Guyana, US ink pact for private sector investment in infrastructure
-silent on controversial Exxon deal
As Guyana and the United States yesterday signed an agreement to bolster private sector investment in infrastructure, visiting Secretary of State Michael Pompeo steered clear of pronouncements on this country’s controversial 2016 Production Sharing Agreement ( PSA) with ExxonMobil, saying simply that his government will support investment opportunities here for Americans.
“The negotiations with the Guyanese Government are between Exxon and the Guyanese Government. Look, we all – they’ve encouraged us to assist in foreign direct investments. We’ll do the things we can to help American companies be successful, have access, have opportunities to engage in fair and transparent business dealings with Guyana,” Pompeo yesterday said at State House following the exchange of a framework Agreement to strengthen energy and infrastructure finance and market building cooperation between the two countries, in the context of the Growth in the Americas Initiative.
Aimed to aid the catalyzing of private capital and facilitate financial market growth for infrastructure development by identifying programmatic and project-specific investment opportunities, the agreement will see a working group established. The group will be coordinated by senior representatives from both countries to develop a joint work plan towards the achievement of the objectives of the Framework within ninety calendar days of its effective date.
Details on the framework signed to strengthen energy and infrastructure finance and market building between Guyana and the United States of America were given by Permanent Secretary of the Ministry of Foreign Affairs, Ambassador Audrey Waddell.
“The framework will facilitate collaboration between Guyana and the United States of America to identify concrete ways to further their joint interests in infrastructure growth, integration, and energy security in order to help meet the economic goals of both countries. Infrastructure, within the context of the framework, refers to facilities and systems serving the public, including but not limited to water, energy and hydrocarbons, buildings, airports, basic sanitation, information technology, logistics infrastructure, roads, railways, bridges, ports, and tunnels,” she said.
Pompeo was also asked if Exxon’s operations here were discussed and if he believes that the 2016 contract is equitable and fair for Guyana.
Guyana’s President Irfaan Ali was quick to point out that the two sides did not discuss issues surrounding Exxon, telling investors that his government welcomes their legitimate businesses here.
“We’re open to – and – open to investment and investors in a transparent manner. And we have said even prior to the elections that there are issues that we’ll have to review, and as you’re aware, we have at the moment a review in terms of the Payara licence that is being done, and we have subjected ourselves to professional guidance. At the end of that review the government, of course, will have to make an informed decision,” he said.
“Secondly, we’ve also committed ourselves to arm’s length relationship with the management of the sector from a political perspective. So you would not see, for example, the petroleum commission … controlled by politicians. The management of this resource must be done by competent, qualified, technical persons who can ensure that we get the best output from our oil and gas resources,” he added.
Ali said his government believes that oil and gas is a great impetus for the macro-economic vision of this country as it “allows us to build, to expand, and to create an environment in which our traditional sector will become competitive, and also brings us additional resources that we can transform the country from an infrastructure perspective, but more importantly in building out the new economy that must focus heavily on knowledge, a knowledge economy, ICT, health and education as export commodities, expanding out agriculture.”
“…We are committed to supporting investment in this sector, and we are committed in ensuring that Guyanese benefit from these investments. That is why we’ve established a technical taskforce to look at local content and to see how we can not only support the local private sector, but how we can build a capacity and ensure that they benefit from local content,” he added.
The agreement, he believes, gives an excellent opportunity not only for the mobilization of US capital, and the US private sector to participate in the wideranging economic opportunities and infrastructure transformation that will take place here in Guyana but it will also stimulate the enhancement of the business environment for US private sector investment in Guyana, particularly in the fields of energy, both unrenewable and renewables, and infrastructure.
“But more importantly, it has to deal also with the transfer of knowledge, the transfer of technology, cooperation, building capacity between the US private sector and the local private sector, and taking the partnership beyond the two governments to the private sector so that you will have greater integration of the private sector and greater participation. And that is what we want,” Ali said.
“We have a large task group in the US, we have great opportunities here, and we want to see more investment. We have said this before. We want to see more investment and more private sector interest from the U.S. So I think this agreement not only sends the right signal, but sets the foundation for that collaboration, cooperation, transfer of technology, and more importantly, building of local capacity here in our local private sector,” he added.
Notably, more opportunities will be available for firms that explore investment opportunities in tourism and the hospitality sector, ICT, food production, among others.
Georgetown told Washington that in its development plans it is mindful also that the largest bulk of its diaspora resides in the United States and would want to tap into the expertise and skillsets that the U.S would have afforded those persons.
”My government remains committed towards leveraging the skills and investment potential of our diaspora,” Ali said.