Urling calls for transparent, accountable national leadership

Published in Stabroek News December 14, 2012

Georgetown Chamber of Commerce and Industry (GCCI) President Clinton Urling wants the country’s “national leaders and public officials” to be more transparent and accountable in the management of public and private sector organizations.

Addressing the Chamber’s Annual Awards Ceremony at the Pegasus Hotel on December 6, Urling declared that these virtues should be among “the highest priorities for our national leaders and public officials.” Transparency and accountability, Urling said, build trust with the public. “That trust is achieved by providing accurate and complete information on expenditure, projects and other transactions.”

Urling used his address to the Chamber forum to issue another call to government to take the initiative on the creation of a development bank to meet the needs of the country's growing small business community. He told the gathering of business leaders, politicians and diplomats that a point has been reached where the need for a development bank "that speaks to the needs of micro and small businesses" had become important.

Noting that some "some new and innovative economic ventures were "considered risky by the traditional commercial banks," Urling said that what was needed was "a development bank preferably structured in the public/private partnership model.He envisages that such a bank would "offer longer-term lending, lower interest rates and less onerous collateral requirements".

Several weeks ago Stabroek Business learnt from Presidential Advisor Keith Burrowes that government was in the process of preparing a White Paper that would address the creation of a development bank.

Urling also told the gathering that the private sector was seeking "accelerated and holistic tax reform" that placed emphasis on comprehensive change rather than on a "disjointed and fractional" approach.

And not for the first time since being elected President of the Georgetown Chamber of Commerce and  Industry Urling called for changes at the University of Guyana that would allow the institution to contribute meaningfully to the creation of an adequate corps of skilled workers to cater to the human resource deficiencies of the private sector. What was needed, he said, was a ' ... transformation of the University of Guyana' in order to change the institution into " a hub for national research and development" and enable it " to produce a competent and qualified labour force to meet the needs of the public and private sectors".

Urling call for an improved learning environment at the country's only university comes against the backdrop of several earlier attempts to establish lasting relationships between UG and more private sector organizations. At the moment, there are just a few that are lasting and successful.

More than two years ago, in the wake of sustained complaints by leading private sector officials about the failure of UG to bridge the human resource gap created by the flight of skills, the Private Sector Commission (PSC) entered into an agreement with the university,which included, among other things, the planned creation of specialized courses tailored to meet the needs of private sector entities and the use of experienced private sector functionaries as guest lecturers at UG. At the same time it was agreed that the private sector would provide financing and equipment for selected projects at UG. The UG/PSC initiative which had envisaged the creation of academic programmes designed to focus greater attention on agriculture and business appeared to flourish at the start of the tenure of Professor Lawrence Carrington was Vice Chancellor of UG in 2009. A UG spokesperson told Stabroek Business earlier this week that while the plan to create stronger linkages between the private sector and UG may have been well-intentioned, it was almost certainly derailed by the fact that the then Vice Chancellor (Professor Carrington) became preoccupied with " the wider crisis" confronting the university.

Urling's call for the university to become "a hub for national research and development" coincides with calls from other private sector leaders for UG to focus more attention on research in the fields of agriculture and education.

Small business snub of Chamber membership invitation disappointing – Urling

Published in Stabroek News March 14, 2014

The Georgetown Chamber of Commerce and Industry (GCCI) is disappointed over “the lack of response” to the decision made by the Chamber last year to open its doors to members from the small business community.

“Frankly, there has not been any real response and the Chamber is disappointed because we feel that we are equipped to help small businesses in various ways,” GCCI President Clinton Urling told Stabroek Business.

Asked whether the Chamber had been able to discern any likely reasons for small entrepreneurs not wanting to become members of the Chamber, Urling said that the business support organisation had not been able to make a determination. He added though, that he had heard talk about small businesses believing that membership of the Chamber might expose their businesses to “unwanted official scrutiny”.

“Nothing could be further from the truth, though I might add that we encourage our members to be mindful of the legal constraints within which they are required to operate,” Urling told Stabroek Business.

