A friendly reminder to Brasilia EDITORIAL
Business September 24, 2004
Stabroek News
September 24, 2004

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One of the most promising initiatives undertaken by this government has been its efforts to build closer relations with Brazil and its realisation that Brazil's huge and fast developing economy has much to offer.

Perhaps frustrated by the pace of greater convergence with its fellow Caricom states, the government possibly saw Brazil as a new market for Guyana's key commodities and fresh produce.

There have also been closer, if informal, ties in the mining sector with the contributions of Brazilian garimperos having resulted in a resuscitation of the diamond industry while their technical skills have helped raise overall gold-mining productivity.

Brazilian culture and cuisine have come to Georgetown and been largely embraced.

Over 100 students are taking Portugese lessons at the Brazilian centre for cultural studies and one Brazilian churrascaria is now a popular place for professionals with lunchtime carnivorous cravings. Universal Airlines recently started a weekly flight to Manaus which could become the equivalent of Port of Spain or Miami for shopping trips.

Trade is guided by the Partial Scope Agreement that was signed in June 2001. It covers some 800 concessions granted on Brazilian exports from car parts to ham shoulders most of which are allowed in 100% duty-free. There are fewer, but still a substantial amount of items Guyana can export duty-free, including quotas of rice and sugar amounting to 10,000 MT each.

But to date, commerce between the countries has been negligible even if you count the chickens smuggled across the border during Guyana's recent poultry shortage. In 2003, Brazil exported US$1.3M in items to Guyana. There are no figures for exports to Brazil, but suffice it to say the miniscule Antigua and Barbuda received more imports ($1.3M) than Brazil.

And this is despite a vastly improved Lethem trail that has cut travel down to almost eight hours from Georgetown to the border. It is possible to drive a truck full of fresh produce at 8 pm from the coast and arrive in Roraima's state capital Boa Vista the next morning.

Possible is the key word, because of an important document that the Brazilian Congress has yet to ratify and which is effectively proving a huge roadblock to Guyana's exports.

Brazilians and Guyanese have been exporting products through the border town of Bom Fin to Lethem under a special regime that means the items are checked first in Boa Vista, sealed and sent to the border. Once over they are checked at Lethem and again at Mabura Hill. Guyanese businessmen are seeing opportunities even though they often pay retail for electrical appliances and truck them over.

But for businessmen wanting to export the route is barred because the Bom Fin customs department is not functioning despite the infrastructure being in place. Exporters would have to go first to Boa Vista, process the documents and then bring in their items which can only be those listed under the Partial Scope Agreement. This could be solved if the Brazilian National Congress ratifies the Cargo and Passenger Agreement that was signed in February 2003. MPs in the Roraima assembly have lobbied to have the agreement ratified and the Brazilian Ambassador Ney Do Prado Dieguez, who has been dynamic in promoting closer economic and cultural ties, has contacted members of the assembly to push for ratification. We understand that it is simply the amount of other legislation to be passed that is holding up the process and not any kind of objection to the agreement.

The non-ratification also affects the use of Guyanese-owned vehicles in Brazil. At the moment only diplomatic and government officials can go over the border.

So the same truck carrying the produce could not cross anyway. And that goes for a family wanting to take a weekend trip to Boa Vista. They would also be impeded by the requirement of having to apply for a visa at the local Brazilian embassy at a cost of $5000 for processing and then waiting about 24 hours. Brazilians can get a tourist visa immediately and at no cost when crossing over at Lethem because the Guyana parliament has ratified another agreement to waive such visas.

Another major impediment is the Takutu bridge that has been stalled for over two years because of problems with the contractor. Investigations are said to be still going on and this is holding up reconstruction.

So while a good start was made and several promising speeches delivered, many on both sides of the border are feeling frustrated by the loose ends still to be tied up.

This is just a friendly reminder to Brasilia to finish up what it started. In the scheme of things Guyana may not register too highly for a country whose GDP was $1.37 trillion in 2003, but Brazil remains a market many Guyanese businessmen are keen to explore.