Foreign Direct Investment in Guyana rose 19% during 2013-2014 — Economic Commission for Latin America and the Caribbean
Foreign Direct Investment (FDI) in Guyana rose by 19 per cent, moving from US$214 million to US$255 million during the period 2013 to 2014, ECLAC has reported
Foreign Direct Investment (FDI) in Guyana rose by 19 per cent, moving from US$214 million to US$255 million during the period 2013 to 2014, ECLAC has reported

FOREIGN Direct Investment (FDI) in Guyana rose by 19 per cent, moving from US$214 million to US$255 million during the period 2013 to 2014, the Economic Commission for Latin America and the Caribbean (ECLAC) said in its annual report, ‘Foreign Direct Investment in Latin America and the Caribbean 2015’. In a recent interview with the Guyana Chronicle, Go-Invest Chief Executive Officer (CEO) Keith Burrowes reported that 2014 was a bright year for Guyana in terms of investments. Guyana was able to attract total investment worth some $196 billion from 234 projects, creating some 15,868 jobs. Investments in locally proposed projects totalled some $107.5 billion, creating some 7254 jobs, while proposed Foreign Direct Investment amounted to $88.4 billion.
While Guyana experienced growth, the flow of FDI into the Caribbean sub-region shrank 4.7 % in 2014 to total $6.027 billion, ECLAC noted.
This nearly 5% decline in FDI directed towards Caribbean countries is less severe than the 16% drop registered in Latin America and the Caribbean as a whole, where flows fell to US$158.803 billion in 2014 from US$189.951 billion in 2013. Nevertheless, since 2008 FDI inflows into the Caribbean have fallen 37%.
The percentage of FDI as a proportion of Gross Domestic Product (GDP) is relatively high in the Caribbean compared with other regions of the world, the study indicates. On average, these flows represent 4% of the sub-region’s GDP, and more than 10% in some of its economies, while in the rest of Latin America that percentage is fewer than 3%.
This dependence, combined with the concentration in terms of the receiving sectors (tourism and increasingly natural resources) and the countries of origin (mainly Canada and the United States), means that Caribbean countries are highly vulnerable to variations in FDI flows, the document stresses.
ECLAC’s report analyses the situation of 16 member states in the Caribbean. Tourism is the sector that receives the most FDI in countries such as Antigua and Barbuda, The Bahamas, Barbados, Belize, Dominica, Grenada, Saint Kitts and Nevis, Saint Lucia and Saint Vincent and the Grenadines, while in other nations natural resources predominate (Guyana, Suriname and Trinidad and Tobago). In Haiti and Jamaica FDI is principally aimed at the transportation and telecommunications sector.
The Dominican Republic is the biggest economy and the top recipient of FDI in the sub-region (21% of flows go to natural resources, 26% to manufacturing and 23% to tourism). In 2014 it received US$2.209 billion, up 11% from 2013 but still a far cry from the over US$3 billion tallied in 2012.
This country was followed by Trinidad and Tobago, which had inflows of US$1.394 billion in 2014 (down 30% from 2013), Jamaica, which registered US$699 million (an increase of 7%), and the Bahamas, with US$374 million (9% less than in 2013).
Jump
Barbados jumped from US$5 million in 2013 to US$275 million in 2014 and Guyana rose 19% (to US$255 million in 2014 from US$214 million in 2013), while Antigua and Barbuda received US$167 million (up 66% from 2013), Belize US$141 million (48% more), Saint Vincent and the Grenadines US$139 million (down 13%), and Saint Kitts and Nevis US$120 million (down 13%).
Countries that had inflows of below US$100 million dollars in 2014 include Haiti (US$99 million, down 47% from 2013), Saint Lucia (US$75 million, down 21% from 2013), Grenada (US$40 million, 64% less than the previous year), Dominica (US$36 million, equivalent to a 36% increase), and Suriname (US$4 million, down 97%).
Meanwhile, Cuba updated in 2014 its legislation regarding foreign investment with the objective of improving the country’s allure in this area and giving greater protection to investors. Currently, the biggest investments in that country are co-financed by the state, although improving diplomatic relations with the United States are being watched closely, along with other factors.
According to the study, the reason for the significant amounts of FDI into the Caribbean lies in the active promotion policies applied by countries in the sub-region. These policies range from actions to improve the overall business climate to the use of financial measures to stimulate FDI inflows, such as exemptions on income tax and customs duties.
Upon analysing the available evidence regarding the impact of these incentives, the organisation recommends that Caribbean countries revise their usefulness, taking into account the high fiscal costs that these measures imply for their economies and the competition generated between countries in their bid to attract projects.
One aspect to take into consideration is the fact that, on average, the repatriation of profits derived from FDI is equivalent to more than three-quarters of the FDI inflows into the Caribbean, especially in countries such as Barbados, Suriname and Trinidad and Tobago.
Currently, in the framework of the Caribbean Community (CARICOM), proposals have been made to align these benefits, which could be useful for taking full advantage of the potential of FDI, including the possibility of improving economies’ competitiveness, the text emphasises.
In this sense, ECLAC encourages countries to advance towards a coordinated policy of FDI promotion, based on the concept that attracting bigger flows is less important than their impact on productive diversification and their convergence with long-term national development plans centred on equality of rights and environmental sustainability.

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