— CPSO’s contention that local content legislation violates regional treaty ‘amusing’
— says local business community, reiterates legislation ensures Guyanese duly benefit from O&G sector
SEVERAL members of the business community on Thursday took to social media to voice their outrage following a leaked e-mail from CARICOM Private Sector Organisation (CPSO) Chairman and President/Chief Executive Officer of the MASSY Group of companies, Gervase Warner, on Thursday, which alleges that Guyana’s Local Content Policy violates the Revised Treaty of Chaguaramas.
The email which has been circulated across social media read, “At the Executive Committee today we agreed that the legislation appears to violate several provisions of the Revised Treaty of Chaguaramas. As a result, the CPSO will take on raising these concerns first to the GoG and then ultimately to the Caribbean Community.”
The CPSO, in a release last night, confirmed the authenticity of the email from Warner but explained that he was speaking in his capacity as CPSO Chairman and not as President and Group CEO of Massy as stated in the said email.
“Despite this error, the communication clearly and irrefutably refers to proposed CPSO actions that are appropriately within its mandate and the various levels at which urgent consultations should be sought to address any possible issues regarding the legislation,” the release said.
It added that the CPSO has been charged with the responsibility to raise issues and seek consultation and possible resolution of such on matters pertaining to the full implementation of the CSME and the concerns raised reflect the views of the CPSO and not that of any specific member company.
Guyana Oil and Gas Energy Chambers (GOGEC) President, Maniram Prashad reacting to the CPSO statement, pointed out that the regional private sector body is largely unknown to Guyanese and questions the mechanism through which the body was created.
“I’m unaware that the formation of CPSO benefitted from wide consultation of the private sector bodies in the Caribbean,” he said while noting that GOGEC, which represents the oil and gas sector in Guyana, was never consulted.
But that aside, he pointed out that the Local Content legislation was open for consultation for more than a year and there was no input from the so-called CPSO but now that the Local Content Bill has become law, the organisation appears from nowhere, with objections.
Prashad contended that CARICOM made a mistake in granting the CPSO associate institution status and intends to meet soon with CARICOM Secretary-General, Dr. Carla Barnett, to share his concerns.
The Local Content legislation which was presented to the Parliament by Natural Resources, Minister Vickram Bharrat, seeks to ensure that Guyanese and Guyanese-owned businesses are given preference when it comes to providing goods and services to the major oil companies operating within Guyana’s borders.
It outlines 40 areas that oil companies and sub-contractors procure from Guyanese companies and Guyanese nationals by the end of 2022. For instance, by the end of 2022, oil companies and their sub-contractors must ensure that 100 per cent of their ground transportation needs are satisfied by Guyanese entities.
The same percentage applies to the provision of immigration support services, customs brokerage services, and visa and work permit services. Similarly, Guyanese should provide 90 per cent of office space rental and accommodation services; 90 per cent for janitorial, laundry, catering services; 95 per cent pest control services; 25 per cent medical services; 20 per cent aviation and support services and 75 per cent local food supply.
President of the GCCI, Timothy Tucker, took to his Facebook page on Thursday to share his views on the email from Warner. He noted that the new legislation was in no way drafted to block out CARICOM states but was created to cater to and provide for the needs of Guyanese as it caters to the needs of all stakeholders in the sector.
Tucker noted that the Local Content legislation provides for 200 plus demand areas for work in the oil and gas industry, 40 of which were carved out to particularly benefit Guyanese.
Tucker noted that even as the CPSO takes issues with the new Local Content legislation Guyana has been at the backend of the Trinidad and Tobago local content policy. That policy, he said has affected Guyana’s ability to trade with its sister state. He explained that this in itself breaches the Treaty of Chaguaramas.
The former Chairman of the Trade and Investment Committee of the GCCI noted that one aspect of the policy that “locked” out Guyanese exporters is a 1935 legislation that prohibits export of honey to Trinidad and Tobago.
He noted that the issue was brought before The Council for Trade and Economic Development (COTED) by Dominica for years, as it closed an entire market off to CARICOM member states.
He noted that Guyana, in particular, has experienced firsthand effects of this legislation, saying, “one of our dear CARICOM sister countries threw a barrier to block the progress of Guyanese business. One small example is our beekeeping project. GCCI trained 40 persons in apiculture (beekeeping), this is a nontraditional industry and it was such a successful project it made the Cover of CDB annual report. At the end of the project we had 40 new entrepreneurs ready to grow their trade and export their products, but export they cannot.”
Tucker is of the view that Trinidad should be expelled from CARICOM because of all their continued violations of the Revised Treaty of Chaguaramas.
“Something as small as Guyanese honey has been blocked from being exported, not just to Trinidad, but to any country that Guyanese have to use Trinidad as a transshipment to get to, years before a shipment of honey that was being transshipped by Larparkan was seized and destroyed, Larparkan was fined 5000 USD by Trinidad, this whole case is in VIOLATION of the Revised Treaty of Chaguaramas and Trinidad continues to dismiss, disobey and disregard COTED’s ruling and by extension Caricom,” the Facebook post read.
Tucker contended that based on the legislation governing Trinidad’s Local Content, similar cases exist for workers/ work permits, CSME certificates, opening a business, exporting products, meats, peppers, pineapple, pumpkin, ground provision, plantains, coconut and trading on their stock market.
Former GCCI President, Lance Hinds, echoed similar sentiments, noting that Trinidad and Tobago’s local content policy has for years been an area of contention for sister CARICOM states.
“We have been going to COTED year after year with trade-related issues and getting stonewalled. Good, let us put everything on the table and trash out. Useful to note that the Trinidad Chamber does not feel the need to take it first to COTED… the very organisation created to deal with these issues,” a Facebook post read.
Former Chairman of the Private Sector Commission (PSC), Nicholas Deygoo-Boyer, also took to social media to weigh in on the email, calling it “quite amusing”.
Deygoo-Boyer noted that the email shows a complete disregard for the people of Guyana and a sense of entitlement on the side of the CPSO.
“The email to me shows ignorance of the mood, sentiments, and aspirations of Guyanese people and an arrogance that there is a God-given right to have at this new industry in Guyana. Funny enough, large companies from other countries, far, far larger than these regional conglomerates, have shown respect to the Guyanese people and worked with them in the spirit of partnership to grow capacity. The most disrespect I have seen has come from these conglomerates who feel a sense of entitlement,” he said.
Even as the CPSO has signalled disapproval of Guyana’s local content legislation and intends to raise its concerns with the Government and CARICOM, CPSO executive and Chairman of Edward B. Beharry & Co. Ltd., Suresh Beharry, through a statement on Thursday, indicated his support for the local content policy.
The statement discloses that contrary to recently alleged information, the narrative that Beharry had been “tasked” to intercede with the authorities in Guyana on a matter concerning apparent limits to CARICOM nationals doing business in Guyana was ‘false and misleading”.
The release noted that the entirety of Beharry’s advice to unnamed entities was that they seek constructive dialogue and engagement with the government and local stakeholders and to avoid any confrontation or disruptive fallout. In the interest of comity, he was prepared to attempt to facilitate an initial engagement.
“Mr. Beharry supports Guyana’s Local Content legislation; in particular, as it relates to the nascent Oil and Gas Industry. In fact, like many others, he has contributed to the in-depth discussions on Guyana’s Local content legislation at each of many iterations. Further, Mr. Beharry welcomes the provisions, protections, and incentives that are provided for all businesses to invest and grow in our oil and gas space,” the release read.