Collapse due to mismanagement or a lack of vision?
November 26, 2001
When the 100 plus years old J.P. Santos was forced to close, it was said that the failure was caused by the vendors blocking the store's entrance, depriving it of customers.
By the time the Water street business of Brassonics ran into financial difficulties, the cause was the PNC marching.
By the time Mohamed's Record Bar failed, the cause had evolved to capital flight.
Now by the time of the failures of Aroaima, Willems, Guyana Furniture Manufacturing, Vinelli, Caribbean Rice, Mankad Mills ... the Honourable Minister of Finance, Mr Sasenarine Kowlessar, oracles that the cause is mismanagement.
On the Evening News of 22nd day of November 2001, the Honourable Minister said, "...many of these businesses have had mismanagement..."
The Honourable Minister parroted the words of the also Honourable President when he said that the problems at GNCB were due to mismanagement. The Government Information Agency (GINA) has also joined the chorus. According to the Guyana Chronicle of 23/11/2001 at p.9 a GINA release informed those Guyanese who did not know that, "There were several business closures from January through November, this year, due to financial and management problems".
It is not individual entities that are failing but rather entire industries, the pillars of the economy are falling - Bauxite, Rice, Sugar. Are Guysuco's, Aroaima's and GNCB's difficulties due only to mismanagement? The Hon. Minister must tell us because he is in charge. And if mismanagement, he must tell us what he and the PPP did to avoid the pitfalls of poor management.
No, it is not mere mismanagement. The PPP government is seeking to excuse itself by shifting the blame of the failure to the population. Failure is endemic, there is something rotten at the core of the body economic and like a cancer it has wasted the body from within, undiagnosed and now evidences at the surface in the form of business collapse.
The only sector that remains standing is the banking sector, deceptively so, holding on to empty securities, raked in by erstwhile lawyers at Bail Court. Worthless securities, not valueless, because no one is in a position to buy.
The collapse of Globe Trust, the 3.9 Billion GNCB losses are not due merely to mismanagement as the PPP Government wishes us to believe. No. NBIC on its own admission said it had to put aside 600 million dollars to ensure its "long term viability".
I say this, within the next 6-12 months, the banking sector will face ruin if the present trend of business collapse continues. And then there will be economic anarchy. Honourable Minister, wake up!
The question is - "Is the failure of business in Guyana due to mismanagement or due to a lack of vision and inability of the PPP Government to facilitate an environment conducive to growth?"
I challenge the Honourable Minister of Finance and the entire lot of Freedom House economists, collectively, to a debate to determine this issue in the national interest.