Almost a year ago, at its annual General Meeting the GCCI took a decision that it would break the 125-year-old mould, which restricted membership of the GCCI to mainstream business community including enterprises in the tourism, manufacturing, import and export, and banking and finance sectors to make room for smaller businesses in the retail and other sectors.

Urling told Stabroek Business that the debate on adjusting the rules of membership to accommodate small businesses had been “an energetic one” with some member favouring the traditional membership arrangements. “Frankly, the conceptualisation of the proposal to admit small businesses had everything to do with the desire to support the small business community in every way that we could. We felt, for example, that the GCCI had to capacity to support small businesses with the creation of business plans, negotiating loans and with various other facets of business development. We believe that we have the systems in place to offer that kind of support and, yes, I do believe that those small businesses that are eligible to become members may have allowed an opportunity to slip by even though it is still possible for them to become members,” Urling said.

Meanwhile, he said he doubts that the annual $10,000 membership fee for small businesses is an issue. “The fees that have been set are eminently reasonable. More to the point we have a Chamber which is now better positioned to provide value for money and that is what our small business community should be focusing on,” Urling said.

International Donors and Funding Agencies Need to Rethink how they Disburse the Management of Funds

For the past two years as the President of the Georgetown Chamber of Commerce (GCCI), I have been trying to convince international donors of the utility of channelling funds through the local private sector organizations. Case in point: The European Union EPA funds. After five years the EPA implementation has proceeded at a slow pace with little or no benefit to our domestic private sector.

Part of the failure can be attributed to the fact that donors continue to disburse funds through state agencies or multilateral agencies such as Ministries, the Caribbean Development Bank, CARICOM, Caribbean Export etc. The past 5 years of implementing the EPA has shown that this arrangement is not working. Numerous reasons can be advanced for the failure, but the most salient are the fact that the targeted small and medium sized businesses feel intimidated to approach these institutions and some of these agencies are located outside of Guyana and with the exception of calls for proposals through online medium and periodic information sessions, the Guyana private sector knows very little of what is available to them.

Why not set up a help desk for small and medium sized enterprises at the Chamber's Secretariat to build the trade and export capacity of these businesses? Add in rigorous transparency and accountability guidelines and let the Chamber recruit, monitor and manage the programmes.

GECOM Chair Clears the Air

Happy to hear GECOM Chairman making his organization's position clear as it relates to local government elections. At a press conference held on Wednesday at the Georgetown Chamber's boardroom I had told the media to enquire from Chairman Surujbally about his entity's readiness for local or national elections after telling me on two formal occasions that GECOM was ready for elections once policy makers make the necessary declaration.  Here's what he had to say:

http://www.stabroeknews.com/2014/news/stories/03/14/gecom-ready-local-polls-notified-date/

The GCCI’s Annual Attitudinal Survey

Published by SN Editorial on March 14, 2014

The annual Attitudinal Survey which the Georgetown Chamber of Commerce has undertaken for three consecutive years has its limitations, one of which is that it proffers the opinions of considerably less than a majority of the business houses in Georgetown and its environs.

Just over 80 respondents might sound like a lot but when account is taken of the scores of small and, in a few instances, medium scale business enterprises that continue to spring up across the city, even the Chamber will admit that its Attitudinal Survey embraces a minority of the urban business community, though that by no means cancels out the validity of the effort.

Another of the Survey’s weaknesses is that it takes no account of the views of the numerous small business owners. This has everything to do with the fact that the efforts of the Chamber notwithstanding, those enterprises which we refer to as small businesses in Guyana have, for the most part, responded negatively to the GCCI’s membership invitation. Chamber President Mr Clinton Urling has confessed to being considerably disappointed by this.

Had the survey been able to reach those small business owners it would have provided them with an opportunity to put into the public domain their considerable challenges. Most of those challenges are linked to difficulties associated with access to capital, which, in many instances has to do with small businesses lacking the requirements necessary to secure the considerate attention of commercial banks.

