|Related Links:||Articles on economic concerns|
|Letters Menu||Archival Menu|
The government has asked the Inter-American Development Bank (IDB) to assist it to define and implement a consistent and coherent export and trade strategy for Guyana and a bank mission is expected next month to start the process.
In an exclusive interview with Stabroek News last week, IDB trade and investment officer Mario Berrios confirmed that the government made a request to the bank to benefit from its Trade Sector Facility.
This facility is intended to support countries to strengthen their institutional capacity to manage their foreign trade. It aids in the implementation of trade agreements; provides technical assistance to improve capacity and to negotiate trade agreements; develops export promotion programmes; increases the analytical capability of governments on trade issues such as trade impact analysis; and strengthens customs administration as well as other areas within trade.
"What we are going to do for Guyana is what we do with all other countries we conduct such programmes in. One thing that is important is that a country asks the bank that it would like to explore the possibility of organising a trade programme using the IDB Trade Sector Facility. When we receive that request, we then do a comprehensive assessment of the trade sector of the country and the institutional capacity within that country. This is what we are going to do over the next month or two," Berrios said.
He indicated that based on this comprehensive assessment, the bank would then identify the areas in which it could support the requesting country with its facility.
Berrios said the study of Guyana's trade regime will be done using grant funding and he added that it was possible that a comprehensive support programme would be necessary, which could take three to four years to implement. He said what would be required of Guyana is for it to be prepared to export on better terms by knowing its markets and its production capacity and by recognising what needs to be done to increase trade activity.
The IDB official said it was highly likely that Guyana could benefit from soft resources to implement a comprehensive trade programme if that was determined to be necessary. He did not anticipate that the process would take very long. He said he imagined that at the end of the next three months it would be determined what needed to be done to get Guyana where it ought to be and a programme could be worked out almost immediately.
The IDB Trade Sector Facility is a three- to five-year programme which offers joint programmes with its Multilateral Investment Fund (MIF) arm. The trade facility offers loans up to US$5 million, provides institutional strengthening and rapid implementation. The expected benefits are high returns from exports, trade, investment and positive trade externalities as well as strategic long-term investments. The trade facility also funds diagnostic trade studies. Guyana can benefit from technical training; simplification of trade laws/regulations; trade strategies for participation in the CARICOM Regional Negotiation Machinery as well as technical support for trade negotiations; implementation of trade agreements and have its information/computer systems for data bases and communication integrated. Export promotion strategies could include market intelligence; identification of export supply capacity and constraints; definition of strategies to create a new environment for export-oriented activities; studies on comparative advantages and competitiveness; training for logistics of international trade and attraction of new investment for exports.
Barrios was one of the IDB officials at a forum to showcase the bank's product and services to Guyanese businesses and he made a presentation on the IDB's Trade Sector Facility.
In his presentation he emphasised that Guyana needed to increase and diversify its export activity and to increase investments and private sector development. He said foreign markets were a key engine of growth and highlighted that it was critical for Guyana to have a coherent and consistent programme of export promotion.
He cited the role of foreign capital to activate export potential and the need for an efficient framework generally to attract foreign investments. Such a framework, he said, had to be simple, streamlined and centralised. He said that investment attraction programmes were more effective when they were specific.
Key problems which he shared with the private sector in the case of institutional capacity on trade include limited or lack of trade services; limited human resource and technical capacity; burdensome regulations and limited business organisation on trade issues.
He said possible actions to improve the enabling environment for trade and investment included developing sufficient institutional capacity; developing and centralising technical expertise; reviewing and simplifying the regulatory framework; reviewing the status of implementation of trade agreements and formulating consistent trade strategies for CARICOM, the Free Trade Area of the Americas and the World Trade Organisation. Customs administration and procedures would have to be modernised as well as customs requirements. Berrios said that the goal in the modernisation of customs would be to render export and import activities simple, low cost and efficient.