By Navendra Seoraj
IMPROVED access to financing is anticipated, as several financial institutions have submitted applications to the Bank of Guyana to establish merchant banks here.

A merchant bank is defined as a bank dealing in commercial loans and investment; officials of these banks are experts in international trade, which makes them specialists in dealing with multinational corporations.
Access to financing has been a much-talked-about hurdle for stakeholders in the private sector, especially now that Guyana is on the cusp of economic transformation and presents a plethora of investment opportunities.

“Cost of capital is a big hurdle, compared to the cost of capital you are competing against… so, definitely, to level that, it requires some work… already we are looking to expand the depth of the financial system,” Vice-President, Bharrat Jagdeo said during the commencement of a one-month stakeholder engagement on local content, at the Arthur Chung Conference Centre, on Monday.

He confirmed that authorities have received a few applications for new merchant banks, noting, however, that those are non-depository institutions, so locals can be liberal once the banks have completed their due diligence and so forth.

It was reported in October that economic advancement on all fronts is expected in the near future, as several United States (US) agencies have offered, collectively, US$200 billion (approximately G$42 trillion) in financing for businesses interested in investing in Guyana.

To aid in Guyana’s progression, the United States of America (U.S.A) had sent a team of persons representing six agencies, including the Department of Treasury, the Export-Import Bank of the United States, the U.S. International Development Finance Corporation, the Department of State, the Department of National Security and the Department of Homeland Security.

Members of the U.S. team had met with representatives of the local Private Sector Commission (PSC) and other stakeholders in the commercial sector, during their one-day visit here. They also met with President Irfaan Ali, the Prime Minister, Brigadier (ret’d) Mark Phillips, Vice-President Jagdeo and other government officials.

“We looked at the quantum of funds they can lend…and from all the agencies in the room, we would be able to access US$200 billion,” Chairman of the Private Sector Commission (PSC), Nicholas Boyer had said following discussions with the delegation.

A member of the U.S. delegation, Chief Executive Officer (CEO) of the U.S. International Development Finance Corporation (DFC), Adam Boehler, had said that, from his end, they are able to back both US-based and Guyanese companies with financing.

Based on discussions with the private sector, Boehler said areas of focus include reducing the cost of electricity; investments in small and medium size businesses and investments in agriculture and farmers.
The agency, through these projects, is looking to increase the amount of jobs and improve the livelihood of every Guyanese, while at the same time focusing on major infrastructural development.