It is of course no secret that the respondents are anonymous and without mincing words the fact of the matter is that in the absence of the cloak of anonymity the number of respondents would almost certainly have been considerably less. Business owners have come to be keen students of the country’s political culture. They fully understand that our democracy has not evolved to a point where every pronouncement that upsets the political rulers goes unnoticed.

For all of its limitations, the GCCI’s Attitudinal Survey is commendable and in some respects, helpful. There is no other initiative that we know of that seeks to probe the views of the business community on important issues. More than that the limited numbers of the respondents and their anonymity notwithstanding, we are aware that numbered amongst the members of the Chamber are some of the best-known, largest and most durable business houses in Guyana. Their reputations certainly lend a measure of credibility to the Survey.

Another interesting thing about the Survey is that, in some respects, the views of the respondents appear to mirror those of larger sections of the citizenry as a whole. Certainly, the outcomes of the survey and the comments made by Mr Urling at his media briefing leaves one in no doubt not only about the seemingly uncontrollable levels of crime and the absence of a comparable police response and also about the near complete loss of confidence in the police on the part of the business community.

More than that and in the light of the frequent and seemingly fruitless exchanges between the police and the private sector Mr Urling even wondered aloud on Wednesday as to where on the police’s scale of priorities the protection of the business community falls.

What the survey also does is to re-enforce the public perception that corruption is rife in the society. There is also no mistaking the perception that much of the corruption manifests itself at the level of the plundering of the state. While the survey does not actually say so, the repetitive nature of the charge (it has been made three years in a row) points to the perception that government is not doing anywhere near as much as it should to curb the plundering of state resources and the various other forms of corrupt practices.

On balance and its limitations notwithstanding, the Survey makes a modest but useful pronouncement on the views of sections of the business community on issues that have to do both with their particular interests and with those of the society as a whole. It suggests, among other things, that the silence of business owners at the individual level is reflective of a particular brand of prudence rather than the absence of an informed point-of-view.

I'm Back!

Its been a long while since I have blogged anything new on this site, well that is about to change. Look forward to regularly updated opinions and news stories here.

Budget Review and Analysis

2011  Economic Growth

Continuing an impressive streak of growth that has now run for six consecutive years, Guyana’s economy turned in another stellar performance last year, growing by a rate of 5.4 per cent.

This overall favorable economic environment is reflected in the performance of the Georgetown Chamber’s member companies. In a recent survey of members, 84 per cent indicated they either broke even or recorded a net profit in 2011. Echoing the larger economic trend, a large majority also are highly optimistic about this year’s prospects for Guyana’s economy and their businesses.

The bulk of current growth arises from the primary commodities and agriculture sectors with mining and quarrying, as a whole, registering a 19.2 per cent rate of increase in 2011.  Most notable in the agriculture sector was the 11 per cent increase in the rice industry. Guyana’s sugar industry grew at a similarly robust rate of 7.1 per cent even though total production levels were lower than what could have been expected, given the country’s potential capacity for this industry.

While these numbers are strongly encouraging, we cannot afford to become complacent and rely too heavily upon these primary goods sectors as the basis for our principal strategy in extending our streak of economic growth. Such excessive reliance could leave us exposed and starkly vulnerable to volatile external price shocks and fluctuations in these sectors.

Thus, we must capitalize upon our current positions of robust economic growth to invest in and diversify other sectors, especially manufacturing and the services industries. As a starting point, we must have more engaged conversations that address lifting the constraints inhibiting the manufacturing sector as well as implementing wider measures to make Guyana’s services industry more globally competitive. 

Some might argue (including myself) that most of the prescriptions dealing with issues of diversification have already have been outlined in the National Competitiveness Strategy (NCS). Therefore, now is the ideal window to accelerate the deliberations process and move toward implementing the programmes of the National Competitiveness Council (NCC). Facilitating this process would, however, require a professionally enhanced and independent National Competitiveness Strategy Unit  (NCSU), which has been tasked with administering and implementing the policies of the NCS and the NCC.

