Some light in the tunnel

Stabroek News
August 2, 2001

Despite the prevailing gloom in the private sector there were two noticeable signs of hope last week. On Tuesday, Mr Clifford Reis, Executive Chairman of Banks DIH Ltd. welcomed invitees to the official opening of the company's twelfth restaurant, the Sheriff Street Qik Serv and Drive Thru Restaurant, and on Wednesday Mr Johnny Carpenter, Chairman of Sterling Products Limited, told shareholders at the company's 46th annual general meeting that the company had made a substantial investment in new plant, steam generation capacity and cold storage facilities leading to the increased production of ice cream and detergents.

Mr Reis referred to the need for a vision of where a business is going and what it wants to achieve. Vision gives a company a competitive edge and enables it to succeed in a fast changing market place. President Jagdeo commended the company for its positive approach, noting that there are opportunities for good investments and that businessmen should be on the look out for them.

Mr Carpenter said Sterling had achieved record sales in the year 2000 and had been rated as one of the top twenty companies in the Caribbean (the top in Guyana) by Reliance Stockbrokers of Trinidad and Tobago in terms of profit before tax expressed as a percentage of net turnover and earnings per share, the two criteria they had used. Sterling's management, headed by Mr Ian Glasford, can take a bow.

Yet the playing field is still far from level in terms of the disadvantages faced by our business sector. These include high interest rates, a very weak currency which makes new equipment hideously expensive, weak local demand and a lack of administrative and technical skills. On Friday the timber producers rang alarm bells at their press conference. The newly elected President of the Forest Products Association, Mr John Willems, said businesses in the sector were faced with a severe cash flow problem which indicated a collapse. He referred to problems facing the rice, gold mining and bauxite industries and called on the parliamentarians of all parties, who had been invited to the conference, to help to find a way forward. Mr Yacoob Ally said several of his company's sawmills had been closed and the industry was in crisis. Because of the prohibitive cost of retooling, machinery and equipment had become outdated, he said. Mr Ramdial Bookmohan, the Chairman of the National Association of Regional Chambers of Commerce said that many of the issues raised at the business summit with President Jagdeo two years ago had not been dealt with.

Though there is some light we are still in the long tunnel of underdevelopment induced by decades of political struggle, a massive brain drain, extensive nationalisation and the one time miniaturisation of local businesses. Recovery was never going to be easy despite the improvement from 1990 as a result of a reversal of earlier policies. Ongoing political upheaval has obviously not helped. The government can do two things. First, the relevant ministers can meet the businessmen, listen carefully and in detail to what they have to say and see if anything can be done to assist. Government has to try to get used to working closely with the private sector. Sometimes, indeed quite often, they do have genuine problems that require cooperation. That is how the 'tiger' economies developed, by working together. The attitude of distrust is a legacy from old attitudes.

Secondly, Go-Invest must start actively looking for new investment. One businessman wrote to say that there was a new approach to investors under Mr Geoffrey DaSilva. It is good to hear this. Mr Da Silva should try to mount overseas trips with persons from the private sector organisations as soon as the investment code, following the road map, has been finalised.