FINANCE Minister Winston Jordan, on Wednesday, challenged the private sector to produce evidence to support a decline in business activities here and also a slowing down of the economy. At the time he made the challenge, he was releasing figures from the Mid-Year Report which shows a 4% growth in the economy, coupled with expansion in the construction sector and other areas.

What is also instructive based on the report, despite its four-year-long lament of a slowing down in the economy, the private sector here has increased its credit by 5.7 per cent to a total of $238.8B for the first half of this year.

Jordan made the call at a press briefing at his Main Street, Georgetown, office on Wednesday. “The PSC has a habit of trotting out statements and I have had a number of meetings with budgets sessions where statements are trotted out and they are hardly backed by figures, it’s just statements they throw out there about the economy is in decline; but where is the evidence of this and people will continue making statements,” the finance minister said. He continued: “Until people bring credible evidence, like the Bank of Guyana report, or the IMF report or Economic Commission for Latin America and the Caribbean (ECLAC) report stating that there is a downturn, then they will just be statements. As far as I am concerned, they are irresponsible statements. Show me that your sales have declined; you use to make $500M every month but now I am down to $350M, that is the first evidence, but then we have to get the numbers.”

It is public knowledge that for years Guyana’s economy saw two forces at work– the formal and underground. The extent to which the latter was allowed to hold sway in the society has been debated, though not refuted. The People’s Progressive Party/ Civic (PPP/C) government has always denied the presence or significance of the underground economy. To the average man and woman, the construction of massive buildings around the country and the opening of businesses, where the latter in some instances never see heavy customer traffic, contradicted any denial.

Professor Clive Thomas, in his several writings on the criminalised state—a term he used to describe Guyana under the PPP/C– has pegged the underground economy at around 60 per cent. In a 2014 interview with Kaieteur News, he said, “The phantom economy is what I call it…is being driven by three forces – tax evasion, evasion of regulatory oversight in terms of those agencies like the gold board, for example, and it is also driven by criminal forms who thrive on businesses that seek to generate gains for themselves in terms of theft from certain activities.”

Even those who deny or want to think Thomas’s figure is high, something has to be amiss in any society where government would allow illicit economic activities and seek not to eliminate them. There was a time in this society when none would have doubted the influence of drug lords in the economy and state, with a forcible reminder being the infamous Saheed “Roger” Khan.

Aside from Khan’s questionable wealth, some of which could have been used in the purchase of assets, there was the full-page newspaper advertisement taken out by him admitting that he played a role in supporting government in crime-fighting. Crime-fighting is the purview of the state and where Khan was bold enough to make such a claim, which was not refuted by the PPP/C government, lends to further evidence of forces that were at play in undermining the legitimacy of the state and the safety of the people.

There can be no credible denial that the Guyana Revenue Authority, though conscious of the presence of illegal money, seemed constrained or reluctant to go after questionable characters. Ostentatious wealth was flaunted in the face of the state, whose government seemed unwilling to investigate and hold persons accountable to the law. Another factor in our polarised society is that those who dared to address the problem were dismissed, verbally assaulted, or accused of being envious of the questionably ‘industrious.’

Evidently, what may have been the appearance of legitimate business and investment might have well been funded with questionable (laundered) money propping up the formal economy. The acknowledgement of this, however, does not ignore the cyclical nature of economies, where features of growth and the slowing down of growth are evident, or the need for corresponding acts to manage same.

Reservations by the international community — governments, institutions and businesses — have also been expressed, evident in the pressure brought to bear by the International Financial Task Force and the Caribbean Financial Action Task Force, to make Guyana compliant with anti-money laundering and countering the financing of terrorism standards. And whereas the PPP/C government sought ways and means to avoid tackling bad money in the system, apparently to lend perception of buoyancy, that the APNU+AFC government has taken this bull by the horns, is commendable. Sourcing the integrity of it, the persons involved, and the authentication of residency in money transactions, banking and otherwise, have formed part of the new regulatory system.

The fleeing informal economy had left many believing and to lay blame on the current government for the slowing down of economic activities, instead of regulating the economy to weed out the underground economy, which brings with it not only a false sense of prosperity, but many social ills unleashed on the society over the past few decades.