CARICOM has fueled manufacturing decline in Guyana – Commentary

CARICOM has fueled manufacturing decline in Guyana – Commentary

By Patrick Barker

This article was written in Dec 2009 and is still relevant today. Maybe some current Ministers reading it would give pause and rethink their position.

It is with interest that I read the article by the President of Guyana Manufacturing and Services Association (GMSA) Ramesh Dookhoo published in the Stabroek News on 12-11-09 and entitled “Open Borders importation policy helped fuel manufacturing decline”. It is regrettable that he did not have an input to Guyana’s formative policy when deciding about being a part of a single market economy.     

It is very easy to examine the results of a policy after the fact, and especially when the effects of bad policy resulted in an overarching repercussion that permeates the whole of the economy negatively. Today, anyone looking at Guyana’s economy could attribute the economic decline of Guyana’s economy to Guyana being a member of CARICOM.  

Being a member is not the only reason for Guyana’s economic decline and stunned growth, but being a member is the major factor that restricts Guyana from growing it’s manufacturing sector and thus the economy in general. CARICOM is an organization of loosely formed groups, many of whom are more concerned about their economic positions while giving the impression that the major concern is the strength of the single market economy.

If we may remember the past we would recall a minister saying that Guyana has “the more open economy than any of its Caribbean partners”. Those partners must have had a smile on their faces, expressing how easily Guyana has been cajoled into thinking that being a member of a single market economy would result in benefits, in the near term, for Guyana.

The statement in the article attributed to Minister Manniram Prashad saying that a liberal importation regime was good for competition and that it could help raise the standards in the manufacturing sector gives evidence to how blinded the Guyanese government insight is to this single market process. As the saying goes they “took the whole line and sinker” not realizing that the members of CARICOM are self-centered, and rightfully, are there to protect their economy from encroachment.

There is also another Guyanese saying that states “if there is an honest man in the midst of thieves then he is the fool”, for he would soon realize that he has lost his shirt. In this case, we have lost our fledgling economy to protectionism. Today Guyana is still thinking that there are more benefits to being a member of CARICOM than looking at the incurred losses. How else do we explain, at this late stage, the honorable Minister still clinging to the belief that liberal competition will help Guyana’s manufacturing sector?

Mr. Dookhoo is correct in his analysis, albeit blame should not only be shouldered by protectionist members of CARICOM, but also by the Guyana government and its policy advisors. To claim that we are an open market economy without any protection, at the said time when many Guyanese farmers are withstanding restrictions against their exports to many CARICOM members, depicts a great political blunder that supports a change in some members of government, if not the whole government.

What Mr. Dookhoo is subtly saying is that Guyana should have some protectionist measures, when he states that “with proper safeguards and support for the local manufacturing sector he believed that our companies are capable of anything we put our minds to”. How that would be achieved without some form of protection is beyond my economic training, but then again I am a capitalist and not engrossed in socialist economics. To become profitable you must be a bit self-centered or else you will encounter economic failure and that is where Guyana’s is currently mired without any leverage.

Mr. Dookhoo is somewhat mystified if he believes that the fruition of a Hydro Electric plant and a “new kind of a Banking system will transform Guyana to economic development. Emphasis must be placed on those running those institutions, for failure is inevitable if those who are administering policies are not astute to discern the pitfalls of bad policies. No amount of money or other economic capital will lead to success if there is lacking in the realization that certain policies could only lead to more economic failure.

In the Kaieteur News on 12/15/09 there is an article that states that Guyana received $1 US billion since 1977, could we really say where that money was spent and what did Guyana have to show for those funds? As such, unless there is a paradigm shift in the mental thinking of the policy advisors, Guyana would continue to take a stroll in economic darkness and obscurity.

This stroll in the economic darkness continues in earnest, as the outward migration continues; as the skill set diminishes evidenced by the amount of Guyanese leaving Guyana unabated, as the crime rate continues to escalate and as the hope of those who are too poor to pay the price of a ticket to someplace else becomes a reality, Guyana remains in the quagmire of destitution as the current politicians look inwardly at their bank accounts and not at the health of the nation that needs building.

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