Mining sector braces for impact of blacklisting

[File Photo]
Minister of Natural Resources and Environment, Robert Persaud.
Minister of Natural Resources and Environment, Robert Persaud.

[] – The recent blacklisting by the Caribbean Financial Action Task Force (CFATF), though it will not affect the market for gold will have negative impacts on the mining sector.

This is according to Natural Resources and Environment Minister Robert Persaud, who said that as a result of CFATF putting other countries on notice to take counter measure with Guyana when doing business, will affect those international transactions that companies within the sector rely on to source equipment and other materials.

“The impact of the blacklisting will be felt by the mining sector… we will have to watch and see what manifestation it takes and then stakeholders in the sector along with the government will have to find ways to deal with the impacts,” Persuad told iNews.

Guyana was blacklisted by CFATF for failing to pass the disputed Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Amendment Bill. The Bill was defeated in the National Assembly on November 7 by a majority opposition vote.

According to the Environment Minister “one would have anticipated that the opposition would have recognized the impacts their actions would have.”

In a recent statement the Ministry of Finance said the move by CFATF to encourage its member countries to consider implementing counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana will severely affect Guyana’s credibility in the International Community.

According to the Ministry the Consequences are as follow:

1.  Persons who receive remittances/ cash via money transfer systems, may experience delays in receiving the transfer. There may also be an increased processing fee resulting from additional paperwork.

2.  Proof of income and identification of the sender of such remittances will be enhanced. Persons most likely to be affected by this are undocumented aliens who reside abroad.

3.  The transfer of money from local to external banks will be delayed as international banks begin to severe ties locally.

4.  This delay in bank transfers or severing of financial ties with local banks can affect fuel prices and ultimately the cost for travel and commodities.

5.  Local businesses may experience delays in the shipment of goods as additional paperwork will be required to prove that a business is legitimate and not a shell company laundering monies or financing terrorism.

6.  Enhanced scrutiny will be implemented to verify the source and destination of all monies.

7.  Persons who shop online and use debit and credit cards to conduct such transactions may find their transactions are denied or delayed.

8.  Insurance services (fire, life, mortgage etc), most of which depend on reinsurance from abroad, are also expected to experience delays, additional filing of paperwork and possibly increased fees.



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