Sustaining Small Business

CULTIVATING a national innovation ecosystem for the birth, germination, and nurturing of fresh, new, original ideas for economic enterprises that could plug into this country’s private sector business-friendly atmosphere would provide every Guyanese with opportunities to play a role in the burgeoning growth happening now across the land. Government had announced plans to reduce red tape and bureaucracy in the business-administration corridor, with the goal of encouraging more citizens to open new businesses, from coming up with an idea and seeing it to fruition without undue roadblocks, to sourcing funding and operating the enterprise with as little headache as possible. The nation’s exciting acceleration of economic development opens a wide range of possibilities for enterprising souls. Indeed, Guyanese all across the country are known for their enterprising spirit, for coming up with innovative solutions to pressing problems, and for inventing new ways to achieve their dreams.

This country is ripe for fresh ideas for new businesses, with government developing every sector for potential expansion and development, including the agro-processing industry. Across every sector, tourism, housing, mining, oil and gas, even on the climate front, opportunities abound. In the manufacturing world, the creative industry, the agricultural sphere, everywhere Guyanese look today they could find opportunities for investments and business operation.
It used to be that savvy business people focused on retail enterprises, with clothing, shoes, appliances, furniture and food, being some of the big attractions for investors. Eventually, malls started mushrooming as the real estate industry took off under the housing miracle that the People’s Progressive Party/Civic Government performed from 1992 to 2015. Today, major international hotel brands, high-intensity tourism resorts, and entertainment enterprises are springing up almost on a daily basis, with investors flocking into the country from overseas, including from Caribbean countries.

Government also rolled out incentives and attraction models for foreign investors and diaspora Guyanese, including tax breaks, and the state’s investment czar, Peter Ramsaroop, announced the welcoming, forward-thinking news that tax-free havens are in the works. In this scenario, Guyanese on the home front would be looking for how they could play their roles. To encourage a robust, dynamic, energetic, local investment atmosphere, with citizens even in remote villages and the hinterland feeling an integral part of this new economic dynamism sweeping the country, some important things need to happen. First, the country would do well to generate a culture of innovation that cultivates good ideas, whereby people could pitch their ideas to the public, be able to refine research and development, and to develop written plans around operations.

Then, a vigorous national financing and funding ecosystem should be easily available to any citizen who comes up with a workable, sensible plan. The model for such a financing system exists, with the experience of the Institute of Private Enterprise Development (IPED), albeit without the high interests on loans that IPED charges. A field for funding and financing would include a structure for banks to invest in talented new entrepreneurs, for a fund, or series of funds, whereby the public could easily purchase shares in a new enterprise, which includes strong accountability pillars, and a state-backed financing guarantee for cottage industries in remote villages. Guyana has a long way to go to reform the structure in place for local citizens to launch businesses; for example, reforming the business laws that tie registration fees to capital shareholding.

It is impossible for a small-business owner in Berbice, Essequibo and the Rupununi to launch a company here with share capital of millions of shares, for example, because the cost of registration is tied to declared share capital. So companies typically register small amounts of shares. This makes it hard for potential investors to purchase shares in a registered company, thereby hampering investment on the local front. The structure of shareholding in new companies is an important factor in developed economies, and one could easily register a company in Canada or the U.S. with tens of millions of shares, making it possible and easy to raise capital and necessary financing from friends, family, and interested potential partners. Given the business acumen of Guyanese, it would be good to see a progressive reform of our business laws.

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