– as Guyana  Threshold Implementation Project closes
Yesterday marked the successful completion of the Guyana Threshold Country/Implementation Plan (GTCP/IP) which over the past two years had been an enabling factor in the advancement of Guyana’s reform process.
The GTCP/IP came out of the Guyana Government’s commitment to achieve and maintain fiscal sustainability through an efficient and effective tax regime, efficient public expenditure management and improved fiduciary oversight.
The plan focused on reducing Guyana’s fiscal deficit by improving its ability to collect revenue and better manage its budget, improving parliamentary oversight, and reducing the number of days and cost to start a business by streamlining business registrations.
Through the work of NATHAN and Associates consultancy, the partnership of the Guyana Government Millennium Challenge Corporation (MCC), the United States Agency for International Development (USAID), and the Inter-American Development Bank (IDB), the programme was described as a great accomplishment during an official close-out reception at Georgetown Club on Camp Street.
At the ceremony, President Bharrat Jagdeo and other government officials joined in a toast of success to Director of the Department of Policy and International Relations of MCC Malik Chaka, Charge d’ Affaires of the US Embassy, Karen Williams and representatives of USAID and NATHAN and Associates.
In his address President Jagdeo expressed thanks to the United States Government and the MCC for allowing Guyana to continue the country’s “very aggressive reform process.”
MCC, a US Government Corporation designed to work with developing and poor countries, is based on the principle that aid is most effective when it reinforces good governance, economic freedom and investments in people that promote economic growth and elimination of extreme poverty.
The MCC Threshold Programme assists countries that are on the threshold of eligibility for Millennium Challenge Account Compacts. The threshold programme is used to assist countries to address the specific policy weaknesses indicated by the country’s scores on 16 policy indicators in three categories – ruling justly, investing in people, and encouraging economic freedoms.
President Jagdeo said the threshold programme came at an opportune time as Guyana was in the process of establishing, consolidating and rebuilding democratic institutions, putting the private sector in the forefront of development and promoting transparency in government’s financial and policy making operations.
Alluding to the important role of the private sector, President Jagdeo recalled the era when the sector was undermined by the state’s occupation of the entire development space, leading to shrinkage in national outputs and a loss in the entrepreneurial class.
“Private sector development is critical to the future good fortunes of this country and we have to continue working to create that environment to grow local capital because we need to develop a local entrepreneurial class but also to be open to foreign investments. We will continue working and building on these reforms to ensure that the environment is created because it’s an important part of our development strategy.”
The Head of State also spoke of the challenges to encourage transparency in government operations, not just financial, but in terms of across the board policy making.
President Jagdeo was pleased with the changes made thus far in the development of democratic institutions “…constitutional changes, framework for greater inclusivity, particularly in a country like ours, which is multi-ethnic, and has had a history of political problems. We need to continue on these reforms and I wish that the quality of the debate (Budget) would mirror what is going on the parliament now, because I have been looking at the debates on the budget… that the quality of the debate will mirror the seriousness of  the reforms that we are pursuing,” President Jagdeo said.
The most gratifying of reforms for the President was the introduction of the Value Added Tax (VAT) which endured several negative responses but was pursued with vigour by the government and is today responsible for significantly enhancing the tools available to the Guyana Revenue Authority (GRA).
Country ownership is a key objective of the MCC programmes, and according to its Director, the Guyana programme is a good example of this objective.
“This was a programme that from day one was owned by the Government and people of Guyana. They provided the focus, participation of people in Government, and they also provided a lot of the human resources that make this programme a success,” the MCC Director said.
He admitted that reform is not a smooth sailing process, but commended Guyana, particularly the leadership of President Jagdeo, for its involvement in the process from the inception.
The completion of the GTCP/IP only marks the beginning of the reform process in Guyana, according to Chaka.
“At the end of the day, these reforms will bring foreign investment, they will create the macro economic environment to help this economy grow,” Chaka said.
He expressed the hope that the programme would allow the Guyana Government to leverage additional donor support in helping to move the reform effort forward and to continue making substantial investment in finance and human resources.
In August 2007, Guyana signed the US$6.7 million MCC Threshold Programme and implementation of the two-year project began in January 2008. MCC Deputy Chief Executive Officer (CEO) Rodney Bent and President Bharrat Jagdeo officiated at the signing of an MCC Threshold Progamme agreement between the United States and Guyana, focusing on reducing Guyana’s fiscal deficit by improving its ability to collect revenue and better manage its budget.
The Guyana Government was credited by James Waller of NATHAN and Associates for demonstrating its ability to undertake meaningful reforms in a very short period of time.
“This project is a demonstration of what good partnership is all about. That partnership was with the Government of Guyana, the Guyana Revenue Authority (GRA) the Ministry of Finance, in particular Minister Singh, the National Procurement and Tendering Administration, the Guyana Office for Investment (GO-Invest), the Deeds Registry, and the Parliament,” Waller said.  (GINA)