THE Ministry of Foreign Affairs on Tuesday released the Memorandum of Understanding (MoU) signed between the Government of the Co-operative Republic of Guyana and the Government of the People’s Republic of China on Cooperation within the Silk Road Economic Belt and 21st Century Maritime Silk Road Initiative.
The release of the document comes approximately three months after it was signed here in Guyana at the Chinese Embassy, and amid public calls for the contents to be made known.
According to Article One of the MoU – Objectives and Guiding Principles of Cooperation, under the agreement Guyana and China will work within the Belt and Road Initiative to promote and realise mutual economic development and sustainable growth, thereby allowing for enhanced political relations, economic ties, security cooperation and people-to-people exchanges.
Article Two – Areas of Cooperation, sets the foundation for the two countries to regularly communicate and promote the synergy and integration of their major development strategies, planning and policies, as well as strengthen communication and coordination.
“The Parties will cooperate and exchange ideas regarding infrastructure connectivity and development in areas of mutual interest, including but not limited to road and railway networks, bridges, civil aviation, maritime transport, harbours and ports, energy and telecommunications,” Section II of Article Two states.
Already, the Guyana Government has said that construction of the Linden to Lethem Highway is among infrastructural projects it hopes China will finance under the Belt and Road Initiative.
Late December, Guyana and Brazil indicated that they will be working closely with China to access a US$50B China Select Fund to help construct the road.
Section III of Article Two sets the foundation for “unimpeded trade.” According to that clause, Guyana and China will enhance international trade and investment initiatives and simultaneously expand two-way investment and trade flows. Under this clause, businesses are encouraged to build, operate and or participate in industrial parks and economic and trade cooperation zones.
Under Section IV (Financial Integration), Guyana and China have agreed to encourage respective financial institutions to provide financing support and financial services for production capacity enhancement, investment and trade promotion.
“The parties will expand the use of their respective local currency in investment and trade based on the investment and trade demands, strengthen the exchanges and cooperation between their currency and financial regulators and promote the mutual establishment of the financial institutions between the two countries,” a sub-section states.
A cooperation mechanism will be formulated by the two countries to manage financial risks and crises, as well as increase cooperation between the banking sector and institutional investors.
Meanwhile Article Three addresses the ‘Modes of Cooperation.’
Section One states that the Modes of Cooperation may include but not limited to “the exchange of high-level visits through existing governmental and non-governmental exchange mechanisms, whereby the parties will build a multi-tiered information sharing platform in diverse fields and with multiple channels to share information resources, increase transparency and encourage participation of people in all sectors of society.”
It also lays a better foundation for the application of free market principles and promotion of public-private partnerships as well as the “provision of investment and financing support through diversified channels and strengthening of exchanges and cooperation to ensure the sustainability of the projects that may be initiated.”
The MoU which contains a total of six articles – Objectives and Guiding Principles of Cooperation; Areas of Cooperation; Modes of Cooperation; Cooperation of Mechanism; Settlement of Differences; Coming into Force, Amendment and Termination – is enforced for a period of three years and possibility of an automatic extension for another three years.
Foreign Affairs Minister Carl Greenidge and China’s Ambassador to Guyana Cui Jianchun, signed the MoU on cooperation within the Silk Road Economic Belt and the 21st Century Maritime Silk Road Initiative last July.
Weighing in on the signing, Prime Minister Moses Nagamootoo had said that there are several opportunities for Guyana to benefit from bilateral relations shared with China now that the country is approaching the status of “a highly developed, prosperous state.”
Guyana is the 74th country to sign onto the “Belt and Road Initiative,” which aims to connect countries through a network of trade routes in Central Asia, Europe and Indo-Pacific littoral countries.
