By Navendra Seoraj
PROMOTING ‘local’ has been a mantra touted for years, and while there has been more rhetoric than action, movement on this front is expected soon, especially through the creation of free economic zones, which are likely to be placed at border areas.

Free economic zones are defined as a class of special economic zones designated by the trade and commerce administrations of various countries. The term is used to designate areas in which companies are taxed very lightly, or not at all, to encourage economic activity. The taxation rules are determined by each country.
“We are now piloting this, but there would need to be legislative changes for those things to happen… government has to decide on the tax regime for free zones… free zones are in areas you want to develop, so they are definitely important,” said Chief Executive Officer (CEO) of the Guyana Office for Investment (Go-Invest), Dr. Peter Ramsaroop, in an exclusive interview with Guyana Chronicle.

The impending bridge across the Corentyne River — connecting Guyana and Suriname — and the Linden to Lethem Road, will serve as a foundation for free economic zones, said Dr. Ramsaroop.

“Those are the areas where you look at free zones… also if you want to develop the West Bank [Demerara], Region One (Barima-Waini), you can open those areas as free zones, to give incentives for investors to go to that particular area,” said the CEO.
Already, the new People’s Progressive Party/Civic (PPP/C) Government has announced the removal of value-added tax (VAT) on exports and other concessions/measures to stimulate growth in the private sector.

The Dr. Irfaan Ali-led administration, within the space of two months, has sought to implement an array of policies and initiatives to foster development within the public and private sectors.

Dr. Ramsaroop said Government’s aim is to create a ‘flourishing’ business environment for current and new business ventures, and to also have a collaborative and consultative relationship with the private sector.
It was reported that creating such an environment would entail transformative investments such as a deep-water harbour, which will essentially close the infrastructural gap in the local economy.
A deep-water harbour is said to be a fixed or floating structure that is built at strategic points in a country to serve as a hub for the transport of goods.

COMPLEMENT
This will also complement a “free zone” because it is known to be a major source of aiding in economic growth, as it links one country to several others. The port is useful in not only shipping items to that country cheaper, but serves as a gateway for other countries’ goods to pass through as well.
With major infrastructural projects expected soon, Dr. Ramsaroop said his office will be looking to pilot the creation of free zones with the Ministry of Tourism, Industry and Commerce.
“We will look at it to see where those are best fitting and ultimately open those areas for future investments,” said the CEO.
It was also reported that to allow for the ease of doing business, Government will create a single-window clearance system which will essentially reduce bureaucracy and cost of doing business in Guyana.

Trinidadian Economist, Dr. Roger Hosein had said: “Doing business in Guyana is way, way too difficult in terms of the international comparison or even in terms of the Caribbean comparison.”

Dr. Hosein said Guyana must do its “homework” on how to improve the ease of doing business here; if the country is successful in this bid, greater private capital injection and foreign capital injection will be facilitated.

Although not responding directly to Dr. Hosein, Dr. Ramsaroop said Guyana will be reducing bureaucracy for the processing time for applications and other relevant paper work required for doing business in Guyana.

The CEO emphasised that Guyana is now officially an oil producing nation so the nation’s approach to development will be greatly enhanced.
Recent oil and gas discoveries have transformed, into a petroleum economy, a nation that was once heavily dependent on agriculture and mining. Guyana is now recognised as a premier frontier of crude oil exploration and production, while it continues to expand and build on its established industries.