Small businesses have shared their concerns on the impending oil and gas industry, acknowledging that while it might be beneficial, they are likely to be at risk from not benefiting from the value chain.
This was shared by the President of the Guyana Manufacturing and Services Association Limited (GMSA), Shyam Nokta.
He suggested that some of these local establishments are in favour of the local content policy so as to enhance their profits.
“Guyana continues to receive international attention, and there is the movement of investors looking for opportunities here. This is good for business and good for Guyana. We need to benefit from those who have experience and expertise in oil and gas,” Nokta said.
He, however, mentioned that there are concerns within the local business community that, in this new sector, local businesses could be vulnerable; or, worse yet, not be part of the value chain in a meaningful way.
This, he added, has fuelled the discussion on local content, with some advocating for legislation to ensure Guyanese businesses benefit.
The GMSA is under the impression that the local content legislation should be crafted at the soonest, and Government should implement stringent implementation strategies.
“The GMSA share the concerns that we need to have a strong local content framework in place sooner (rather) than later, and with Government playing its part in ensuring local content plans are implemented,” Nokta added.
Nokta said the GMSA is of the belief that after the framework is finalised, local establishments should be prepared to provide quality services. The document should also be adjusted to ensure that there is mutuality between international and local establishments.
“However, we also believe there is the need to adopt a systematic approach, and not be too prescriptive too early. Even as we push to ensure there is a framework to facilitate mutually beneficial partnering, and joint ventures between foreign and local businesses, we, as Guyanese businesses, also need to raise the bar in terms of our preparedness for this new sector,” he posited.
In terms of preparedness, the GMSA President signalled that the Centre for Local Business Development has made remarkable improvements in aiding businesses to increase their professionalism. “In this regard, the Centre for Local Business Development need to be recognised for the work they are doing.
Many GMSA members have been taking advantage of the orientation and training offered, (and) we would like to urge more businesses to take up this opportunity. We also recommend that the Centre’s programmes expand and be rolled out in other parts of Guyana,” he said.
In the business sector, “critical” components, such as local content policy and legislation for a Petroleum Commission and a Sovereign Wealth Fund continue to be “discussed and debated”.
Amid criticisms over the establishment of the Policy, the Energy Department had assured that the piece of legislation will be available before the first oil, which is due to come in less than two years.
The local content policy will defend the country against local companies being bypassed for contracts and services in favour of foreign companies and workers. Energy Department Head Dr Mark Bynoe was quoted as saying that a second draft policy will be finalised before yearend.
This is after collaborating with the Private Sector, a section of the economy which stands to gain wide-ranging benefits from a favourable local content policy. He, meanwhile, updated the press that once all is settled and ironed out, a ‘white paper’ while be presented to the National Assembly to be debated upon.
The draft local content policy was criticised for lacking provisions which would guard against exploitation by companies.
It had been reported that the document fails to cater for issues such as how to avoid procurement fraud, conflict of interest, and favouritism.