ON Thursday, we learnt that President David Granger has called for a speedy resolution of the issue regarding the European Union (EU) Parliament’s non-support of Guyana’s removal from the money-laundering blacklist.
Rightfully so, the President of Guyana has done everything to comply with international best practices relating to open, transparent and responsible government. From all accounts, Guyana was recently removed from the blacklist and Ethiopia was added, but this move was rejected by the EU Parliament. According to a report by the Ministry of the Presidency, the EU legislator, with whom the Head-of-State engaged, explained that differences had arisen between the European Commission and the European Parliament over the blacklisting of countries facilitating money laundering.
He noted that this was entirely the reason for the Parliament’s rejection; not Guyana’s performance in so far as it relates to money laundering. President Granger was quoted as saying that while the EU is blinking, Guyana is bleeding and reiterated his call for the matter to be resolved. That Guyana is on a blacklist would have greeted many Guyanese with surprise, given that only recently we were cleared by the Financial Action Task Force as well as the Caribbean Financial Action Task Force.
Guyana can ill-afford to be on any blacklist of the EU, given that we still trade with that bloc and is also part of the EU Economic Partnership Agreement. The EU’s trade and development partnership with the Caribbean stretches back over more than 30 years. In October 2008, Antigua and Barbuda, The Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Jamaica, Saint Lucia, Saint Vincent and the Grenadines, Saint Kitts and Nevis, Suriname, Trinidad, Tobago, and The Dominican Republic signed with the EU the CARIFORUM-EU Economic Partnership Agreement. Haiti signed the agreement in December 2009, but is not yet applying it pending ratification.
The agreement also comes with substantial EU aid for trade. The purpose of the agreement is to make it easier for people and businesses from the two regions to invest in and trade with each other and thus to help Caribbean countries grow their economies and create jobs. Besides, the EU is CARIFORUM’s second largest trading partner, after the U.S. The main exports from the Caribbean to the EU are in: fuel and mining products, notably petroleum gas and oils; bananas, sugar and rum; minerals, notably gold, corundum, aluminium oxide and hydroxide, and iron ore products and fertilisers.
Though it was overdue, Guyana was able through robust efforts by this new government to take her rightful place among member-states in being compliant with the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) regulatory institution. The passage and assenting of the AML/CFT (Amendment) Bill has seen Guyana being removed from the monitoring category of FATF and CFATF.
At the same time, one cannot help wondering why on the part of elected officials they would engage in acts that would hurt the country’s reputation and development. According to the FATF’s website, Guyana’s removal had to do with the significant progress the country has made in improving its regime to combat money laundering and terrorist financing. Guyana had been recalcitrant since 2009 to comply with the regulatory institution and was in 2013 placed on the CFATF’s monitoring list.
In February 2014, when CFATF’s Financial Advisor Roger Hernandes visited Guyana, he informed that the country’s status was likely to remain for a minimum of two years, with removal contingent on implementation of AML/CFT laws. When countries become members of international organisation they carry responsibility to adhere to the agreements they have signed on to. That the Government in 2009 felt it could have gotten away with not honouring its commitment to international organisations hurt the society.
When the proverbial hammer hit in 2014 and the business community reacted out of concern as to the additional requirements needed at the international level to trade, Guyana was four years behind in honouring its obligations. What this highlights is that political grandstanding and inaction carry with it dire implications. A country whose formal economy was moving in parallel with the underground/ narco economy, which world governments would have been aware of, it is reasonable to think any Government mindful of the security implications such would have on the people, the state, and its international integrity would move to correct it. According to renowned economist Professor Clive Thomas in a study done between 2001-2008, the underground economy was worth approximately $188B (US$940 million).
The society was also aware that persons of questionable character interfaced with officialdom, of which the most notorious among them being Roger Khan — who in 2009 was jailed in the U.S. — took out a full- page newspaper advertisement claiming that he had helped the government in crime-fighting. The happenings as aforementioned would aid in arriving at an understanding why international organisations are determined to have Guyana, as a member-state, confirm to international standards once it remains in these associations. The financial integrity of a country and those who do business within and with it has a significant part to do with the legitimacy of its money.