Growth of manufacturing sector affected by 2017 tax measures- GMSA President

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-16 companies honoured at GMSA’s annual awards

President of the Guyana Manufacturing and Services Ltd Association (GMSA) Shyam Nokta has highlighted the impact of the 2017 budget on the country’s manufacturing sector which according to him has caused a reduction in cash flow for businesses.

GMSA’s President Shyam Nokta

He made these comments at the GMSA’s annual awards and dinner at the Pegasus Hotel on Friday evening where sixteen companies and sector stakeholder Arnon Adams were all honoured for their contributions to the manufacturing sector.

“When we look at the economy’s performance, actual GDP growth for 2017 was 2.9% compared with the 3.8% projected at the beginning of 2017. The overall downward trend for the last few years in almost all the productive sectors continued in 2017. The downscaling of the sugar industry is cause for concern especially in the absence of any concrete plan to buffer job losses” said Nokta.

The body’s President also pointed out that measures such as the re-categorizing of zero & standard rated items and the inclusion of Value Added Tax (VAT) on forestry products and electricity have affected the growth of sector.

“These have impact in a negative way, on the manufacturing sector and has contributed in many instances to increases in price and reduced cash flow,” he observed.

Since the implementation of these measures, Nokta noted that GMSA has been engaging Government Ministers and technical officers, offering recommendations to foster economic growth.

“This engagement was followed up by the GSMA engaging the Ministry of Finance as part of the Ministry of Finance’s 2018 Budget consultations and where he put forward a number of proposals… paramount is the need for urgent action to address our transmission and distribution system while advancing mature and feasible initiatives for renewable and clean energy,” Nokta told the gathering of industry representatives and other stakeholders.

Nokta stated that the GMSA is pleased that several measures that were advocated for in the area of forestry and wood processing were adopted in its examining of Budget 2018. These measures included the exemption of VAT on logs and rough lumber and a budgetary allocation of $50M to partner with the private sector to establish a consolidated dimensional stock yard.

“The measures regarding imported pine are also welcomed however much more still needs to be done for forestry sector to recover from its current decline,” Nokta added.

UK’s High Commissioner to Guyana Greg Quinn

UK’s High Commissioner to Guyana Greg Quinn spoke at the ceremony and highlighted Guyana dropping two places on the World Bank’s Ease of Doing Business index while suggesting that less red tape is needed to facilitate smoother business operations.

“Ensuring businesses can operate whilst also meeting the necessary legislation is a key to the growth of the economy. Bureaucracy must be reduced and the ability of entrepreneurs to set up businesses must be made easier,” he stated.

Quinn indicated that his country is supporting measures of the Business Ministry on “improving Guyana’s business environment”.

The report for World Bank’s Ease of Doing Business ranking for 2018 showed that Guyana slipped two places – from 124 in 2017 to 126 for 2018.

Doing Business, measures regulations that affect various areas regarding the life of a business or in setting up new businesses. Some of the categories considered to determine ‘the ease of doing businesses were “starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, and trading across borders. The assessment uses various indicators to analyse economic outcomes and identify the appropriate reforms for business regulation.

16 companies were honoured for their contributions to the manufacturing sector

Friday night’s ceremony at Pegasus included the likes of many dignitaries, private and public sector representatives and honourees which included Fibre Tech industrial plastics, Umami Inc, Sterling Products, Bounty Farm, Pandama Retreat and Whinery and the Government Analysts Food and Drug Department.

GSMA has been honouring both large and small scale members of the manufacturing sector for their contribution to Guyana’s economy.

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