–Private Sector Commission says

COME Monday, the government will be tabling key pieces of legislation in the National Assembly, with one being the much-anticipated Local Content Legislation which is expected to lay the foundation for locals to be equitably and equally involved in development across various sectors of Guyana’s economy.

Speaking at the Georgetown Chamber of Commerce and Industry (GCCI)’s 132nd Awards Ceremony and Gala Dinner, on Thursday evening, Vice-President, Dr. Bharrat Jagdeo, said that when the National Assembly reconvenes next week, the government will be moving to table the Local Content Legislation and amendments to the Natural Resources Fund (NRF) Act.

Both of the proposed legislative adjustments, once passed by the National Assembly and accented to by the President, Dr. Irfaan Ali, are expected to serve, essentially, as the gold standard for operations in Guyana’s natural resources sector, guiding both the management of revenue generated from various activities and participation in every economic area.

International nonprofit organisation – the Natural Resource Governance Institute – in a report published in March 2015, said that many resource-rich countries make efforts to improve the local economy by leveraging linkages to extractive projects, beyond the revenues these generate.

“The value brought to the local, regional or national economy from an extraction project is referred to as the local content. A push toward local content strives to ensure that a company is hiring local labor and procuring local goods and services from the host country,” the institute wrote.

Recognising the importance of local content and the significance of Local Content Legislation, Chairman of the Private Sector Commission (PSC), Paul Cheong, said that Guyana’s economy and its people only stand to benefit from such provisions.

“It will give the local persons and businesses more opportunities to participate in the industry through more jobs and contracts,” Cheong said in an invited comment to the Sunday Chronicle.
Already, over 800 Guyanese have been supplying ExxonMobil since the oil-and-gas giant commenced operations in Guyana in 2015.

President of ExxonMobil Guyana, Alistair Routledge, speaking at the GCCI’s recent event, said that between 2015 to now, the company has spent US$540 million to procure goods and services from those suppliers.

“I am a firm believer — as it is the position of ExxonMobil — that Guyanese should not only benefit from the revenues that come from oil and gas, but should play an active role in the development of the resource as well,” Routledge related.

He highlighted that to date, more than 3,200 Guyanese are working on ExxonMobil’s local operations and almost the entire supply chain for the company’s offshore activities has been relocated to this country.

It is expected that such Local Content Legislation will cater for the existing conditions, and while this would indeed be the case, President, Dr Irfaan Ali, had held firmly to the view that such a framework must not be static.

“Local content is not meant [to] be static… as our country continues to grow and change in nature, different aspects of the economy will evolve and the document has to evolve to match this development,” President Ali said during the opening of a stakeholder engagement forum on local content, at the Arthur Chung Conference Centre, in February.

In outlining his vision for this policy on the first day of the process, President Ali said: “For us, the policy has to be a living policy, one that is flexible, responsive and one that has great clarity and sets a framework through which all are engaged and understand their responsibilities to local content.

“Local content is not only about doing business… local content is about building the capacity of local companies, giving them the capability to become globally competitive, so that they can have necessary transformation that would lead them to the next level.”

It is for this reason that the President said the policy, contrary to the belief that it will focus specifically on oil and gas, would cover every sector in the country.

“While it [oil and gas] will be one critically targeted area, the local content policy is one that will cover every sector of the country. There is focus on insurance; the banking sector; development of manufacturing capacity; rentals, human resource transformation; and training and development in all emerging areas of the economy,” the Head-of-State reasoned.