We’re certainly within striking distance of having all of the tools in place to sustain and expand our recent trend for economic growth. In the past decade, Guyana’s government has prudently supervised and managed the major macro-economic fundamentals that drive our economy. This judicious approach has led to reductions in the public debt burden and has unquestionably strengthened the foundation for the favorable economic environment that prevails today.  However, within the last few years, Guyana’s national debt also has been on the increase. In order to achieve this complex objective, the government will have to strike an appropriate balance in pursuing essential economic projects while not slipping back into a debt trap that plagued Guyana in the past and which today has rattled even the most developed economies in Europe and North America.

Budget Debates and Cuts

Impassioned debate, prudent deliberations and fully engaged discussions comprise the hallmark of a well-functioning democratic body politic.  These elements also most often lead to fractured and contemptuous environments of public dialogue, as widely divergent views and ideas percolate, come to dominate, and then fade within a continuously regenerating cycle of political positions and proposals. In Guyana’s parliament, the situation and circumstances are no different.

This year represents the first time since Guyana gained independence that we have a parliament where the ruling government must work closely with the minority parties in the House who hold the key to building successful coalitions for legislative majorities. The outcome of last year’s general and regional elections consolidated this unprecedented political environment so it should surprise no one that the opposition parties were not going to automatically agree to every budgetary proposal as advanced by the government.  The debates present Guyana’s best opportunity for ensuring our long-term economic health and also represent a defining moment in Guyana’s history and one that is good for the country moving forward.

As it turned out, the main opposition negotiated with the government and effected increases from $8,100 to $10,000 in allocations to senior pensioners.  This example precisely represents the ideal spirit of compromise and maturity essential to making the new parliamentary dispensation as effective as possible. However, any hope of continuing this spirit of dialogue was dashed recently when the government and opposition parties could not agree to a compromise on the budgetary allocations. This led to the combined opposition voting to remove some allocations until the government met certain conditions.

Among the largest allocations in limbo is approximately $18.4 billion for numerous economic and social development programmes in the Low Carbon Development Strategy. In addition to initiating small- and micro-enterprise development and strengthening the institutional agencies connected to the strategy, these programmes include the Amaila Falls project, Amerindian Land Titling, Amerindian Development Fund, the Cunha Canal rehabilitation, and the hinterland electrification project to install 11,000 solar home systems in 150 communities.

While the opposition parties have argued that funds for these proposed allocations have not been earmarked in the contingency reserves and are conditional programmes, few, if any, would deny the intrinsic value of these programmes for stimulating economic growth that potentially reaches to all corners of society.  Some of these projects should have been funded and allocated in the budget, regardless of whether or not the government had met the requirements to access the Guyana REDD+ Initiative Fund (GRIF).

The two most notable initiatives that immediately affect the private sector are the Amaila Falls project and the small- and micro-enterprise development allocations. No further elucidation is required to expound on what these two initiatives would mean economically to the private sector. Notwithstanding, it is not too late for both sides of the House to discuss the potential benefits of these and other proposals with the aim of having supplemental provisions funded, a more satisfying alternative to the political posturing that has become the norm since the budgetary removals were announced.

Allocations and Targets

In terms of final targets and allocations projected for 2012, the government appears to have taken the modest case scenario in its forecast, anticipating a growth rate of 4.1 per cent. The expected 1.8 per cent increase in the mining and quarry sectors is especially modest. In fact, the sectors likely will turn in a far more robust performance given what we are witnessing in the gold industry along with large-scale investments in other mining projects such as manganese.

Inflation – which is projected to be 4.6 per cent – will require especially careful attention by the government to ensure it does not balloon out of control. In the survey, virtually every Chamber member cited the rising operational costs of business as a major constraint, which would then be passed onto consumers and trigger eventually a chain of other socioeconomic problems.

Also, the budget cuts will have an impact upon final economic projections. What would be helpful is for the Finance Minister to make public his opinion as to if and how the budgetary cuts will revise original growth forecasts and what those updated projections will be. Such transparency will be helpful to all parties in the public and private sectors as they continue to fine-tune their own economic plans for the remainder of the year.