to allow a 20% increase to the teachers for 2024. Except for some related costs that are ad valorem, the other charges are already provided for in the approved Estimates.

The Government can afford this and the teachers deserve nothing less.

Christopher Ram

The Teachers’ strike enters its second week beginning tomorrow. The planning and execution by the leadership of the Guyana Teachers Union and the passion and energy demonstrated by the striking teachers across the Regions suggest the preparation for a long struggle. The Government on the other hand appears to be all over the place – literally and figuratively – and suggests that it is playing a waiting and words game.  

President Irfaan Ali tells the teachers to be patient – he will look after them gradually and that things will be all right after 2027. Assuming of course that the price of oil will continue on its recent boom trajectory. The Vice President says he is not worried – the striking Region Six teachers will vote for the PPP/C in 2025, apparently claiming their indentureship to the Party. The AG recognises the teachers’ constitutional right to strike but leaving unaddressed the unconstitutionality of wage imposition, an ignominious practice this Administration shares with its predecessor. And Minster of Education and MP Datadin boast of this Administration’s generous salary increases since it came to power. It does not appear that they recognise that the increases have a crude average of less than 7% per annum over five years.

Notwithstanding its apparent collective resolve, the Government’s case is constitutionally, legally, morally and practically weak and defenseless. On the constitutional and legal question, the Constitution and the Trades Union Recognition Act are clear. The Government as an employer, must go through the recognised unions. That imperative arose following a court ruling during the labour struggles under Forbes Burnham. This Administration must not try to outdo Burnham in dictatorial instincts and practice.

The VP can show that he is not spiteful by using his residual powers as an immediate step, to restore the deduction of union dues, which the Government will have to do as part of any settlement anyway. He, more than anyone of the current government leaders, was involved in and is aware of the impact of the 1999 strike by public servants. He must know too that the current leadership of the GTU is even better than the GPSU leadership in the nineties, and that the argument in those days about the inflationary impact of a significant wage increase was completely misplaced.

The Ministry of Education has put out a table of increases in salaries to various levels of teachers over the past five years, presumably to show how well they are paid. (I thank the Ministry for saving me the research). Here is my brief interpretation and contextualisation of those numbers. The increases over the period of 2019 – 2024 average 33%, ranging from 23% for the Principals of the Technical Institutes in Georgetown (GTI) and Linder (LTI) and Cyril Potter College of Education, to 39% for a Graduate HM of a Grade D school.

Now, compare that with other numbers put out by the Government. Over the same period, GDP has grown by roughly 310%, capital expenditure by 905% and current expenditure by 198%. It is difficult to deduce from these numbers a recognition of the importance of teachers for our country and economy, or a basic understanding by the Government of their own numbers. The contrast with contractors, many of whom pay no taxes, and with speeding up poorly planned and executed construction work cannot be starker.

With ministerial salaries almost doubled by tax-free allowances, they are out of touch with the skyrocketing cost of living affecting everyone. The collective Cabinet seems unable to understand and appreciate that for one thousand dollars in increase to teachers, more than $300 comes back to the Government in the form of income tax and value-added tax. That means that every $3,000 salary adjustment will cost the Government and benefit the teachers only $2,000. And they do not seem to understand that to measure the impact of the strike in percentages of non-striking teachers is fallacious and misinformed. The absence of the striking teachers will exacerbate the existing shortages in almost every classroom and that even 20% of striking teachers will cause total disruption in the school.

This may not, however, affect many of the children of government ministers and officials who can afford to send their children to private schools, and even abroad. The statements by the President, the VP and their ministers show at best how little they understand and worse, that they do not care.

Christopher Ram

Dear Editor,

One of our other public companies – Caribbean Container Inc. (CCI) – seems to have an even more serious problem with its share price than Banks DIH Limited does. Between the Stock Exchange (GASCI) trading session 1007 on 20 February 2023 and trading session 1057 on 5 February 2024, the price of CCI’s shares has skyrocketed from $40 to $200. There is nothing in the fundamentals of that company (see Table below) that could conceivably justify anything close to this 400% increase in the share price over a 1-year period. In fact, if we go back one year earlier to 27 June 2022 when the price was $15, the increase is a staggering 1,233%!

The only noteworthy development in the Company is the leasing of part of its property which will generate a steady flow of income in the immediate future.   

Source of Information: Annual Reports and GASCI Website

The principal shareholders in the company are Demerara Holdings Inc., whose ultimate beneficial owner is the estate of its former Managing Director, which owns 85.92% of CCI’s shares, and Secure International Inc., a Beharry Group company which owns 5.16%.  The Securities Industry Act requires disclosure of 5% or more.

The number of shares traded between February last year and this month to date, was 66,400 and between 27 June 2022, that number was 90,200. For completeness, the average number of shares traded over eighteen sessions was 3,688 shares. This represents just 0.059 % of the 150,916,595 shares in issue. It ought not to be that transactions involving 0.059% of shares in issue can move the share price by 1,233%! While this is an extreme case, such distortions are not unique to CCI as the trading records of DDL and Banks DIH show. 

I am not suggesting any insider dealing or other improper conduct on the part of any person, including CCI’s management. But rather that something is wrong with the working of our Stock Exchange, its shareholdings, market participants and shareholder and investor education. There is a lot of blame to go around, including misleading information in annual reports and peddled by chairpersons of public companies.

Part of the solution lies in meaningful reform but efforts to get successive governments to pay attention to both GASCI and the Securities Exchange have produced little or no fruit. I am hopeful that the recent comments published in the Stabroek News on Banks DIH Inc. and now this extreme disclosure will stir the powers that be into some meaningful action.

An immediate course of action would be for the Stock Exchange to immediately suspend trading of shares in this company, and to make inquiries and appropriate recommendations. We cannot at the same time boast of a world class economy and have an imperfectly functioning Stock Exchange. 

Christopher Ram